Jinjiang Apocalypse: Why Does The Domestic Sports Brand Rise?

To mention "China Shoes Capital", Wenzhou city of Zhejiang province has the stamp certification of China Light Industry Federation and China Leather Industry Association, but if it is on the "sports shoes and clothing capital of China", Fujian Jinjiang city should take this exclusive brand in a logical way.

Looking at the ten major sports brands in the country, except Lining, they all come from Jinjiang (Quanzhou, Fujian Province under the jurisdiction of county-level cities).

As Jinjiang's "hope of the whole county", Anta has been ranked first in China's sports brand market in the past 7 years, and its revenue scale is 2.3 times that of Lining, who ranks second. According to the annual report released by Anta in 2018, Anta's annual revenue in 2018 was about 24 billion 100 million, an increase of 44.4% over the previous year and a net profit of 4 billion 100 million. Anta's riding on the dust has lifted the two - degree sail of the domestic sports brand, and also outlined the thirty years' hard road to explore the sports industry in Jinjiang.

Among the three big cities in Fujian, Fuzhou is the administrative center, Xiamen is the tourist center, and Quanzhou is undoubtedly the economic center. Among them, "Fujian dragon" Jinjiang is the leader of Quanzhou and even Fujian's county economy. Quanzhou is in the second line and keeps a low profile, so that people have neglected its real strength. In 2018, Quanzhou achieved 846 billion 700 million yuan in GDP and GDP for the first time, breaking 800 billion, nominal growth rate of 12.19%, an increase of 92 billion yuan compared with last year, and GDP ranks first in the province.

Jinjiang achieved a GDP of 222 billion 900 million yuan, an increase of 9% over the previous year, accounting for 6.2% of the total, accounting for 26.3% of Quanzhou's total. Jinjiang was once a "high-yield poor county" at the initial stage of reform and opening up, and its financial and per capita income were lower than the national and provincial average level. However, in July 19, 2019, Jinjiang ranked fifth in China's top 100 counties.

Jinjiang has more than 3000 sports shoes and clothing enterprises. The annual output of sports shoes is as high as 1 billion pairs, accounting for 40% of the national output, 20% of the global output, and the output value of sports related products occupy 18.4% of Jinjiang's GDP.

In the history of inspiring entrepreneurship in this small town, Jinjiang has vividly interpreted the "love struggle to win" with their southern Fujian customs and marine civilization. The development of Jinjiang sports brand is the most brilliant branch of Jinjiang's development process relying on the private economy.

　 The way to create a brand: counterfeit - OEM - Brand

Geography endows Jinjiang with its Central Plains culture and marine culture. History endows Jinjiang with its culture and religious culture. Jinjiang people rely on the harbor and stride to create their own overseas Chinese culture. In the period of China's reform and opening up, the four major modes of rural economic development are South of Jiangsu mode, Wenzhou mode, Dongguan (Pearl River Delta) mode and Jinjiang mode. Jinjiang is the only model formed by county economy. The "Jinjiang model" is meant to "imply the profound extrapolation tradition and strong desire to change the poverty situation in the vast majority of Jinjiang's overseas Chinese."

Since the third Plenary Session of the 11th CPC Central Committee 1978, economic construction and reform and opening up have become the main theme of the whole country. Subject to the objective geographical conditions on the southeast coast, the total amount of land resources and soil productivity in Jinjiang are obviously insufficient, which forces Jinjiang to "work on behalf of agriculture" and implement the development strategy of township enterprises. In the era of the people's initial involvement in the market economy, "market" is the only weathervane, so a wave of "imitation production" featuring private enterprises and family workshops was launched in Jinjiang.

In 1983, the "Yang Dai clothing shoes and hat factory" founded by Lin Tuqiu, Yang Dai village, Chen Dai Town, produced the first pair of Jinjiang sports shoes, and also marked the beginning of the footwear industry in Jinjiang. In the same year, the 361 - degree predecessor Huafeng shoe factory was established.

In 1987, XTEP was founded by Sanxing company.

In 1989, PEAK's predecessor, Feng Deng shoe factory was established.

In 1993, Xi Long lung was founded in Kyushu. Through the "imitation production", Jinjiang sports brand enterprises not only quickly completed the accumulation of primitive capital, but also gradually became the leading domestic production technology.

In 1991, "North drift youth" Ding Shizhong returned to Jinjiang to build Anta with the 200 thousand original money earned from selling shoes in Beijing.

