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What Adidas Knew About Kanye

By The New York Times

Join Michael Barbaro and Megan Twohey on "The Daily" as they unravel the Adidas-Kanye West collaboration saga that shook the fashion and business worlds. Discover the genesis of the Yeezy Boost 350 phenomenon that arose when Adidas, once struggling in the athletic footwear market, aligned with Kanye West's grand fashion aspirations. Delve into the allure of celebrity influence and its revolutionary impact on fashion, underscored by high-profile events such as New York Fashion Week and the ensuing frenzied sold-out collections.

As the partnership flourished financially, the speakers dissect the balance Adidas sought between the profitable ties with West and the ethical dilemmas posed by his controversial behavior. Learn how Adidas's strategies, including a morals clause and internal management efforts, ultimately gave way to a breach of contract in response to societal backlash. Addressing a billion-dollar unsold inventory debacle and Kanye's fluctuating net worth, "The Daily" offers a nuanced look at the fallout, Adidas's accountability, and their respective paths forward in a post-collaboration landscape – a telling case of commerce entwined with celebrity and controversy.

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What Adidas Knew About Kanye

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What Adidas Knew About Kanye

1-Page Summary

The Inception and Rise of the Adidas-Kanye Partnership

The Birth of a Collaboration: Challenges and Triumphs

When Adidas was struggling in the athletic footwear market, it found a partner in Kanye West, who held aspirations to influence the fashion world. The collaboration birthed the Yeezy Boost 350, a sneaker that became a cultural phenomenon despite not being optimized for athletic performance. Kanye’s attention to detail brought about both innovations and challenges for Adidas.

Celebrity Impact and the Fashion Revolution

The high-profile nature of the Yeezy brand was unmistakable during its debut at New York Fashion Week, attracting A-list celebrities and leading to sold-out collections. West's vision translated into high demand, exerting a palpable impact on accessible fashion and aesthetics.

Treading the Tightrope: Business Decisions Amidst Controversy

As Adidas processed employee grievances over Kanye's volatile behavior, they still saw the lucrative partnership as an opportunity to be extended. The morals clause introduced in 2016 during contract renegotiations was meant to mitigate potential issues, but even with Kanye’s subsequent problematic public behavior, the clause was not invoked.

Damage Control: Addressing Kanye's Erratic Behavior

Adidas employed various strategies such as meditation apps and private communication channels to manage the stress associated with Kanye's erratic behavior, which included publicly endorsing Donald Trump and making controversial statements on slavery.

The Financial Aftermath of High-Stakes Collaboration

The Cost of Controversy: Ending the Adidas-Kanye Partnership

Kanye's anti-Semitic remarks and accusations of design misappropriation led to Adidas ending the partnership—a move that reacted to widespread societal backlash and was framed as a breach of contract. The aftermath saw Adidas bracing for its first financial downturn in years, and Kanye's net worth saw a substantial reduction.

The Dilemma of Unsold Inventory: Financial Entanglement and Strategies

Adidas faced a new predicament with a billion dollars’ worth of unsold Yeezy inventory remaining. The choice made by Adidas' new CEO to sell the stock revealed the tangled financial ties that persisted between Adidas and Kanye post-separation.

Reflections and Reckoning: Analyzing the Fallout

Behind the Headlines: Adidas's Dual Perspectives on Accountability

Journalists Michael Barbaro and Megan Twohey discussed the Adidas-Kanye partnership from two perspectives. One suggesting Adidas prioritized financial interests over holding Kanye accountable, while the other pointed to Adidas’s success in leveraging the celebrity’s fame.

Moving Forward: The Path Ahead for Adidas Post-Investigation

Adidas was left to navigate its future without the profitable Kanye partnership. A sale of the remaining Yeezy inventory continued to yield financial returns for both parties, even after their collaboration had ended.

