What Kind Of Strategy Has Anta Completed Its Pformation?

Has completed its own pformation, and last year became the first domestic sporting goods company with an annual turnover of tens of billions of dollars.

August 29th, Anta

02020.HK (Anta sports) announced its first semi annual report in Hongkong after entering the 10 billion club. As of June 30, 2016, the company's operating income reached RMB 6 billion 140 million yuan, an increase of 20.2% over the same period last year, which is Anta's third consecutive year's revenue growth over 20%.

And it has reached 11 billion 126 million yuan in 2015.

Since last year, Anta's performance has surpassed the best performance of the industry before the stock crisis.

In 2010,

The revenue reached the highest level of 9 billion 400 million yuan in history, and then went down all the way.

And from Jinjiang, Fujian, Anta, which has no natural brand, has come out of the crisis quickly. And the key to becoming a billion brand is to reach the broadest mass market of consumers.

"The position of Anta brand is to sell the sports shoes at a suitable price to those who need it," Zheng Jie, Anta brand president, told the economic observer.

But this is not simple, because not everyone can identify their own position, Anta saw clearly, and also clearly see the consumer, which is probably the biggest gain of Anta over 10 billion revenue.

Sell to those in need

According to the results of market research, Anta portrayed the image of its main consumer group as an office worker with a monthly income of about 5000 yuan, and college students, sports enthusiasts, live in two or three line cities.

Anta's stores also cater for this distribution.

Judging from the current distribution of Anta's 8510 stores, 15% of the first tier cities, 75% of the two or three cities, and 10% of the other markets.

After the annual revenue of over 10 billion, Anta's future strategy is still the first tier city to display its image, and the two or three line city to protect its status. And the new 100 to 200 stores planned for the end of the year will also be mainly located in the two or three line cities.

Despite the high level of consumption of high-end consumers and the high price of products in the first tier cities, many consumers choose more and compete fiercely. In this market, many international brands have the advantage of brand power.

After the 2008 Olympic Games, Lining wanted to directly fight against international brands, and upgraded the brand through the "90" strategy, but the final result proved the failure of the strategy.

"The sporting goods industry is a high margin industry. Even if the domestic sporting goods company executes a low price strategy, the main market is in the two or three tier cities, but it can still make a big profit.

If blindly upgrading the brand, it may cause the loss of the existing consumers.

That's the case with Lining.

But at present, the number of new consumers is decreasing every year, and if they stick to the original market, they will also fall into a bottleneck.

Roland Begg senior partner Ren Guoqiang said.

Anta is also unwilling to step in place.

"Brand upgrading is a very long process. It is not difficult for high-end brands to expand to low-end market, but it is more difficult for low-end brands to climb up," Zheng Jie told the economic observer.

Anta's strategy is to acquire the right to use foreign famous brands. Anta acquired the trademark rights and franchise rights of high-end sports brand FILA in China (including Hongkong and Macao) in 2009.

At present, the FILA business revenue growth has exceeded the main brand Anta, stores reached 687, Ding Shizhong revealed in the performance conference, FILA stores will reach 700 to 750 by the end of this year.

Despite the FILA's direct mode and rapid expansion, Anta sports increased average daily turnover days and employee cost accounts by 7 days and 0.4% respectively. However, the experience of FILA's high gross margin and the operation of high-end brands benefited Anta sports. The good sales volume of FILA in high-end department stores accelerated the layout of Anta Sports in high-end brands to a certain extent.

Under the "borrowing" mentality, in April 20, 2016, Anta set up a joint venture with Desanto, a subsidiary of Tokyo listed company, Descente Global Re-tail Limited of Japan and the subsidiary company of I-TOCHU Corporation of Tokyo listed company, including Anta sports holding 60%, and enjoying the exclusive rights in China (excluding Hongkong and Macao) and engaging in the design, sales and distribution business of all categories of products with "Descente" trademark.

This will help Anta enter the outdoor ski market.

"Any low-end brand will encounter an intermediate zone dilemma in the process of upgrading.

Neither the high-end market nor the low-end market brands are willing to touch the middle end market, but the middle zone is the area where the upgrading process of the low-end brands must go through.

The key way sports consulting company CEO Zhang Qing said, "multi brand strategy at present has a significant effect on Anta's revenue growth, but this strategy may bring about the problem of internal resource allocation."

In addition, Anta sports revenue growth has also benefited from its marketing strategy.

