Ah, Adidas, the brand of choice for slavs across the world.
It’s kind of ironic once you realize that the brand was started by a German guy named Adolf, but hey, that’s life.
What’ll surprise you even more is the fact that Puma was started by the same family.
That’s why, in this post on Behind the Business, we’ll be looking at the dramatic history of Germany’s premiere sportswear brand, Adidas.
Our story starts in the early 1920’s, in the quiet Bavarian town of Herzogenaurach.
The town was a shoemaker’s delight, and many of its former textile mills had been converted into shoe workshops.
In fact, out of the town’s 3500 residents, there were 112 cobblers.
One of them was 20-year-old Adolf “Adi” Dassler, the poor son of a shoemaker and a laundry worker.
His family was too poor to give him a formal education and so he had to follow in his father’s footsteps by making shoes.
The years after World War 1, however, were some of the harshest in recent memory, and it was hard to make a living as a cobbler.
Adi couldn't even afford a dedicated working area, and so had to do his business from the back of his mother’s laundry.
Electricity was so unreliable that Adi had to power his machines by hooking them up to his bike and pedalling.
The materials for the shoes themselves were also expensive.
To make ends meet, Adi had to scavenge leftover military equipment from the war.
He repurposed everything he could get his hands on, from military uniforms to sacks and vehicle tires.
Adi’s first products were bedroom slippers, with rubber soles made from tires.
As an ardent sports fan, however, Adi had always wanted to make sporting shoes.
He experimented by adding small metal cleats and spikes to his footwear in the hopes of creating something sports-worthy.
Just as Adi was starting to making a name for himself, he was joined by his brother Rudolf in 1924.
Rudolf was two years older and had formal education, which made him the star of the family.
He was also more experienced, having previously worked at a porcelain factory and a leather enterprise in Nuremberg.
Rudolf was a charismatic, extroverted salesperson who was very successful in making good deals and getting customers.
The two Dassler brothers made great partners and together they started a joint enterprise called “die Gebrüder Dassler Schuhfabrik”.
With Adi handling production and Rudi doing the marketing, their business became very efficient.
By 1926, their sports shoes had become popular enough to allow the Dasslers to finally move out of their mother’s laundry and to build an actual workshop.
Adi and Rudolf’s father joined them at this new location and together with about a dozen other employees, the brothers were now capable of producing up to 100 pairs of shoes every day.
Adi was eager to expand beyond Bavaria, and to this end he took it upon himself to visit every major sporting event he could find to get athletes to try out his footwear.
His efforts paid off and in the 1928 Olympics in Amsterdam, Dassler shoes graced the feet of many top German athletes.
Adi’s shoes appeared again in the 1932 Olympics in Los Angeles, this time worn by sprinter Arthur Jonath.
Arthur managed to win several medals, proving that the Dassler’s shoes were worthy of even the best athletes.
This Olympic success gave the brand great recognition, and so Adi decided that, for the 1936 Olympics, he’d want to sponsor nothing less than a gold-medalist.
Adi packed his best shoes and personally drove to the Olympic Village in Berlin, where he talked to the American runner Jesse Owens a few days before the Olympics.
It’s a mystery how, but Adi managed to convince Owens to wear his shoes in the competition.
When Owens ended up winning four gold medals, Adi was beyond ecstatic.
The Dassler brand continued its stellar performance in the 1930s, and to gain the government’s support Adi and Rudolf ended up joining the Nazi Party.
Unfortunately for them though, that other Adolf decided to invade Poland, and once the war got underway demand for civilian goods plummeted.
By December 1943 Germany was starting to lose on the Eastern Front and in desperation it began repurposing the few civilian enterprises left, among which was the Dassler business.
Their shoe factory ended up producing anti-tank weapons - the much feared “panzerschrecks”.
In April 1945, however, Herzogenaurach received a healthy dose of liberty in the form of the advancing American troops.
The Americans initially wanted to destroy the Dassler factory, but Adi’s wife somehow managed to convince the soldiers that they actually just wanted to make shoes.
Eventually, the Americans stationed near the town became one of the company’s first international clients, especially once they heard of Dassler’s link to Jesse Owens.
Despite their business surviving relatively intact, World War 2 devastated the German economy and the Dasslers had to go back to scavenging old war materials.
Sometimes workers didn’t even get paid in currency, but rather through barter with items like firewood or yarn.
Most serious of all, however, was the immense personal schism that ocurred between Adi and Rudolf.
While the exact reason for their falling out remains a mystery, the most prominent theory is that Rudolf thought Adi had informed on him during the war, which eventually landed Rudolf in an Allied POW camp for several years.
Whatever the cause, World War 2 ended up causing irreversible damage to the Dasslers’ relationship and in 1948 Rudolf left the family business.
He took a large part of the workforce with him, and assumed control of what was supposed to be a new factory building.
Thus, he founded Puma and vowed to never speak to Adi again.
The rivalry spread to the town itself, and to this day citizens of Herzogenaurach are known as “Bent Necks” for their tendency to crane their necks to look at what shoes other people are wearing.
The supporters of the two brands became very territorial, since each enterprise was situated on opposite sides of the river.
Depending on their allegiance, workers claimed various bars, restaurants, and even schools.
Adi renamed his share of the enterprise to Adidas and focused on technical innovations and sponsorships.
He would end up revolutionizing shoe designs for a variety of sports while giving away his best creations to star athletes and Olympians.
Adidas made their big break in the US during the 1950’s, and over time their fame trickled down from professional sports into everyday life.
Puma was also doing well, but the Dassler brothers continued to hate each other with a passion.
Their feud would haunt them to their graves, and today each brother is buried at an opposite side of the Herzogenaurach cemetery.
Adi died in 1978, and that’s when Adidas finally started to lose some of its steam.
They lost ground in North America to upstarts like Nike and Reebok, and in 1989 they were forced into bankruptcy after losing nearly $80 million.
Ownership of the company passed through several French businessmen until 1993, when Robert Louis-Dreyfus managed to restore the brand by moving production to Asia.
Under his guidance, Adidas staged a dramatic reappearance in the US in the late 1990’s, despite stiff competition.
Since then, their sales have been steadily rising and they’ve acquired several other brands, most notably Reebok in 2005.
Recently they’ve taken notice of the growing role of technology in sports and in 2015 they made a landmark acquisition by buying the fitness tech company Runtastic for $240 million.
Despite the fair amount of twists and turns in their rise to fortune, Adidas has definitely secured its place as one of the great German enterprises of the modern age.
Thanks for reading!
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