Return To Basketball, Can CONVERSE Make A Comeback?

Unlike other brands that have recently stirred up the basketball shoe market, the history of CONVERSE (Converse) basketball shoes has been around for 102 years.

In the eastern time of April 17th, CONVERSE released All Star Pro BB in New York, Broolyn, officially announcing the return to the basketball market.

At the same time, they announced the signing of Chinese basketball star Abdul Sarah M as spokesperson. This is CONVERSE's first basketball player in China after being bought by Nike.

In 1917, it launched basketball shoes, became the first sponsor of the US basketball Olympic team in 1936, became the official footwear of NBA in 1986, and was once a sponsor of Wade's shoes before Lining and AJ. CONVERSE has a rich and brilliant past in basketball.

In fact, in the offices of CONVERSE China, basketball elements always exist. They have a conference room named after "Dr.J" (the nickname of Julius Owen NBA), and there are several elements of "basketball era" on the wall, such as the 1986 The Weapon series of Larry Byrd and Magic Johnson.

During the exclusive interview with lazy bear sports, Matthew Jung, general manager of CONVERSE Asia Pacific region, repeated the phrase "really have a story" five times.

The history, origin and heritage of CONVERSE in basketball are regarded as the core of "story".

"CONVERSE is a young culture oriented and driven brand. Communication with young people and young culture is very important. When we realize the importance of basketball in the global youth culture, we will seize this opportunity.

Basketball has always been a part of our DNA. Strictly speaking, this may not be a return, but more like a part of us. It's just that we think it's the best time to recover the traditions and roots of basketball.

Matthew Jung told lazy bear sports.

According to Footwear News's report, the research and design test of All Star Pro BB took nearly a year and a half.

This means that CONVERSE decided to "kill back" the basketball market, at least until October 2017, which is why, compared to the earlier announcement of the New Balance of basketball shoes market, CONVERSE can launch products to the market earlier. The latest news is that All Star Pro BB will be listed in North America and June in China in May.

In fact, since CONVERSE was bought by Nike for $309 million in 2003, it has gradually embarked on the leisure road with lifestyle, trend and street as its core label and positioning. Until this announcement of the return, basketball and professional sports gradually withdrew from the historical dance platform in CONVERSE's development.

Now, they announce their return and retell the story between themselves and basketball.

For why this time, instead of two years ago, three years ago or even five years ago, Matthew Jung explained, "when Nike acquired CONVERSE, it was very clear that the brand was divided, Nike was good at high sports performance, we advocated lifestyle, but over the years, we saw the opportunity. Because of our unique DNA, we believe that there may be some extra space for CONVERSE to return to basketball as a part of the overall strategy of Nike company."

A visible background is that, according to Nike's earnings, in the 2018 fiscal year, CONVERSE's revenue was $1 billion 886 million, down 8% from the same period last year, and the pre tax profit of $310 million, a 35% decrease from the same period last year.

As a centenary brand, CONVERSE is facing a tough time after Nike's acquisition.

At this point, the introduction of professional basketball shoes products will bring new possibilities to CONVERSE besides the trend and casual footwear business. "For us, this is an opportunity to connect with new fans and new consumer groups."

Matthew Jung said.

Brandis Russell, vice president of CONVERSE global footwear industry (Brandis Russell), has said before: "we are concerned about the youth culture and basketball culture now, and also want to establish contacts with young people who create new culture inside and outside the stadium."

Generally speaking, it is not easy for a sports brand to try to enter a new field or new category. It needs cooperation in many aspects such as product, brand, marketing and production.

But for CONVERSE, which backs its parent company Nike and has basketball roots in the past, there are natural advantages in this area -- for example, for the new player who enters the field, the core technology of the core of the core that will start with a lot of money and lots of time to start, All Star Pro BB directly brings Nike's React technology.

In terms of design, All Star Pro BB is led by Kobe, a designer of several signature shoes and Eric Avar of Nike Innovation's creative vice president, to lead Nike and CONVERSE's team to work together. Its design is closely related to CONVERSE's Chuck Taylor All All and CONVERSE.

In addition, Nike's broad marketing resources in the field of basketball can also help CONVERSE.

From the start of the 2017-18 season, Nike has become the exclusive NBA sponsors for 8 years and 1 billion dollars.

This means that in the field of basketball, a single Nike can have abundant resources to pfer to CONVERSE.

In 2017, CONVERSE launched joint canvas shoes with the theme of NBA team in China.

After CONVERSE has regained possession of practical basketball shoes, the relevant resources sponsored by Nike may be a piece of cake for the "family".

In fact, CONVERSE's return to basketball has the same meaning for Nike's overall strategy.

After the release of CONVERSE All Star Pro BB, many people commented on micro-blog that "although I haven't played basketball for a long time, I can do it by pressing the road", "planting grass, playing tennis out of the street," and "very suitable for everyday wear."

Thanks to the brand appeal of CONVERSE in the leisure field, All Star Pro BB has attracted more and more users of leisure life besides attracting basketball audiences who have a higher demand for lifestyles and trends.

After all, Nike is more positioned to be a professional sports brand, and CONVERSE has the opportunity to extend its shoes to Nike's weaker territory.

"Just like the players we signed, they are not superstars, either by Abdul or Wu Bu Lei. They are new stars with their own unique style and creativity."

Matthew Jung explains CONVERSE's contract standard in this way, to a certain extent, reflects its market positioning and segmentation.

In April 2018, Grand View Research issued a report saying that the market value of the global sports shoes Market in 2017 was $64 billion 300 million.

In addition, the market composite growth rate of market value increased to 5%, and by 2025, the market value of the global sports shoes market will reach US $95 billion 140 million.

At the same time, the basketball shoe market is facing unprecedented fierce competition. The old rival Adidas is in hot pursuit. The new basketball players such as Under Armour, Puma and New Balance are eager to have a more comprehensive basketball product line and brand combination, which helps Nike group have a richer product line and target market to cope with the market competition.

Moreover, the price of North America 140 US dollars and China 999 yuan RMB belong to the middle end of international brand basketball shoes, but for Tmall, the most expensive product of CONVERSE's official flagship store is 769 yuan, this is a higher unit price and gross profit margin.

All of these will help CONVERSE's growth.

However, even if they have their own advantages, Matthew Jung still says that their pace in basketball will not be too radical. "They will proceed cautiously. At present, All Star Pro BB is the core."

One of the difficulties before CONVERSE is that in the huge basketball spokesperson, how to carry out the story of CONVERSE basketball and create the marketing attention and sound is the problem that CONVERSE has to face and solve. Abdul, who has not yet made a successful achievement in the field of basketball spokesmen, is going to carry out the story of CONVERSE basketball.

And for the Chinese market, one of the main sources of growth in recent years, CONVERSE has also shown enough attention.

Abdul Sarah M was the spokesman of CONVERSE's first official propaganda after the official return to basketball.

"I believe that in the next year, the Chinese market will remain one of the core growth areas of CONVERSE's global business, and in terms of basketball, China will be a very, very core market like North America."

Matthew Jung indicates.

Matthew Jung revealed that CONVERSE currently has 1200 stores in China, and CONVERSE basketball's important job in China is to "tell the true story and let people really understand our basketball story."

Matthew Jung believes that consumers in the Chinese market are more open than North America, "they are willing to try new things."

In North America, your childhood brand may become your first choice in life.

CONVERSE China has only been established for 11 years. As a centenary brand, we are still new people in this market. The openness of the Chinese market for new people is exciting.