Dive Brief:
- As Reebok prepares for new ownership, the athletics retailer is laying off approximately 150 employees, the company confirmed to Retail Dive. The Boston Globe first reported the news.
- The majority of impacted employees work at Reebok’s headquarters in Boston, according to a company spokesperson. The layoffs, which include employees from various departments, are part of restructuring tied to its acquisition.
- Authentic Brands Group is set to acquire Reebok in the first quarter this year, at which time the layoffs will take effect.
Dive Insight:
Reebok is prepping for a new life under Authentic Brands Group, after Adidas agreed to sell the brand for $2.46 billion in August last year. At the time, Authentic Brands said it would maintain Reebok’s footprint “across retail, wholesale and e-commerce channels,” but organizational shifts already are taking place to achieve its new vision for the company.
“Last week, in preparation for a new operating model, we announced a restructure of our organization, which will impact a number of employees at our Boston, MA headquarters,” Reebok said in a statement about the layoffs. “We want to sincerely thank these employees for their years of service and dedication to Reebok. We will share more details about the future of the organization after the sale process is complete.”
Since Adidas officially put Reebok up for sale in February 2021, it has been working to define a new brand identity. In June, the company released the first look at its updated brand direction, which included a long-form film, under Vice President of Creative Direction Kerby Jean-Raymond. That led to additional films including a “Radicalm” video surrounding its women’s collection.
Identity is one of the elements Reebok has struggled with over the years, as it grew to a sports powerhouse in the ’80s, expanded into the music lifestyle business and then shrank to focus on the fitness market under Adidas. Under Authentic Brands, the company has a chance to redefine itself, and possibly compete again in some of the key sports in the industry. In December, Authentic Brands signed a deal with JD Group to expand Reebok’s distribution to 2,850 stores across North America and Europe, including Finish Line and JD, among others.
Although it struggled financially under Adidas, Reebok returned to positive sales growth in 2019, according to Adidas, and profitability improved. In recent months, Reebok has been performing decently well, according to Matt Powell, senior industry adviser for Sports with the NPD Group. Per a webinar Powell gave on Tuesday, Reebok saw active apparel sales volumes grow by 118% last year over 2019, and 81% in the women’s active apparel segment in particular. In the footwear category, Reebok has also seen improvement.
“Running shoes drove gains in the performance footwear category, as smaller brands surged, including On, Hoka, Puma, and Reebok,” Powell said in an NPD report on Q4 released Friday.
