---
title: "Adidas's 3 Billion Yuan Lesson: Uncovering the Digital Marketing Fog of 'Over-Investment'"
description: "A recent viral article in advertising circles, 'Adidas: We Over-Invested in Digital Marketing,' reveals that due to excessive spending on performance-based ads, Adidas loses at least 3 billion RMB annually, with even greater costs from neglecting brand building. This piece serves as a milestone warning for brands increasingly prioritizing visible digital marketing over long-term brand equity."
author: "陆离"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2019-12-11"
categories: "Brand Marketing"
language: "en"
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original_source: "https://mp.weixin.qq.com/s/0bph6sVZb0JTaReYbOcq8A"
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citation: "陆离. “Adidas's 3 Billion Yuan Lesson: Uncovering the Digital Marketing Fog of 'Over-Investment'.” New Distribution, 2019-12-11. https://xinjignxiao.com/en/articles/adidas-s-3-billion-yuan-lesson-uncovering-the-digital-marketing-fog-of-o-d645601c/"
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# Adidas's 3 Billion Yuan Lesson: Uncovering the Digital Marketing Fog of 'Over-Investment'

> A recent viral article in advertising circles, 'Adidas: We Over-Invested in Digital Marketing,' reveals that due to excessive spending on performance-based ads, Adidas loses at least 3 billion RMB annually, with even greater costs from neglecting brand building. This piece serves as a milestone warning for brands increasingly prioritizing visible digital marketing over long-term brand equity.

**Introduction:**
A recent viral article in advertising circles is 'Adidas: We Over-Invested in Digital Marketing.' The core message is that due to over-investment in 'performance-visible' ads, Adidas pays at least 3 billion RMB annually as a 'lesson,' with the greater cost being the neglect and abandonment of brand building, causing immeasurable losses.
Domestically and internationally, this article is considered a 'milestone' report, seen as a crucial warning for brand owners who increasingly treat 'performance-visible' digital marketing as the core pursuit of their brands—namely, under the hypnosis of digital media weaving the myth of 'visible results,' more and more brands are becoming short-sighted, chasing short-term visible marketing 'results' and KPI growth, causing people to lose grasp of brand core value.
The author holds no bias against digital media marketing, but the value of this article lies in suggesting a logical combination of digital marketing and 'brand' marketing, which can lead to unexpected brand growth as a 'flywheel.'

**-01- Blinded by What You See**
There is a famous saying in advertising: **Half of your advertising budget is wasted; you just don't know which half.**
For nearly 20 years, this phrase has been a mantra repeated by digital media to outshine traditional media like TV, newspapers, and outdoor ads.
Rather than digital media being more effective, this 'curse' hits the minds of advertisers—**no one wants to waste their ad budget, and no one wants to appear foolish.**
Indeed, traditional media lag in effectiveness evaluation and data visualization, making digital media seem vibrant—who can resist seeing that every click, view, jump, or viral spread you purchase comes with data, numbers, and precise ROI calculations?
Clearly, this makes brand owners increasingly willing to spend money on media where ROI is quantifiable. The Adidas case above is a prime example: Adidas allocated over 70% of its 2 billion euro annual marketing budget to 'performance-visible' marketing, while traditional 'brand building' received less than 30%.
If Adidas's budget ratio is what many brand owners aspire to achieve as a 'better' marketing cost structure, then you should immediately read 'Adidas's Confession.'
Because it tells brand owners a fact: over-investing or relying entirely on 'performance-visible' channels—such as feed ads, SEO/SEM, e-commerce ads, social media, or even newer 'fragmented' marketing—is not only dangerous but also short-sighted. Even if these channels are monitorable and can be paid per CPA or even CPS (purchase), with immediate ROI.
For most mid-to-senior employees in key advertising positions, 'data visibility' clearly helps them better achieve their KPIs and report clearer, more fruitful ROI to superiors.
The most alarming aspect of the Adidas case is not the investment in digital media—this trend is irresistible—but its greatest value is reminding people that chasing the obvious short-term benefits of 'performance-visible' marketing can cause people to lose sight of brand essence and even substitute short-term marketing for long-term brand building. The result, like modern people who hope 'energy pills' can replace long-term exercise or believe 'data shows e-cigarettes are harmless,' is ultimately paying a long-term health cost.
Some things in this world may simply be impossible to quantify accurately, such as literature, music, and brand influence. Just as you cannot use data to prove one Nobel laureate's work is better than another's—**this world tells us that some things involving the soul cannot be quantified, but their impact on people is often more powerful and profound.**

