Can Adidas Continue Its "Yangchun" Performance?

According to the world clothing shoes and hats net, recently, the three major sports giants have announced the latest earnings report, which can be seen in comparison.

Restore growth while old rivals

Enter the bottleneck stage.

At least in the Greater China region, Nike's first quarter growth in the past two years is less than 10%.

Andmar, once thought to be a threat to ADI Nike, is no longer what it used to be.

Nike, a clothing commentator who worked in Adidas, told reporters that Adidas had caught it.

The vogue of sports and sports fashion has finally realized the counterattack.

"I think this is the main reason, and Adi was in the layout more than ten years ago, and Nike missed the trend because of its own entanglements."

On the other hand, Nike will also fashion sports products, and this mode itself has risks.

Can Adidas, which has an advantage now, continue the "Yangchun" performance?

1, "barbaric growth"

At the beginning of March, Adidas released the four quarter and full year financial report ending December 31, 2016, and a little lagging Adidas ran away all the way to Andemar, struggling to catch up with Nike.

In the fourth quarter of 2016, Adidas's net sales amounted to 4 billion 687 million euros (5 billion 4 million dollars at April 5th exchange rate, the same below), an increase of 12.5% compared with the same period last year. Gross profit was 2 billion 288 million euros (2 billion 443 million US dollars), an increase of 16.4% over the previous year, with a gross profit margin of 48.8%.

In the whole year of 2016, the net sales of Adidas group increased by 14%, to 19 billion 291 million euros (20 billion 597 million US dollars), and gross profit was 9 billion 379 million euros ($10 billion 14 million), an increase of 14.8% over the same period last year. The operating profit was 1 billion 491 million euro (1 billion 592 million dollars), 40.7% year-on-year; net profit increased 60.5% to 1 billion 17 million euro (1 billion 17 million dollar).

The 2016 data is nothing more than "crazy and barbaric growth".

In contrast, Nike, which still has market dominance, has entered the "bottleneck" period.

In March 22nd, Nike announced its third quarter financial report in 2017. In the quarter ended February 28th, the company's operating income was $8 billion 400 million, an increase of 5% compared to the same period last year, slightly lower than analysts' previous 8 billion 470 million dollars expectations. Net profit increased 20% to 1 billion 140 million US dollars, gross margin was 44.5%, down 1.4% over last year.

It is worth noting that Adidas and Nike are unable to directly compare their performance in the same period because of the different ways of calculating the fiscal year.

But Adidas's fourth quarter 2016 and Nike's third quarterly report show that Nike's revenue is still running away from ADI, but on the growth rate, ADI is 12.5% above 5% Nike, gross profit margin, ADI is 48.8%, more than 44.5% of Nike.

In the Greater China market, Nike also has no advantage.

According to the results, the real growth of Nike's Greater China region has been below 10% for the first 9 quarters, and 1 billion 75 million dollars in the third quarter.

In the whole year of 2016, sales in Adidas Greater China exceeded 3 billion euros ($3 billion 200 million), an increase of 28% over the previous year, accounting for 16% of global sales and the fastest growing market in Adidas.

According to the data in 2015, in 2015, Nike's share in the domestic market reached 17.4%, Adidas accounted for 16%, and the gap between the two sides was obviously smaller.

Andemar did not return to the past.

Its February statement shows that its sales will increase by 12% to nearly $5 billion 400 million this year.

This is less than the average analyst estimate of US $6 billion 50 million, and will become the lowest annual income since 2005.

Meanwhile, Andrew's income in the fourth quarter of last year increased by 11.7%, about 1 billion 310 million US dollars (net profit 104 million US dollars), not only less than expected $1 billion 410 million, but also the lowest level since 2009.

In fact, at least in 2014, Adidas also faced the attack of Nike and Andemar.

In the fourth quarter of 2014, Adidas suffered a loss of up to 140 million euros, which also dragged down Adidas's annual performance.

The net profit of Euro 490 million fell by 37.7% compared with the same period last year. Even if it did not consider the decline in goodwill, it failed to achieve the full target of 650 million euros.

In the first 5 years, Adidas's sales also fluctuated.

Its profits are also on the decline in general, 564 million euros in 2014, lower than 5.68 euros in 2010.

In the North American market, in 2014, Adidas even lost to Andrew for the first time in third place.

2, seize fashion vents.

From the continuous downhill to the overturn, Adidas only took a year, behind which was grabbed the draught.

