How Did It Become? Cage Sold 3 Million Pairs Of Panda Shoes For Two Years.

Recently, Chunxi Road, the most famous business district in Chengdu, can see a giant panda statue in the more than 1300 square meter Cage flagship store.

On the high wall behind the cash register, the giant panda's patterns are also placed in the words of SKECHERS and CHENGDU.

Sichuan is the home of the giant panda, and this design is also easy to remind people of Cage's D Lites series sneakers.

"We had a lot to do with Chengdu, because Cage had better sell it.

"Cage Chen Weili, CEO China, said at the opening ceremony of the day.

Skech, who has entered China for 10 years, has ushered in a good time.

In 2016, the sports brand from the US California achieved sales of 65 billion yuan in China.

In China's sporting goods market, this volume is now inferior to Nike, Adidas, Anta and Lining.

By the end of last year, Skech's sales outlets in China had reached 2250.

But this number can not compare with those of Nike and Adidas, which are foreign brands, but also less than those of Anta and Lining.

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Chen Weili's goal is to break through 3000 stores this year.

According to Cage, the Asian flagship store in Sri Lanka spent more than 6 months to decorate and invested about 15000000 yuan.

"Chengdu is the penetration point in Southwest China. We want to do something for the southwest retail industry. Cage has the ability to use such a large store to show our wide product line."

Next, Skech will open brand experience stores in Shanghai, Beijing, Guangzhou and Xiamen.

In addition to the Shanghai Xujiahui store's investment for dealers, the remaining 6 brand stores were invested by Cage China.

Chen Weili put Cage's sales goal in China for tenth years in the 10 billion yuan mark. He thought it was not a difficult problem. "According to the order data, we have exceeded 10 billion this year."

How did it become?

As Cage's signature product, "panda shoes" was born in 2000. Thick bottom and retro design were once popular with American consumers.

At present, the sales of "panda shoes" in China account for more than 20% of Cage's total revenue in China.

Behind this is Cage grabbed a crack market.

Like many foreign brands, Cage's trip to China is not smooth sailing.

At the early stage of Skech's headquarters, he tried to enter China by proxy mode, but failed.

In October 2007, Cage was founded in China.

But for all sports brands, the inventory crisis triggered by the 2008 Beijing Olympics is a fatal blow.

In 2009, Lining, an energetic Chinese, surpassed Adidas in the Chinese market and pursued Nike. In 2010, it was close to 10 billion yuan mark. But then Lining fell into a cliff style and lost three consecutive years until 2015.

Such an external environment is undoubtedly a blow to Skech.

"In 2008, we had high confidence in Olympic Games and a large number of stocks. By the 2012 and 2013, there was a stock crisis in sports brands," Chen Weili said bluntly. "The most difficult part for Cage to enter the Chinese market is the first 4 years."

However, it was a blessing in disguise that in early 2011, both Nike and Adidas decided to enter the low line market at the same time to widen the market, which left Skech with more space in the first and second tier cities.

But Skech himself has gone through many detours.

At first, Chen Weili's team used to discount the way to open up the market, and consumers did not buy it without establishing a reputation.

A shop assistant once told Chen Weili, "I kneel down and no one else buys our shoes. Our shoes are not suitable for consumers."

The bigger mistake lies in brand positioning and product selection.

Because of the Olympic Games, Cage has neglected his "panda shoes" based on the market. Instead, he launched the first generation of lightweight running shoes, mainly attacking the professional sports market.

Such a positioning means direct confrontation with Nike and Adidas, which is obviously not sensible.

Subsequently, Chen Weili began to lead the team to adjust, "many international brands feel that consumers should adapt to the brand. My starting point is to adapt the brand to the market and pfer to the consumers."

He hired consultants to investigate the market and repositioned the brand in comfort and leisure sports. "Our starting point is that athletes are not my customers. They can walk on our shoes and run."

Compared with Nike, Adidas and other more performance oriented sports brands, Cage mainly promotes walking shoes, business casual shoes and other products.

Comfortable and light has always been the biggest feature of Cage.