**-02- What Do We Want?**
This article does not advocate brand mysticism; on the contrary, we should conduct more precise analysis.
Most people know this formula:
**GMV = Traffic x Average Order Value x Repurchase Rate x Conversion Rate**
Let's analyze the proportions:
First, traffic dividends are generally disappearing, making 'fragmented marketing' attached to traffic more expensive. Under the premise that this multiplier remains unchanged or shrinks, to increase GMV, you need to work on the other multipliers. Then you'll find:
> **Conversion rate—depends on brand awareness and recognition, i.e., brand influence determines conversion rate;**
>
> **Average order value—depends on the premium capability brought by brand momentum;**
>
> **Repurchase rate—depends on product experience, brand stickiness, and the frequency of hitting user minds (partially related to traffic);**
This formula actually tells us that **most variables for increasing GMV are related to brand power, with only traffic having a lower correlation with brand.**
However, due to the obvious temptation of digital media, most brand owners spare no expense to invest in increasingly expensive, fragmented, and even dust-like 'performance-visible' traffic ads, while neglecting brand building and brand ignition that can equally or even more significantly boost GMV.
This also answers why marketing budgets are increasing, companies like BAT, Toutiao, Douyin, and Kuaishou are making more money, but more brand owners feel these traffic ads occasionally have a Viagra effect—not only can't stop taking the medicine, but costs rise, and after a low-price-induced climax like live-streaming sales, prices become harder to maintain, and business becomes harder.
The answer is that money is not spent where it can truly build brand power and accumulate long-term value.
In analyzing the Adidas case, senior practitioners raised an important point: most digital media evaluate effectiveness based on the 'last click,' i.e., the click that leads to purchase—but deeper research shows that before this crucial click, a user needs at least 20+ brand contacts to produce the final key result, and many interactions are non-digital, traditional.
Here, special mention should be made of the popular influencer economy, social media marketing, and so-called 'fragmented marketing' in recent years. In fact, more and more brand owners feel that fragmented, digital investment has consumed a lot of budget, and fragmentation has even become dust-like. Moreover, seemingly precise distribution and daily grass-planting (seeding) fail to bring real ignition effects.
It's simple: advertising is a marketing method that must enter the user's mind to be effective, just as drugs must cross the 'blood-brain barrier' to work in the body.
However, most fragmented marketing seems omnipresent but is light, soft, disordered, and non-directional, so it lacks the brand momentum to penetrate user minds. It looks like a flurry of petals but is ineffective.
Some might cite live-streaming king Li Jiaqi as proof of influencer marketing's power, but this is actually a counterexample—according to 36Kr, during this year's Double 11 pre-sale, Estée Lauder eye cream in Li Jiaqi's live room sold one bottle every 15 seconds. Official flagship store data shows he alone accounted for 87% of that product's sales, not only because of his eloquence but also because he had the lowest price online.
The key question is: if Li Jiaqi were not promoting a big brand like Estée Lauder eye cream, could he achieve such brilliant results? This is a typical example of brand momentum driving conversion rates—could there be a more vivid one?
In World War II, each soldier fired an average of 20,000 bullets to kill one enemy, totaling hundreds of millions of bullets—but what ultimately changed the war's course were the two atomic bombs dropped on Hiroshima and Nagasaki, with yields of 13,000 tons and 20,000 tons of TNT.
Compared to the total tonnage of bullets and explosives used in WWII, 13,000 and 20,000 tons are extremely small numbers, but they ended the war. The reason is simple: they had unprecedented concentrated ignition capability.
However, the 'brighter than a thousand suns' highlight moment is not the essence of the atomic bomb's victory; the real essence is that years of theoretical construction and the 'Manhattan' nuclear engineering project were the fundamental guarantee of the explosion.
The more one pursues short-term results, the easier it is to abandon long-term construction—this is not uncommon today.

