NEW YORK — The athletic and swim industries are bustling with corporate makeover, design and competitive activity. Here, a look at some of what’s on the horizon.
Reebok and Adidas Merger
The sporting goods industry is closely watching the pending merger between Adidas and Reebok, which is likely to close in the first quarter of 2006. The impact of the $3.8 billion deal on the industry is uncertain as Adidas aggressively seeks to build its U.S. business and tries to catch up to chief rival Nike. Some market watchers believe the merger won’t yield positive results, at least in the immediate future.
“The recently announced acquisition of the Reebok brand could prove to be both a near-term drag on earnings and a marketing distraction to Adidas’ core U.S. business segments in the first half of 2006,” John Shanley, analyst at Susquehanna Financial Group, wrote in a recent research note. “Following a disappointing third quarter performance by Reebok International, we believe the short- and medium-term outlook for the Reebok brand itself, especially in its core U.S. market environment, is likely to remain weak well into the first half of the year.”
The deal melds two different cultures. Adidas is a German global sporting goods giant, while Reebok is primarily an American firm that does the bulk of its business in the U.S. But the two brands sell many of their offerings in the same distribution channel in specialty stores and athletic chains, and often compete with each other. Adidas has a new U.S. leader, Rob Langstaff, who will oversee the day-to-day management of the company’s business here and likely will play a part in overseeing the merger activity with Reebok.
Meanwhile, Reebok continues to add to its stable of music world personalities, and has just signed a deal with reggaeton artist Daddy Yankee for a collection of athletic footwear, apparel and accessories called DY to launch in the spring. Yankee also will be featured in Reebok’s “I Am What I Am” global ad campaign.
Let the Games Begin
Athletes competing in the Winter Olympics — and the brands that clothe them — are preparing for the Games, set for Feb. 10-26 in Turin, Italy.
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While some bemoan the two-year Olympic cycle, the Games are still the world’s largest sporting event and a key international opportunity for athletic brands to showcase their latest looks and technologies.
For these Games, Nike is taking over from Adidas as an apparel sponsor of the U.S. Olympic Committee and will provide the uniforms that all American athletes wear when receiving medals, as well as loungewear for athletes to wear around the Olympic Village. As an official team sponsor, Nike — along with Roots, which is also a USOC apparel sponsor — has broad licensing rights to use the Olympic trademarks on its products as well as in marketing and advertising.
Nike has developed a range of looks for the athletes, including a quilted down jacket and layering items, and also has a range of consumer products that use the Olympic logos. The collection will be available to consumers at Niketown, usolympicshop.com and niketown.com, said a Nike spokesman.
Roots has developed retro-inspired looks for U.S. athletes as they march in the opening and closing ceremonies. Speedo will be among those providing merchandise for the athletes. The company has developed sledding suits from its Fastskin II technology, designed to help athletes improve their times. Fila and Adidas also will outfit a number of federations and leagues.
The Winter Games are smaller than the Summer edition. Figure skating, bobsled, speed skating, luge and a variety of ski competitions are among the highlights. The Olympic torch was lit at Olympia, Greece, on Nov. 27 and arrived in Italy Wednesday. Designer Giorgio Armani is among several Italian celebrities who will carry it during the final approach to Turin’s Olympic stadium.
Swim Fashion
The swimwear market is getting a major fashion injection this season with more big-name designers entering the category and an increase throughout the market in forward and directional looks.
Michael Kors and Carmen Marc Valvo are two of the best known to hit the swim scene with lines that feature designs to appeal to their loyal customers. Julien MacDonald also is stepping into the scene through a new partnership with Melissa Obadash.
Lenny, a Brazilian label popular in Europe and South America, is also new in the U.S., since designer Lenny Niemeyer wasn’t selling under her branded label here and instead worked with other labels. Her signature collection features glamorous designs such as suits with gold links, animal prints and tropical influences.
“Breaking into the U.S. market is an important step in developing Lenny as an international lifestyle brand,” Niemeyer said.
Lenny has been picked up by stores such as Saks Fifth Avenue and Barneys New York.
Fashion trends for the season include crocheted looks, cutout styles and hardware, as well as Fifties-inspired suits, citrus hues and tropical prints.
Figleaves.com, a fast-growing online retailer of innerwear and swimwear, is among the merchants that have dramatically expanded their swim offerings because of increasing interest in the category.
“People want a swim wardrobe now,” said Jo Jeffery, a vice president at Fig Leaves, who noted that swim is the fastest-growing segment of her Web site. “Whereas people used to pack one suit for their vacation, now they like to have a lot of options.”
Among the brands her company is selling for spring are Kors, Cosabella and Aguaclara. The site also has increased its selection of separates and swimwear for women with larger cup sizes, including the addition of a label called Storm-In-A-D-Cup, Jeffery said.