The Speed Of Dropping Is Unexpected. Can Andrea Return To Jedi?

Andrew will quit the MLB shirt sponsorship contract, which has been through all kinds of hardships, instead of Nike.

When warrior star Stephen Currie became the biggest celebrity endorsement star, Andrew Andemar focused on basketball shoes. Although the sales volume of the single product has skyrocketed, but with the decline of its attention and the new trend of leisure fashion in the field of sports shoes, the sales of products that Andemar once proud of has been steadily declining, and the backlog of inventory and the speed of the falling trend of andmar, which lack the current elements, are far from enough.

NBA the Western Conference finals have ended. The Knights and warriors have been in the finals for fourth consecutive years. For hundreds of millions of basketball fans in China, the eastern and Western finals and finals are an enduring classic. I don't know when it started. Basketball has become one of the favorite sports of the young generation in China.

However, in the birthplace of basketball, NBA (National Basketball Association, USA Basketball League) ranks third among the four major professional sports leagues in the United States, and the other three are NFL (National Football League, National Football League), MLB (Major League, major league baseball) and the National Basketball Association (hockey League).

A survey in the United States shows that 25% of Americans are NFL fans, 14% of them are MLB fans, and only 9% of Americans are NBA fans. Ratings, or profits, rank NFL, MLB, NBA and NHL.

It can be seen that from the perspective of capital accumulation, NBA is not the most eye-catching among the four sports alliances. Compared with NBA, it is clear that NFL and MLB are better at attracting gold. Therefore, the hidden commercial value behind NFL and MLB is more worthy of investors' attention and thinking. Behind the four major alliances, the replacement of sports brands also indicates the rise and fall of the business world.

MLB (Major League Baseball, major league baseball)

And the dust falling from the clouds is undoubtedly Andemar. According to Sports Business Daily (sports business daily) reporter Terry Lefton news, Andrew will withdraw from the hardships of the MLB shirt sponsorship contract, instead of Nike. This means that Andrew has gone down the "top two" altar in North America. The main battlefield of the sports brand is still Adidas and Nike's two male hegemony, not the tripartite confrontation, nor the group of men.

People can't help asking: what's wrong with andmar?

The relationship between Andrea and MLB

At the end of 2016, Andrew company formally announced the signing of the sponsorship contract with MLB for 10 years, which is the beginning of the romance between the two sides. The contract shows that after the 2020 season, Andrew will join the US sporting goods provider Fanatics to provide MLB's brand uniforms. At the time of the signing of the agreement, Andrea was at the height of the day. In 2014, Andrew's revenue in North America surpassed Adidas for the first time to squeeze the giant out of the top two.

According to the 2016 agreement, except for the hat, which is still provided by the existing sponsor New Era, all MLB's clothing will be taken by Andrea. MLB's team service provider was signed by Nike (signed in 2009) and Majestic (2005), and its cooperation agreement will be formally terminated in 2019. According to media reports at the time, it was not easy for Nike to get the cooperation list.

There are 30 teams under MLB. There are 162 matches in a year. With the cooperation, the sports brand will get an unparalleled brand exposure, which will bring invaluable commercial value to the brand. This is also the reason why Andrea hard worked hard to cooperate with MLB.

Bob Level, President of Leffler Agency, an advertising and marketing company in Baltimore, believes that the repeated emergence of brand logo will have an impact on people, so that people will gradually accept the brand and become interested in the purchase of the brand.

According to the agreement, Andemar's brand logo will be spanferred from the sleeves of the shirt to the front of the chest. The change of position also means that the exposure will be greatly improved. In addition, MLB stars Bryce Harper, Clayton Kershaw and Buster Posey are also Andemar's spokesmen.

When all of US signed a big celebration for Andrea, in September 2017, MLB decided by coordination that Andemar's shirt contract was advanced to 2019. Early implementation should be good for Andrea. However, in April of this year, MLB declared that the plan had changed, and the starting time of cooperation between the two sides would be postponed to 2020. A change of seventy percent off has worried that the contract will abort.

Time proves that suspicion is not groundless. Beijing time on May 25th, the US media "Sports Business Daily" reported that Andrew decided to give up the major league baseball MLB's jersey sponsorship contract. Now it seems that this is just a trick of "advance, delay, and finally stop". At first, MLB and Andrea did not just adjust the time, but intended to end the cooperation.

The termination of cooperation is closely related to the decline of Andemar's performance. Ending cooperation, Andrew will save up to 50 million dollars in huge spending to ease the financial difficulties of declining performance. The capital market voted for Andrew's move. In the United States local time in May 24th, Andrew shares rose 2.5% to 20.58 U.S. dollars per share, reaching the highest level since July 2017, after a slight drop, but remained stable.

Some analysts say that Under Armour's abandonment of the deal is a signal to shareholders that they are happy.

If there is no accident, in the long run, the sponsorship of the four major professional sports leagues in the United States will still be firmly controlled by Adidas and Nike. Adidas has the sponsorship rights of NHL, while Nike controls the three major Jersey contracts of NBA, NFL and MLB. The so-called giant is still big, ginger or old spicy.

The joint and breakup of Andemar and MLB reflected the superficiality of the brand's childish and cultural details, but after the breakup, the financial situation improved, the share price rose, and Andemar was also faced with the opportunity of rebirth. But what is the revelation of how many people have managed to achieve a sharp and steep decline in their performance and the future development and possible "comeback"?