Broader Implications: Other News and Final Acknowledgments

Following Twohey’s investigative piece, new discussions emerged about Adidas possibly refraining from selling the remaining Yeezy stock, potentially incurring a significant financial hit. Furthermore, the article expands to touch upon other significant news stories and ends with a traditional sign-off by Barbaro, concluding the intricate analysis of Adidas's and Kanye West's complex relationship.

1-Page Summary

Additional Materials

Clarifications

  • The Adidas-Kanye partnership began when Adidas collaborated with Kanye West to create the Yeezy Boost 350 sneaker, which gained immense popularity despite not being designed for sports. The partnership faced challenges due to Kanye's controversial behavior, including public statements and erratic actions. Ultimately, the collaboration ended due to issues like Kanye's remarks and disagreements, leading to financial consequences for both parties. The aftermath involved managing unsold inventory and navigating the fallout of the partnership's termination.
  • The Yeezy Boost 350 is a sneaker created through the collaboration between Adidas and Kanye West. Despite not being designed for athletic performance, it gained immense popularity and became a cultural phenomenon. Its debut at New York Fashion Week attracted A-list celebrities and led to sold-out collections, showcasing Kanye's influence in the fashion world. The Yeezy Boost 350's impact extended beyond traditional athletic footwear, influencing accessible fashion and aesthetics.
  • A morals clause in a contract typically allows a party to terminate the agreement if the other party engages in behavior that could harm their reputation or brand. In the context of the Adidas-Kanye partnership, the morals clause was introduced during contract renegotiations to address concerns about Kanye West's controversial public behavior. Despite the inclusion of this clause, Adidas did not invoke it when faced with Kanye's erratic actions, such as endorsing Donald Trump and making controversial statements. The presence of a morals clause aimed to protect Adidas from potential reputational damage caused by Kanye's behavior.
  • Adidas employed strategies such as meditation apps and private communication channels to help manage the stress associated with Kanye West's erratic behavior. These measures were implemented to address challenges arising from Kanye's public endorsements and controversial statements. The goal was to navigate the complexities of the partnership while mitigating the impact of Kanye's behavior on the collaboration. These efforts aimed to maintain a working relationship despite the challenges posed by Kanye's actions.
  • Kanye West faced backlash for making anti-Semitic remarks and accusing Adidas of design misappropriation. These actions led to the end of the Adidas-Kanye partnership and significant financial repercussions for both parties. The fallout highlighted the complexities of managing public image and ethical considerations in high-profile collaborations. The aftermath underscored the importance of accountability and the impact of controversial statements on business relationships.
  • Adidas faced challenges with a significant amount of unsold Yeezy inventory worth a billion dollars after ending their partnership with Kanye West. The decision to sell the remaining stock was made to address the financial entanglement between Adidas and Kanye post-separation. This move aimed to mitigate losses and optimize financial returns for both parties involved. The unsold inventory posed a dilemma that required strategic decisions to navigate the aftermath of the partnership's termination.
  • The journalists Michael Barbaro and Megan Twohey presented contrasting perspectives on Adidas's management of the partnership with Kanye West. One viewpoint suggested Adidas prioritized financial gains over holding Kanye accountable for his actions. The other perspective highlighted Adidas's success in leveraging Kanye's fame for mutual benefit. These differing viewpoints shed light on the complexities of corporate partnerships with high-profile individuals.
  • The broader implications and discussions surrounding the Adidas-Kanye relationship revolve around the potential financial impact of refraining from selling the remaining Yeezy stock, the considerations involved in managing unsold inventory, and the strategic decisions made by Adidas post-separation. These discussions also touch upon the complexities of navigating business relationships with high-profile celebrities and the reputational risks associated with controversial partnerships.

