Sports Shoe Enterprise Lining'S Internationalization Process

since

In 1997, the Asian financial crisis broke out and the sporting goods industry was affected.

Li Ning Co has chosen to expand its overseas market to diversify its market risks.

Lining believes that multinational corporations are more capable of resisting regional economic crisis.

Besides, as early as January 1993, Nike opened its first store in Shanghai, and Adidas also accelerated the pace of entering the Chinese market.

Since foreign companies can come to China, Li Ning Co can also "go out".

In 1999, the Li Ning Co set up the international trade department, and began to test the international market, and set a sales target of breaking 1 billion yuan in 3 years.

In terms of product development, Li Ning Co hired top designers and editions of Italy, France and South Korea, and hired professional management personnel to enhance market research and design development.

By the end of 2001, the turnover of Li Ning Co was 730 million yuan and the net profit was 49 million 600 thousand yuan.

Li Ning Co's domestic and foreign sales volume has not exceeded 1 billion yuan.

In contrast with Lining's active move towards overseas markets, Anta and other domestic manufacturers that have made use of agents to manufacture sporting goods of pnational corporations have greatly accelerated the pace of opening stores in various places in China in the past 3 years and have grown rapidly.

Similar practices with Anta include Jinjiang's del Hui and PEAK brands.

In 2002, Nike replaced Lining as the first place in the market share of China's sports brand.

Prior to this, Lining brand's leading position in the Chinese market has been maintained for 9 years.

Li Ning Co's internal sighing is: internationalization is too early.

Re interpretation of "internationalization"

At the end of 2001, Zhang Zhiyong, general manager of Li Ning Co, said: "since 2002, we have become more aware than ever about how to make a brand and how to make a product. This is not done by one person, nor by technology alone. The company needs reliable organizations and teams.

Only in this way can we truly pform into a company that promotes sports culture.

The Li Ning Co has adopted a series of measures to enhance the management capabilities of the company to promote sales and increase profit margins, including reorganizing management, strengthening information technology and adjusting capital structure, and listing on the main board of Hongkong in 2004, raising funds for expansion and upgrading of its distribution and retail network, brand promotion, market activities, and the establishment of design and R & D centers in Hongkong.

In 2003, Li Ning Co's turnover finally crossed the "1 billion yuan threshold", reaching 1 billion 276 million yuan.

But Zhang Zhiyong saw the hidden problems behind it.

He believes that the threshold of crossing 1 billion yuan is not only the result of "sports marketing", but the growth of Li Ning Co's performance is the result of "excessive expansion".

1 billion 276 million yuan of income comes from the sale of various non sporting goods such as suits, neckties, purses and even cosmetics.

Zhang Zhiyong thought, "the hardest part of strategy is to throw things away, even if they are still very profitable.

Giving up is the right choice. The reality is often overestimating the life span of the original product.

Some products can bring sales, but they will not help Lining's brand.

Li Ning Co began to pay more attention to the domestic market.

"China is a highly internationalized market, to a certain extent, China is the world, and the local market is always our most important market."

Zhang Zhiyong said.

In 2005, the proportion of Li Ning Co's revenue from the international market was 1.3% (2.4% in the same period in 2004).

Li Ning Co has made adjustments to its internationalization strategy.

The specific way is to postpone international sales, concentrate on breaking through the domestic market, and do a good job in the domestic sporting goods market after rapid growth.

Brand promotion and promotion directly point to the international market.

First of all, we should create international brands and expand the international market.

This approach is different from other Chinese enterprises' low dumping methods. We hope to increase the added value of the brand first. "

Zhang Zhiyong said.

Li Ning Co CFO Chen Weicheng admits: "the internationalization of future enterprises is not necessarily the internationalization of product sales, but it must be the internationalization of product quality and brand."

In 2002, Li Ning Co established a cooperative relationship with DuPont, 3M and other international enterprises to improve their sports performance and professional standards.

In 2004, Li Ning Co strengthened the specialized research and development of products, especially the appearance design.

