After Ye, formerly known as Kanye West, made several rude and antisemitic comments, Adidas cut ties with the singer on Tuesday.
After few hours, both Gap and Foot Locker announced they will pull Yeezy goods from shelves.
“Antisemitism and other forms of bigotry and discrimination are not tolerated at Foot Locker, Inc. “While we continue to be a partner with adidas and carry a wide range of their collections, we will not be supporting any future Yeezy product drops,” a Foot Locker spokeswoman said.
YeezyGap.com was also taken offline by Gap and now simply goes to the main Gap page.
According to Gap’s beliefs, “antisemitism, racism, and hate in any form are reprehensible and not accepted,” the company declared in September while announcing it would no longer work with Ye. At the time, the store announced it will liquidate all remaining Yeezy stock.
Both Gap and Foot Locker released remarks that were similar to those released by Adidas. “Antisemitism and other forms of hate speech are not tolerated at Adidas. Business ideals of “diversity and inclusiveness, mutual respect, and justice” have been “violated by Ye’s recent statements and actions,” the company claimed.
After careful consideration, the company has decided to cancel its business relationship with Ye, cease manufacturing Yeezy-branded products, and cease making any further payments to Ye and his enterprises. To put it bluntly, Adidas is pulling the plug on the Adidas Yeezy brand.
Impact On Adidas
Due to the high degree of seasonality that occurs in the fourth quarter, Adidas predicted that this would have a short-term negative impact on the company’s net income in 2022 of up to 250 million euros ($246 million).
It went on to say that it was the “sole owner of all design rights to existing goods as well as past and new colorways under the collaboration” and that it would disclose additional details when it reported its earnings for the third quarter on November 9.
After Bloomberg reported early in the day that it was preparing to discontinue the collaboration, Adidas’ share price dropped by 4% during the morning trading session in Frankfurt, Germany.
On October 6, the corporation initiated a review of the agreement, but ever since then, it has been under intense scrutiny for its lack of activity.
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A U.S.-based Adidas employee named Sarah Camhi took to LinkedIn on Monday to express her displeasure with the company’s handling of Kanye West’s anti-Semitic comments: “It’s been 14 days since Kanye started spewing anti-Semitic rhetoric and adidas has remained quiet; both internally to employees as well as externally to our
To which the director of trade marketing remarked, “We need to do better as a brand. Neither our employees nor our local communities are receiving the care and attention they need. I refuse to support Adidas until they make a public statement.
German firm started collaborating with Ye in 2013, and in 2016, they secured a partnership to produce and market his Yeezy line of clothes. According to Adidas, the agreement is one of the most fruitful ones in the company’s history and has had a “tremendous influence” on sales.
But in recent months, Ye has publicly challenged Adidas, as well as some of his other corporate partners, like retailer Gap.
An Already Sour Relationship
Despite the company’s financial success, Adidas and Ye’s partnership has deteriorated. Adidas has, in most cases, chosen to disregard Ye’s public rants and the subsequent media cycles, thereby distancing the creator from his work (or in this case, product).
When Ye said in 2018 that “slavery was a choice,” Adidas CEO Kasper Rrsted said, “there definitely are some things we don’t endorse,” before going on to call Ye “a very essential element of our strategy and has been a wonderful designer.”
While several Yeezy Gap products have already been released, Adidas has yet to show that it has a post-Yeezy perspective, and it also has an immediate option to fill the $2 billion hole that would be left without Yeezy (assuming sales stay strong while Ye’s public opinion tanks, which is uncertain).
Since Adidas, like Nike and its rivals, is already feeling the financial effects of a slowing economy and sitting on large amounts of surplus inventory, this void is an urgent issue.
What, if anything, could replace Yeezy? The Ivy Park collection created by Adidas and Beyoncé is a marketing fantasy, but its scale doesn’t appear comparable, and the company has never revealed any money from it.
A $2 billion profit (about the fashion house’s annual revenue) seems like a stretch for the Balenciaga collaboration, but I have no doubt that it will be successful. Williams’s Adidas collections are still impressive, but every major sneaker label has new, equally impressive collabs coming out every day.
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