How Can Michelin Shoes Sell?

How does the multinational tire manufacturer promote its "French lifestyle" in China?

Tip: start with soles.

The French tire maker Michelin decided to let the "tires" on its behalf appear on Chinese made sports shoes.

"We will make the sport shoes stronger and more wearable."

Eli Chkaiban, managing director of Michelin Michelin (lifestyle company Elie), said the tone of the sentence, like a commentator who rated the performance of F1 racing car on TV very much. (Elie Chkaiban)

The pedal sports shoes become a fashion for people to display fashion outside the stadium, and they fight hard around the battle of the fashionable family. In China, there are more than 200 brands of sports shoes, and everyone wants to win the favor of consumers.

Now, Michelin broke in again.

For the first time in its 18 year history, Li Ning Co Ltd will coexist with other companies' trademarks and its red deformation letter "L". Michelin Co will provide Lining with unique rubber formula, specially designed patterns and a small blue bottom white word "Michelin Performance" logo.

At the beginning of March, Li Ning Co and Michelin jointly released the news of this cooperation.

Michelin lifestyle company is a wholly owned subsidiary of Michelin group.

This is the first time Michelin has worked with Chinese sporting goods manufacturers.

In China, the target consumers of basketball shoes are usually athletes, who are pursuing excellent product performance.

However, the manufacturers of sports shoes will not ignore the needs of a large number of basketball fans. The vast majority of outdoor basketball courts in China are cement floors, requiring sports shoes to have stronger wear resistance and better safety protection.

"The rubber formula of indoor and outdoor basketball shoes sole is completely different."

Guo Jianxin, chief operating officer of Li Ning Co, said.

At first, Michelin was just a factory that built bicycle tires.

One day in April 1896, Andrew Michelin pointed to the shape of the bicycle tires, and said to the founder of the company and his brother Edward Michelin, "look, if it has arms, it's more like a person!"

Since then, "Michelin tires" was born.

Over the next more than 100 years, Michelin has gradually developed into the world's leading auto tire manufacturer. The company has spared no effort in promoting the image of "tires", and has become a world-renowned brand from a regional brand in Europe.

In 2000, Michelin group put forward the "brand extension plan" and set up Michelin lifestyle company. The aim is to create an emotional connection with Michelin users through new consumer products other than traditional tire products, so as to enhance their brand image, value and attractiveness.

Michelin used tire technology for sports shoes for the first time, and in 2003 it worked with Babolat, France.

Baoli is a famous tennis racket and badminton rackets manufacturer in the world, but there were no tennis shoes products at that time. They hope to cooperate with Michelin to make tennis shoes.

"At the first technical meeting, the teams of the two companies are speaking in completely different languages - they come from two very different areas -- tennis and tires," Eli Chkaiban told the first financial weekly. "Now, they are just like a team and have been working closely for five years."

The cooperation between the two sides has promoted five series of tennis shoes products, and Michelin's technology has improved the performance of Babolat shoes.

Through laboratory tests and comparative tests with other brands, Michelin's unique rubber formula has increased the wear resistance of Babolat tennis shoes by 40%.

Now, Babolat has become a leading European tennis shoe brand, providing shoes for a large number of former male and female tennis stars.

In 2005, Babolat attracted more ordinary consumers through the star effect by sponsoring tennis shoes and tennis racket for Andy Roddick.

For Michelin, working closely with third party companies to share their expertise is a breakthrough in Michelin tradition.

Eli Chkaiban said Michelin's R & D center has never publicly disclosed its technical secrets to third party organizations, and Babolat's technical cooperation is "an innovation of Michelin culture".

Subsequently, Michelin has successively cooperated with UMBRO (Umbro) football shoes, Everlast boxing shoes and Cornilleau world table tennis racket and other global leading sports brands.

Michelin lifestyle company adopts the franchise mode and does not participate in the specific product production.

Michelin provides technical and brand licensing for Lining sports shoes. Li Ning Co is responsible for the production and sale of sports shoes developed by the two sides, and then pays technical and brand royalties to Michelin in accordance with the sales volume of these sports shoes.

Michelin's brand development mainly focuses on motor vehicle spare parts sports and leisure products.