Counterarguments

  • The success of the Yeezy Boost 350 could be attributed to the existing popularity of sneaker culture and the trend of limited-edition releases, not solely to Kanye West's influence or Adidas's struggles.
  • The notion that the Yeezy brand revolutionized accessible fashion could be contested, as the high price points and limited availability of Yeezy products may not align with the concept of accessibility.
  • The effectiveness of the morals clause and Adidas's decision not to invoke it could be criticized as being more about public relations and financial considerations than about ethical standards.
  • The strategies employed by Adidas to manage Kanye's behavior, such as meditation apps and private communication channels, could be seen as insufficient or merely symbolic gestures rather than substantive solutions.
  • The decision to end the partnership with Kanye could be viewed as a reactive measure rather than a proactive stance on ethical business practices, with Adidas acting only when public pressure escalated.
  • The choice to sell the remaining Yeezy inventory might be criticized for prioritizing financial recovery over the potential long-term brand damage associated with continuing to profit from the partnership.
  • The discussions by journalists about Adidas's accountability could be seen as lacking in depth if they do not consider the broader context of celebrity endorsements and the complexities of corporate responsibility.
  • The financial implications for Adidas post-investigation could be interpreted differently, with some arguing that the brand's resilience and diversification might mitigate the impact of losing the Yeezy collaboration.
  • The broader implications for the fashion industry and celebrity partnerships might be more nuanced, with some arguing that such collaborations are inherently risky and require better risk management strategies.

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What Adidas Knew About Kanye

The Inception and Rise of the Adidas-Kanye Partnership

The Birth of a Collaboration: Challenges and Triumphs

When Adidas was trailing in the athletic footwear market, it found an ally in Kanye West, who was eager to expand his influence in fashion. The partnership, investigated by Megan Twohey, brought to light the utilization of insider knowledge and confidential Adidas documents, offering a comprehensive look at its challenges and achievements.

The collaboration led to the Yeezy Boost 350, a sneaker that not only became a cultural hit but also fostered Adidas's presence in the athleisure trend. West's specific vision, emphasizing aesthetics, materials, and accessible pricing, guided the collection's design, leading to products that sold out quickly and created intense demand.

Despite its success, the partnership faced early challenges, including Kanye's display of explicit material during meetings.

Celebrity Impact and the Fashion Revolution

The high-profile nature of the Yeezy brand was unmistakabl ...

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The Inception and Rise of the Adidas-Kanye Partnership

Additional Materials

Clarifications

  • The mention of "insider knowledge and confidential Adidas documents" in the text suggests that Kanye West may have had access to privileged information about Adidas's strategies, plans, or products that were not publicly available. This access could have provided him with insights that influenced the collaboration between Kanye and Adidas, potentially giving him a unique perspective on the brand's inner workings.
  • Kanye West's display of explicit material during meetings may refer to instances where he showcased provocative or controversial content, possibly related to his creative ideas or designs, which could have been deemed inappropriate or disruptive in a professional setting. This behavior might have caused discomfort or raised concerns among those present, impacting the dynamics of the collaboration between Kanye West and Adidas. Such actions could have presented challenges for both parties in maintaining a professional working environment and aligning on creative direction.
  • The debut of the Yeezy brand at New York Fashion Week was significant because it marked Kanye ...

Counterarguments

  • The success of the Yeezy Boost 350 may not solely be attributed to its design and pricing but also to the marketing and hype surrounding Kanye West's celebrity status.
  • The partnership's challenges, such as Kanye's behavior, could be seen as a reflection of the difficulties in managing collaborations with high-profile individuals who have strong personal brands.
  • The presence of A-list celebrities at the Yeezy brand's debut may have overshadowed the fashion and design aspects, focusing more on the event's star power than the products themselves.
  • While the Yeezy brand had a significant impact on accessible fashion, it's important to consider that other designers and brands m ...

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What Adidas Knew About Kanye

Treading the Tightrope: Business Decisions Amidst Controversy

As Adidas processed employee grievances over Kanye's volatile behavior, they still saw the lucrative partnership as an opportunity to be extended. Despite Kanye insinuating that centuries of slavery could be perceived as a choice, sparking widespread outrage, Adidas did not resort to their morals clause to reprimand Kanye. This was surprising given the existence of the clause designed for such situations.

