China'S Independent Brand Is Nike'S Way Of Fighting With Adidas.

In July 6th, the sporting goods unit fell across the board, of which XTEP lost the largest decline, down 5.98%, Lining fell 2.01%, Anta fell 0.74%, China's trend fell 2.92%, PEAK fell 2.92%, and 360 degrees fell 0.36%.

Nike grabs China's ambition

For sports brand giants Nike and Adidas, developing countries like China are not just production.

In the field of sportswear, Nike and Adidas have been occupying the most high-end positions. Although the two will not fight to death, they are also carrying out a seesaw battle all the time.

At the end of the world cup, it was a sports feast. On the performance of major sports brands, an online public opinion survey company "NMIncite", a joint venture between Nelson and McKinsey's two companies, published a survey report on the 2 day, which showed that when Adidas's momentum was high, Nike would have fallen, and Adidas had already surpassed Nike on the Internet, and the two overlords were unable to seize the market on a large scale.

Under the condition that the high-end market has matured, it is necessary to exert great efforts in emerging markets to expand the field.

It is imperative for Nike to sink.

At present,

According to insiders, if Nike wants to achieve sustained and rapid growth in the Chinese market, it must adjust its strategy and speed up its entry into the domestic two or three line market and even the county level market.

At present, China's two or three tier cities, the market's most acceptable footwear pricing is between 170 yuan ~250 yuan, while Nike sells shoes in China in the price of 400 yuan ~1000 yuan, the difference of 150 yuan or more restricts Nike to enter the market, and Lining and PEAK are eroding the first line Market of Nike. If they want to do a good job of sinking, the price will be the biggest bargaining chip of Nike. For this reason, UBS made a pricing proposal of 300 yuan for Nike.

China's own brand is Nike's stumbling block

In the 4 quarter of 2010, the average order growth of XTEP international was the highest, reaching 23%, and China ranked second, 20%, Anta ranked third, 19%, Lining ranked fourth, and the growth rate also had two figures.

Among the Chinese sports brands, PEAK, Lining, 31st degree, Anta and so on have become listed companies, and more and more brands are rising. These leading sports brands have been deeply rooted in all the large and small cities in China.

PEAK CEO Xu Zhihua said that 1000 stores will be added in 2010, and at the same time accelerate the entry into the domestic primary market, competing with international high-end brands such as Nike and Adidas.

According to the sales data of Lining, the boss of China, the momentum of catching up with Nike has already been achieved in 2009.

Insiders have once said that China's domestic brand is a revolutionary strategic route that surrounds the city in the countryside.

Nowadays, wherever Nike and Adidas are, there will always be 3~4's Lining and Anta.

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Lining, PEAK and other domestic expansion and development, but their ambition is more than domestic, Lining has opened stores to Hongkong, and even foreign markets, PEAK CEO Xu Zhihua said that the company will set up products R & D centers and sales companies in Losangeles, becoming the second Chinese sporting goods companies after Nike.

The feasibility of 300 yuan pricing

Through detailed cost accounting, UBS calculated the price of Nike low price shoes, which is 300 yuan / double, which is 25% lower than the current price.

At present, Nike's cheapest sneakers are priced at 395 yuan, the cost of the distribution fee is about 134 yuan, the production cost is about 95 yuan, and the profit of Nike is 78 yuan.

According to the "300 yuan plan model" provided by the UBS team, the supplier will reduce the operating cost by 9% and the production cost by 26%. Nike and its dealers will also have to reduce the operating cost by 20% and 36% respectively.

For these purposes, Nike may shift more factories to inland China and reduce costs in product design and procurement.

Although Nike's "low price card" will reduce the profit of its suppliers and their suppliers by about 21%, the rapid growth of sales volume is expected to offset the decline in profits of all parties.

At the same time, for dealers, a large part of the sales management fee comes from the expensive store rents in the first tier cities. If the rental cost of the pferred cities is 1\3 of the first tier cities, as long as sales can reach 50% of the first tier cities, the goal of reducing sales management expenses is likely to be realized.

For Nike's low price line, many people think that it will affect the high-end image of Nike, but many people in the industry say that the price of each brand is high and low, and 300 yuan is only a product of people's quality.

Consumers who pursue high quality can still choose high priced Nike shoes, such as NOKIA mobile phones. The price ranges from 199 to 6000. Whether consumers pay the bill depends on whether the company can meet the needs of different market segments with multiple product combinations.

China's economic development in recent years is obvious to all, and the Chinese consumption power is also growing.

Today, it has surpassed the United States as the second largest luxury consumer in the world, and just like LV, Chanel and so on, it has sunk to China's two or three tier cities. How can Nike and other sports brands lose this big cake? In 2010, China's brand sports shoes market will reach 69 billion yuan, and by 2020, it may reach 297 billion yuan. How should we grasp the two or three line market in China? Although Nike has not yet made a real low price marketing behavior, the industry has predicted that the low price of Nike is not far away, which may be a huge and rapid storm.