Why Is The Growth Rate Of Stall 360 Degrees Far Behind Anta Lining?

As the four largest sports brand in China, Anta, Lining, 31st degree and XTEP occupy half of the domestic sporting goods, but after a few years' gallop, the 31st degree obviously fell behind.

In May 28th, 01361.HK issued a notice that the company's president and major shareholder Ding Wu added 428 thousand shares of the company, with a total cost of HK $600 thousand. Previously, Ding Wu also increased 2 million 692 thousand shares in May 23rd and May 24th.

However, from the earnings report, in 2018, the annual operating income of 331% was 5 billion 187 million yuan, an increase of 0.56% over the same period, operating profit of 782 million yuan, a decrease of 20.8% compared with the same period last year, while net profit plunged 33.5%, only 304 million yuan.

The board said the company had confidence in the company's future. However, the declining market share, declining profitability and the problem of brand influence can not be ignored.

　 Performance encounters Waterloo

Compared with the other three brands, the performance of 360 degrees is a bit invisible.

According to the 2018 earnings report, Anta group's annual revenue was 24 billion 100 million yuan, up 44.4% over the same period last year. Lining's annual revenue was 10 billion 511 million yuan, up 18.5% over the same period last year. XTEP's annual revenue was 63.83%, up 25% over the same period last year.

Looking at the financial reports of these years, GPLP rhino finance found that since 2016, the business revenue of 31st degree is basically stagnant. There are four main categories of revenue, including footwear, clothing, accessories and others. In 2018, footwear and apparel accounted for 81.4% of the company's total revenue. However, the revenue from footwear products dropped by 4.07% in 2018, and the revenue from clothing products increased by only 0.58%.

Revenue declined, but the cost of advertising was not spent.

In 2018, the total amount of advertising expenditure, staff costs and R & D expenses amounted to $1 billion 224 million, which increased by 79 million yuan compared with 1 billion 145 million yuan in 2017, and the advertising expenses increased by 50 million to 550 million yuan in 2017.

That is to say, in 2018, 31st degree spent 550 million in advertising and publicity, which only led to turnover from 5 billion 158 million yuan in 2017 to 5 billion 187 million yuan in 2018, which only increased by 30 million yuan.

In fact, the decline of its development has gradually emerged since 2017. In September 2017, the company's share price dropped from HK $4.13 / share to HK $1.45 / share up to now, less than two years later, the decline was as high as 64.4%. At present, the market value of the company is about HK $2 billion 998 million, which is only about 45% of its net assets at the end of 2018.

Think of it, in 2017, 360 degrees had exceeded 5 billion 158 million of XTEP's revenue to become the top three of the Chinese sports brand, but now the 31st degree is no longer the 31st degree.

　　 Closed shop, take the electricity supplier, still bring immovable performance

The continued downturn in performance has led to a continuous layoff of layoffs.

Once upon a time, with the bonus of the 2008 Beijing Olympic Games, 360 degrees opened up 3 new stores every day, and the stores were crazy. By March 2009, nearly 6000 stores had been opened.

But since the beginning of 2012, the number of stores has begun to show a downward trend. According to the 2018 financial report, by the end of 2018, the number of core brand stores was 5539, compared with 5808 stores in 2017, a decrease of 269. Compared with the number of 8082 stores at the end of 2012, the number of stores decreased by 2543.

At the same time, the number of employees is decreasing. In 2018, the number of employees was 7992, compared with 8555 last year, a decrease of 6.59%, compared with 2011, a drop of 20.11%.

There is no way out under the line, and the development of electricity providers also has little effect.

With the rapid development of the electricity supplier industry, in 2014, 360 degrees also took a look at the electricity supplier. However, the 31st degree did not fully develop the electricity supplier. Instead, it appeared to be too cautious in the aspect of the electricity supplier. It also caused a very low level of electricity in the 31st degree. The most obvious example is that it was criticized by consumers in 2018 when it was double eleven. At that time, the 31st degree was challenged by the "brush list", and the products were still selling, and so on.

Too much input to the electronic business platform has made the 360 degree walk on this road trembling with fear. According to the 2018 earnings report, the Commission and other service charges to the electronic business platform amounted to 120 million yuan, up 40% from 85 million 900 thousand last year. The expenditure on other e-commerce increased from 48 million 200 thousand yuan last year to 57 million 800 thousand yuan. This also led to a sales cost of $3 billion 81 million in 2018 and an annual growth rate of 2.7%.

Ben thought about becoming a new profit growth point through the electricity supplier, but because of the excessive investment in the electronic business platform, the cost of sales increased, but it dragged down the performance.

　　 Positioning is not clear, brand transformation is not easy.

In fact, poor financial performance is only one aspect of the 360 degree scale. For the whole 360 degree, the biggest difficulty now is the difficulty of brand transformation.

Similarly, Anta and Lining, who are in deep trouble because of the downturn in the market, have quickly found the brand positioning and got rid of the swamp and made themselves into the leading brands of the domestic sports brands after a continuous loss.

In recent years, Anta has not only acquired high-end brands such as FILA and DESCENTE, but also made a good strategy in its own brand image, while "Lining" relied on the "national tide" craze to create "China Lining" and other flag brands, and opened a brand new "national tide" era and billions of markets.

In contrast, the 31st degree of "local flavor" has naturally lost young consumers on the second line.

For the 31st degree, no transformation will die, but transformation may not work well. Although we are promoting the "brand remolding plan", we want to expand the middle and high-end customers on the basis of grasping the sinking market. Generally speaking, it is not easy to reverse the brand impression of consumers in the short term.

For now, 31st degree has been sponsoring high-end sports events and inviting many celebrity endorsements, but in fact it is not consistent with the true positioning of the brand. In fact, the layout of the 31st degree in China is still dominated by three or four line cities, with more than 65% of the stores located in cities below three lines, while the proportion in the first tier cities is only 8.9%.

In other words, although 360 degrees have been doing high-end marketing in recent years, the actual consumers who buy 331 degrees are still three or four line cities, so that consumers can not precisely locate consumers, and the effect is also not good.

As a result, market share is declining, profitability is declining, and brand influence is going wrong. It is hard to rely on CEO to increase market confidence. To truly touch consumers in the first tier cities, we need to work hard in brand positioning and R & D.