"Nike, ADI, UA are all sports, we are the genes of California, relaxed, relaxed and enjoying sports," said Zhang Ruiyan, vice president of Cage China market and store development department. "Sweat is not a sport, walking is also a sport."

"Panda shoes" then returned to the core product position.

Over the past two years, the cumulative sales of this shoe have reached 3 million pairs, and sales increased by more than 60% last year.

These two years are also favored by consumers in leisure sports.

Many Korean celebrities are photographed in the street of panda shoes, making Cage's brand popularity and sales rising all the way, including Park Shin Hye from "you from the stars" and "Pinocchio".

Zhang Ruiyan revealed that the South Korean team has increased the promotion of investment, such as the video of the star wearing Cage shoes.

On the price, Cage is about 30% lower than the average of Nike, and the price of the brand panda shoes is 599 yuan.

"Just in the middle of Nike, ADI, UA and Anta, Lining, XTEP, there's a position for me, I'm robbing their business," Chen Weili said.

But he does not think that these brands are his competitors because they are different from their customers.

Maintain Chinese characteristics

The whole world has benefited from this movement of leisure sports.

In the first three months of 2016, Skech's market share in the American sports shoes market was 5%, which was 4.6% of Adidas's 4.6%, becoming the second largest sports shoe company in the United States after Nike, according to market research firm data.

According to a report by Morgan and Stanley at that time, the recent success of Skech was partly due to the fact that consumers are more and more inclined to choose comfortable shoes for shoes compared with basketball shoes.

Whether people want to exercise or not, they just like to buy sports clothes and shoes. Cage's high growth is due to this "leisure sports" fashion.

"The fashion of sports shoes is changing, and this trend has made Cage cheaper."

Since last year, Cage has developed momentum in the direction of professional sports, such as replacing Asics as the name sponsor of the Losangeles marathon.

The company also became a sponsor of Houston marathon's shoes and clothing.

But Skech, who has been fighting for the failure of the professional runner market, has not forgotten the lessons of the past.

Chen Weili, a native of Quanzhou, grew up in the United States and studied Chinese for ten years.

According to his memory, the reason for his determination to enter the domestic retail industry is that his father once returned to Quanzhou to eat with seven wolves and Anta, and was told how good the domestic retail market was.

Chen Weili's father founded the Luen Thai Group in 1965.

The Hongkong based multinational business covers many sectors such as retail, fishery, tourism, investment, real estate and so on.

Among them, the Hong Kong Equity listed company is a well-known apparel supply chain service provider.

Chen Weili is in charge of the business of the two private groups of Luen Thai and Chen's holdings.

But Chen Weili did not choose to create his own brand like most Quanzhou townships. "Starting a new brand in China is not easy. I want to find a potential international brand to bring into China."

He chose Skech in the United States.

In California slang, Cage is a "sitting young man".

This style is very similar to Chen Weili. Casual shirt is his favorite everyday wear. Only on the most formal occasions, the multinational company will wear a Western-style tie.

Skech China is actually a joint venture established by Skech and Chen Weili's associated Thai enterprises, each with 50% shares and Chen Weili as CEO.

This is different from the way that international brands such as Nike and Adidas enter China. The former is set up by headquarters in China.

But Cage, who has a low profile and low volume of business, has chosen a more secure joint venture. This makes Cage China more independent decision-making power and flexibility.

This is crucial to the rapidly changing Chinese market.

Skech's latest report shows that last year, the wholesale business in the US market decreased by 1.6% compared with the same period last year, and the gross profit margin was reduced by 3.6%.

In the international market, wholesale business increased by 27.1% and gross margin increased to 44.3%, of which the contribution from the United Kingdom, Germany, Spain and China's joint venture contributed the most to $1 billion 90 million.

China accounted for 3 billion yuan in wholesale earnings, accounting for nearly 1/8 of global revenues.

Chen Weili also revealed that more than 90% of Skech's stores in China are profitable and the profit is in the "mid double digit".

Whether from gross, growth or gross margins, the Chinese market is crucial to Skech's growth in the world.

