Nike'S "One Brother" Status Has Faced Unprecedented Challenges.

The first quarter earnings of Nike group released in the 2017 fiscal year confirm the pessimistic tone of the market. Even if the fixed exchange rate of 10% of the quarter's income rises, the order growth in the next half year is worse than the market expectation. What is more noteworthy is that the world's largest sporting goods manufacturer is losing ground in the context of Adidas's strong recovery and Andrew's efforts to catch up and the rise of its distinctive brand.

It is understood that Nike has issued a bold statement - to the 2020 fiscal year revenue exceeded 50 billion dollars, which means that in the next five years Nike will maintain 63.4% of revenue growth. The industry believes that although Nike still occupies the dominant position in the sporting goods market, the challenges from competitors Adidas and Andrew are intensifying.

Nike's latest report shows that as of August 31, 2016, Nike's sales reached 9 billion 60 million US dollars, up 8% from 8 billion 414 million US dollars in the same period last year. But the situation is not optimistic. According to Nike, the order volume increased by 5% in the next 6 months, down 4% from 9% in the same period last year, while the growth rate in the North American market was only 1%. This is the lowest order quantity in 5 quarters, and the future order quantity is an important factor to measure the development of an enterprise.

It is worth mentioning that in addition to China and Japan, business revenue increased by 410 million US dollars and US $140 million respectively over the same period last year, rising by 12% and 39% respectively. Nike In major markets, North America and Western Europe fell by 4% and 19% respectively, down 38 million and 93 million US dollars respectively compared with the same period last year. Among them, the most obvious decline in emerging markets, down 87 million U.S. dollars, down 34%. Nike's pre tax income decreased by 11% compared with the same period last year.

In addition, Nike's stock jumped 11% to $4 billion 900 million in the first quarter. The increase in inventory is one reason why Nike's online store can face up to 25% off of its competitors. Relative to the difficult market environment of Nike, Adidas market is developing well, and the overall performance is growing rapidly. In the two quarter of this year, Adidas's total business revenue reached 4 billion 400 million euros, the growth rate was 13%, if the exchange rate unchanged, the increase was as high as 21%. Among them, China's business revenue rose 30%, and its turnover in the United States soared to 788 million euros, up 22.6%.

Although sales in Latin America and Russia have declined, business revenue has increased by 7.9% and 7.2% respectively. In the first half of this year, Adidas Net profit surged 99% to 291 million euros, operating profit rose to 414 million euros, up 77% over the same period last year, far exceeding analysts' expectations. At the same time, sports brand Andrea also far exceeds the speed of development in the same industry. In the first quarter, its revenue reached 1 billion US dollars, up 27.7% from the same period last year, and its quarterly net income was 6 million 344 thousand US dollars. Among them, the income in the North American local market increased by 21.5% to 827 million 100 thousand US dollars, or 82.7%, far exceeding the market expectation.

In contrast to the growth rate of competitors' performance, Nike's position in the global sports brand market has been seriously affected. Brands in North America, Western Europe and emerging markets have declined to varying degrees, with a decrease of 4%, 19% and 34% respectively. In the face of a strong competitor and a weak market economy, Nike, who always sits on the top of the sports brand, seems to be somewhat powerless. The decline in the performance of its own brand is just the result of its competitors' performance, which has created an unprecedented level for Nike. Market pressure 。

In this regard, Kang Lanxin, general manager of the clothing and accessories college, said that Nike, as an international sports brand, is not precise enough to develop its brand image in the global and even the Chinese market. At the same time, the rapid development of domestic brands has also affected Nike's market to a certain extent. Vertically speaking, the production of products of different levels and styles and upgrading of products can meet the changing needs of sports enthusiasts.

Nike's competitor Adidas not only has a series of sports performance performance, but also the traditional series of sports originals and sports fashion series style are also popular; while Nike's brand classification remains in the traditional five series of sports, old brand positioning has long been not applicable to the present society, breaking through traditional and continuous innovation is the development way.