After getting rid of the black history of Shanzhai, with the convenient sea and land traffic conditions and the advantage of cheap labor force, Jinjiang started a OEM generation factory mode based on foreign trade orders. As a result, many Jinjiang sports brand enterprises including Anta have joined the ranks of the international sports brands.

PEAK has been supporting processing for Nike since 1983.

From 1987 to 2001, XTEP has been doing OEM for 14 years.

Anta also received overseas orders before 1996.

What is different is that Ding Shizhong knows that OEM is not a permanent solution. He has started thinking about how to open a store and expand his distribution channels. Two years later, Anta formed the sales model of agent distribution, and also had the first batch of distributors.

In 1997, when the financial crisis broke out in Southeast Asia, half of the Jinjiang shoe factories that had relied on overseas orders to earn money could no longer stand up. Of course, Anta did not include a rainy day. Many years of foundry career have benefited Jinjiang sports brand enterprises, and the most important thing is to follow the international brand of "stealing teachers and learning skills". After the wave of the sand, the remaining enterprises finally realized the weight of the two words of the brand, so they set their own doors. In a popular brand building movement, Jinjiang sports brands such as Anta, XTEP, 361 degrees, Hongxing Erke, del Hui, and "noble bird" emerge as the times require.

From counterfeit to OEM to brand, Jinjiang's business attitude also relies on others to self-reliance. In the first two stages, enterprises do not have to face other sales links outside production, but also in the early stage of licensing. However, the wholesale sales mode of agent distribution in Jinjiang sports enterprises has reduced the risk of product backlog and rapidly increased the market share while exposing the fatal short board which is out of touch with the market.

As a result, from the beginning of Anta, Jinjiang sports enterprises carried out a change of sales channels. Franchised stores and monopoly counters have replaced agents and distributors, from wholesale to retail, and Jinjiang enterprises have established direct sales relationship with consumers. To solve the optimization problem of sales mode, how to become famous is the ultimate topic of enterprise. Finally, Jinjiang sports brand enterprises have to face up to the two big mountains that they have easily bypassed and developed and marketing their products. For Jinjiang enterprises, the real battle is just beginning.

　 R & D Road: Imitation Innovation -- independent innovation

Han Ye, director of the 361 degree public affairs center, said in an interview with Xinhua News Agency: "there is still a big gap between the professional degree and reputation of domestic sports companies in the field of subdivision, especially in the international mainstream projects. International brands still occupy a major market share, and the fundamental reason is the ability of R & D of products."

The low investment in R & D will undoubtedly restrict the industrial upgrading of sports goods. Perhaps the "imitation production" tradition makes Jinjiang sports brand lack the ability of independent innovation. In terms of product design, Jinjiang sports brand once used the idea of "buying samples and copying copies", and there was no innovation at all. For sports shoes, the design can still be painted, but the core technology of the product can not be directly copied and pasted.

At the same time, Nike, Adidas and other international brands began to vigorously layout the Chinese market and accelerate the sinking of the channel, which greatly threatened the brand of Jinjiang sports that ploughed deep into the three or four line market. The Jinjiang sports brand can not compete with the international brand in terms of product innovation capability, brand management capability and retail operation capability, which is subject to the core business model barriers. Therefore, Jinjiang sports enterprises embarked on the road of brand research and development.

In 2005, Anta set up the first sports science laboratory in China for 30 million yuan, which was approved by CNAS in 2011. In order to avoid the laboratory being reduced to "face Engineering", the technology research and development of sports shoes have been truly implemented to sports skills and human comfort. Anta has also cooperated with Beijing Sport University Biomechanics Research Institute and China leather and shoemaking Research Institute to develop Anta core technology and "feel glue" technology.

In 2009, Anta's R & D investment reached 100 million yuan. In November of the same year, Anta's enterprise technology center was approved by the national development and Reform Commission. It became the first national enterprise technology center recognized by the state in China's sporting goods industry.

In 2011, Anta's R & D expenses amounted to nearly 300 million yuan, accounting for more than 3% of sales revenue.

In addition, Anta focuses on stimulating technological innovation through top-level events and first class stars, and increasing research and development efforts on special sports products such as CBA and jogging. After the establishment of the sports science laboratory in 2005, Anta's first technology research and development project is to develop professional basketball players' foot type rule and standard last type design. Through several years of technical tackling, all CBA players' satisfaction with Anta products has reached 97%.

