A month after Adidas terminated its relationship with Kanye West (Ye) following the rapper’s antisemitic remarks on social media and his controversial support for the ‘White Lives Matter’ movement, the fashion giant has declared it will continue to sell Ye’s ‘Yeezy’ shoes.
Though sneakerheads and Ye fans alike may be quick to celebrate, there’s a catch: while the shoe itself will remain in Adidas’ marketable collection, future iterations of the shoe will no longer feature Ye’s branding or the ‘Yeezy’ name.
The news came from the company’s Q3 earnings call on Wednesday, in which the dilemma of the future of ‘Yeezy’ was one of the main topics. Adidas Chief Financial Officer, Harm Ohlmeyer, said that while ‘Yeezy’ shoes would continue to exist, it would be under circumstances decided by the organisation.
“Going forward, we will leverage the existing inventory with the exact plans being developed as we speak,” Ohlmeyer said.
“It should refrain from relaunching items under its own brand, as they will always be synonymous with West, and this would likely result in muted customer demand.”
It may be confusing as to why Adidas is permitted to do this, considering Ye’s close attachment to the ‘Yeezy’ brand. However, Ye himself doesn’t own the designs of the shoes, he only owns the branding and name rights.
Ohlmeyer himself confirmed this in the same call, solidifying Adidas’ total ownership over all aspects of ‘Yeezy’ shoes, save for the name.
“Adidas is the sole owner of all design rights registered to existing products,” he said. “We intend to make use of these rights as early as 2023.
“We own all the versions and new colourways. It’s our IP. We are working through all the options.”
While Adidas is going to great lengths to separate itself from the highly-controversial rapper, the act of doing so has created considerable financial grief for the company. On Wednesday, they announced that the process has caused Adidas to lose $250 million USD ($378 million AUD) in profit and $500 million USD ($757 million AUD) in lost revenue.
It’s easy to see why this move has caused such significant losses: Morgan Stanley, a financial management company, estimates that the ‘Yeezy’ brand generated nearly $2 billion USD ($3 billion AUD) in sales last year alone, which made up 8% of Adidas’ total sales.
As for Ye, it’s unlikely he’ll surrender ‘Yeezy’ so easily: he’s previously declared that Adidas “raped and stolen” his designs, so he may end up unleashing another social media storm on the few remaining platforms he’s allowed on.
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