What’s At Stake With Kanye’s Latest Breakup?

Adidas appears to be close to ending their relationship with Kanye West after a string of public controversies. After leaving The Gap and now likely leaving Adidas, Kanye West may soon have to launch his own ventures in sneakers and apparel.

What’s At Stake With Kanye’s Latest Breakup?

It goes without saying that Kanye West, now legally known as ‘Ye,’ is no stranger to controversy. As we wrap up several fashion weeks across New York, London, Milan, and Paris, a common thread throughout all the shows has been the future of Kanye West in the fashion world.

After publicly discussing his desire to leave his contracts with Adidas and The Gap over the last few months, Kanye officially ended his relationship with The Gap in mid-September, putting an end to a partnership that was supposed to last ten years. He has also expressed his desire to leave his relationship with Adidas when the contract is scheduled to expire in 2026. The Gap hoped that a Ye partnership would bring more cultural relevance to their brand. So would Adidas losing Ye also harm the brand’s cultural relevance?

This week, Adidas announced that they are placing the Yeezy brand and the entire partnership under review. Many people consider this ‘review’ to be the unofficial confirmation that the relationship between Kanye West and Adidas is over.

Here’s an official statement from Adidas: “adidas has always been about creativity, innovation and supporting athletes and artists to achieve their vision. The adidas Yeezy partnership is one of the most successful collaborations in our industry’s history. We are proud of our team that has worked tirelessly throughout our collaboration with Ye and the iconic products that were born from it. We also recognize that all successful partnerships are rooted in mutual respect and shared values. After repeated efforts to privately resolve the situation, we have taken the decision to place the partnership under review. We will continue to co-manage the current product during this period.”

The timing of this announcement comes right off the back of Kanye West’s latest controversy, this time from his Paris Fashion Week event this past week. During the Yeezy Season 9 Show in Paris, Kanye West wore a “White Lives Matter” t-shirt and posted on social media, “BLACK LIVES MATTER WAS A SCAM/NOW IT’S OVER/YOU’RE WELCOME.” Many people were deeply offended by this and social media lit up with people expressing their disgust at Ye. Vogue fashion editor Gabrielle Karefa-Johnson was one of the people criticizing Ye, who then responded by mocking her on Instagram.

The latest antics from Paris Fashion Week come after several public complaints from Ye over the last few months, such as Kanye accusing Adidas of stealing his designs for the Adilette 22 slides and not getting his approval for Yeezy Day. Ye also said that Adidas offered to buy him out for $1 Billion.

Putting aside all the drama, from a commercial perspective Yeezy is a highly consequential part of Adidas’ business. Yeezy generated $1.7 Billion worth of revenue for Adidas last year, which makes up 7% of Adidas’ total annual revenue of $25 Billion. In reaction to the recent news about the partnership review, Adidas stock price has gone down and is getting close to a six-year-low.

Kanye West has clearly contributed to Adidas’ bottom line. Without a Yeezy brand, is Adidas a weaker company? Most likely yes. Since the very first Yeezy Boost 350s came out in 2015, pretty much every successive Yeezy shoe release has been met with fanfare and high demand. While the hype has gone through ups and downs, overall Yeezy shoes are still some of the most sought-after products on the sneaker market, whether to be worn or resold.

In a world where there is no more Adidas Yeezy, what happens to all the currently existing Yeezy shoes? Think about it. If the Yeezy line is discontinued, then no more Adidas Yeezys will ever be created again. That makes all currently existing Yeezy shoes inherently more valuable due to scarcity. None of this is financial advice, but these are all legitimate considerations for anyone interested in collecting or investing in what might now become a rare and extinct sneaker line.

The future of both Adidas and Kanye West is unclear. Adidas might be able to spin off a Yeezy-inspired brand, but not having Kanye West as an official partner will make it difficult to generate any similar demand for a new product line. Much like The Gap, Adidas wanted Kanye West to reignite the brand’s cultural relevance and to help create a new artistic vision.

Kanye West will likely launch his own brand. He is one of the few people in the world who has been able to create a successful new sneaker brand. With the exception of the Jordan brand, Yeezy is the only legitimate competitor to Nike and Adidas when it comes to cultural influence.

If Kanye launches his own fashion brand, could it work? Despite your opinion on Kanye West’s historical controversies, which stretch across several decades at this point, it is clear that he is still able to sell products–whether people like him or not. Because of that, a standalone brand from Ye would at least generate significant interest from sneakerheads, collectors/investors, and his still massive global fanbase.

If and when Kanye launches a new sneaker and apparel brand, there will be plenty of buyers for his products and it will definitely shake up the sneaker and broader fashion world. This might also inspire other cultural figures to launch their own sneaker and fashion brands. Apart from Kanye West, the closest we have to another influencer launching their own brand is Roger Federer being co-owner of the On shoe brand.

Whatever happens next with Ye and sneakers will have a major impact on culture.