Kayne West & Adidas – A Lesson In Brand Management

In recent years, we’ve seen an increase in collaborations between celebrities and known brands. Whether it’s Nike x Billie Eilish, Gucci x Harry Styles or COACH x Lil’ Nas X, celebrity endorsements and collaborations can be lucrative for both the brand and the celebrity in question.

In some instances, the controversy attached to that celebrity might add to the value of the endorsement – case in point, the apparent reissue of the Dior Sauvage adverts, featuring Jonny Depp and following his recent success before the US Courts and the (arguable) rehabilitation of his image. One person’s ‘controversy’ is another’s ‘edgy’ and either can get people (and more importantly, consumers) talking.

However, as we’ve seen following Kayne West’s recent outbursts, not all publicity is good publicity. Collaborations can, in certain circumstances, have serious negative repercussions on public perception of the brand.

Kanye West’s recent controversies

Kanye West’s behaviour has been subject to widespread reports but, to recap, in October 2022 he launched a line of t-shirts that featured the white supremacist phrase, “White Lives Matter.”

Not content with the offense caused, Kanye West subsequently proclaimed on Twitter that he was going to go “death con 3 on Jewish people.” West went onto say that he was not “anti-Semitic because black people are actually Jew”. He added that “you guys have toyed with me and tried to black ball anyone whoever opposes your agenda”.

The fallout for Kanye West was swift. Whilst he has previous for erratic behaviour, his latest outbursts were too much for many brands, with Balenciaga and GAP quickly bringing their relationship with Kanye West to an end (although it is reported that West states that he ended his relationship with GAP). So toxic was Kanye West’s behaviour that the talent agency that represented him, the CAA, also dropped him.

Adidas took longer to sever ties. Kanye West’s tweets were issued on 9^th October 2022 and Adidas did not call time of their collaboration with him until 25^th October 2022.  The statement issued by Adidas at that time gives us a glimpse into the value of the collaboration with Kanye West – Adidas acknowledged that:

According to Forbes, Kanye West is now worth $400 million, compared to his previous net worth of £2 billion.

How did Adidas end the partnership with Kanye West?

It has not been disclosed exactly how Adidas (or the other brands) terminated their arrangements with Kanye West. However, the relationship between Kanye West and Adidas will no doubt have been detailed in a lengthy, collaboration agreement.

Given the purpose, the agreement will contain stringent obligations pertaining to brand protection, including (we would expect) an obligation not to bring the brand into disrepute, and an express ability to terminate the arrangement and claim damages if that obligation were to be breached.

It’s difficult to think of a set of circumstances more likely to tarnish a brand than those outlined above. Those that followed the drama as it unfolded will recall that with Adidas seemingly sticking with Kanye West in the immediate aftermath, it too was subject to censure.

In the absence of an express contractual right to terminate for breach, it appears to us that, so serious was Kanye West’s behaviour in the context of the agreement, his behaviour would constitute a repudiation of the contract. This, therefore, entitles Adidas to terminate immediately, relieve it of all ongoing obligations under the contract (such as having to pay Kanye West) and claim damages.

A repudiatory breach is a breach that goes to the core of the agreement, with the breach depriving the innocent party of the benefit of the contract.

Conclusion

The relationship between Adidas and Kanye West has clearly been a successful one. However, this has now ended due to Kanye West’s actions. It is evident that this will have a serious impact on both parties.

Adidas has announced that they are the sole owner of the design rights to ‘Yeezy’ and will continue to sell Yeezy designs but will not be using the ‘Yeezy’ name. Controversially, Adidas has now announced it will be bringing out new designs in 2023. It is hard to predict whether this will be a continued success for Adidas. Whilst Adidas may well have severed ties with Kanye West, it remains to be seen whether the draw for the consumer the Yeezy design was, or the Yeezy name.