The most important thing is that Anta began to follow the model of imitation and innovation, and rely on independent research and development to master the core technology. In the three core areas of high-end sports shoes, shock absorption technology has always been one of the themes of sports shoes biomechanics research. After years of exploration, Anta's R & D system has developed core technologies such as "A-form arch shock absorption technology" and "A-Core core technology". In 2010, Anta also developed a unique "A-JELLY elastic adhesive technology", with unique environmental protection materials applied to the soles and heels of the sneakers. Its excellent rebound ability can enhance the cushioning performance of shoes while improving the energy return effect of sports shoes.

Not only Anta, but also other sports enterprises in Jinjiang are aware of the importance of brand upgrading and technological innovation. In early 2006, Hongxing Erke and the Institute of Chinese Academy of Sciences established a cooperative relationship, focusing on the development of professional antibacterial materials, and further enhance the brand technology content. By the end of the year, XTEP and Shanghai Shanghai nano technology company jointly developed "nano silver antibacterial sports shoes" officially put on the market. In April 2007, the sports equipment research and development base of the Sports Science Research Institute of the State Sports General Administration formally settled in Xi Long lung. In May 2017, the 361 degree research and development center, located in the five Li Industrial Park, Jinjiang, Fujian, was officially completed, aiming to realize the R & D target of the main function of the brand in 2031.

　 Marketing way: celebrity endorsement + CCTV advertising + event sponsorship

After several positive transformations, Anta continued to take the lead in the field of marketing in Jinjiang sports enterprises.

In 1999, Anta gamble 800 thousand hired pingpong Kong Linghui as spokesperson. With the 2000 Sydney Olympic Games Kong Linghui won the table tennis men's singles gold medal, Anta's reputation has also been fired, and other Jinjiang sports enterprises have caught up with each other.

In 2000, he signed a contract with former international champion Su Mao Chen.

In 2001, Nicky Wu, a Taiwan film star, became the spokesman for the new era.

In 2003, del Hui also hired Jay Chou as spokesperson.

In 2001, XTEP hired Hongkong artiste Nicholas Tse as the brand spokesperson and image ambassador, then signed a contract with Twins, a popular women's group in Hongkong, and later won the Taiwan idol Willber Pan and Jolin.

In 2002, Liu Yudong, a basketball star in China, joined PEAK as the spokesman for PEAK brand image.

In 2003, Xi Long invited Aaron Kwok to become the brand spokesperson. Ma Lin, Fu Mingxia, Deng Ya Ping and Wang Nan respectively speak for East Asian shoes, Meck Heng, Wei Min Deng Ya Ping (Quanzhou) shoes and gold lake.

By the end of April 2007, more than 70 star endorsers were hired by Jinjiang sports companies.

In addition to celebrity endorsements, Anta is also the first to eat crabs in advertising. At the beginning of the millennium in the late 90s, when the TV commercials were booming, Anta spent 3 million on the prime time advertising channel of CCTV sports channel (CCTV5), which made a good start for the Jinjiang sports enterprise to contract CCTV5.

According to statistics, in 2000, a total of 16 Jinjiang sports brand enterprises launched advertisements in CCTV, 38 in 2001, and 44 in 2003. From 2000 to 2001, the advertising cost of Jinjiang sports brand enterprises in the central television station exceeded 200 million yuan per year, in 2003 it was 500 million yuan, and in 2004 it was as high as 700 million. In 2008 only during the Beijing Olympic Games, the advertising fees of Jinjiang sports companies betting on CCTV reached 430 million yuan. At that time, CCTV5 was also nicknamed "Jinjiang channel". In the 2006-2008 years, the advertising cost of Jinjiang sports brand enterprises in CCTV and local satellite TV amounted to 4 billion 591 million yuan.

In 2002, the sales volume of del Hui exceeded 350 million yuan, and in 2004, the sales volume was 620 million yuan. In the same year, Anta's sales volume also reached 311 million yuan. Visible, star endorsement and television advertising two pronged marketing strategy has been quite effective. However, these two promotion methods are almost applicable to any brand, and the best destination of sports brand is to become sponsors of sports events. Popular sports events as positive energy IP, behind the strong flow support, has always been a must for sports brand.

In 2004, Anta began sponsoring the CBA League.

