By Mark Baber
February 17 – Puma issued an upbeat fourth quarter 2014 report Monday, revealing a 3.3% increase in currency adjusted worldwide sales of €3.2 billion (£2.6 billion) and documenting the company’s success in halting a slide in sales and repositioning its branding. Full year earnings were below expectations though and shares have slipped 17% over the year.
2014 saw Arsenal and Puma enter into what was for each party their biggest ever supplier agreement – believed to be worth £30 million a year to the club. Although no direct link is made in the report, Puma reported a 6.8% increase in apparel sales of €1.21 billion and sales in the UK were reported as being particularly strong.
“A significant increase in sales was achieved in the apparel segment last year. This was partly due to the strong sales of jerseys and memorabilia related to the football World Cup as well as the generally strong demand for Teamsport products, particularly Arsenal, Dortmund and Italy jerseys,” said a note in the report.
Puma, which trails Nike and Adidas by a large margin, sponsors Italy and Brorussia Dortmund as well as Sergio Aguero, Mario Balotelli, Cesc Fabregas, Falcao, Olivier Giroud, Marco Reus and Yaya Toure.
Puma says that: “The year 2015 has started very positively for PUMA as the 2015 Africa Cup of Nations proved to be a fantastic stage for our football products with Ivory Coast beating Ghana 9:8 in a thrilling penalty shootout, with both teams being outfitted by PUMA. Led by their captain and PUMA star player Yaya Touré, the ‘Elephants’ put on a brilliant performance to claim their second Africa Cup of Nations title after 1992. On the pitch in Equatorial Guinea, Touré sported the next generation of our evoPOWER football boot, designed to bring Power and Accuracy to a higher level. The innovative shoe was launched at the beginning of this year through a ‘Head to Head’ campaign featuring PUMA key assets Mario Balotelli and Cesc Fàbregas.”
In terms of general brand positioning, Puma will continue its focus on Usain Bolt (who is expected to retire in 2017), is honing in on the female market with Rihanna being appointed as a creative director and is investing heavily in the ‘Forever Faster’ marketing campaign.
According to CEO Bjørn Gulden: “The addition of Rihanna, as a Brand Ambassador and as one of our creative directors, is a commitment to our increased focus on the female consumer segment, as we truly believe that the ‘future is female’.”
Although earnings have been hit hard by the strength of the dollar (with its Asian supply contracts denominated in the US currency) and the weakness of the rouble, the company which is 86% owned by the Kering owners of Gucci and Yves Saint Laurent, believes it is successfully turning things around from a situation where it produced products which. according to Gulden, “no-one bought”.
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