During the 2016 contract renegotiations, the morals clause was introduced with the intention to enable Adidas to sever ties should West's behavior prove detrimental. Meanwhile, West negotiated a lucrative agreement that ensured significant royalties, advance payments, and stock options, with performance-based conditions for extending the partnership potentially for a full decade. The sustained sales of Yeezy merchandise even after the end of the partnership continued to bolster Adidas' financial outlook for the year.

Damage Control: Addressing Kanye's Erratic Behavior

To manage the unpredictability stemming from Kanye's behavior, Adidas implemented measures such as assigning roles intermittently within the Yeezy division to reduce mental strain and provided meditation apps subscriptions. They also established a private communic ...

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Treading the Tightrope: Business Decisions Amidst Controversy

Additional Materials

Clarifications

  • A morals clause in a contract sets behavioral standards to prevent actions that could harm the reputation of the parties involved. It is commonly used in agreements with public figures like celebrities and athletes to protect the interests of the contracting parties. Breaching a morals clause can lead to contract termination. These clauses aim to uphold a positive public image and prevent behaviors that could damage the parties' reputations.
  • Kanye West, a prominent rapper and fashion designer, has been known for his controversial statements and behavior. He has made headlines for his outspoken support of former U.S. President Donald Trump, as well as his comments on sensitive topics like slavery. West has also been open about his struggles with mental health, including being diagnosed with bipolar disorder, which has influenced his public actions and statements. These factors have contributed to a complex public persona that has sparked both admiration and criticism.
  • Yeezy merchandise, a product line created by Kanye West in collaboration with Adidas, includes sneakers, apparel, and accessories. The Yeezy brand has gained immense popularity for its unique designs and limited releases, leading to high demand and resale value. The success of Yeezy merchandise has significantly contributed to Kanye West's and Adidas' financial success and brand recognition. The sustained sales of Yeezy products have played a crucial role in bolstering Adidas' financial outlook and solidifying the partnership with Kanye West.
  • Adidas implemented measures to manage Kanye's erratic behavior, including rotating roles within the Yeezy division to reduce stress and providing me ...

Counterarguments

  • Adidas' decision not to use the morals clause could be seen as prioritizing profits over ethical considerations.
  • Extending the partnership with Kanye might reflect a tolerance for controversial behavior if it is financially beneficial.
  • The introduction of the morals clause suggests Adidas anticipated potential issues, yet their inaction could imply it was not effectively enforced.
  • The lucrative agreement with Kanye could be criticized for potentially incentivizing controversial behavior by not having clear financial consequences.
  • The financial success of the Yeezy merchandise might overshadow the importance of addressing the ethical implications of the partnership.
  • Assigning roles intermittently within the Yeezy division could be seen as a temporary fix rather than a sustainable solution to managing erratic behavior.
  • Providing meditation app subscriptions may not be an adequate response to the potential imp ...

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What Adidas Knew About Kanye

The Financial Aftermath of High-Stakes Collaboration

The Cost of Controversy: Ending the Adidas-Kanye Partnership

Kanye's contentious public behavior, such as appearing with White Lives Matter apparel and making anti-Semitic statements, eventually led to Adidas ending the partnership, framed as a breach of contract in reaction to societal backlash.

This followed Kanye boasting on a podcast about being able to act anti-Semitically without repercussions from Adidas—an assertion that coincided with increasing condemnation from societal leaders and influencers.

The termination resulted in Adidas bracing for its first financial downturn in many years, while Kanye saw a reduction in his net worth.

The Dilemma of Unsold Inventory: Financial Entanglement and Strategies

Adidas faced a new predicament with over a billion dollars' worth of unsold Yeezy inventory. The new CEO's decision t ...