In 2005, Anta became the only designated partner of sports equipment in the 2005 to 2008 Chinese Table Tennis Super League.

In 2007, Anta named the sponsorship of the 6 volleyball competitions in the 2007 to 2010 season.

In 2008, Anta became the only designated award winning supplier of the 2010 Winter Olympic Games.

By the end of 2005, 361 degrees became the world's top partner and the only designated sports equipment for the Xiamen International Marathon.

In 2007, 361 degrees sponsored the A1 World Cup formula and the National College Basketball Super League.

In 2009, it became the top sponsor of the Chinese Table Tennis Super League in 361, and signed a contract with the Guangzhou Asian Organizing Committee for 350 million yuan. It became the first Jinjiang sports shoes and clothing enterprise to sponsor intercontinental competitions.

From 2006 to 2008, the funds of sports events sponsored by Jinjiang sports enterprises amounted to 890 million yuan.

In 2007, Anta listed in Hongkong.

In 2007, the global financial crisis broke out. In October of the same year, Anta, the most sensitive Anta, took the lead in listing in China.

After the Beijing Olympic Games in 2008, the major forces of Jinjiang sports enterprises listed in succession: Hongxing Erke and alligator are listed in Singapore, and XTEP is listed in Hongkong, China.

In 2009, 361 degrees and PEAK also landed on China's Hongkong stock market.

In 2010 only February to April, Merck international and flying sports were listed in Hongkong, China.

　　 The crisis behind prosperity

Presumably, the development of Jinjiang sports brand can also be summed up in eight words: flourishing and declining.

The 2003-2007 year is the golden age of Jinjiang sports brand. The illusion of prosperity for everyone has the blind expansion of enterprises. Agents and franchisees can help companies extend their tentacles, but because of their lack of adequate management capabilities for sales channels, this expansion has become the culprit of the collapse of many Jinjiang enterprises. After the 2008 Olympic Games, many enterprises were in an overloaded state.

Until 2012, the overcapacity of domestic sports brands led to the outbreak of the inventory crisis, and some small businesses were declared bankrupt because of the collapse of the cash flow. "Jinjiang sports brand enterprises are not enough to sell for three years." This sentence can be used to describe their huge product volume, and it can also be used to describe its extensive business mode. In 2012, the entire Jinjiang sports brand store shrinks by more than 10%.

The once famous Jinjiang enterprises are facing a protracted clearance operation, and even XTEP, the four largest sports brand in China, did not announce that the inventory was basically cleared until the end of 2017. In order to clean up the stock, most enterprises have to lower the price and sell the money. This makes the brand image destroyed by the enterprise, and many Jinjiang brands and even domestic brands are forced to give up the middle end market.

The original intention of Anta is to "start a business with ease and to be down-to-earth", but in the 28 years since its establishment, it has been carrying out the policy of "never stop". Compared with other Jinjiang brands, Anta has survived the stock crisis because of its higher proportion and lower cost of self owned shops, and thus stands out in the "price war". In addition, Anta has acquired sophisticated foreign high-end brands and embarked on a multi brand and collectivization route to enter the high-end market.

In 2009, Anta acquired FILA, an old sports leisure brand in Italy.

In 2013, Anta bought the Quanzhou globe.

In 2014, Anta surpassed Lining and became the leader of China's sporting goods industry.

In 2015, Anta acquired Spandi (sprandi), breaking billions of incantation and becoming the first Chinese enterprise with over 10 billion revenue in the whole industry.

In 2016, Anta and Japan's high-end sports brand Desanto (Descente) cooperation;

In 2017, KOLON SPORT of Korea joined Anta.

Since the 90s of last century, hundreds of sports brands have sprung up around the 649 square kilometers of land in Jinjiang. I can't help complaining when I lose my mind. Throughout the history of the development of Jinjiang sports brand, it is like a history of entrepreneurial follow - up, marketing strategy is identical, brand homogenization is serious, and even listing is getting together.

The origin of family workshops makes most Jinjiang enterprises lack scientific management and long-term planning. The sports industry in Jinjiang has the size of "cluster", but it does not form a "cluster effect". This is probably the "family of origin" giving Jinjiang enterprises the helplessness.

Located on the coast, it is three days, and the past and the past are seven points. In the past thirty years, people in Jinjiang have won the title of "sports shoes capital" by virtue of the spirit of love and competition, which has also reflected the rise and fall of China's sports brand industry.