Today, Michelin has gradually improved its franchise plan.

Michelin's technology and "Mr. tires" have been applied to automobile accessories, tennis shoes, soccer shoes, table tennis racket, roller skates, golf clubs and personal accessories and other sports and leisure products.

As of 2007, Michelin lifestyle company has developed 75 franchise partners in the world. The licensed products are sold through more than 30000 large retail chain outlets and tens of thousands of independent retailers. The business income of brand expansion is more than 200 million euros (about 300 million US dollars).

Although compared to the annual sales of Michelin group of 16 billion 800 million euros, the contribution of Michelin lifestyle company is a very small data.

But from its profit model, this should be considered a good performance return.

At the moment, Michelin's rubber formula and tire tread experts have been stationed in Lining's sports shoes factory and began developing the most suitable texture and rubber formula for a basketball shoe and cross-country running shoes.

The two sides have identified a one year development plan, which will complete the development schedule according to the schedule according to the product's time to market.

In China, Michelin's brand development plan is just beginning.

Cooperation with Li Ning Co is the first time Michelin has shown its "French lifestyle" to consumers through sports shoes and leisure products in China.

Li Ning Co has 5676 retail outlets in China, which will become a window for Michelin tires to attract users of non automotive related products.

The initial contract period between the two parties is until 2011.

"The sales volume of sports shoes is the final criterion."

Eli Chkaiban said.

The first contact between the two sides began in 2006, when a representative of Michelin lifestyle company came to China to take the initiative to discuss cooperation with Li Ning Co.

The two sides saw the benefits of cooperation, and soon reached a cooperation intention. But for prudence, the two parties signed the agreement for a long time.

Lining, Michelin's lifestyle company headquarters in Britain, and Michelin, a Chinese company in Beijing and Shanghai, "often hold telephone conferences to discuss details", said Miao Qing, a public relations department of Li Ning Co.

A white sports shoes priced at 289 yuan can be seen at Lining flagship store in Nanjing East Road, Shanghai.

This sneaker has not been pformed by Michelin. It is just a celebration version to announce the cooperation between the two sides.

Before the announcement of cooperation between the two sides in early March, the sneakers were put into Lining's more than 5000 retail outlets in China to preheat the market.

Li Ning Co said Michelin sports shoes need to be determined according to the progress of development.

Michelin has long been known for its professional tire manufacturing technology.

But for Michelin, although the soles of sneakers are also rubber products, the application of tire technology to sports shoes is not a small challenge. They both touch the ground, but there is a big gap between the pressure and friction. The quality of automobile tires can be seen through the data, and whether the sports shoes are popular depends largely on the user's feelings.

"Sometimes, you can copy the pattern of the tire directly to the sole, and sometimes you need to constantly revise it until the pattern is applied to the sole," said Eli Chkaiban.

However, because the requirements of different products are different, the tire pattern can be used very little.

After the manufacturer puts forward the design requirements and provides relevant data, Michelin experts will first use computer technology to simulate the most appropriate pattern, and then determine the rubber formula of the sole according to the pattern.

After completing the initial test in Michelin internal laboratory, the rubber formula and pattern design will be provided to the cooperative manufacturer, and a small quantity of products will be produced by it.

Both sides will test the tested sneakers and sometimes send them to independent third party professional laboratories for testing.

Finally, the tested sneakers are tried on by experienced athletes, and are constantly adjusted according to feedback until the required performance is achieved.

Michelin and Lining cooperate with the same process.

Miao Qing said that the sneakers will be sent to the sports physiology laboratory of Chinese University Hong Kong for machine testing and comfort test.

The Li Ning Co began working with the laboratory in 2004 to conduct sports biomechanics tests on its sports shoes and build a Chinese foot database.

At present, nearly 70% of Michelin's lifestyle comes from auto parts, and sports and leisure businesses account for only 15%.

Eli Chkaiban said that from 2008, sports and leisure business will become the focus of the company's business.

In the more than 100 years of Michelin's history, it suffered two world wars. It experienced difficult pformation and numerous fierce competition.

"Thinking innovation" is regarded as a good way to maintain combat effectiveness in traditional industries.