**-03- Digital Media Is Not Ineffective, But Should Be Used with Concentrated Brand Ignition**
If you agree with the above points, let's continue to deduce how to conduct brand building and brand ignition. Look at another formula:
**Brand Momentum = Brand Differentiation x Mind Sharpness x Reach Intensity**
Currently, we are in a non-optionally chosen dust-like communication era, where clear brand reach becomes increasingly difficult. Like basic scientific principles—sound travels fastest in solids, slowest in gases—traditional media is closest to solids, and dust-like is closest to gases.
In fact, whether you choose it or not, fragmentation and dust-like are inevitable and irresistible facts for today's media environment, implying great uncertainty and greater difficulty in reaching brand minds. What certainties can we grasp? The author believes there are two:
  * **1. Building differentiated brands and telling mind stories is never outdated;**
  * **2. Locking onto the time-space where users must pass for concentrated ignition is never outdated;**
We can see recently some brands that have successfully ignited their brands, including representatives of both new and traditional economies, but their common feature is applying both points simultaneously:
For example, Bosideng, a brand once considered aging, precisely because of its 'oldness,' extracted the brand highlight 'Focusing on down jackets for 43 years, selling well in 72 countries,' instantly adding thickness and credibility. Coupled with frequent trendy new products and participation in world-class fashion weeks, this traditional functional consumer product suddenly gained differentiation and fashion sense not found in peers of the same era; revenue jumped from over 6 billion in the previous year to 10.4 billion.
For example, Feihe, facing the international professional and safe image of 75% international brands, did not follow but leveraged Chinese users' common sense that 'one side's water and soil nurtures one side's people,' driving the mind nail of 'more suitable for Chinese baby constitution' firmly into users' brains. From 3.5 billion revenue four years ago to an expected 15 billion this year.
Another example is Meituan and Ele.me, both mature new economy brands, but they continue to conduct concentrated brand ignition. Is it because consumers are unfamiliar with their brands? No, it's because they understand the secret of diminishing marginal costs of brand ignition—every repetition accumulates, and every bit of accumulation means the next communication cost is a bit cheaper—
And Luckin Coffee, its advertising strategy is not simply brand reach but combines brand reach with popular social fission, making each concentrated investment accompanied by a new consumption climax...
Finally, let's see where these successful brand ignitions overlap—obviously, they all chose Focus Media, a concentrated ignition facility targeting mainstream audiences.
Focus Media is a medium often described as forced viewing in enclosed spaces, but for brand ignition, its strength lies first in being on the必经之路 of mainstream people—**one is going to work, the other is going home. It's conceivable that as long as the physical form of human work does not fundamentally change**—**Focus Media will always be effective and cannot be blocked.**
Another secret of Focus Media—if repeated impact within a unit of time reaches a certain threshold, it not only makes the audience absolutely unforgettable but can even become a social practice—recently, a website called Yiche adopted the approach of 'packaging one day' of Focus Media's national channels, implementing a communication method called 'super-overlay,' and the result was unsurprising—it became famous overnight.
Yiche conducted an on-site survey of car dealers at the Guangzhou Auto Show, showing that the influence generated by this one-day screen takeover on Focus Media's national elevator media exceeded the sum of all Yiche's advertising on four major TV stations, three major video platforms, and three major outdoor media.
The atomic bomb case above tells us that you must consider and handle everything clearly—brand differentiation, user mind characteristics, what words or forms you will use to enter user minds, how to seize the critical period of user mind changes brought by ignition and match it with other follow-up measures—before finally pressing the red 'detonate' button.
In the final part of the article, the author wants to explain—**fragmentation and concentration are never absolutely mutually exclusive, but a dynamic process of change and combination.** Brands without core brand ignition means like Focus Media often cannot enter broad user minds, while appropriate and timely fragmented marketing can complement brand ignition, further consolidate user mind recognition, and increase positive interaction and reach between users and brands—research shows that **before users make final purchase decisions, 'mutual contact' between consumers and brand information may need up to 20 times.** Such multiple contacts should obviously not be completed by Focus Media alone; a soft-hard combination of fragmented media and Focus Media is actually a better form.
This is an era where brand building is increasingly difficult, but also an era where traditional economies urgently need brand power for transformation and upgrading. The author finds that most analysis articles currently visible emphasize the differences between fragmented marketing and concentrated ignition facilities, but few insightful people explore the effects of combining the two. I hope this article can inspire brand owners, after all, there is no standard answer for this new combination model; only continuous innovation and exploration.

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## Citation metadata

- Publisher: New Distribution
- Author: 陆离
- Published: 2019-12-11
- Canonical: https://xinjignxiao.com/en/articles/adidas-s-3-billion-yuan-lesson-uncovering-the-digital-marketing-fog-of-o-d645601c/
- Original source: https://mp.weixin.qq.com/s/0bph6sVZb0JTaReYbOcq8A

## Copyright and AI use

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Contact: zhaobo258@gmail.com · +86 158 5481 7671