Prof G Markets: Adidas’ Crisis Management, Google and Meta Earnings, and Market Moving Fed Speeches

Crisis Response

Scott Galloway analyzes Adidas' response to the Kanye West controversy, highlighting the complexities of crisis management. He explains that Adidas had no choice but to sever ties with West due to the potential backlash and financial implications. Galloway notes that the decision was both a moral and capitalist one, as continuing the partnership would have led to significant financial losses and reputational damage 1.

Crisis management is always difficult. You have to acknowledge the problem. The top garagal has to take responsibility for the decision, and you need to overcorrect.

--- Scott Galloway

The termination of the Yeezy line, which constituted a significant portion of Adidas' sales, is expected to have a substantial impact on the company's earnings 2.

   

Market Dynamics

In comparing Adidas to its competitors, Scott Galloway highlights the disparity in market valuation between Adidas and Nike. He points out that Nike's market cap is significantly higher, trading at three times the valuation of Adidas, which presents a potential investment opportunity for Adidas 3. Galloway suggests that despite the recent controversies, Adidas' decision to cut ties with Kanye West could enhance its brand image among consumers.

At the end of the day, this is a retail brand. So if customers are buying the shoes, then investors will buy the stock.

--- Ed Elson

The controversy has not significantly altered consumer perceptions, as many view Adidas' actions positively, potentially boosting its market position 3.