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Winand Krawinkel
Feb/March 2012

Adidas in 2011:

When a plan comes together

2011 was a very good year, when most of their planned strategies came together, says adidas SA MD Winand Krawinkel. He is confident that his second year at the helm of adidas SA will be as good. Words: Trudi du Toit. Photo: Nic du Toit

After a year in the hot seat at adidas SA Winand Krawinkel is even more upbeat and positive than when he just arrived in the country. A year ago there was a slight tinge of apprehension, as can be expected from a new arrival from Europe, tasked with leading an unfamiliar group of people to new levels in a new market. Now he is visibly relaxed and infectiously cheerful.

Since it is year end, his demeanour tells it all: adidas SA had a very good year.

Krawinkel is ebullient about the success of the past year, which he attributes to the team’s focussed approach and futuristic planning. “We sat down and discussed strategy, defined what worked well — what are the best selling products, where do they sell, what are the hot sellers? And went out and implemented the decisions.

“Many strategies I talked about a year ago were implemented. We grew our key accounts, as I said we should, as well as our presence in independents. I said that the adidas SA team looked impressive — they turned out to be excellent. I especially like their fighting spirit.”

As planned, we grew a quality order book, gained a lot of shelf space and made sure that retailers understood what the brand stands for. “We emphasised the need to tell stories and explain concepts.”

Because he believes 70% of purchasing decisions are made in-store, they ensured that sales people knew their products well and that the brand was showcased properly. They communicated more with retailers and where a product was moving well, they tried to gain more shelf space. After all, once you created a demand for a product, consumers have to be able to access it, he says.

Another strategy he identified was the use of social media and with high double digit monthly growth the adidas following on Facebook and Twitter has reached new levels. This is complemented by a vibrant loyalty programme at retail. “People want to interact with the adidas brand,” Krawinkel reiterates what he said a year ago. “They ask questions and it generates a lot of conversation around the brand.” The questions were from people wanting feedback on products, others wanting to praise or criticise the brand. “We get very interesting comments. They discuss things like (soccer) jersey designs and give very interesting input for us to consider.”

South Africans appreciate that they are able to interact with a truly global brand with good international support, but with unique characteristics that make it locally relevant, he believes. Krawinkel mentions their campaign with the adidas is all in tagline that showcased local partner Orlando Pirates with the all in champions tag when they were crowned triple champions after winning the PSL title.

But, implementing strategies alone do not necessarily guarantee sales growth.

To be successful, you don’t sit back and wait for developments, you watch market developments and make sure you have the right strategies in place to meet new developments. “Lead from the front and be the best at what you do,” is his philosophy, adding “it is not only about selling product.” Apart from moving fast to get product to the market, Krawinkel also believes in a daily dose of hard work and never becoming complacent.

In a nutshell: there’s no place for slackers or dithering if you want to be the leading brand in SA.

Three growth pillars

Three pillars — running, training and lifestyle — supported the good growth figures of the past year (which he will not disclose). The exception was soccer, which peaked and experienced exceptional growth in 2010 due to adidas’ sponsorship of the 2010 FIFA World Cup and the Bafana Bafana team.

In the running segment trail running recorded incredible growth, he says, driven by the worldwide trend to enjoy more outdoor activities. He believes minimalist running shoes are here to stay, with a definite place in future ranges. But, it is a niche market. “How big it will be in 2012? … we’ll have to see.”

In training, their national partnership with Virgin Active — where adidas, besides a full activation programme, provides clothing and footwear to personal trainers — has paid off. Their training apparel, with technologies like Climacool and Clima360, have done very well.

The potential has been unleashed with lifestyle, he says.

“Our Originals sub-brand with its trefoil logo has performed exceptionally well and we expect strong growth off this base in the future,” says Krawinkel. Adidas founder Adi Dassler had designed the trefoil and it has been associated with the brand since the 1950’s. “It is our underlying heritage.”

Concerns global economy

Krawinkel is especially pleased with their results in the current global economic climate when delivery problems and price increases from China coupled with less money in consumer pockets did not create optimal trading conditions. Yet, adidas SA experienced major growth in key retail areas, including independents — which he attributes to excellent relationships with customers.

The economic downturn is a bigger problem for weaker brands, he says, because stronger international brands do a lot of work on R & D (research and development) to offer different products to meet all market demands.

In SA the sports retail industry has so far been less impacted by the global economic recession — for example, growth in semi-durable goods like footwear and clothing was more than the GDP average. “I was very happy to notice that the South Africans are active people,” says Krawinkel. “People run, they train at the gym, they play football, active participation is a way of life.”

The year ahead

In 2012 consumer behaviour will be a major challenge, he believes. There will be more pressure on retailers. Well-known brands will be less affected, as they will have more room to manoeuvre, and will feel less pressure than the price-driven goods. But, margins will become tighter.

“We’ll have to build quality order books — and convert them into sales. So far it has worked well, but some customers are becoming more careful.”

Sub-Saharan Africa also beckons. As in SA, they will take the best of established international business practices and adapt to local conditions. Questions about the strength of the retail base in countries like Nigeria Krawinkel laughs off as being Euro-centric. He does, however, concede that the expansion will be on the back of mono-brand stores — but stresses that they will be combining this with partnerships with other retailers.

Product-wise they recently launched denim under the Originals label for customers who want the complete adidas look from head-to-toe. Specialised or niche hardware products like cricket bats and hockey sticks have complemented their historical footwear and clothing offering to brand fans.

F50 adiZero

And then there is the roll-out of the new F50 adiZero soccer boot featuring miCoach to look forward to. One cannot help but share Krawinkel’s enthusiasm for this ultra-light smart technology boot (see page 23).

A miCoach speed cell chip planted in the sole can record and wirelessly transmit everything the player’s feet do on the field. This enables the coach — and player — to view all the data of what he did during a match or training session on a tablet or computer. Transmitting the average and maximum speed, the number of sprints, distance covered at varying intensity levels, the length of time the player was active… there will be no place to hide any lack of form or effort.

And to stop you from feeling complacent, you can even compare your performance against that of third-time FIFA Player of the Year Lionel Messi.

Top clubs like AC Milan and Real Madrid already use the F50 adiZero to monitor the players’ performance and fitness and legendary coach Jose Mourinho says it has enhanced their training sessions.

“It is our ambition to be known as the innovation leader,” beams Krawinkel, optimistic that 2012 will be another good year.

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