Saturday, August 13, 2011

Damaging your band

Adidas are on the verge of damaging their brand in New Zealand with the current fight over the pricing of the All Blacks world cup 2011 jersey.  Adidas have priced it at $220NZD and have said in the media that New Zealanders are comfortable paying for the privilege as they can see the benefit of Adidas's investment in NZ rugby.

Well people power has proven Adidas wrong as Kiwis have been up in arms about the price and the saga has played out in the media.  There has been wide swept public backlash at the exorbitant cost of the jersey in New Zealand, when it is retailing on USA and UK websites for less that $90NZD.
The jersey was retailing in New Zealand for $220 but was listed for sale at US$79.99 (NZ$92.68) on US websites and could be found cheaper on British websites.The jersey was retailing in New Zealand for $220 but was listed for sale at US$79.99 (NZ$92.68) on US websites and could be found cheaper on British websites.
You might say well ok, Kiwis can just buy the jersey from these websites at the cheaper price.  Well Adidas doesn't think so having the companies stopped from selling and shipping to New Zealander's, which has caused even more outcry.

 Even Prime Minister John Key has suggested that Adidas are in the wrong and should reconsider their pricing.  The outcry then moved to the retailers who have less than 7% margin on the jerseys.  A meeting between the biggest retailer Rebel Sport and Adidas didnt result in a positive outcome.  Rebel Sport and other retailer have now discounted the price of the jersey by $50 cutting into their own profits.

The row has turned sour for some Adidas staff with branding being removed from their vehicles as they were becoming the targets of verbal abuse when caught in traffic or waiting at the lights.  Today also saw a peaceful demonstration outside Eden Park in Auckland where an effigy of the Adidas logo was burnt.  Adidas have also canceled a ritzy supporters party due to the 'crisis'

So why is the jersey this price?  Well it certainly isnt the costs of making it, with the manufacturing price per jersey believed to be around $8 as the jerseys are made in Thailand where staff are severely under paid and also young.  So none of the purchase price goes back into New Zealand it is merely a money grubbing multi-national corporation who has sunk their teeth into NZ and seem to be winning.

Adidas have now apologised that this issue has derailed attention in a world cup year, as well as restoring access for Kiwi's wanting to buy the jersey from one of the overseas websites, but the haven't lowered the price, and havent admitted they are in the wrong.

In my opinion they have shot themselves in the foot, and continue to do so, and are in the process of destroying their brand and brand reputation in the New Zealand market.

Read more from HERE or HERE or any number of New Zealand media websites - its on them all.

No comments:

Post a Comment