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The global sportswear giant is on a mission to hit €4bn sales online, using cloud technology to revolutionise how it serves customers.
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3 MAY 2019
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How ecommerce became Adidas’s most important channel
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Adidas CEO Kasper Rørsted is clear that the sportswear brand’s future is digital. In fact, that is not just its future but its present-day reality. Its global ecommerce business is currently its fastest growing channel, with sales up 36% in the 2018 financial year.
“The most important store we have in the world is .com, period,” he says. This is reflected in the company’s ecommerce revenue target of €4bn by 2020 and its aim to derive 60% of sales from channels it controls.
But while Rørsted observes “a lot of companies struggle in the transformation from brick-and-mortar to a much more hybrid model”, Adidas doesn’t seem to be suffering the same challenges. Its ongoing digital transformation helped it achieve 8% currency-neutral sales growth overall last year, while increasing operating profit by 14%.
Indeed, its digital plans are highly ambitious, with an aim of making the end-to-end process from product creation to point of sale entirely digital – something it is already well on the way to achieving with the implementation of Salesforce Marketing, Commerce and Service Cloud technologies.
As the company’s annual report for 2018 noted: “The digital transformation is fundamentally changing the way our consumers behave and the way we work. Technology has enabled us to accelerate building direct relationships with our consumer.
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“Improving digital capabilities along the entire value chain enables us not only to interact with the consumer, but also to become faster, better and more efficient in every part of the organisation.”
This shift in Adidas’s business and marketing operations is not just the product of a top-down corporate strategy, obviously. It is a necessary response to the realities of consumer demand today.
Head of digital brand commerce Joseph Godsey points out: “The age of sub-par performance in digital is gone, because the people who are now engaging in those experiences know the speed of a site. They know what good looks like.”
And as his colleague, vice-president of digital experience design Jacqueline Smith-Dubendorfer, adds, consumer brands such as Adidas in trend-driven markets like fashion can’t afford to wait and see how digital behaviour develops.
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SOURCE: SALESFORCE, 'STATE OF MARKETING 2019'
“It’s not a question of if or when. It’s happening now and we need to lead and be able to respond to those consumer expectations immediately. So if you’re not meeting their expectation at that first point, you’ve lost them straight away.”
The digital business changes Adidas has instigated, and the technology it has adopted, have clear manifestations for the customer – particularly when it comes to the website and mobile experiences. When a consumer arrives at Adidas.com, they won’t necessarily see the homepage but could be dynamically served a more relevant page, based on their interests identified by Salesforce’s data management platform.
With Adidas being a Manchester United kit sponsor, a fan might land on a page tailored for the club’s supporters, for instance. Similarly, the mobile commerce site can default to a personalised selection of products rather than a generic catalogue.
As Salesforce regional vice-president Jayne Howson explains: “We know from research that 56% - over half – of online purchases are made on mobile. So [the Adidas mobile website] is incredibly important real estate, an incredibly important shop window. By using artificial intelligence, Adidas delivers products that are the most relevant to [a consumer] first.”
From a customer service point of view, Adidas has also integrated AI chatbots into its site. These are able to give an instant response to consumer queries before or after a purchase, to make product suggestions or allow order changes, for example. This helps increase basket size and reduce abandonments or order cancellations, while freeing up human service staff to help customers with more complex questions more promptly.
The result is that Adidas is better able to serve consumers in the way they expect. Smith-Dubendorfer says: “This generation, they expect something now. They want instant gratification. They want to explore. They want to discover.”
The implications of this new customer-driven approach have also transformed Adidas’s internal culture and ways of working. Silos have been dismantled and there is a continuous effort to improve the experience.
Godsey says: “We moved from a world where you would spend six months, nine months building a big [technology] capability and you would launch it and you would celebrate. You now get into a cadence where we actually have [the equivalent of] Black Friday and Cyber Monday constantly throughout the year.”
For CEO Rørsted, it’s all part of a simple but ambitious goal: “We want to create the best sports company in the world.” ■
“The most important store we have in the world is .com, period.”
Kasper Rørsted, Adidas
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