If you have yet to hear, German sneaker brand Adidas finally caved under pressure and cut ties with hip-hop and fashion mogul Kanye West. The highly lucrative relationship, which started in 2013, was already showing signs of crumbling earlier this year as Kanye continued to vent about how unhappy he was with the company’s direction. However, West and Adidas were still scheduled to be in bed together for a few more years, which was not the worst thing in the world considering the billions they made from the partnership.
When West began to get backlash for his antisemitic comments earlier this month, eyes immediately turned to Adidas to release a statement or cut ties with him, considering the company’s troubling history with Nazi Germany. Unfortunately, they did not move fast enough for people despite telling the public that the relationship was under review.
While they tried to sort through the mess behind the scenes and figure out the best way to deal with it all with minimal damage, their stocks were already plummeting 15%. Meanwhile, Balenciaga, The Gap, Def Jam, CAA, and numerous others beat the company to the punch, denouncing West with a quickness.
Finally, the company made the necessary decision to end its partnership with West and pull all his sneakers at a massive loss to both Adidas and Kanye. Not only does Kanye lose his billionaire status now, but Adidas is set to lose upwards of $200 million in the wake of Yeezys being pulled. Several large sneaker chains have already pulled the shoes off the shelves, and fans are clamoring to resell sites to try and get their hands on a pair before everything is gone for good.
It’s understandable now why the company was trying to figure things out; it’s reported that by the time they are done with scrubbing West and his products from their company, they will be down $650 Million. Not to mention the amount of people they might have to lay off now as they rebrand and restructure in the wake of this fiasco. Already competitors are seeing a rise in profit, with Nike up 5%.
So is there a way for Adidas to salvage some of their profits while still doing right by the public? According to Bloomberg.com, “Adidas AG intends to sell existing Yeezy product designs using its own branding after ending its partnership with rapper and designer Ye, formerly Kanye West.” You read that right. The company is looking to restrategize and bring Yeezys back at the top of 2023 with a rebrand aimed at marketing them as Adidas and not what they were formally known as. “Looking ahead, on our understanding, the company will not sell any Yeezy-branded products, and all Yeezy products will be branded under the Adidas brand,” Morgan Stanley analyst Edouard Aubin said in a public statement released this week.
How is this possible? While Kanye owns the Yeezy branding and name, Adidas owns the sneaker design. According to CNN, Adidas’ official statement about their split from Kanye reads, “Adidas is the sole owner of all design rights to existing products as well as previous and new colorways under the partnership.” Let’s see what West says about this when he inevitably releases a statement.
Aftermath of Kanye West’s antisemitic comments:— Pop Crave (@PopCrave) October 25, 2022
Adidas cut ties
Balenciaga cut ties
Vogue and Anna Wintour cut ties
Dropped by talent agency, CAA
Dropped by lawyer
Streams, sales & airplay plummeted
Restricted from Instagram & Twitter
Stadium shows cancelled
Documentary shelved pic.twitter.com/D1UiaAG3e9
In the meantime, fans have already began strategizing on selling their Yeezy’s. TMZ reports, the keyphrase ‘sell yeezys’ skyrocketed a whopping 581% Wednesday. According to the media outlet, fans are trying to decide if now is a good time to resell their shoes or will they be more profitable in the future.