Adidas pulls out of Amazon & eBay
28th June Leave a comment
A couple of days ago, German sportswear manufacturer adidas has announced to stop allowing merchants to sell their products on marketplaces such as Amazon and eBay. The reasoning behind this: strengthen the global adidas brand by taking full control of it and not have it harmed by cheap prices and “shabby” digital neighborhoods.
The German publication Markt Intern broke the news last week: As far as the European market is concerend and after a grace period, as of January 2013 adidas will stop having their producs sold via online platforms which “offer used or damaged goods”, “allow private sales”, “have more than one retailer for the same product” and “have no separate brand store for each of adidas’ brands”. This surely is a bold and unprecedented move. I don’t have the numbers, but I would imagine that in the short run, adidas loses a lot of its turnover. It’s a successful, public company with almost $14bn in revenue and, to be sure, its shareholders won’t initially be very thrilled by it.
Of course it seems understandable that manufacturers are trying to protect their brands. In most cases, it’s all they have (why else would someone buy a running shoe for 1oo+ Euros when it’s being stitched together by some poor kid in Bangladesh for a couple of dollars?) However, pulling the plug like this expresses pure panic and not a well-balanced strategy. If eBay and Amazon are where the customers are, why does adidas knowingly blocks sales in such a way? In this context, if your German is decent enough, you should have a look at the E-Mail von Altmann, an open letter written to adidas’ CEO by Johannes Altmann, one of Germany’s most prominent eCommerce experts.
(Image by autumn_bliss)