New Tactics Of Chinese Local Clothing Brand

In 2010, for the local sports brand of big and small, it is doomed to be a eventful year.

At the end of 2010, the local sports brand leader Li Ning Co (02331.HK) was hit by a record drop of nearly 16% on the 20 day of December 2010 on the 20 day of December 2010 due to the decline in orders in the second quarter of 2011, and the market value evaporated about HK $3 billion 500 million a day. And after the crash, share prices did not stop the decline. The capital market truthfully records the market's worries about the brand operation prospects of local sports.

Market watchers generally believe that the year-on-year reduction in orders is only a fuse, and the market is responding fiercely because it is worried that local sports brands will encounter the "ceiling" through the path of thickening performance of new stores. The local sports brands represented by Li Ning Co will face difficulties if they do not change their immutable development routines for many years.

Back in time, the market came out in mid 2010. Nike International brands such as Adidas have been besieged by local sports brands. Their sales revenue in the Chinese market has declined. They want to adjust the channel structure and enter the two or three line market. In order to adapt to the consumption level of the two or three line market, low price shoes will be launched to grab the market firmly controlled by local sports brands. Just the news that Nike launched cheap shoes immediately caused a chain reaction in the capital market. In July 6, 2010, sports apparel stocks fell across the board: XTEP fell 5.98%, Li Ning Co fell 2.01%, Anta fell 0.74%, China's trend fell 2.92%, PEAK fell 2.92%, and 360 degrees fell 0.36%.

In addition to the sharp drop in orders, Li Ning Co also released the news that it will integrate distribution channels in 2011, and will shut down some undesirable single business shops, which will close the number of 500~600 shops.

After years of rapid development, along with the blowout of sporting goods market, the local sports brand represented by Jinjiang brand has achieved extraordinary development. However, in 2010, with the decline of Li Ning Co's ordering quantity and the integration of stores, it means that the whole industry has entered a period of transformation.

Extensive and intensive

In the impression of people, mainland The rise of sports brand is closely related to the resource input, the strong desire to build brand and the instinct of copycat imitation. CCTV five has become the Jinjiang channel, and Jinjiang enterprises are competing to hire celebrity endorsements, such as mushrooming shops, which constitute the development path of Anta, 31st, XTEP, Jordan, PEAK, Hongxing Erke, del Hui, Meck, and Hyde dragon.

However, such a development path has reached a critical point. "After the Beijing Olympic Games, the sports market in China formed a blowout trend. The competition upgrading and marketing upgrading brought about by the expansion of the market pushed the competition of sports goods industry to the extreme. However, from 2009 to 2010, the mode of horizontal growth by laying shop and opening shop has encountered a bottleneck and reached a critical point. Like Li Ning Co, the number of stores in the country has reached more than 7000, the volume is very large, management has a certain degree of difficulty, maintaining a relatively high profit margin is also difficult. There is still room for improving the brand premium capability to achieve vertical growth. The key road sports consulting firm CEO Zhang Qing said 。

Not only Li Ning Co, but also brands like Anta, XTEP, Jordan and 31st degree have felt the pressure of the market. In the brand building, we should invest more resources, seize high-quality sports resources, and create new stores on the channel to promote growth. This is the main driving force for local sports brands. However, due to the substantial increase in rent and the difficulty of making money in new shops, Li Ning Co CEO Zhang Zhiyong said: "the sports goods retail market is under heavy pressure. On the one hand, the growth mode of relying on a large number of new stores has been difficult to sustain. On the other hand, the cost of operating terminal retail stores is increasing, which makes Li Ning Co dealers more cautious about the growth prospects of the next year. In order to help dealers ease the pressure of rising costs, Li Ning Co even said it would increase the discount rate to dealers.

The industry believes that "the poor will change", the original path can not go down, only to find new ways. It is an inevitable choice to enhance the attractiveness of the brand and enhance the premium of the brand. Nike's entry into the two or three line market and the introduction of cheap shoes can make local sports brands nervous. It is because the local sports brand has gone through the stage of brand building, but compared with the international brand, there is still a big gap. When losing the advantage of price and channel, facing the competition, the local sports brand is inevitably "guilty".

Zhang Qing believes that there will be a new form of competition in the industry, that is to form a hypermarket from the channel, such as the Gome and Suning of the household appliance industry. For example, the Gome investment of Peng run group is to integrate many sports brands and manage the price through professional channels.

"I support division of labor, circulation and manufacturing should be different. In the future, this will become a direction, but there will still be differentiation. After all, there are more factors that affect the consumption of emotional clothing. Li Ning Co once had the possibility of developing a retail brand. In the 1997 financial crisis, in order to deal with dealers not taking goods, under the pressure of distribution pressure, Chen Yihong once led the establishment of 12 subsidiaries as retailers, and then it was possible to grow independently into big ditch companies, but after the financial crisis, they were incorporated. If we split up and develop to the present, we will not lose to BELLE at least.

However, the new trend of channel development is only to alleviate and divert the pressure. If the horizontal expansion is not realistic, then the attraction and premium capability of the brand will only be increased longitudinally.

Focus and brand promotion

How to improve the brand's premium capability?

In fact, the pressure on local sports brands is not only due to the international brands such as Nike and Adidas. Because the brand homogenization is serious, and most of them are located in sports and leisure, the local sports brand has to face an awkward fact: the main sport leisure vatso product has achieved a crazy growth by means of "everything object" viral marketing, low price and convenient channels, and the global apparel retail giant UNIQLO has also eroded the sports consumption market with low price and simple and refreshing fashion.