Although Chen Weili said that the headquarters did not exert too much pressure on Skech China, it is undeniable that Cage China will play a more important role in the future.

In China, the national fitness trend has been spotted. What Cage wants to capture is the entry-level sports participants.

Compared with headquarters, there are few professional events directly sponsored by Skech in the Chinese market.

One of the few benefits is the sponsorship of the Shanghai international 10 kilometer classic and the Wenzhou marathon's shoes and clothes, which was sponsored by AOKANG international, the famous AOKANG agent.

At the same time, Cage, China, CO sponsored the "walk for love" program with the one foundation, and even set up a hip-hop dance class in 5 cities.

This can also be seen from the advertisement of Li Xiaopeng, the latest spokesman, "changing a pair of shoes to go."

Prior to this, the Korean women's group SISTAR and the Korean men's group EXO have gradually become Cage's spokesperson in the Asia Pacific region.

Catching the shoes of the junior runners and the pandas that conform to the sports and leisure trend are still Cage's remaining trump card.

Go to the three or four line.

From the perspective of promotion, Skech's strategy in China is more inclined to the traditional way of selling.

To a certain extent, Cage's brand communication ability is deficient.

From Baidu search index, we can see that the spread of Cage is far lower than Nike, nor Anta, and its own explosion point is not enough, there is little traffic peak.

This is in stark contrast to Andemar, who later entered the Chinese market (UA).

Zhang Ruiyan admitted that Skech's reputation in China is not as old as those of Nike and Adidas. It needs to focus on the layout of the two or three emerging cities. "We aim at the precise marketing of young consumers, and put a lot of subway advertisements into 15 important cities, such as North and Guangzhou, and will sign more spokesmen in the future, such as small meat and popular actresses."

According to her, last year Cage's promotion cost exceeded 200 million yuan in China.

To a certain extent, this product oriented sales method decides that Cage will put more effort into the cooperation relationship with the agents.

At present, Skech has nearly 20 agents in China, including Baosheng international, BELLE international, AOKANG international, Hangzhou Chen he dress, Shanghai AI FA and so on.

Chen Weili's request for agents is like this: "there is money, there is a market network, understand retail, high integrity, loyalty to the brand."

Cage and China are responsible for building brands, training shop assistants and managing inventories, while agents are responsible for developing channels and building sales teams.

In the past two or three years, Skech hastily broke into three or four line cities and opened more than 100 stores. This seems to be the biggest mistake Chen Weili has made in the past 10 years. "The team is not ready yet, nor is it going to be the right city."

Now, Chen Weili felt that the time had come.

On the one hand, because of the development of urbanization, the income level of residents has greatly improved, and the government has encouraged young people to return home and start businesses, and more business investment has poured into these once obscure small cities.

On the other hand, the sinking of international brands to the three or four tier cities is the general trend.

After the first and second tier cities are almost saturated, urban residents with increasing consumption power have become the new customer groups that these big brands want.

The cooperation with AOKANG international in August 2015 can be seen as Cage's ambition in the three or four line city.

The former is a traditional leather shoe magnate with a history of nearly 30 years.

Wang Zhentao, chairman of AOKANG international, said before receiving an interview with lazy bear sports, "our approach is to differentiate from YY (Baosheng international YYsports Sheng Dao sports), take the store and shopping mall.

Our competitors are Anta, XTEP, 31st degree, PEAK, positioning and price down, this year began mass production.

By the end of last year, AOKANG international had 135 Skech stores, with revenues of nearly 100 million yuan, and plans to open to 1000 in 2020.

Zhang Ruiyan also said that when Skech sinks to the three or four tier cities, he will use price segments to distinguish some low-priced products.

"God loves me"

There is no doubt that Cage is in a period of rapid growth, and its revenue in the Chinese market increased by 86% over the same period last year.

Adidas, which has been well recognized by the market, has gained 28% growth in the Greater China region.

When asked about the reasons for Cage's success, Chen Weili replied half jokingly, "I don" t know why. God loves me..

