Ten Billion Lining'S Next Step

Business history has proved countless times that the revival of enterprises is always a product of coincidence and coincidence. No one knows what will become your opportunity, but the fate of a company may be profoundly changed by inadvertent decisions.

When we look at the rapid turnover of the domestic sports brand Lining, this seems to be once again confirmed. In less than two years, Lining, who was once in a low ebb, suddenly opened up the situation, and put a young, fashionable and clear brand of the sports brand in front of the public, shocked and renewed the old cognition of the brand. Last year, Li Ning Co's revenue grew from its peak last 8 years after the first break. The group revenue grew 18% to 10 billion 511 million yuan, gross profit margin was 48.1%, and net profit rose 39% to 715 million yuan.

If we want to trace a starting point for this series of changes, then in February of last year, Lining's first fashion on New York fashion week is undoubtedly an important turning point in the history of Lining's brand development. In fact, Lining's fashion was originally accidental. At the beginning of last year, Lining boarded the fashion week in New York on the occasion of the invitation from Tmall New York China Japan. Lining, general manager of the electricity supplier Feng Ye, said at the time, "still underestimated the enthusiasm of users, the show just finished 1 minutes, and many products were sold out in Tmall."

Then, Lining appeared in Paris men's wear week last June and New York fashion week in February this year. People don't even have time to ask why a professional sports brand suddenly became so interested in fashion, and realized that fashion has become a key word to be talked about nowadays when people talk about Lining.

It is very important for a gun to start, but sustained efforts are more productive. In March this year, when Lining held the product launch of the fashion line 2019 autumn and winter in Shanghai, he first put forward the concept of Lining fashion line, and made clear the positioning of the product line aiming at the high-end market in sports fashion style. This also means that Lining's fashion strategy will develop from a casual test to a sustainable business.

In the past Saturday, Lining released the latest 2020 spring summer series in Paris men's wear week. This show is of great significance. It is not only the brand's two degree show in Paris, but also the first appearance after Lining formally established the Lining fashion line. Meanwhile, 2020 is the 30th anniversary of Lining's brand creation, which is also a tribute to Lining's fashion line for the upcoming thirty-second Summer Olympic Games.

As an independent product line, Lining's fashion line naturally clarifies the new logic in product design, marketing and sales channels. In this season, Lining drew inspiration from table tennis and other sports, taking China's national ball as the entry point and pattern elements of the clothing series design. The whole series is mainly composed of green, blue, yellow, powder and other vibrant colors, focusing on the development of sports Polo shirts and brand core shoes.

Unlike the emphasis on "China Lining" slogans in the past quarter, the new series is more introverted. The application of the integral racquet pattern and the elements of the 1984 Summer Olympic Games, Mr. Lining competition number 11, add details and contents to the simple sportswear.

In terms of the stereoscopic performance of the fashion show including the venue selection, space design and show music, the new series is more comprehensive than before. For example, the site was selected at Lycee Turgot middle school in Paris, making the space a campus basketball court. The show music was composed of hip-hop, contrast jazz and Chinese voice mixing in 90s. This can be seen as an effort to further adapt Lining fashion line to the existing system of the global fashion industry.

If Lining's fashion line, which was first unveiled last year, is still an attempt to mark the surface with multiple elements, today's Lining fashion line really begins to explore the clothing culture and express itself in stylish language.

In addition to the progress in design, Lining's fashion line has a new layout in overall planning. On the eve of the big show, Li Gang, general manager of Lining fashion line, first revealed the positioning and expansion plan of the new product line after the establishment of the new product line. He said that the design team, including the four fashion week series, is a team composed of designers with different product lines. It is an independent project that is different from conventional business. But after that, the Lining fashion line will be run by independent teams from design, products, merchandise to sales.

To many people's surprise, the new Lining fashion line will be closer to the designer brand in the way of brand operation. "We take the big company as the background, but the operation method is more like the designer brand, personalized mainly." Li Gang told fashion headlines that the information is flourishing and young people are more aware of tide cards. In this case, what Lining should do is not only simple sports fashion, but to explore the cultural background behind him. Designer brand and advanced business brand have their own attitude and product culture. Brands must have their own roots. Only in this way can consumers resonate, just like imitation of fast fashion in the past.

In the 2020 spring summer series, Lining fashion line opened showroom in Paris, and selected a series of high quality designs for overseas retailers. Previously, Lining fashion line has successfully entered China's local retailers such as Lane Crawford. This season, it has ordered more than 30 high-end buyer shops and selected ball shoe shops, including KITH, SSENSE, LN-CC, Slam Jam, END Clothing, Oki-Ni and Selfridges.

In fact, after the recent Hongkong shareholders' meeting, the company pointed out that business is still mainly focused on the Chinese market, and overseas oriented high-end channel is a new battleground that Lining never opened up before. But Li Gang pointed out that the forefront of the world's fashion industry is still Paris, London, Milan and New York. Lining's fashion line needs to show and promote its brand in these top cities.

