How Does Decathlon Make A New Path In The Chinese Market?

At home

Strong rebound, while the international brand continues to flourish.

And in this fierce competition

There is always a brand that does not take the unusual road.

In 2003,

The French sporting goods retail group quietly entered China.

Without seeking celebrity endorsements and not engaging in sports sponsorship, Decathlon is also the most unadorned physical advertising product even though it carries out brand promotion.

Even so, from the commercial point of view, the development of self developing sports brand, which integrates R & D, production, logistics and retailing, has been worth developing in China in recent years.

Decathlon, known as IKEA, is a new way in the Chinese market.

13 years in China, from the acclimatization to the fast lane

It is understood that since the 90s of last century, Decathlon has come to China as a manufacturer. In 2003, Decathlon officially entered the Chinese market after opening the first standard concept, Shanghai flower shop in Shanghai, China.

Originally from France, Decathlon's original brand concept and business model originated from the slow pace experiential consumption in Europe.

In the Chinese market, Decathlon has taken a detour in the initial location criteria.

According to the information learned in the ecosystem business, the location of Decathlon standard concept shopping arcade has a unified standard: peripheral road network, convenient public pportation, convenient access to shopping malls, strong visibility in shopping malls, a sense of prominently in main passageways and sub roads and parking lots and outlets.

In addition, the Decathlon shopping center also needs to reserve a certain area of open space for the surrounding residents to use, and is equipped with a free parking lot.

Obviously, this site selection standard encountered many problems in China at that time: the expensive open space in the outskirts of the first tier cities was expensive, and the high land rent instantly increased the cost of the products, so that Decathlon, the main cost performance line, was in a dilemma.

In fact, the second best Decathlon can only lower its store requirements. The first Decathlon store in Shanghai has only 2000 square meters in its initial stage.

The problems encountered by Decathlon when entering China are more than that. The consumption habits of Chinese audiences also make them suffer a bit. Half of their location is located in the suburbs far away from the urban area, partly because European consumers are used to buying cars on weekends by family, but in contrast, consumers in China were more accustomed to complete a series of consumption needs such as eating, shopping and leisure in the nearby comprehensive shopping malls.

Decathlon's early hardships were directly reflected in the slow pace of expansion. In 2011, Decathlon was the eighth year in China, and there were only thirty-four shops in the country.

Huge differences in the market environment make the company's exploration journey brimming with thorns.

But after that, with the gradual acceptance of the concept of one-stop shopping malls, the development of Decathlon also welcomed a turning point.

In 2014, Decathlon made a strategic adjustment in China, and put forward the sMall concept store for the first time, controlling the area of the shopping mall at 1500 square meters, and it was also set up in the crowded area or combined with the commercial intensive area and the comprehensive shopping mall.

At the same time, Decathlon also made changes in the vertical expansion area of stores in China.

For example, when the Shanghai flower shop was pformed in 2010, it expanded the storefront to two floors, reaching 5000 square meters.

With the gradual change of Chinese users, Decathlon's sales and sales volume began to grow rapidly. By 2014, Decathlon broke 100 stores in China's offline stores.

So far, Decathlon has also embarked on the fast track of China's market development.

Touching the pulse of the Chinese market, Decathlon did these five things.

1, brand positioning with high cost performance ratio

According to the consumption market of sports goods in China, due to the development of sports industry and the increase of outdoor sports activities in recent years, China's sports equipment consumption population is increasing year by year. According to the "big data report on sports online consumption map" released by the first financial and business data center, China's sporting goods consumption has always been on the rise in the past 5 years, and its growth rate in 2015 alone exceeded 27%.

Compared with the United States, the retail sales of sports equipment in China are still less than 1/3 in the United States, while the consumption of sports goods per capita is 1/17, which reflects the great potential of China's sports equipment market.

From the perspective of market development, Chinese consumers are also pursuing more practical and cost-effective products when they consume sports goods.

This is consistent with the positioning of Decathlon's own sporting goods that provide high tech performance and price friendly sports for entry level sports enthusiasts.

Earlier, Decathlon officials said that the proportion of Decathlon's own brand products in the Chinese market accounted for 96%, while the remaining 4% were the three party brands, such as NIKE and Adidas, which were introduced to meet the higher demand of consumers.

And in September this year, Decathlon announced that it would realize the full ownership of China's products in the future.

At present, the 4% party proportion of Decathlon's third party brand will also gradually withdraw from Decathlon China market.

From this strategic change, we can see Decathlon's success in China through its free product characteristics.

2, online sales channels to get through

At the same time, we have to say that the online sales channel that Decathlon started in 2010 has helped them get a lot of returns.

According to the ecosphere, by 2015, Decathlon's online business has covered 370 cities. In 2012, the sales volume of Decathlon Tmall stores increased by 136% compared to that of 2012. In 2012 -2014, the sales volume increased by more than 100% in the three consecutive years, and the number of fans exceeded 2 million 680 thousand.

One industry tells the ecosystem that Decathlon Tmall flagship store has a repeat customer purchase rate of 40% in 3 months.

The online booking and offline pick-up mode will also drain the store. Many consumers will continue to purchase at the same time while taking delivery.

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3, expand to the two or three line city entity shop

Decathlon initially located in the suburbs of the first tier cities, but in 2013, Decathlon began to exert its strength in China's two or three tier cities.

As of 2013, Decathlon had a total of 24 concept stores in the super first tier city, "North Canton", accounting for 30%, and there were 27 conceptual stores in 10 first tier cities, accounting for 33%, and 30 30 in the remaining 22 two or three cities, accounting for 37%.

This year, Decathlon is heading west, and is in the northwest of Xinjiang and Urumqi.

4. gradually reduce production costs

The whole industry chain of Decathlon has controlled the two ends of the industrial chain, and has grabbed the product design, raw material procurement and shopping malls operation in its own hands, and the manufacturing links in the middle have been completed by OEM foundry manufacturers.

It is understood that Decathlon has procurement centers in 23 countries around the world, of which 52% of the annual output comes from North Asia, while China's industrial procurement base accounts for about 40% of Decathlon's annual output. High efficiency output also attracts Decathlon to directly link the whole industry in China and draw materials nearby, becoming one of its strategies to save costs and Sinicization.

5, cheap and efficient human resources

Decathlon can use the low-cost strategy to seize the market in China, and also stems from its company's talent development strategy.

It is understood that at present, Decathlon has more than 15000 full-time employees in China, and its annual recruitment plan in China is more than 3000.

Not only that, Decathlon has nearly the same number of full-time employees as part-time students.

Recruiting graduates with lower wages and benefits and training young managers of potential stocks is the way Decathlon effectively controls labor costs.

According to Decathlon's official documents, the number of graduates admitted to Decathlon in 2015 accounted for 45% of the total enrollment. According to information from the ecosphere, the average salary of employees in Decathlon Beijing area is around 5000 yuan, even if it is a full-time manager level, the salary is hardly more than 10000 yuan.

Decca often co operates with British universities to recruit senior management talents for Chinese students.

In terms of talent selection, they also prefer inexperienced and energetic "Xiao Bai".

The average salary standard of the first tier cities shows that the average salaries of Beijing and Shanghai are over 8500 yuan, and the difference between Decathlon's salary and its salary is not small.

According to insiders, Decathlon will have an overnight market every quarter, and the sales assistant's overtime is common. This is not consistent with Decathlon's 40 hour working week.