Chinese Sporting Goods Brands Encounter Cold Winter After The Feast

February 2012 will be finished, sporting goods in China

The World University Games, held in Shenzhen last year, has become the exhibition of Chinese national sporting goods brand.

Chinese sporting goods companies not only grab the sponsorship of powerful and high profile delegations from the top international companies, but also extend to the Afro Latin American delegations, which are hard to attract the attention of sponsors in the past.

A senior manager of a sporting goods company in China told reporters confidently that the marketing of products would not be a problem if they were willing to spend money.

The executive reviewed the practice of improving the brand exposure of Chinese sporting goods companies in recent years, that is, to seize the advertising time of state-level TV sports channels. In the Beijing Olympic Games, the Chinese sports teams or athletes were sponsored by various names in connection with the Olympic Games, and large-scale sponsorship of foreign delegations at the Guangzhou Asian Games to show the brand's international market value.

At the Universiade in Shenzhen, the pursuit of exposure by domestic sports brands was so extreme that some brands didn't know the basic information of the delegation when they sponsored foreign delegations.

"In the past 10 years, China's sporting goods industry has never seen a period of rapid development, benefiting from the improvement of national income and the substantial increase of sports consumption demand, coupled with the stimulating effect of the Beijing Olympics on sporting goods consumption, the cheap and cheap domestic products have been favored by the working class and students."

A senior manager of a domestic sporting goods company told reporters that "the strategy of developing the Chinese market with international famous sports brands is usually different from that of the first tier cities gradually to the two or three tier cities. The domestic sporting goods enterprises basically go on the way of siege from the two or three tier cities to the first tier cities.

Because of the low cost advantage, with the help of brand exposure rate, domestic sporting goods can quickly open the sales of two or three tier cities at a lower terminal price.

But the international sports brand will face the opposite strategy in the first tier city strategy and the domestic sports brand's two or three line city strategy.

Just as half of the 1000 newly opened stores in the international sports brand in 2011 are distributed in small and medium-sized cities, sooner or later, international sports brands will shift their sales focus to the base that domestic sports brands have built up.

A domestic sporting goods brand executive said: "to be able to gain a foothold in the first tier cities is the higher pursuit of enterprises."

The confrontation between domestic and international sporting goods companies intensified after 2010, because the focus of each other's competition was the traditional sphere of influence of the other side.

In 2009, the inventory of a certain international sporting goods brand in the domestic market increased significantly, and finally had to discount products, resulting in a negative growth in sales revenue.

At the same time, with the discount sale of international brand products, the consumers of the two or three tier cities also have the desire to pursue international brands.

The competitiveness of the international brand to the low and middle end market is improved, and the price advantage of the domestic brand becomes weaker and weaker. This also makes the domestic sporting goods enterprises keep its market share in the two or three tier cities more difficult.

The negative impact of rising domestic raw material prices and rising manpower and marketing costs will bring greater challenges to domestic sporting goods companies.

The closure of an international sports brand in flagship store in Nanjing West Road, Shanghai, "is precisely because the growth rate of performance is far less than the growth rate of rent".

In the view of industry expert Ma Gang, although this incident happened on international sporting goods enterprises, it is not a case for the whole industry.

Compared with the prediction of domestic sales in 2012, the situation of domestic brands can only be described as torment.

Through the development of the two or three line city market, an international sports brand has proposed that this year's performance growth rate can still reach two digits.

But after nearly 10 years of rapid growth of the domestic sporting goods industry, since 2011, it has begun to face the difficult situation that the international sporting goods companies have encountered a substantial increase in inventory. Many domestic sporting goods enterprises listed in Hongkong have been continuously lowered by international investment banks, and some domestic sporting goods enterprises have stopped growing or even declining since 2011.

China's sporting goods industry, which has been running at high speed for nearly 10 years, has been braking. It still adopts the practice that has been adopted in the past few years to enhance the brand exposure rate of the enterprises, and it is hard to save the Chinese sporting goods enterprises in trouble.

The same products and similar marketing methods bring about the homogenization of sports goods in China.

Ma Gang said: "homogenization is a serious problem, not only the brand of sports shoes and clothing, including leisure brands, but also serious homogenization.

After more than 10 years of rapid development, China's garment industry will usher in an adjustment cycle and an innovation cycle.

Compared with the domestic sporting goods enterprises, the international sporting goods enterprises began to focus on the cultural value construction of the corporate brand earlier, and to enhance the loyalty of the consumers to the brand with sports culture as the link.

Some sporting goods companies in China have even raised slogans to seize the international market in the past few years, but their marketing methods are doubtful.

In Ma Gang's view, "if we look at the absolute value of market share, we can see that one or two domestic brands have become the dominant players in the domestic market, and there are also domestic brands entering some foreign markets. But their strategies to enter the foreign market are based on the reputation of foreign spokesmen abroad, while foreign consumers have little knowledge of the brand's culture, background and style.

A product should be integrated into the local market, and the introduction and running of brand culture can not be ignored.

The 2012 Olympic Games will be a new year of sports, but for Chinese sporting goods companies, it will be difficult to enjoy the Olympic feast as much as 4 years ago.

But winter is also a prelude to spring.

Ma Gang said, "it is a process to say" cold winter "or" shuffle period ". That is to say, the sporting goods industry is returning to the adjustment period from the high speed development stage. This does not mean that the era of sporting goods is over, but that the sporting goods industry is about to usher in a new start.