After many months of deliberations, Adidas has now decided to sell its remaining $1 billion worth of shoes and clothing from its partnership with “Ye,” formerly Kanye West, which concluded last fall after the rapper’s series of antisemitic remarks.
Other than Adidas, other sponsors and representatives included Creative Artist Agency, Balenciaga, Vogue, GAP, JPMorgan Chase, and MRC had cut ties with the rapper.
Adidas had put the merchandise in storage after others after the controversy came out. The German company will be donating the earned money from the Ye merchandise towards non-profit proceeds.
Ending the collaboration between Ye and Adidas led to the sportswear brand’s first loss in 31 years. It also inspired shareholders to file suit.
CEO Bjørn Gulden said, “Burning the goods is not the solution. … What we are trying to do now over time is to sell parts of this merchandise and donate money to the organizations [that were] hurt by Kanye’s statements.”
If Adidas cannot sell the Ye products, then it faces a $700 million loss. One notable downside of the plan is that Ye will still receive 15% of sales.
“[It’s] a very difficult, sensitive situation,” Gulden said. “And I can just repeat, if you look at [the Yeezy] business, there is no doubt that Ye is one of the most creative people that have ever been on the planet. I think the way this was taken to market is probably the best, I would say, go-to-market job that any brand has done.”
The company is facing a daunting task to sell off the merchandise with Ye’s damaged reputation making antisemitic comments, including marketing efforts.
Meanwhile, this week Ye’s restarted presidential campaign took another internal hit with his returned campaign manager Milo Yiannopoulos accused by the outgoing campaign treasurer of breaking campaign finance laws.
Ye’s erratic behavior lead to a chain of events that included of clothing designs of “white lives matter”, in an interview with Tucker Carlson, a dinner at Mar-A-Lago with former President Donald Trump with a white supremacist, appearance on Alex Jones’ InfoWars, and his damaging Twitter rant.
He also commented on panel claiming he would say antisemitic remarks and not get dropped. The white supremacists supporting Ye held a banner over the 405 bridge in Los Angeles, California that said “Kanye was right about Jews”. It was the final straw that led to the cut-off.
Adidas was looking to re-purpose in selling the Ye merchandise in the aftermath that included selling the products at discounted prices.
“There’s no way to get out of this gracefully or profitably,” Matt Powell, a footwear retail expert who has worked with Adidas, said. “The question is, how can they lighten the bad things that are going to happen?”
The German apparel company is facing tough marketing efforts to sell of the Ye merchandise as profit loss looms.
Produced in association with Jewish News Syndicate