Here’s what you’ll find in our full summary

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The Financial Aftermath of High-Stakes Collaboration

Additional Materials

Clarifications

  • White Lives Matter is a slogan used by some groups as a response to the Black Lives Matter movement. It has been criticized for being associated with white supremacist ideologies and seen as a way to undermine the focus on racial justice and equality. The phrase has sparked controversy and debates due to its perceived insensitivity and divisive nature in the context of ongoing racial tensions.
  • Kanye West faced criticism for making anti-Semitic statements, which are remarks or actions that are discriminatory or prejudiced against Jewish people. These statements were seen as offensive and inappropriate, leading to backlash and contributing to the end of his partnership with Adidas. Anti-Semitism is a form of discrimination that has a long history and is considered a serious issue globally. Kanye's comments were widely condemned for perpetuating harmful stereotypes and promoting hate towards the Jewish community.
  • Financial intertwinement between Adidas and Kanye signifies a deep financial connection that exists between the two parties, even after the termination of their business partnership. This connection is highlighted by the significant amount of unsold Yeezy inventory that Adidas still holds post-separation, indicating ongoing financial implications for both Adidas and Kanye. The decision to sell this remaining inventory demonstrates ...

Counterarguments

  • Adidas's decision to end the partnership may not solely be a reaction to societal backlash but also a strategic business decision to protect the brand's long-term reputation and financial health.
  • The financial downturn at Adidas could be influenced by other market factors and not solely attributed to the end of the Kanye partnership.
  • The decrease in Kanye's net worth might not be directly tied to the Adidas partnership termination, as celebrity net worth can fluctuate due to a variety of factors, including other business ventures and personal spending.
  • The unsold Yeezy inventory could represent an opportunity for Adidas to engage in creative marketing or philanthropic efforts, potentially turning a challenging situation into a positive outcome for the brand.
  • The decision to sell t ...

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What Adidas Knew About Kanye

Reflections and Reckoning: Analyzing the Fallout

Behind the Headlines: Adidas's Dual Perspectives on Accountability

Journalists Michael Barbaro and Megan Twohey discussed the Adidas-Kanye partnership from two perspectives.

One suggesting Adidas prioritized financial interests over holding Kanye accountable, possibly shying away from confrontation to protect its monetary interests.

The other perspective hinted at Adidas's success in leveraging a high-profile celebrity's draw, capitalizing on Kanye's fame and continuing to benefit financially, even amidst controversy.

Moving Forward: The Path Ahead for Adidas Post-Investigation

Following Megan Twohey's investigative piece, Adidas, under the new leadership of Bjorn Goulden, faced the dilemma of whether to sell the remaining Yeezy inventory or not, an action that could represent a substantial financial hit to the company. Despite the terminated business arrangement, the decision over the Yeezy stock sale highlighted the ongoing financial interrelation between Adidas and Kanye West.

Broader Implications: Other News and Fi ...

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Reflections and Reckoning: Analyzing the Fallout

Additional Materials

Clarifications

  • The Adidas-Kanye partnership involved Adidas collaborating with Kanye West on the Yeezy brand. The fallout highlighted tensions between prioritizing financial gains and holding Kanye accountable for his actions. The investigation led to discussions about the company's decision-making regarding the remaining Yeezy inventory and its financial implications. The situation underscored the complexities of balancing business interests with ethical considerations in high-profile partnerships.
  • The decision to sell the remaining Yeezy inventory post-investigation was significant due to its financial impact on Adidas. It represented a strategic choice for the company under new leadership, Bjorn Goulden, as it could affect the ...

Counterarguments

  • Adidas may argue that their partnership decisions are based on a complex set of factors beyond just financial interests, including brand image, long-term strategy, and consumer expectations.
  • It could be contended that Adidas's relationship with Kanye was also about innovation and design collaboration, not just leveraging fame for financial gain.
  • The decision to potentially sell the remaining Yeezy inventory might be seen as a responsible business move to recoup investments and minimize waste, rather than a purely financial dilemma.
  • Some might argue that the financial interrelation between Adidas and Kanye West is a common occurrence in the fashion industry when dealing with celebrity partnerships and should not be overly criticized.
  • The inclusion of broader current events like Israel's actions in Gaza and Sena ...

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