"At present, the number of overseas customers selected by the brand will not be too large. Only the best customers in the industry will be selected. They may not bring too much income to the brand in the short term. The sales of 1 domestic stores may be comparable to those of dozens of overseas stores, but these outlets can provide Lining with good publicity. Therefore, in the early stage of overseas markets, marketing is the main factor, and later sales will gradually contribute to certain sales volume, and some experience will be explored. The brand does not rule out more layout in the future.

Obviously, for the fashion business, the test of overseas market is like the landing of the international fashion week. Its purpose is not to "incense the wall inside the wall", but to truly integrate into the international discourse and market system, break the mind, do not follow the trend, and initiate the dialogue in the era of globalization. In mid March of this year, Lining also took the 19 autumn and winter series of "row" as the title of the sixth atmos con of Shibuya, Tokyo, Japan, for the same reason.

But in terms of actual sales, Lining's fashion line still relies heavily on the domestic market. Since August last year, the group has opened a new channel for the fashion line. It is tentatively called the Lining fashion store in China. Up to now, more than 60 stores have been opened in China, with a shop area of about 150 square meters, which is mainly distributed in the top business circles of the first tier and second tier cities, such as Sanlitun, Beijing and SKP. Shanghai's iapm and Hong Kong Hui are also planned to open.

Li Gang disclosed that the Chinese Lining fashion shop generally opened the shopping center in the leisure trend floor instead of the sports floor. It was adjacent to Adidas clover, FILA and international leisure brands such as Calvin Klein, and the price segment was higher than that of Lining before. Li Gang believes that if the brand and product power is enough, the pricing of Lining's fashion line still has room for improvement.

It is reported that the number of Lining fashion stores in China opened more than 20 stores in 2018, and plans to open 100 stores this year, bringing the total number to 120. Although this type of store has not yet made significant contributions to group sales, the internal data show that the store has a strong profitability of single stores, and its goods are strong, and terminal flow discount is more than ten percent off.

According to internal data, dealers have applied far more than 100 stores to Lining fashion stores in China. Both stores and distributors are willing to set up Lining fashion store in China. On the whole, Lining group road upgraded with brand upgrade, and low-end channel was constantly eliminated. Recently, in order to upgrade the brand, Lining group has begun to open a large number of comprehensive stores in the three or four line cities in a second tier city, which are usually more than 500 square meters, covering all product categories.

Some analysts have questioned the channel strategy that influenced Lining's fashion. He believes that fashion will limit the brand to the first tier cities, while the first tier cities are expensive and limited. Li Gang responded that now the brand does not pursue the scale and quantity of the store, but it can produce good products in the right place by selling the right products to the right consumers. "Our stores are in the core business circle, and the cost of rents is very high. Although the cost of operation is very high, dealers and Lining still make money, because as long as products and brands are right, expensive places mean better and higher quality passenger flow, and sales are higher.

In fact, since the founder returned to the brand in 2014, Lining has been committed to improving business efficiency. Up to the first quarter of this year, Lining recorded a 10% to 20% growth in the same store in the first quarter. Ceng Huafeng, chief financial officer of the company, said at the shareholders' meeting that the company closed about 30 low loss stores in the first quarter, but it also expanded about 100 by the quarter. It will continue to focus on store efficiency development. Lining said that the company will merge and develop online and offline in the future.

For the bold experiment of Lining fashion line, its online and offline channel layout has also begun to extend to a variety of forms. Earlier, the brand said that the Lining fashion line will be sold under the domestic online and offline outlets, including the opening of Lining fashion independent store, the simultaneous sale of some fashionable line products in the Lining flagship store, the purchase of multi brand collection buyer stores in China, the opening of Tmall Lining fashion flagship store and the online platform of YOHO, BUY, Xiaohong book and so on. Among them, the online has become an important strategic layout of the group, Li Gang said, "as a whole is a very important sales channel, we are now more to create content to do marketing, online is the fastest platform for business reaction."

The pursuit of speed and efficiency permeates the development of the whole group, and is concentrated on the Lining fashion line that changes faster.

The original development cycle of the big goods domain sports life class is 18 months from product creativity to listing. This cycle is acceptable for professional sports and strong technology brands, but for fashion brands, it is too long, fashion is usually 3 to 6 months, fast fashion is faster. However, the short development time is bound to have a relatively high demand for the supply chain. In the past, supply chain has always been a short board for Lining, and its brand is mainly outsourcing, which makes products unable to produce exactly according to brand wishes. Especially after Lining entered the fashion business, the brand challenged the efficiency of design and supply chain.

This year, Lining group's investment supply base in Guangxi was officially launched, meaning that Lining, with a long history of foundry, welcomed the "self built factory" era. It is expected that the production capacity will be released in the next 2 to 3 years, and 30% of the footwear industry will be produced in the future. The brand has also started to build factories and self built small version houses, which can sample clothes and projects in small quantities, greatly improve the production speed, and more importantly, slowly precipitate the core capabilities in the Lining system, so as to enhance the ability of its own supply chain management and R & D technology knowledge application.

