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The move in the last few days to transfer €3.5 billion worth of Puma shares from the Luxury Group Kering into the hands of the Puma shareholders, at a stroke reducing the Kering interest from about 86% down to 16%, has passed with little comment.
The battle of Herzogenaurach between the Dassler brothers who separated to form Adidas and Puma was one of the big corporate stories of the 20th century. Towards the end of the century both companies seemed to lose their way, but Puma faltered most.
A similar story ran out in the U.S., where Reebok from the east coast took on Nike from the west and seemed to be achieving success until unexpectedly rushing down a lifestyle route, hiring marketing executives from the perfume industry. As part of its recovery, Adidas attempted suicide by purchasing Reebok, without the skills to absorb and manage it, and has only recently come back to strength.
While all this happened, Kering bought into Puma a decade ago and moved it towards fashion and lifestyle. It gained some traction with this, given we have had a couple of decades in which sportswear has had a big influence on fashion. Yet, for the sports enthusiast, Puma lost legitimacy. It was stuck in the middle of the two approaches and did not feel authentic.
Those who have been following the sports market for a little while will reprimand me for using the word “authentic” alongside Puma since it is a Nike word. Whenever Nike got into trouble in the market it retreated to being authentically athletic and giving top priority to product development for their athletic and other sports footwear. The compromise with the poorly defined term “lifestyle” that got Reebok into trouble is exactly what has also slowed Puma.
So, after a period in which Puma appears to have been pulling itself away from the luxury and lifestyle entanglement towards well designed performance and style, which has been rewarded with a big increase in sales, Kering has decided to let it fly.
For many tanners, sports performance is a sector that took footwear leather into a commodity and then dropped it for plastic and textile; a danger we can see being replicated elsewhere. In June 2012, Puma went further and the Financial Times published a front-page article quoting Puma’s executive chairman: “Puma will have to stop using leather in its famous football boots and trainers because it is such an environmentally damaging product”, the sportswear company’s executive chairman has said.
This rightly created an outcry, which would have been even bigger today given the knowledge we now have of the dangers of all types of plastic at end of life. While it is clear that leather will not win back the high-volume soccer and trainer market, it is good to see the Puma King, which must be reaching near to its 50th anniversary, still available in leather with models such as the lovely 1982 style 'Puma King Top DI – regal red /white' in a good-looking leather.
Given that some of their other top boots such as the 'ONE 17.1 FG' are also sold in leather we can hope that the future for leather remains open as this famous brand regains its place in the sports world.
Dr Mike Redwood
January 24, 2017
Follow Dr Mike Redwood on twitter: @michaelredwood
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