1. Sportswear Industry: Please refer to the Market Foresight and Investment Strategic Planning Analysis Report of China Sportswear Industry by Forward-looking Industry Research Institute.
2. Li Ning Company: Li Ning Company has been listed since 2004, and its performance has been rising all the way. In 2009, its sales in the Mainland surpassed Adidas for the first time, and its performance once occupied the forefront of the sporting goods industry in China. However, in recent years, with the strong development of other sports brands, the domestic and international markets continue to be sluggish, and the performance of Li Ning Company continues to decline, which is experiencing a crisis of survival. In addition, the mistakes of Li Ning's development strategy and the lack of brand spirit are also the reasons for Li Ning's problems. At present, Li Ning Company should recognize the root of the problem and find the way of development.
In 2004, before the opening of the Athens Olympic Games, the sports brand Li Ning was listed in Hong Kong. In 2008 Beijing Olympic Games, Li Ning pushed Olympic marketing to the peak. The following year, sales in the mainland market surpassed Adidas for the first time. Li Ning's performance once occupied the forefront of the sporting goods industry in China. However, the 20 1 1 annual report shows that Li Ning's annual operating income was 893 1 billion yuan, down 5.84% year-on-year, and its net profit was 386 million yuan, down 65. 19% year-on-year. After years of continuous climbing, performance began to decline. In the first half of 20 12, the sales revenue was 3.88 billion yuan, down 9.54% year-on-year, and the net profit was 44 million yuan, down 84.92% year-on-year. By 20 13, the net loss has reached 392 million yuan. Sales revenue and net profit both declined. Li Ning in this situation is not alone. The domestic local sports brand market has shrunk, its performance has fallen sharply, and its prospects are worrying. This paper analyzes the present situation of Li Ning Company, and puts forward corresponding opinions and suggestions for the existing problems.
First, the main problems of Li Ning Company
The core value of Li Ning brand is not very clear in consumers' minds, and the existing consumers' brand recognition of Li Ning brand is not very consistent with the brand positioning that Li Ning Company strives to build. Some brand attributes recognized by consumers are exactly what Li Ning Company wants to weaken in order to realize its brand internationalization strategy.
(a) Market issues
1. The brand positioning is not clear. According to the research done by Gallup Consulting, friendliness and a sense of national honor are the most prominent brand personalities of Li Ning. It is not the youth, fashion and internationalization that Li Ning is trying to shape. Li Ning's goal positioning is "high-end", "professional" and "internationalization". Li Ning's positioning is "high-end", "primary" and "national brand". At the same time, consumers are positioned as "friendly", "honor" and "national brand". Moreover, the attribute of "nationality" is being weakened by Li Ning's "internationalization" desire.
2. Style does not match the brand image. Because of the unclear brand positioning, Li Ning Company has some problems in product design, sponsorship activities, image and product advertising, store opening style, and even the choice of image spokesperson, which makes consumers' impression of Li Ning brand messy and brand image inconsistent.
3. Li Ning's incomplete high-end positioning leads to two sides being attacked. "If I have no money, I will buy cheaper Anta; If I have money, why not buy international brands Nike and Adidas? " After 2008, Li Ning began to take the high-end strategy, but Li Ning's high-end development was not thorough. As a result, Nike and Adidas are the top two international giants, followed by the challengers of China local enterprises such as Anta and Xtep. The positioning space of the middle and high-end market that Li Ning originally established and relied on has been squeezed unprecedentedly.
4. Too eager to change. Eager to change from price market to value market. Li Ning also made a risky decision: to close the distance with international sports brands by raising prices. Although the price difference between Li Ning brand products and foreign brands such as Nike and Adidas has been narrowing after the price increase, the main customer groups of Li Ning brand are still concentrated in second-and third-tier cities, and because the styles, experiences and marketing methods of products have not kept pace, Li Ning's original price-performance ratio advantage has been completely lost, and those consumers who are already quite sensitive to price have to turn to domestic sports brands such as Anta and Peak.
(b) Management issues
After the glory of 2008, Li Ning's performance declined until it lost money. In 20 10, Zhang Yong, CEO of Li Ning Company, boldly launched the brand remolding campaign, hoping to change the declining performance. However, contrary to expectations, this battle made Li Ning's financial statements even worse. Careful analysis shows that the problem of Li Ning Company lies not only in the mistakes of market reform, but also in the confusion of its internal management.
1. The cost is too high. Cost control has always been a major aspect that restricts Li Ning's profit. The problem of high cost has existed in the company for a long time, but it still exists after so many years from the company's reform to Li Ning's return. Compared with Li Ning and Anta, the overall staff of Anta, including a large number of factory employees, is 1 1.
500 people, the cost ratio in 20 1 1 is only 4.
180 Li Ning is lower; In marketing, Li Ning's investment ranks first in the same industry in China, with expenses accounting for 65,438+07.6% of operating income and 65,438+03.7% of Anta. But the problem is that Li Ning lost more than 300 million yuan.
The channel is out of control. Li Ning Company has always adopted a "light company" channel model, that is, outsourcing production and sales to channels. Although this channel model has now become the mainstream business model, it is still too early for Li Ning. Because the premise of this model is that enterprises should have strong ability to control upstream and downstream, control the smooth production of products and control the implementation of policies by downstream. Li Ning Company still lacks in these two aspects, so due to production problems, dealers are unwilling to increase inventory, and the whole supply chain lacks coordination and unity.
3. Rough management. Many aspiring middle and senior employees of Li Ning Company generally believe that there are many problems in the management of the company, such as poor cooperation between departments and selfish departmentalism among employees, which leads to low work efficiency. There is a problem of poor coordination between the board of directors and management, which affects the overall development of the company. In addition, some aspects of Li Ning's management are too detailed, the division of departments is too detailed, and the number is too large, which directly increases the management cost.
In brand promotion, Ogilvy PR is responsible for the new media promotion of Li Ning basketball, while the new media promotion of Li Ning's comprehensive products is handed over to a marketing company called Time Fun Interactive, and all other promotions are handed over to Fulai International Public Relations Company. When the three companies have business intersections, they need people from Li Ning Company to coordinate, and a lot of work needs to be stopped. Moreover, the coordinator of Li Ning Company is constantly changing.
Second, the reform of Li Ning Company
Li Ning's rapid growth in 2008-2009 secretly accelerated his decline. After realizing this problem, Li Ning's top brand remolding campaign not only failed to solve the problem, but increased the burden. Li Ning, regarded as the "savior" of Li Ning Company, returned to the company at the age of 49, hoping to change the status quo, revive Li Ning's past glory and continue Li Ning's dream.