In order to run fast in China, Skech is facing many challenges.

First of all, unlike other brands, the rapid expansion of enclosure has been largely completed. Skech is still in the stage of expanding stores.

Although sales in the same store increased by 25% last year, it is not easy to take account of the profitability of single stores while pursuing speed.

Skech continued to expand in the first and second tier cities, but also extended to three or four or even five line cities.

Chen Weili is also aware of the consequences of precipitate expansion.

"China is big. We will not go anywhere. If the market is mature, we will go.

Wanda, if you go, I'll go with you.

Wanda's management in the three or four tier cities is also mature day by day, "he said." if I open 150 in three or four cities, I will be very happy. "

Increasing the proportion of Direct stores is a way to increase profits.

At present, Cage has more than 150 direct outlets in China. Its annual revenue is about 600 million yuan, which is higher than that of the franchised stores.

The huge number of brand stores that are invested in is also a positive sign, displaying wider product lines and brand images with larger stores.

Increasing the proportion of electricity providers is also an inevitable move.

Skech's total sales of double eleven Tmall platform last year amounted to 288 million yuan, up 7 over the same period, of which the ranking of women's shoes is still ranked first.

Zhang Ruiyan said that this is the first to benefit from the products of Cage, including the specific electricity suppliers, on the other hand, there are only more than 2000 outlets under the line, which also stimulate consumers' online purchases.

At present, Skech has sports, women's shoes, men's shoes and 4 flagship stores in Tmall.

Secondly, Skech needs to respond more when the center of gravity of the channel shifts from the street store to the shopping center.

With the convenience of pportation and other infrastructures, the shopping center with radiation capability will eat part of town business street business.

In other words, consumers are willing to go farther to get a better shopping experience.

Some channel vendors revealed that part of Cage's Street store business was not as good as expected, and the cost was too high to be profitable.

At present, several main agents of Cage, such as Baosheng international and AOKANG international, have reached cooperation with Wanda to make more layout for shopping mall channels.

Chen Weili did not shy away from following the strategy of Nike and Adidas in the channel. "I like Skech very much where they are. Only if we run together, can I win."

But from the product point of view, Cage's revenue has a lot of room for improvement, such as men and children.

"There were no big stores before, only women's shoes were available, and female customers accounted for 65%. Now the store is big, men's shoes can be put in," Chen Weili said.

Last year, double eleven, Cage's men's shoes ranked third in Tmall men's shoes shop, which gave him great confidence.

"Men's shoes are not working. I believe my male business will get better. It's time to work hard," he said.

In the newly opened Chengdu store, children occupy a large area as one of the four product lines.

"Changing shoes to play" is the slogan of product line.

The design of tents and blackboards increased the consumer experience.

Anta and the 360 degree children's business have brought many growth points to the brand. Skech also has high hopes for this.

Skech, who wants to do a big job in China, has another potential crisis, one after another.

Skech annual report shows that there are 4 suspected cases of infringement at the trial stage, which are prosecuted by Nike, Adidas and CONVERSE respectively.

Adidas proposed that Cage's Skechers Onix and other four series of shoes copied their trademarks, and Nike sued Cage's Men 's Burst series and violated their design patents.

This part of the product has not been introduced into the Chinese market, but Skech also said that if the intellectual property rights could not be guaranteed or prosecuted for infringement, the brand would not be able to maintain competitiveness.

Conversely, in the Chinese market.

It has been beset by Shanzhai Cage.

Most of these cottage products appear in low tier cities to confuse urban residents who lack brand identities.

This is a huge hurting for Skech, who is expanding to the three or four line city.

At least in Chen Weili's hometown Quanzhou, Shanzhai Cage has fewer brands.

Chen Weili, who has been shopping in shopping mall, has noticed the chill of China's retail industry. "20 years ago, as long as it was foreign products, everyone wanted it.

But today, retail sales in China are very challenging, and communication with consumers is becoming more and more simple. Young people become impatient.

"Customer is God" has become a slogan in China.

Chen Weili said he wanted to do that, "once you buy our shoes, I will win your heart."

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