According to the research, during the Rio Olympics, Anta's marketing activities had raised the brand reputation by 17%.

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The beginning of the cooperation between Anta and the Olympic Games originated from the 1999 world champion Kong Linghui, who used to play table tennis. In combination with the marketing tactics of "celebrity endorsement +CCTV", it opened the way of marketing for domestic sports brands and sports events.

In 2000, Anta followed Kong Linghui to Sydney Olympic Games and gained a lot of exposure.

In the same year, Anta's sales exceeded 300 million yuan, 6 times in 1997, the first time the annual total market share of sports shoes market share.

The Rio Olympic Games, which has cooperated with the Chinese Olympic Committee for 7 years, has provided Anta Olympic champion with the first prize dress and a full set of living equipment.

According to statistics, only the Anta champion dragon clothing has made 70 appearances on the podium.

Anta has also implemented the corresponding marketing plan at the new media end in China, which has strengthened the interaction between the brand and the target audience.

In an interview with the economic observer, Wei Jianglei, general manager of sina sports, said, "Anta's past marketing pays much attention to trademarks, focus maps, links and other aspects. This year, more attention is paid to interaction.

This interaction includes interaction in our studio, interaction on micro-blog topics and interaction on live platforms.

This time Anta asked for a full social interaction and put forward a quality interactive request.

It is reported that Anta sports started planning every 10 months before the Olympic Games from the theme design, website design to content implementation of every step of the Olympic marketing plan.

According to data from Sina micro-blog, Anta has read nearly 200 million of the micro-blog topic to break the theme, and the number of discussions has exceeded 300 thousand.

Ding Shizhong pointed out: "Olympic marketing may not significantly enhance Anta's sales in the short term, but its significance lies in enhancing brand awareness and influence.

It has been seven years since the cooperation between Anta and the Chinese Olympic Committee in 2009. The sales volume of Anta from 40 to more than 100 billion, confirms that the investment in the past is very effective.

Although Anta's Olympic marketing is huge, this event did not substantially increase Anta's marketing budget.

Zheng Jie disclosed that Anta's annual marketing expenses account for about 13% of revenue, and this year will not exceed this range.

Post 10 billion Era

Although 13 consecutive quarterly orders grew, data from Anta's semi annual report showed that the order data released by Anta in the first quarter of 2017 increased only by the number of units per annum.

Prior to that, orders will increase by quarter with high unit numbers and low double digits.

"Internet sales lead to faster and faster turnover of flexible network orders, to a certain extent, reduce the order volume of orders."

Zheng Jie explained to the Economic Observer newspaper that Anta sports sales system has changed from a single entity store to an entity + Internet mode this year. The proportion of Internet sales in the first half of the year is high.

In addition, half year report shows that R & D costs in the first half of are 4.4% of the total revenue. Although this proportion has made Anta enter the first camp of domestic brands, there is still a gap between R & D expenditure from foreign brands, which account for 5% to 10% of revenue.

"Foreign sports brands have a succession of brand tonality, such as Andemar's pursuit of technology and Nike's popularity among young people.

However, there are few brand cultures in domestic brands. Homogenization is more serious in both products and brand tonality. Sports products need to reflect the corresponding sports spirit.

Ren Guoqiang, senior partner of Roland Begg, said that although domestic brands have gradually stepped out of the previous years of high backlog and inefficient operation of stores, they must remain vigilant and increase the level of product development.

"Foreign brands can invest 5% to 10% of their revenues every year, while domestic brands do not have so much.

Domestic brands also need to make efforts in advertising investment, store operation and media delivery.

The same problem is also mentioned by other industry insiders. Local sporting goods enterprises need a period of time to get rid of the state of earning hard money in the past, and domestic brands are generally exerting their strength in the research and development of their single category, and they are much more involved in the field of running shoes.

Foreign brands are more blooming, and R & D strength affects all kinds of products. This is also the difference between domestic and foreign investment in the distribution of research forces.

With the continuous improvement of the mainstream consumer group movement, the choice of sports items is becoming wider and wider.

Not only is it necessary to improve brand tonal and technical content, but with the increase of raw material and manpower cost, Anta's low price strategy will also suffer the impact of cost.

Although Anta has made some achievements in its operational capability, it still lacks in comparison with foreign brands, especially terminal management and vertical subdivision.

Zhang Qing believes that Anta needs to provide sports equipment for more popular sports.