"Uncle and cock wire Tour"

Andrea is very young compared to Nike and Adidas. Founded in 1996, the company has experienced development in recent years as a roller coaster. Andemar, who is up and down, is like a long journey through "a big uncle and a cock silk". He constantly adjusts his self perception, and also buys a bill for young and reckless.

Andemar first started Rugby equipment, and his design style was simple. He specialized in high-end and professional sports equipment. He once led the trend of producing sports equipment that was tight and sweat absorbent polyester yarn was used as material.

In 2005, when Andemar listed on the NYSE, its performance continued to grow. Sales increased from the initial 87 million US dollars to nearly about 4000000000 US dollars in the past two years. The quarterly revenue of the 26 consecutive quarters increased by more than 20%, creating the myth of the sports equipment market. During this period, the price of Andrew's stock rose unstoppable, and its market value increased by more than 10 times from 2010 to 2015.

However, rapid expansion also foreshadowed the rapid decline in the future. In 2017, Andrew's total revenue was $4 billion 977 million, an increase of only 3.13% over the previous year, a loss of $48 million 260 thousand, net profit fell by 75.6% compared to the same period last year, and the share price also fell to 10 US dollars from the peak of the peak period of about 27 US dollars.

The market thinks there are three reasons for such a falling free fall.

First, the main market is shrinking in the North American market, and the North American market, which accounts for 76.5% of the world's revenue, is down 5.07% in 2017. In 2016, the North American market accounted for about 83% of its global market. Tracing the source, the decline of North American wholesale business, which is dependent on Andrew Ma, is the culprit. We can see that the North American market is slightly volatile, Andemar will shiver, "the North American market and the North American market". Andemar's business layout is not diversified enough globally.

Second, gross margin decline is also a key factor. In 2016 and 2015, the sales cost of Andrew was 53.6% and 51.9% respectively. In 2017, the proportion increased to 55%. The fundamental reason is that Andrew encountered trouble in the supply chain of raw materials acquisition and capacity and improper inventory management.

Third, the preferences of consumers have changed drastically, and Andemar has not kept up with them in time. "Due to changes in consumer demand for sports products of different types and brands, we may not be able to accept our new products. Our future success depends partly on our grasp of these changes." Andemar recognizes that consumer preferences involve evolving shopping experiences. If Andemar's agents fail to provide attractive offline consumption experience, or Andemar can't provide a good e-commerce shopping experience, consumers are doomed to leave you.

Reflection

In my view, corporate culture is also an important reason. The main reason why Adidas and Nike have been able to flourishing as a giant are mainly due to the numerous adjustments of consumers' tastes and the great differences between countries and regions over the past decades. However, the giants did not fall into the passive way, but promptly adapted to the changes of the times and worked hard to "lead the trend". For example, the "retro leisure wind" that has been popular in recent two years has been captured by the two giants in a timely fashion and timely launched related products.

Recently, NBA officially announced the 2017 NBA star. Gym shoes Sales volume list, basketball shoes industry overall decline more than 13% last year, mountaineering, fitness and other professional equipment attention is also declining. Andemar failed to keep up with the trend and adapt to the tastes of young consumers. And since the warrior star Stephen Currie became the biggest celebrity endorsement star, Andemar focused on basketball shoes, too dependent on a celebrity endorsement and a single product, resulting in thin sales. When the leisure wind hit, Andrew de Ma, who lacked the fashion elements, was at a loss.

Against the giant, Adidas's retro shoes and Yeezy series are popular in the world and won the 2016 "Sports Business of the Year" (best sports player of the year) of YAHOO economic and financial awards. Stan Smith, the best seller of a single product, has been able to fire almost every 10 years since the 60s of last century. The total sales volume has exceeded 40 million pairs, and has been standing on the global stage of fashion, affecting the fashion trend from street hip-hop, leisure fashion to high-end fashion. Stan Smith spanformed from the original professional tennis shoes into the popular casual shoes nowadays. It has enduring a long time, reflecting the close relationship between leisure style rather than professional equipment and sports brand giants.

From anmar, we can see how important the diversification of equipment is. Whether Nike or Adidas, they are involved in different categories of professional products, the choice of leisure style is also very rich. Andrew's strategy of focusing on subdivision can not guarantee that it can be split into the huge consumer market of sports brand giants.

At the same time, the Andemar case also tells us that the growth of a giant star can bring about a "skyrocketing" sales of related styles, and it will also bring about the same degree of "slump". "Betting" for a certain spokesperson or a product can enjoy limited dividends and can not bring about sustained growth in performance.

Of course, once in North America. market Andemar, who defeated Adidas, has a respectable reason. In the three quarter of March 31st, global sales increased 5.9% to 1 billion 190 million US dollars in the first three months of the fiscal year, exceeding the analysts' expectations of $1 billion 120 million, due to the good performance of international business and clothing category. But net losses also expanded to $30 million 200 thousand from $2 million 300 thousand in the same period last year. However, with the success of the warriors in the Western Conference finals, "7" to advance to the finals, and the fifth generation of the signing of the Curry 5 in the playoffs, the business optimization of Andrea and the excellent performance of curry are expected to help Andrea get out of the trouble.