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    Sports Brand: Ending High Speed Growth And Entering Primary Maturity Stage

    2011/7/22 10:09:00 49

    Brand Industry Lining

    The sporting goods industry ended its fast growing year in 2010. industry Entering the primary maturity stage, the industry growth is relatively slow, several leading. brand Constitute a relatively stable industry pattern, new brands are not easy to rise rapidly.


    On the road of high end, Lining takes the lead. In July 2008, Lining Cooperated with Lotto, an international fashion sports brand from Italy, won the 20 year franchise in China for 934 million yuan.


    In September 30, 2009, Anta spent about HK $600 million to complete the acquisition of Full Prospect85% equity and Fila Marketing full stake. With this acquisition, Anta has the trademark of Italy's high-end sports brand FILA in mainland China, Hongkong and Macao, and has acquired the brand's retail business in Hongkong and Macao.


    A good development desire does not always bring good results. In mid March this year, Lining announced 2010 earnings report, according to the earnings information, Lining's high-end brand Lotto has been in deficit for 3 consecutive years, the loss amount exceeds 200 million yuan, of which 2010 lost 112 million yuan. Lining's official "explanation" is that "Lotto (Le Tu) brand is still in the initial stage of development and promotion, and has undertaken higher product research and development and brand promotion expenses".


    The success of KAPPA brand in China is "accidental". Thousands of troops are easy to win and one will be hard to find. Chen Yihong and Qin Dazhong have taken up the banner of China's trend: the former was the main manager of Li Ning Co for 10 years; the well-known sports brand conditions of KAPPA, the financial crisis of KAPPA parent company, the financial support for China's permanent sale, the financial support of famous investment banks, the movement orientation of avoiding Nike, ADI, the rapid growth of the industry, and the outstanding design ability. At the same time, so many opportunities can be combined together.


    Zhao Yu, a strategic consultant of sports consulting company, believes that Lotto is in a state of "acclimatization". On the one hand, the product line has not received enough support in the Chinese market, and on the other hand, it lacks enough market promotion, which is rather somewhat vague. The author believes that Lotto's poor performance for several years may be related to the following aspects. The first is the transformation of the Chinese market environment. The sporting goods industry ended the high growth period in 2010. The growth rate of the mainstream brands such as Anta, XTEP, 31st, PEAK and so on in 2010 was only around 25%, and Lining only achieved 13% growth. The industry has entered a stage of primary maturity, and industry growth is relatively slow. Several leading brands constitute a relatively stable industry pattern, and new brands are not easy to rise rapidly.


    What does Lotto represent in China? A successful brand must have a clear personality orientation that meets the needs of the market. Is there any new blue ocean in the sporting goods market outside professional sports or fashion sports, or is there a specific market to break through? Mr. Zhang Zhiyong is responsible for Lining's overall strength and limited energy. For the new brand of Lotto, we need another leader who is bold, wise and market aware.


    In the slow growth of industry, Lotto has been unable to take the national layout strategy at the same time. The author thinks that the layout strategy has two main points, one is to select several regional key markets, the other is to avoid the dominant market of Nike and Adidas. International brands (Nike, Puma, etc.) have stabilized in the first tier market, and channels have been sinking to the two or three line market in recent years. Lotto should make use of Lining's good competitive advantage in the two or three line market to expand in the international brand blank or vulnerable regional market. Lotto should focus the limited promotion expenses on several key markets, make breakthroughs and gain benefits, and strive for greater development by fighting for war, instead of taking the "brand is still in the stage of pre development and promotion" as an excuse. In addition, Lotto should launch products that are popular with consumers according to the actual needs of the Chinese market, and not stick to the original style and product line. The brand or enterprise that succeeds in the Chinese market basically follows this principle.


    FILA has so far been "obscure" in the Chinese market. Up to the first half of 2010, there were nearly 50 stores in mainland China and only 10 in Hongkong and Macao. Anta said that in order to exert influence on the young elite group in China's high-end consumer market, it plans to carry out brand remolding and market activities to relocate FILA. It is understood that FILA's channel in the Chinese market has been positioned in "a second tier city". Anta has set up a strong product development team for FILA, and has introduced high-end OEM suppliers.


    I believe that FILA has worked with many world-famous sports players such as Ingmar, Mark, and so on. Perhaps Anta's first thing to do is to "wake up" the memory of FILA to Chinese consumers. It will give the brand's deep foundation, historical culture and legend to the perfect display and dissemination, so as to consolidate its position of "high-end" and "internationally famous brand" in the Chinese market.

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