Too connected. Too transparent. Too fast. That’s pretty much how our world is like today.
All the information and events spread knows no boundaries, and this makes the reputations of brands more vulnerable and valuable than ever.
One would think that brands with history, brands who claim to “have been there before,” like Adidas, have the advantage of having more experience with dealing with all kinds of crises vs. the new kids on the block like Facebook, for whom the recent fallout over the Cambridge Analytica and congressional hearings have been their “first dark time.”
Yet, some companies, like Adidas, have not managed to learn from history. As we speak, Adidas continues to lose the goodwill of the millions of its loyal customers in the former Soviet republics, namely Ukraine and the Baltic States.
Last week, Facebook pages of the Ukrainian and Baltic states’ thought leaders and communicators exploded with comments of outrage addressed at the sportswear company Adidas in response to its release of the “USSR emblazoned tank dress.” The apparel was said to be produced in anticipation of the 2018 World Cup, to be hosted by Russia this summer, however, the dresses and T-shirts featured not the Russian national insignia, but the hammer and sickle symbol of the repressive Soviet totalitarian regime.
A Google search for “Adidas + USSR apparel” instantly revealed numerous ads to buy the new USSR-branded Adidas clothing. Immediately thereafter, the search results included the Change.org petition, “Adidas: Remove Soviet Symbols From Adidas Apparel” and news stories, such as “Behind the Bootleg Adidas Sneakers Worn By Soviet Special Forces” and explanations of “why Adidas is so popular among Russians?”
Unfortunately, it appears that Adidas doesn’t understand that Russia isn’t representative of USSR, which was, in fact, comprised of 15 republics with individual histories, ethnicities, cultures and languages. Most of these former republics are currently angry at the Russian Federation. Why? Because Russia today (just like Russia Today TV) is trying to recreate the very USSR that — for the populations of these republics — was a true empire of evil.
By creating pieces of clothing carrying the name and symbols of the Soviet authoritarian regime, the company refrains from recognizing the unthinkable losses that the member-republics had undergone. The Baltic states lost their independence during WWII; Ukraine’s sovereignty was first crushed in the early 1920s and then confiscated after the war and similar are the stories of other countries.
Ukraine itself estimates the human losses during the repressive Communist-led Soviet regime at between 18 to 21 million Ukrainians, including the innocent victims of the Josef Stalin-ordered Holodomor of 1932-33. The total victims of the Soviet communist regime are estimated at up to 35 million Ukrainians, Crimean Tatars, Lithuanians, Latvians, Estonians, Georgians, Armenians, Moldovans, Kazakhs, and other nations suffered.
What dismays here even more is how German-native brand is neglecting not just the memory of the nations mentioned above, but the Germans as well – those, in particular, that suffered from the USSR and witnessed the death of hundreds of people trying to escape the Soviet-controlled German Democratic Republic through the Berlin Wall and the scope of tragedy of the divided Germany between the East and the West after World War II. How can the company be able to demonstrate such lack of empathy even to the history of the fellow citizens of its own country of origin?
When speaking of the company’s DNA, Adidas of the 21st century can be compared to the pre-1980’s Adidas. Back then, the opportunistic drive to sell their sneakers to the large Soviet market — behind the Iron Curtain of values and sanctions — made Adidas the official sponsor of the Olympic Games in Moscow – the very games, which were then boycotted by 66 countries. However, Adidas’ “business success” in the USSR did not last long: the company had to leave due to Soviet-ownership of its factory and the rules the Communist state had made, and the technology for producing the running shoes immediately after the infamous Olympic Games was de facto expropriated. Subsequently, these shoes (re-branded “Moskva,” – the uppercase Cyrillic spelling of “Moscow,”) were used by the USSR Special Forces in the Afghanistan war against the West and, later, in the Chechen war. History has taught some entities and people very little.
We can only guess what Adidas’ present motive was for this USSR tank-product. Perhaps it was to tap deeper into an ever-increasing Soviet-nostalgic Russian market? Or to attract retro-oriented (usually right or left radicals in their respective markets) fans globally?
So far, it has achieved a number of things:
Adidas has shocked roughly 50 million consumers in Ukraine and the Baltic states, and their respective diasporas around the globe. Not to forget, this happened just before the UEFA Champions League final match, which took place on May 26, and has Adidas as its sponsor as well.
It has also demonstrated an astounding lack of tact for a strategically-minded international business.
It has also become yet another symbol of a deep crisis of values that “multinational” businesses now often show when they enter economic markets where geopolitics, culture and diplomacy have vast implications and lasting impacts. Territories, where sanctions are real, and that are strict in their intentions to punish actions like the annexation of Crimea or the aggression against a sovereign neighbor.
Adidas, just like Facebook, has also proved that without sound international relations and reputation management counseling, global brands are like children with bombs in their hands. They have no clue about the broader implications of certain brand associations, as with historical symbolism. They have no clue about whom it may appeal to, but also whom it may thrust away for a long time, if not forever.
The response from the creative audiences in Ukraine and some neighbor countries has been swift. In addition to the petition on Change.org, numerous creative posters putting Nazi insignia in the place of the USSR one has spread online. Lithuania’s Ministry of Foreign Affairs expressed its resentment, stating their position in social media, that they are “being sick with ‘imperial nostalgia.’” Many draw parallels with the numerous USSR-created famines, gulags and Soviet concentration camps, which Adidas has inadvertently associated itself with when issuing its USSR-themed apparel.
From the classic crisis management and communications perspective, Adidas’ tactics should have been to take the following basic measures:
* Recall the product immediately
The brand did remove the notorious apparel from their official online stores few hours after the reputation fire started. However, the company continues to sell the products through their official website to customers in Great Britain and distributes this collection through resellers – including Farfetch – to a wider global audience of buyers.
* Apologize
A profound and genuine apology from the company (not their distributor) is a must.
Adidas CEO, however, as of May 15 failed to do so – still no statement heard. And silence is not a viable option in nowadays public relations, it’s indistinguishable from guilt. So, the longer the Adidas management is hiding – the worse the situation is getting.
* Conduct an internal audit of what went wrong to make such a wide scale mistake
The company have to figure out was it a provocation, a blunt lack of knowledge and poor judgment, or a (another) failure of corporate values – to fix whatever it was and take measures to prevent such incidents in the future
* Never release a product without proper assessment by an international reputation management team
Essentially, for multinationals to secure themselves from situations like this, they must embrace that ethics and knowledge is not simply being good. It also shows that it’s smart business.
Ukraine Crisis Media Center has now begun publishing visual reminders on Soviet legacy of persecution and totalitarianism to Adidas on a daily basis – until Adidas withdraws it USSR clothing line and CEO Kasper Rørsted publicly apologizes for this morally repugnant sales tactic. The tagline says: Across 70 years of Soviet rule, the populations of many nations were decimated, displaced, killed by artificial famine, tortured, persecuted, their lives, cultures, and livelihoods destroyed. Thanks, Adidas, for reminding us of that.
The main demand of the campaign and activists is that Adidas recalls these products immediately from its online, offline stores and distribution centers, and issues a profound apology.
