Adidas 2003 Annual Report Download - page 104

CLIMACOOL®, a3®, GROUND CONTROL SYSTEM™ AND THE
T-MAC 4 LACELESS FOOTWEAR TECHNOLOGIES DRIVE
INTEREST IN adidas SPORT PERFORMANCE /// Within the
adidas Sport Performance division, our famous ClimaCool®
technology (see Brand Strategies) will be introduced at vari-
ous price points and technology levels throughout the year. In
particular, this technology will be highlighted at the Summer
Olympics in August. For ClimaCool®, we are targeting sales of
four million pairs of shoes and five million pieces of apparel.
In addition, we will focus distribution of our premium running
product, the a3®ULTRARIDE, to vertical running retailers,
starting in the second quarter of 2004. In the second half of
the year, we will introduce two completely new technologies
with the Ground Control System™, our first major footwear
technology co-developed by adidas and Salomon (see Brand
Strategies) and the new T-MAC 4 Laceless Footwear Technol-
ogy (see Brand Strategies). While sales from these technolo-
gies are unlikely to exceed 10% of total adidas revenues in
2004, we view them as a critical element of driving consumer
attention and demand for adidas products.
RUNNING AND FOOTBALL CATEGORIES AS MAIN DRIVERS
FOR adidas SPORT PERFORMANCE GROWTH /// While new
technologies have a major impact on the image of the adidas
brand as a performance leader, sales development in the
adidas Sport Performance division is always determined by
the performance of our five major sports categories: running,
football, basketball, tennis and training. In 2004, we expect
running and football to be the major growth drivers for the
brand. This reflects the expansion and commercialization of
our major footwear technologies, which are largely targeted
at the running segment. The football category will be posi-
tively impacted by the UEFA EURO 2004™ European Football
Championships in Portugal combined with our new products
for this event, the Roteiro™ match ball, and the innovative
football boots F50 and PredatorPulse™. Further growth is
also expected in both the adidas Sport Heritage and Sport
Style divisions (see Brand Strategies).
SALOMON BRINGS MAJOR INNOVATION TO BOTH SUMMER
AND WINTER CATEGORIES /// At Salomon, major product
innovation is coming in both the winter and summer product
categories. In the winter segment, which currently comprises
the majority of sales, new innovations such as the Scram-
bler™ and Streetracer®ski collections, the ERA®snowboard
technology and the Spaceframe™ Course ski boot in the
second half of the year, will help us extend our market-
leading position in winter sports. In summer products and
soft goods, where we are targeting over-proportionate growth
in 2004, the Ground Control System™ will be the leading
Salomon footwear technology. Moreover, an entirely new
Salomon apparel line will be introduced, which we expect to
increase sales by around 50% in the category versus 2003 as
a result of expanded distribution and increased sourcing
efficiencies.
NEW METALWOOD TO BE LAUNCHED AT TAYLORMADE-
adidas GOLF /// At TaylorMade-adidas Golf, we will introduce
a revolutionary new metalwood in the summer of 2004. As
metalwoods are the Group’s highest-margin product category
and comprise nearly 50% of segment sales, this introduction
will be an important contributor to TaylorMade-adidas Golf
top-line growth in 2004. In addition, new product introductions
or extensions are planned for other categories such as irons,
golf balls and putters.
100 REPORTING GROUP MANAGEMENT REPORT /// OUTLOOK
KEY PROFIT & LOSS TARGETS FOR 2004
Gross margin ≥45.0%
Operating margin 7.8%
Net income growth ≥10.0%
MAJOR PRODUCT LAUNCHES IN 20041)
Product Brand Launch Date
ClimaCool®adidas March, July and August
a3®ULTRARIDE adidas Second quarter
Ground Control System™ adidas/ Salomon Second half
T-MAC 4 Laceless
Footwear Technology adidas Fourth quarter
Roteiro™ football adidas First quarter
F50 football boot adidas First quarter
PredatorPulse™ adidas Second quarter
Scrambler™ ski Salomon Second half
Streetracer®ski Salomon Second half
New Salomon apparel Salomon First and third quarters
New metalwood TaylorMade-adidas Golf Summer
RAC CGB irons TaylorMade-adidas Golf First quarter
Revolution golf ball Maxfli First quarter
1)See Brand Strategies for full product descriptions.
TAYLORMADE /// ROSSA MONZA MID PUTTER