Quietly Pushing The New Kappa, The Bureau Of Subdivision, The Winning Geometry.

The resurgence of Kappa has begun to enter new fields and seek new growth points.

In March 4th, Kappa quietly launched the women's fitness products in Tmall flagship store. The LOGO printing of this series of products was changed to the special design of "KE" font.

It's worth noting that this is the first time Kappa launched a series of women's fitness products.

Industry insiders say that it has a strong correlation with the performance fluctuations of the Kappa parent company in recent years.

Beijing Business Daily reporter noted that in order to speed up recovery, China's trend has begun to reform, and opened a new model.

Chen Yihong, chairman and executive director of China trend board, said that the trend of China's future is to grasp the opportunities at home and abroad, and to deepen the market segmentation.

Women's fitness products

In March 4th, Kappa Tmall flagship store went on the line of women's fitness products, including fitness bra, T-shirt, tight yoga pants and so on. The functions include stability, self-cultivation, breathability and so on.

At the same time, Kappa LOGO printing of this series of products has been changed to the special design of "KE" font.

In fact, this is the first time that Kappa has launched women's fitness products.

However, the Beijing Commercial Daily reporter landed on Kappa official website and did not see women's fitness products.

As for whether the product has entered the offline store synchronously, Kappa Tmall flagship store clerk replies that it is not known because the online and offline operation is independent.

Kappa responsible person replied exclusively to the Beijing Commercial Daily. The women's fitness business is Kappa's further exploration of the domestic sports market, which is not the main business.

The first choice of Tmall flagship store is to capture the user portrait more accurately. If the business is widely recognized in the future, it will consider investing more in women's fitness products.

Insiders pointed out that the new product launched by Kappa is related to the gradual rise of women's fitness craze in recent years.

According to a report released by FT Confidential Research, a high-end research service, Chinese women's participation in the sports market has been increasing.

In 2016, the proportion of women who did not participate in sports at all was 10.4%, down 4.3% from the previous year.

With the increasing number of women taking part in sports, women's fitness consumption is also increasing rapidly.

FT Confidential Research reported that the annual expenditure on sports equipment for each woman was 1141 yuan, while that for male consumers was 1081 yuan, while that of women in sports equipment was far higher than that for men.

Guotai Junan Securities report also pointed out that in 2019, China's mainland women's economic market scale will reach 4 trillion and 500 billion yuan.

"Not only is Kappa optimistic about women's fitness apparel, but many domestic and foreign sports brands are overweight."

Cheng Weixiong, general manager of textile and clothing management and Shanghai Liang Qi Brand Management Co., Ltd. believes that with the rise of women's light sports market, especially the high-end female sports match products are mostly monopolized by foreign brands, while domestic brands only have some consumer base in the mass market.

Kappa through Tmall into the women's fitness market segmentation is a good choice: not only less investment, but also through Tmall's big data, user experience labelling for user portrait, more convenient for Kappa to match the fitness market scene with accurate brand, product, market, user positioning.

Recovery still needs comprehensive consideration.

Insiders pointed out that behind the development of Kappa's new business, in addition to seeing the "women's light sports market" that is "rising rapidly", it is also related to the fluctuations in the performance of the Kappa parent company in China and the recovery efforts.

In February 27th, the announcement of China's trend indicated that as of December 31, 2018, the company's revenue increased by 17.3% to 1 billion 706 million yuan, and gross profit (before the stock impairment loss was allocated back) increased 10.8% to 955 million yuan over the same period, and the profit attributable to shareholders decreased by 60.9% to 315 million yuan over the same period last year.

As for the decline in earnings, Chen Yihong said in the report that the main stock market index continued to decline in the second half of 2018, and the stock prices such as Alibaba held by the group also fell.

However, as the stock market has improved, the loss of the stock market has been restored as at the date of this performance announcement.

Beijing Business Daily reporter noted that compared with the peak period, China's trend of revenue has shrunk considerably, but by 2018, there have been signs of recovery.

In 2002, Kappa entered the Chinese market.

Subsequently, China's trend gained ownership of Kappa in China.

At its peak, the number of Kappa stores was about 4000; in 2010, China's total revenue exceeded 4 billion 200 million yuan.

But since 2011, China's revenue has been hovering around 1 billion 400 million yuan.

By the end of 2017, China's revenue was 1 billion 455 million yuan.

Until 2018, revenue grew considerably.

In China's trend, "Kappa brand has gone out of the trough".

This is actually a number of strategic initiatives that China has begun to take. In 2018, in China, China began to introduce new customers and opened up new models. Meanwhile, in the first half of 2018, China moved to develop new customers in Hebei, Jiangsu, Shandong, Hunan and Guizhou, and continued to develop a new business model of direct operation.

Only in this way, insiders say, "Kappa's development in China is not smooth sailing. It is still a matter of time before we want a real" recovery ".

This is not only a product, but also needs to be considered in terms of channels, prices and costs.

Racing behind the Bureau

In fact, Chen Yihong's eyes have noticed that sports subdivides the market.

He said that in recent years, the Chinese government has been supporting the development of the sports industry. Domestic sporting goods companies have been looking at international brands, and pnational takeovers are frequent.

In the new period of development of sports goods industry, how to grasp the market opportunities at home and abroad and deepen the market segmentation is an important issue facing the group.

Driven by the trend of China, the entry into women's fitness products is not the first time that Kappa has expanded its new business territory.

Prior to that, Kappa also opened up the field of student wear.

At present, the student clothing business has been operated on the Kappa official website.

Cooperative schools include eleven Education Group secondary schools, eleven schools, one branch, forty seven middle schools, Yizhuang Experimental Primary School and Wuxing experimental middle school.

It is noteworthy that although the market for female sports equipment is huge, competition is also fierce.

As early as 2015, in the five year plan announced by Nike, the female market was set as a key breakthrough. In the 2020 fiscal year, sales of Nike's female products increased from 5 billion 700 million US dollars to 11 billion US dollars, accounting for more than 1/5 of total annual revenue.

At the same time, the Jordan brand dominated by men's basketball also announced the increase of women's market in 2015, and the large-scale production of women's basketball shoes.

In addition to sporting goods, "one brother" Nike is constantly upgrading the Chinese market. Adidas, Nike, Lining, 31st degree and Decathlon have begun to layout the female consumer market.

At the same time, the professional yoga clothing brand Lulu lemon Lululemon has also emerged from many sports apparel brands in just a few years.

In 2016, Lululemon entered the Chinese market, and through free sponsoring local yoga instructors, fitness red clothing, organizing large-scale community Yoga activities and other publicity methods, further promoting brand to consumers.

In the eyes of the Kappa responsible person, Kappa's position is to become a sports brand under the sports industry, and hopes to be more precise to consumers through subdivision.

According to the insiders, at present, the subdivision area of sports and sporting goods industry needs to be excavated, and Kappa's efforts to subdivide areas are expected to promote performance to achieve new growth.

However, this also requires the operation and management capabilities of Kappa.

For the future development of Kappa, Cheng Weixiong suggested that Kappa was originally a fashion movement, and had a lively life in the local market. However, the Fashion Fever quickly reduced fever.

At present, Kappa belongs to the two or three tier brand in the domestic market, and the brand is somewhat dull in the market. Kappa's idea of trying to get a slice of the recovery from China's sports market is correct, but if we need to establish a firm foothold in the sports market, we must define the relationship between fashion and sports, and do a good job in brand positioning of Kappa, in order to better promote the closer interaction between products, stores and consumers.