Adidas Renews Its Sponsorship Contract With The German Football Association For Four Years

The German Football Association DFB announced its agreement with the world's first football.

Adidas

Renew for four years

The sponsorship contract extends the cooperation between the two sides over 60 years.

The value of the new contract is more than 200 million euros, which means that the German Football Association will receive the sponsorship of 50 million euros from Adidas AG, Adidas group every year for four years starting from 2018. It is two times the current contract 25 million euro, and is the most expensive sponsorship contract of the world football team, beyond the French team (43 million euros), which is praised by the biggest competitor Nike Inc. Nike group.

The group also promised to move its Jersey back to Germany.

With these two points, Adidas AG and Adidas group successfully repelled Nike Inc. Nike group.

Herbert Hainer, chief executive of Adidas AG, who will retire at the end of September, said at a press conference in Paris that the group hopes to sponsor the German Football Association in the long term, after which the two sides generally sign a ten year contract.

Adidas AG, Adidas group, has just released its annual sales target of 2 billion 500 million euros in football products. Last week, the group believed that the 2016 European Cup being able to promote record sales of the group football category, the German national team jersey sales could be estimated to reach 1 million 300 thousand.

In the 2012 European Cup, the German national team sold 1 million shirts, while Germany sold 3 million in the 2014 World Cup in Brazil.

The sales target of 2 billion 500 million euros was 14% and 19% higher than that of the 2 billion 200 million euros sold in the 2015 fiscal year (13% of total revenue) and the 2 billion 100 million euro sales in 2014 Brazil World Cup.

At the same time, sponsored by Manchester United PLC Manchester United, Real Madrid CF Real Madrid and the king of Bundesliga FC Bayern Munich AG, Bayern Munich and other powerful teams, the Adidas group was released early last month by Chelsea, who was pferred to the Nike brand of Nike group from the start of the season with a price of 60 million pounds per year.

Adidas AG and Adidas group received a 50 million euro default penalty from Chelsea FC Chelsea and raised its annual earnings forecast for the third time in less than three months.

Jean-Pascal Gayant, a French football economist, points out that as long as football maintains its status as a global media player, the cost of sponsorship is unlimited. He expects greater growth in the next World Cup.

In the 2016 European Cup of 24 teams, Adidas AG Adidas group sponsored nine teams including the last champion Spain, and Nike Inc. Nike group sponsored 6 host teams such as France, England and Portugal, and Puma SE Puma sponsors five teams such as Italy and Switzerland.

According to Adidas AG Adidas group, the new sports sponsorship strategy based on the "Creating the New" business plan will reduce sponsorship to non top sports teams and league matches in the future, and turn to more resources for individual sports stars who have the ability to enhance brand awareness in social media.

Herbert Hainer said at the press conference that in the past 12 months, the group has invested heavily in football, and soccer has also promoted the sale of other products. "We have won market share in the main market, and the supply of football products has also been accepted by young target consumers."

He disclosed that the market share of Adidas AG Adidas group was 36% in the five largest European soccer market in the first quarter, but this data was only one percentage point ahead of the Nike Inc. Nike group.

Data show that in the first quarter, the net profit of Adidas Adidas Group continued to grow 37.6% to 350 million euros, and its operating profit was 490 million euros, up 35.2% from 363 million euros a year earlier, and the operating profit margin also increased by 140 basis points to 10.3% in.

Sales growth of 16.8% was driven by the strong sales of NMD and the strong recovery of the US market. The fixed exchange rate increased by 22%. Net sales rose to 4 billion 769 million euros from 4 billion 83 million euros a year ago. This is the highest quarterly sales in the group.

The group now expects net profit for year-on-year operations to grow by 25% over the previous year, after an expected growth of 15%-18% and net profit of 900 million euros, after expected 8.3-8.5 billion euros.

The latest operating profit margin is expected to be 7%, which was expected to be 6.6%-7.0%.