In 2004, in order to improve the professionalism and comfort of the products, Li Ning Co and the Department of human sports science of Chinese University Hong Kong collected and analyzed the characteristics of professional sports.

In August, Li Ning Co and the Exeter company in the United States worked together to develop the core technology of Lining sports shoes.

In October of the same year, he also worked with DRD design office in America to carry out the design of Lining sports shoes.

By the end of 2004, Lining sports technology development (Hongkong) Co., Ltd. and Hongkong design and research center were set up to focus on the design of Lining brand clothing products.

With the success of Beijing's bid for Olympic Games, "Chinese elements" are very hot in the international market. Many international brands have launched products containing Chinese elements.

Li Ning Co has long focused on the use of Chinese elements in products, and as a local company, it has a deeper understanding and grasp of the essence and essence of Chinese elements. In addition, the international efforts made by Li Ning Co in R & D and design have made Lining products perfectly integrated with the unique Chinese elements and modern sophisticated technology as well as the appearance of fashion trends.

With the rise of "Chinese style" at home and abroad, Lining's brand strength has extended the connotation of the brand vertically and established a unique brand image.

{page_break}

Olympic opportunity

After the successful bid for Beijing's Olympic bid, Lining and Zhang Zhiyong were busy preparing materials, contacting and conducting various negotiations, and applying to the Beijing Olympic Games as a licensed sponsor.

Lining believes that as a local sports brand, the application of Lining to become a signing sponsor of the Beijing Olympic Games is of great significance, and more importantly, this is a rare opportunity to enhance brand influence and sales.

So, chairman Lining personally led the company executives to fight for this.

In January 3, 2007, Zhang Zhiyong and his team returned to the office in frustration with seven boxes of documents.

Adidas has become a Beijing Olympic Charter sponsor with a bid of 1 billion 300 million yuan, and Lining's offer is 1 billion yuan.

Zhang Zhiyong said, "1 billion, this is definitely our ceiling quotation.

Our brand is less than 20 years. People are the brand of 120 years.

The most direct purpose of winning the Olympic sponsorship sponsors is to enhance the international influence and sales share of the brand.

Now, it's the same thing to use all the opportunities related to Olympic Games to publicize their effects. The key is strategy.

For Lining, it was "the most direct advertisement" that Lining's flying torch lit the Olympic torch at 8 hours and 8 minutes in August 8, 2008.

According to incomplete statistics, 4 billion of the world's audience watched the opening ceremony of the Olympic Games on TV.

In August 11th, the first trading day after the opening of the Beijing Olympic Games, Li Ning Co (2331.HK) rose from HK $18 to HK $18.66, closing at HK $18.24.

In October 2008, according to a survey conducted by CCTV market research company CTR, 37.4% of respondents thought that Lining was a sponsor of the Beijing Olympic Games, while the real Olympic sponsor Adidas had a cognitive rate of only 22.8%. Lining became the brand with the highest rate of misrecognition by Olympic sponsors.

Li Ning Co's interim results in 2008 showed a turnover of 3 billion 60 million yuan, an increase of 60.3% over the same period last year.

According to the prediction of Li Ning Co, the turnover from 2008 to 2010 was 6 billion 410 million yuan, 9 billion 70 million yuan and 11 billion 790 million yuan respectively, with a net profit of 660 million yuan, 820 million yuan and 1 billion 90 million yuan respectively, thanks to the economies of scale and the effect of the Beijing Olympic Games.

Zhang Zhiyong believes that 2009 will be the beginning of the new international strategy of Li Ning Co.

In the five years from 2009 to 2013, Li Ning Co will enhance the influence of brands and products from three aspects: consumer goals, product goals and supply chain goals.

Zhang Zhiyong said that from 2014 to 2018 would be the stage of "full internationalization" of Li Ning Co.

According to the plan, Li Ning Co will become one of the five largest sports Brand Company in the world in 2018, and 20% of its revenue will come from overseas.

By that time, the Lining brand had consolidated its original local advantages, and based on the essence of Lining's brand, together with all the efforts made now, pformed into a rival who could compete with Nike and Adidas.