Athletic retail brand, Adidas, is about to close down several stores in the coming years as part of a shift towards selling more goods online, the company’s Chief Executive Officer told the Financial Times.
In the interview, Adidas CEO Kasper Rorsted said “over time, we will have fewer stores but they will be better,” adding that over the coming year, the number of Adidas stores was expected to contract slightly. “Our website is the most important store we have in the world.”
Adidas is aiming to more than double its e-commerce sales to 4 billion euros ($4.91 billion) by 2020 from 1.6 billion last year. At present, the company has 2,500 stores globally and 13,000 additional mono-branded franchise stores.
In 2017, the company closed a whopping 220 stores, of which 180 were based in Russia alone and 37 were in North America. The brand aims to focus on new stores in perhaps 10 to 15 key cities around the world and plans to close “roughly 170 stores again” this year, CFO Harm Ohlmeyer told analysts last month, according to a transcript from Seeking Alpha. Ohlmeyer also said that the brand will invest in IT — for both e-commerce and its distribution infrastructure.
To facilitate this new strategy, Adidas is seeking to hire roughly 200 employees in that space, Rorsted told the Financial Times. Last month, he told analysts that e-commerce grew 57% last year and that the company aims to get “the absolute number to above 1.5 billion euros still with a target of approximately 4 billion euros in 2022,” according to Seeking Alpha’s transcript.
When and how this strategy unfolds and how Rorsted’s vision for the brand takes form will be something many analysts will be waiting for.