Speed Up Mergers And Acquisitions And Expand Subdivision Of Domestic Sports Brands.

The four major sports brands in China, Anta, Lining, XTEP and 31st degree, have released 2018 annual reports. The annual report shows that domestic sports brands accelerate the acquisition of other brands, and gradually expand the scope of subdivision. The industry believes that the domestic sports brand began to "walk on multiple legs", from the original "price war" to "brand power" competition.

Domestic brands accelerate mergers and acquisitions to enhance brand competitiveness

Mention domestic sports brand acquisition case will have to mention Anta. Anta lasted for more than half a year, and finally amamin sports income capsule.

In March 12th, Anta announced that the consortium made up of Anta sports, Fangyuan capital, AnameredInvestments, the founder of Lululemon, founder of ChipWilson and Tencent, has successfully completed the voluntary proposal to offer a cash offer for the public offering of the shares issued and issued by the company. The tender offer is worth about 4 billion 600 million euros, or about 36 billion yuan.

Amin has Canadian sports brand Arc 'teryx (original bird), French outdoor outdoor brand Salomon (Salomon), and American tennis equipment brand Wilson (Wilson).

Anta said that the diversified brand combination of amamin is in line with Anta's multi brand strategy. Anta believes that some of its brands have great potential in the world and China. In addition, the acquisition will further enhance our group's ability to expand in China's domestic and foreign markets as the world's leading sporting goods company.

In fact, Anta has already tasted the sweetness of multi brand strategy. According to the 2018 performance report, the Italy sports brand FILA, after being bought by Anta in 2009, has become the most important growth point of the group. In 2018, the retail sales of other brand products represented by FILA reached an increase of 85%-90%. In the earnings report, Anta has defined FILA as the second main brand of the group. In addition to FILA, Anta also owns Chinese sports products such as Sprandi, Japan DESENTE, Korea KOLON and other sporting goods business in China.

In addition to Anta, XTEP also began the road of mergers and acquisitions. XTEP announced in March 4th that it had established a joint venture with Wolverine WorldWide to design, market and distribute two brands of "Merrell" and "Saucony" in mainland China and Hong Kong and Macao, and each side will invest 155 million yuan in each.

Anta and XTEP mainly buy foreign brands, while Lining aims at domestic emerging markets. In January 14th, there was media coverage that Lining group associated company was an extraordinary Chinese sports acquisition hero League Snake club. Li Qilin, the nephew of Li Ning Co founder Lining, will lead a professional team and club to open up and upgrade the Snake team in the future. It is understood that the acquisition of Snake China's absolute control stake in the extraordinary Chinese sports involves hundreds of millions of dollars in cash.

Li Qilin said that the reason why he chose to buy a hero League club directly is that it is a new industry with core value and future output of traditional sports. He said he would bring the sense, cognition and resources accumulated in traditional sports to Snake for many years, hoping to make 1+1>2 effective.

Experts from the China Sports Industry Alliance told the China Commercial Daily reporter that at present, more attention has been paid to the competition, because the majority of the young players such as post-90s are the players and the audience. These consumer groups will become the main consumers in the future, and the early layout of the sports brands will also be aimed at locking the future target consumer groups.

Experts from the China Association of cultural, educational, sports and sporting goods think that the acceleration of acquisition of sports brand reflects a trend that sports brand moves from the original main price war to the promotion of comprehensive brand value. He said that in the past long period of time, domestic sports brands occupied a large number of low-end market share by price war and cost performance advantage, but this also caused consumers' impression of "low end" of the brand was difficult to eliminate, which further led to the difficulty of improving the premium power of the brand. And the acquisition of foreign brands can directly enter the middle and high-end market to obtain profits.

The above experts said that whether Anta XTEP acquired foreign brands or Lining bought the electric club, in fact, the logic of capital acquisition is the same, that is, to invest in a new growth point that can enhance performance. This growth point can be a foreign brand or an emerging market brand in China. What the capital pays more attention to is whether the acquired brand can drive the consumption of related groups for a long time.

Expand the scope of subdivision and aim for broader market space.

The above enterprises are not only satisfied with other brands, but also aim at wider market space through merger and acquisition. It is reported that Anta acquired amamin sports owns cross-country running shoes, alpine skiing equipment, ultra high end outdoor clothing, cross-country skiing equipment, tennis, skiing, sports watches and commercial fitness machinery and other categories.

Amamfin sports reported in 2018 that the outdoor sector was strong, with sales of 1 billion 661 million euros and an increase of 10% in local currency. The growth momentum of the Asia Pacific region mainly comes from China and Japan. It can be seen that the sales volume of these subdivision products still has much room for growth in China.

The main product of XTEP's brand Merrell is outdoor hiking shoes, and Saucony is one of the four "running shoes" in the industry. By relying on domestic brand channel network and marketing, these brands are expected to achieve more effective expansion in China.

In order to help the rapid development of the subdivision sector, XTEP Group executives said that this year the joint venture company will form a team to carry out product research and development and channel construction. XTEP can play the advantage of local resources. On the one hand, it will be an e-commerce channel. In addition, it plans to set up the flagship store in the second tier cities and Hong Kong and Macao regions in the mainland next year. In the next three years, each brand will open 30-50 new stores to form a scale effect in March 12th.

According to the relevant staff of ISPO exhibition at sporting goods business platform, sports brand layout for outdoor products and other sub categories is the great potential of outdoor products market. At present, the demand for commodities such as skiing, rock climbing and riding in outdoor products industry is increasing. Sports brand entry into these areas as early as possible is conducive to a more substantial growth in the future.

Lining values the growth potential of the electricity market. According to the 2018 China electric sports industry development report, the core market of China's electricity industry is about 2 billion 900 million yuan, and the scale of the derivatives market is about 5 billion 580 million yuan. In this industry as a whole good trend, competitive clothing as one of the major categories, sales volume can not be underestimated.

According to a staff member who did not want to be named in the Li Ning Co, the rise of the electronic competition market provided Lining with more imaginative development space, and also provided a good platform for Lining's younger marketing route.

Zhou Hao, chairman of strategy consulting firms's Bain global partners and greater China and merger and acquisition business, believes that the growth rate of sports and leisure oriented sports apparel market has slowed down to less than 5% per year in the past few years. However, the professional sports apparel (including shoes) market has increased by more than 20% in recent years, and it will probably accelerate growth in the future.

Experts from the China Association for cultural, educational, sports and sporting goods said that the sports market at home and abroad is fiercely competitive. In order to disperse the pressure, the most important thing is to expand the subdivision rather than concentrate on a certain direction.

The experts admit that at present, sports brands both at home and abroad regard the Chinese market as a huge engine of growth. Although the demand for sporting goods is more and more intense in domestic consumers, there is also a fast fashion brand entering the sporting goods industry. These fast fashion brands can meet consumers' changing aesthetic needs with their keen fashion sense and quick response, which makes the sports brand "caught unprepared". "But professional sportswear, such as outdoor products or special clothing for competition, which needs certain technological content and research and development ability to produce, is still better at sports brand nowadays. Sports brand layout and subdivision are also aimed at improving industry barriers and seeking new growth space.