The "dog meat" that sells sports in the local sporting goods industry, which used to hang on sports, is not working now. Zhang Qing said. In the past, sporting goods enterprises were hanging out of sports shell, actually selling leisure. However, if we continue to develop, we need a more professional division. We need to tap the spirit of sports, truly emphasize the connotation of sports, and emphasize the sports brand itself.

On the last day of June 2010, Li Ning Co suddenly announced that it had to change its brand logo and slogan: "L" Pinyin logo became "human" symbol, "everything is possible" for a more internationalized "MakeTheChange" instead. Li Ning Co changed its bid, and its turnover in mainland China finally surpassed Adidas, becoming the second largest sports brand after Nike. In fact, this is a great effort by Li Ning Co to focus on the connotation of its brand.

More than just the first tier Li Ning Co, many local sports brands have begun to calm down the direction of brand development and think about their future path after the clamour of the licensing movement.

In 2010, Jordan launched his new brand proposition: "leaping and reborn, BeyondYourself." In 2002, Jordan's annual output value was only 120 million yuan, and sales in 2010 were expected to exceed 3 billion yuan. But in the face of market changes, Jordan has to change.

"There is a limit to everyone in us, including athletes. It may be your role model, your opponent, or even yourself. When we are faced with this limit, we dare to challenge and surpass it. Every transcendence must break through an unimaginable limit. Every freshman has to experience an unknown darkness. After nirvana, we will usher in new me! This so-called "leap, new life, BeyondYourself". Jordan general manager Ni Zhennian said. In any mature industry, we should either raise the brand value up to the first tier, or make a small long tail in the segmented market. Compared with competitors who are still superstitious sports resources, crazy advertising and open shop, Jordan spent second years quietly in the basketball field. Before he launched a new offensive, he first invited a professional market research company to understand the consumer psychology and consumption patterns of the new generation of consumer goods, followed by cooperation with brand creative agencies to carve out brand positioning and value proposition. {page_break}

"Jordan has readjusted his own development orientation. The next step will focus on the establishment of comprehensive professional sports brand attributes, establish the brand personality image style, lay the foundation for the future development of the brand, and at the same time, strengthen communication with young consumers to help brand younger." Ni Zhennian said.

Now is a watershed, left or right, it's time to make decisions. Zhang Qing believes that some sports goods brands lack foresight strategic vision, and are constrained by the original ideas. When analyzing the decline in orders and growth rates, the simple reason is that the number of shops is not enough and sports resources are not abundant.

"The sports attributes of future sportswear should be strengthened, and the brand positioning should be strengthened according to the product line, and the brand planning should be distinct." In Zhang Qing's view, some local sports brands, such as PEAK and XTEP, have problems in developing their ideas. With PEAK's volume and ability, they should spend more energy on reshaping the brand. "The process of Jinjiang's brand development is relatively crude. It is usually resource oriented and speculative. It can quickly build the brand through a large amount of input of resources. At this time, even the product name can become a brand. But after this stage, we must sort out the target consumer group, its brand proposition, the core of its brand spirit, define its brand clearly, and then strengthen it through a large number of market behaviors." Zhang Qing said.

Phoenix Nirvana

From the foundry to the brand building, it is a magnificent turn of the local sports brand represented by the Jinjiang department. This has made the local sports brand accumulate the capital of the international sports brand after years of accumulation, but the local sports brand has been forced into a situation that can not be turned around, and has to make another magnificent turn. However, how will the local sports brand with billions of scale turn around?

Ni Zhennian believes that after years of accumulation of international sports brand, both operational skills and marketing resources are better than domestic enterprises. Under the existing conditions, domestic enterprises should narrow down their differences with international brands and work hard to make more innovations, including product innovation, marketing concept innovation, marketing tools innovation, sales and service innovation, etc. "For Jordan, we need to take a more active view and take the initiative to deal with the market transformation. The reconstruction of the brand before the Asian Games in Guangzhou is a positive way. Jordan will continue to comply with the requirements of the development of the industry, and steadily push forward and develop, based on the two or three line market, and actively enter the first-line market.

In the eyes of Song Shisan, the industry watchdog, the competition has escalated. Enterprises must work hard on the system and many details. After extensive wild development, Jinjiang sports brand should embark on a fine development path. At present, many enterprises in Jinjiang seem to have a relatively good brand, but these brands have not been beaten, and their ability to resist risks is relatively poor. These enterprises are not built on the basis of brand development, but rely on large-scale investment in marketing, relying too much on terminals and promotion, but only with marketing momentum to achieve mass sales.

Song Shisan said: "at present, Jinjiang has not yet had a very strong brand. Most of them are in the two or three line. Anta, PEAK, Jordan and others have a tendency to take the lead, but the feeling is still weaker. If we can achieve leapfrog development through brand merger and go out of Jinjiang, or upgrade the image of the city and enterprise management innovation, we can say that we have really entered the brand age.

Zhang Qing said: "I think that enterprises should think like a person. Inamori Kazuo said he was confident in himself. To know that they are enough and not enough, compared with foreign brands, local sports brands do not have enough place, but because rooted in a big market like China, and China is developing from a sports power to a sports power, then it will produce an international brand in the national brand, so no matter what the past is, it is just a difficult development process, and we have to be confident in ourselves in the future.

Who will succeed in the next wave?