The consolidation of the brand foundation will undoubtedly provide a more solid endorsement for the promotion of brand power, making Lining different from the brand of "national tide" which has been on the rise for many years. Li Gang believes that the tide of the country is more motivated by feelings, but ultimately everything is still attributable to the product itself. Publicity is well done. If the product is not available, consumers will not pay the bill.

Public awareness is often lagging behind. When people began to notice the fashionable Lining, in fact, the change had already been brewing or even happened. There are signs that Lining's fashion line is becoming faster and more fashionable, but it never wants to become a fast fashion. In the latest series of official news releases, Lining's fashion line wrote, "as a professional comprehensive sporting goods company, Lining combines the Lining brand movement DNA and the trend culture from the rich sports and product categories with a traceable way and a fusion mentality, creating a series of clothing products with contemporary texture and brand personality."

This almost establishes the methodology established by Lining for the development fashion series, and such a clear methodology is very important for Lining's spanboundary behavior. As a professional sports background of the fashion industry "outsiders", Lining's fashion before it is faced with speculation from all walks of life and even questioned. Some analysts say that Lining's ultimate ambition has become a fashion brand, which means that the brand has abandoned the solid professional sports foundation laid down over the years.

Especially when sports brands balance professional sports and fashion as the focus of the industry, it is not only Lining, but also the Stan Smith little white shoes and Yeezy coconut shoes attacking Adidas in the fashion industry. To this end, Adidas CEO Kasper Rorsted has had to respond to Adidas's insistence on professional sports brand positioning this year.

However, with the introduction of Lining's fashion line, the group's layout of the fashion business is relatively clear. That is not the overall fashion of the group level, but is committed to the development of fashion as an independent business while adhering to the professional sports positioning as the core. As a result, the question of deviating from orbit is gradually dispelled.

Li Gang said to fashion headlines, "we have found a right and suitable direction for Lining's development through fashion. At the same time, we hope to accumulate experience through other fashions such as basketball and running. Taking fashion as the breakthrough point, the ultimate goal is to hope that all product lines can develop. "

In other words, the strategic role of fashion is to leverage the whole group's development as a lever. But this is still not the most important reason. For a long time, Lining, like most domestic commercial brands, has relatively weak brand awareness. The wholesale sales channel also determines the brand positioning and orientation to a certain extent. This has been greatly changed in the new era.

In the wake of the awakening of brand awareness in domestic manufacturing, fashion unexpectedly provided Lining with a shortcut to enhance brand power, which enabled Lining to save a lot of money compared with his competitors. Lack of brand building can not be built overnight. Many domestic manufacturing giants are still trapped in the failure to establish a modern brand image despite their resources in supply chain and sales channels.

Lining, chief designer Chen Lijie of the BADFIVE street basketball series, once told the lazy bear sports that Lining's fashion line is "let Lining return to the brand image of representing the status, high-end quality and fashion trend through Fashion Week". This is a brand return.

The revival of an enterprise often involves many problems at the operational level, and the fashion layout has not yet become a meritorious service. However, this opportunity can enhance the capability of Li Ning Co in many aspects. Lining himself has said before that he cares not about how much sales can be brought by sports and fashion products, but the new abilities that Li Ning Co has accumulated over the past few years behind these sports fashion products.

Now, the competitive advantage of Lining's fashion line is two points. First of all, Lining is a sports brand. Lining has his own understanding and goals in sports fashion. The second is Chinese culture, integrating Chinese culture into product design, and taking the brand story of founder Lining as the core asset. Li Gang said, "now both domestic and international customers have been very interested in Lining in the past two years, mainly because there is no competitive brand like Lining in the market."

For Lining, there is no reference to the direction it tries. Compared with FILA, Anta's biggest rival, Anta's fashion ambitions are more intense. Compared with Nike, Adidas and other brands, Lining fashion line has irreplaceable value in brand value and identity. At the same time, Lining's fashion line's group background and Sport foundation make it different from the designer brand of independent operation.

From the group level, Lining also appears to be very independent. With the goal of "single brand and multi category", he focuses on the development of Lining brand. Since last year, Anta has swallowed amamin sports, and when XTEP bought Korea K-Swiss, Lining became the only company in the domestic sports giant that did not open up the strategy of acquiring XTEP.

Over the past one or two years, the biggest curiosity about Lining is that the core team that does not seem to change too much outside the company can bring about almost disruptive changes in the company. Li Gang's explanation is that in the past Lining positioned herself less than Nike and Adidas, but now the brand has opened the ceiling, and the goal is to become a world-class sports brand. The brand can not just be the same as Nike and Adidas, and even better in some aspects than these brands.

"The biggest change is to open the mind and change the way of thinking. The most difficult thing is to change people's thinking. The whole company is gradually opening its mind from products, brands, channels, sales to supply chain and so on. A hasty decision unexpectedly opened up a unique new path. When Lining, who is about to enter 30th anniversary, is determined to take a road that no one else has gone through, it also means that the brand is becoming more confident.