As far as cold Yun is concerned, Adidas has grasped the popularity of sports fashion and entertainment, and has achieved rapid growth.

Adidas also clearly agrees with this statement. Its new CEO Kasper Rorsted said in an interview with Bloomberg that the reason why Addie turned over was "providing consumers with the right products at the right time".

Adidas's 2016 annual report shows that in 2016, the sales of lifestyle products Originals, Neo and Y3 increased by 45%, which is 3 times the sales of pure sports products.

At the performance briefing, Kasper Rorsted suggested that the market of lifestyle products is much larger than that of the sports market, so Adidas must take part in it.

Adidas CFO Robin Stalker revealed that sales of leisure products now account for 30% of the total.

Besides, in addition to designing fashion trends, Adidas group will also learn fast fashion brands such as Zara and H&M in production mode this year.

Moving the explosive production line from Asia to Germany and the United States.

As a result, the company can keep production every quarter, if there are signs of being out of stock, immediately make up the warehouse to avoid accumulating or shortage.

But other products will still be produced in Asian factories.

In view of the anticipation of the draught, Adidas increased its profit expectations from 2015 to 2020 and changed the previous high growth rate to an average annual increase of 10%-12%.

ADI also said that in 2020, sales of "fast production" will account for 50% of the total.

Behind the brilliant performance, Adidas began to fashion and fashion more than ten years ago.

{page_break}

Leng Yun pointed out that ADI has long put forward a multi brand strategy to create "Trifolium", "Y3" and other sub brands.

"In the past two years, fashion has made such a big push for its performance. It's still time to come. This is the result of Adidas's years of accumulation."

Leng Yun also revealed that Nike had thought about similar routes and launched related brands, but worried about the impact of excessive fashion on its sports brand professionalism, and finally chose to shelve the above plans.

3, will Nike enter the game?

Seize the opportunity, can Adidas maintain its advantages in the fashion vents?

Leng Yun gave an affirmative reply.

In her view, the Chinese market alone, for example, has great potential for sporting goods in China, which makes the sports industry itself a sunrise industry.

At the same time, fashion movement and sports fashion is still a major trend.

"If Adidas does not make major strategic mistakes, it will not be a problem to develop for another 20 years."

She said.

On the other hand, Nike will also become a strong competitor of Adidas in sports fashion.

In March 13th, Tfboys member Wang Junkai was invited to visit Nike's global headquarters. He met with the designer Tinkei Hatfield (Tinker Hatfield) who once built the Air Jordan series, and co designed the shoes. He ran long distance with the gold medal winner of the Rio Olympic 1500 metre race, Xiao Ma Xiu sentarou Weitz (Matt Centrowitz Jr.), to shoot commercials.

Although this is only an invitation to visit, there is no mention of endorsement, but the choice of Wang Junkai seems to imply that Nike is trying new changes.

Leng Yun said, to a certain extent, this means that Nike will become more fashionable.

Having said that, the degree to which Nike will go to fashion will also be uncertain.

In an interview in January, Phil Nate, founder of Nike Phil, made it clear that "Nike will not find celebrity endorsements, only to find athletes". (Knight)

On the contrary, Adidas has star spokesmen such as Wu Yifan, Eddie Peng, Angela Baby, Fan Bingbing and Eason Chan in China.

Leng Yun is very optimistic about Nike's fashion.

She said frankly that Nike's innovation power (including business models, research and development capabilities, marketing, etc.) is in the leading position in the industry, so long as its positioning is clear, there will be more obvious development.

"Both of them are old brands that have gone through many industrial cycles, and their strength can not be underestimated."

Nike also has the risk of entering the above market, that is, the ability to build multi brands.

Leng Yun believes that ADI has many years of experience in many brands, and can get a better balance between brand professionalism and fashion sense. Nike is not. "This is actually very difficult and risky."

It is noteworthy that sports brand fashion itself is also facing risks.

Insiders pointed out that in the past, Puma (Puma) was also immersed in the fashion trend, but it was against the global economic crisis.

"Consumers at that time preferred safer sports equipment, but recently they became obsessed with" sports and leisure ".

It can be seen that consumers' preferences for fashion really want to be changed and unable to control.

On the other hand, whether the brand can grasp the balance between professionalism and fashion sense.

"The balance of their two has a certain degree of contradiction, which depends on what the enterprises care more. In a competitive environment, a slight difference will lose consumers."

Cold Yun said.

More interesting reports, please pay attention to the world clothing shoes and hats net.