On this blog, we previously discussed what brands can and should do when one of their endorsers engages in activities that might reflect badly on them (see “What to Do When Your Celebrity Spokesperson Says Something Ugly? It’s a Question that a Lot of Companies Are Having to Figure Out”). For adidas, which had a profitable collaboration with the media personality Ye (formerly known as Kanye West), the answer, ultimately, was to sever ties when his anti-Semitic and offensive rants became nearly constant.

But when it did so, adidas already had massive amounts of Yeezy gear in stores and in production. Determined not to allow the ugly mess to affect its employees, adidas announced it would complete its current production lines, so that it would not threaten the jobs of workers producing the sneakers and clothing.

But then what? What was the company to do with the estimated $1.3 billion worth of Yeezy gear sitting in its warehouses?

One option would be to donate the items, but in that case, the likelihood of a profitable resale market would mean that the Yeezy brand would still be getting press and praise. The sneakers in particular already fetched hundreds of dollars among collectors; releasing them into the sneakerhead universe would likely push their prices and revenues to absurd levels.

Another idea was to liquidate all the items, such as by burning or incinerating them. Although this choice would avoid further spread of the Yeezy brand, it also represents a substantial waste of material and resources.

Adidas arguably might rebrand the clothing and sneakers, putting another label on the gear that already exists. Such a choice likely is not possible though, because Ye still owns many of the intellectual property rights on the clothing. Simply taking his designs and putting a new label on them would open adidas up to lawsuits and allegations of intellectual property theft.

Yet another option, and the one ultimately adopted by adidas’s leadership, is to sell the products as they normally would be sold, then donate the profits to charitable organizations. After several months of consideration, adidas chose to donate the proceeds of all Yeezy sales to the Anti-Defamation League, which works to combat Jewish hate and antisemitism throughout the world, and the Philonise & Keeta Floyd Institute for Social Change, an organization started by the siblings of the late George Floyd to address criminal justice, police brutality, and systemic racism. Still, Ye reportedly will earn his 15 percent share of the sales, as initially contracted, meaning that he will profit off the sales, nearly as much as anti-hate groups do.

Discussion Questions

1. What is the most ethical choice for adidas, and other companies in similar situations, for dealing with products linked to endorsers or spokespeople whose behaviors are offensive or unacceptable?
2. As a consumer, would you be willing to purchase Yeezy gear at this point?
3. If you were a marketer for adidas, how would you recommend that the company promote the remaining products?

Sources: Melissa Eddy, “Adidas Is Wondering What to Do with $1.3 Billion in Yeezy Sneakers,” The New York Times, March 8, 2023; Preezy Brown, “Adidas to Donate Proceeds from Yeezy Inventory to George Floyd’s Family Foundation,” Vibe, May 22, 2023; The Philonise and Keeta Floyd Institute for Social Change, https://pakfisc.org/about-us/