What Happened To Li Ning?

In terms of stock, as the most famous sportswear brand in China, Li Ning Company is still the local sportswear brand with the largest market share. However, in terms of increment, in the past three years, the performance of Li Ning company was inferior to that of some other companies in the industry; as soon as the competitors living in Jinjiang were becoming more and more clear in terms of development strategy (Anta took the professional comprehensive sportswear brand line, peak took the professional basketball route, and hongxingerke focused on professional tennis products), Li Ning began to play a combination of boxing, It is worth noting that in the past two years, under the multi brand strategic policy of Li Ning, Li Ning company has made frequent moves. On the one hand, it has carried out downward extension of the market, on the other hand, it has carried out multi brand operation through acquisition or joint venture. Up there are Nike and Adi, downward, Jinjiang department is expanding, what's Li Ning's next step?: what's the strategic consideration of Li Ning's acquisition of red double happiness? Guo Jianxin: the products of Hongshuangxi belong to the category of sports equipment. Table tennis, badminton and weightlifting are the three pillars. The outer circumference includes foot basket volleyball, etc. Hongshuangxi company is the leader in the field of table tennis. It has the first market share in China, the management level and the first-class product technology in China. It is also a partner of the International Table Tennis Federation (ITTF). It will provide most of the equipment for table tennis competition in 2008 Olympic Games. The goal of the acquisition is to make Li Ning a global leader in table tennis and indoor sports, and to achieve faster growth and greater sales revenue with China's economic development. It is estimated that the market of table tennis shoes and equipment will increase by about 3.5 billion in the future, including the market of table tennis equipment and equipment, which will exceed 1.5 billion in China. As for the acquisition, Morgan Stanley published a report that Li Ning invested 305 million yuan to acquire Hongshuangxi, a table tennis supplies supplier. The sales volume of Hongshuangxi in 2006 was 320 million yuan. The acquisition will help expand its product portfolio, bring cross selling opportunities for table tennis and footwear products, and expect Hongshuangxi to benefit from Li Ning's strong market network and platform. Merrill Lynch said that although the acquisition of red double happiness only contributed 5% of the profits, it will be conducive to Li Ning's strategic development if it can bring the famous mainland brands into the bag. In April this year, Li Ning launched Xindong brand through the supermarket channel. The latter aims at the middle and low-end market. What plans does Li Ning have for the downward extension of the market? What's the current situation of Xindong's operation? Guo Jianxin: Xindong's launch is mainly for the consideration of market segmentation. There are great regional differences in China, and consumers' demands for brands and products in different regions are completely different; therefore, we will provide a rich combination of product lines to meet diversified needs. Xindong is aimed at supermarket stores. Now it has entered 20 supermarkets, such as Carrefour, Jingkelong, Shanghai Lianhua and Yichu lotus, with retail prices of 100 to 300 yuan. After Xindong went public, it exceeded our expectation. We plan to have 200 outlets this year. It's about shoes and clothing, and accessories. This is a little different from the brand positioning of Li Ning. At present, what is the brand positioning of Li Ning? Guo Jianxin: at present, our direction is to be a high-end professional sports brand. Li Ning is a sports brand, a fashion brand, and a brand with oriental characteristics. These positioning can fully show Li Ning's sports professional characteristics; among them, the oriental characteristics are the biggest advantage that distinguishes us from our competitors. In the future, we will do more work on the connotation of these three brands. Li Ning's core consumer group is 14-23 years old;: what do you think of the current market competition pattern, including the catch-up of Jinjiang series and other latecomers? Guo Jianxin: we are very happy to see a number of domestic brands develop together in the mature market of China, but we have big differences in brand differentiation and market positioning, and the market will be more subdivided. For Li Ning brand, we will, as always, strengthen our core competitiveness. At present, our direction is committed to be a high-end professional sports brand. Li Ning is a sports, fashionable and Oriental brand. These positioning can fully show Li Ning's sports professional characteristics; among them, the oriental characteristics are the biggest advantage that we distinguish from our competitors. In the book, Li Ning's virtual production model is mentioned. It can make Li Ning understand the market demand flexibly, and to a certain extent, neglect the operation of assets. When did this kind of virtual production begin? How to implement it? Guo Jianxin: it can be said that since the day of its birth, Li Ning has adopted the mode of asset light operation. Like other famous international sports brands, Li Ning company currently adopts the form of production outsourcing, and does not consider its own production at present. We completely outsource our production to YY2, the largest shoe-making enterprise in the world. We focus on the areas we are most good at? Product design, brand marketing, product distribution, combined with efficient management capabilities, so that investors can see the future profit value? We do not rely on simple cost reduction, but on the improvement of brand value. If there is no self production capacity, how to coordinate with the OEM factory in case of a sudden blowout of clothing demand or personalized customization? Will the flexibility of production be weak? Guo Jianxin: we will coordinate the personalized production demand in advance, such as limited edition. Internationalization is one of Li Ning's development strategies. However, according to the 2006 financial report, Li Ning's international market turnover only accounted for 0.9% of the total turnover. Why was such a strategy formulated at that time? What were the implementation steps? What was Li Ning's strategic goal in the next stage? Guo Jianxin: sports have no national boundaries. If you want to be bigger and stronger in the sporting goods industry, you must show yourself on the international sports stage and get recognition. Therefore, Li Ning company has been actively participating in international sports events since its establishment. After its strength has been enhanced, it has carried out international sports marketing and exhibition of its brand. Of course, the exploration of internationalization is also divided into different steps. Li Ning company takes the road of brand internationalization first and then market internationalization. At present, we have formulated three strategic stages: the first stage ends in 2008, and the second stage is 2009-2013. Li Ning is expected to maintain the growth rate of 35% in China's two most important markets every year. At that time, Li Ning will become the third largest company in the world in 2018-5. But China is a highly international market. To some extent, China is the world, and the local market will always be our most important market.