In June, listed in Hong Kong li-ning, anta, Chinese sports such as aspirin grams apparel stock prices fell for two weeks. Reason is merely a message: Nike plan to turn into the mainland two three-wire low-priced product market. In fact, adidas also had a similar plan. So, with Nike led the foreign brands to 2 why do the three-line market expansion?
Their plan will encounter what challenges? This is we going to talk about today’s topic.
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increases basic confirm Forbes China’s list: single DingLei list WenGuoQing: measure wealth whether shrink index to Chinese three-line market into two has become the foreign
brands in global such as Nike realization of business growth collectivly.
The Chinese market at present is already nike air max’s largest overseas markets. 2009, Nike in the Chinese market income year-on-year increase by 10%. And domestic sports brand li ning
and anta etc income growth more than 25%. Are formed so big contrast, is because the foreign brands long confined to north wide first cities, while local brand is more strongly
focused on two three-wire city. First, while the city market size, consumer purchasing power is strong, but growth is relatively slow, competition is intense, cost is also
higher. And with China urbanization process, two three-wire urban consumers income growth level fast, market space is enormous. Can say, if still in the Nike self-appointed
first-tier cities that it is the world’s fastest-growing sports rainments surrendering the market competition.
However, nike air maxe are in two three-wire market success would face a daunting challenge.
First line of adjustment. In China, the market in most subordinate cities most acceptable footwear pricing in 170 yuan ~ 250 yuan between, and Nike shoes products to be sold in
China in the price is $ 400 ~ 1000 yuan of interval. Therefore, Nike must consider offer some price lower products. According to estimation, Nike need will footwear products
price interval moves 25%, to 300 yuan per pair level.
However, price is not easy to implement. Because it means the enterprise must compress product value chain cost. In order to make the product price to $ 300, Nike and suppliers
of unit profit need drop about 21%. And final sales growth can bring enough to offset the loss of profit prices fall is a mystery.
Secondly, reduce prices may damage the brand image, make its lose loyalty old customers. For many young consumers, can have a pair of Nike trainers is a decent thing. If the
product price to mass that is acceptable level, then past and personalized pursuit of high-end customer from products to be satisfying will greatly abate. In 2008, adidas used
in order to protect the brand image, risking and distributors of risk, boiled prevents them from low-cost clear inventories. Big in the brand image of love which is obvious.
Finally, to be in two three-wire city, increasing sales terminals fenster notes coverage is a never-to-be-evaded candy.
In the impression of average person, sales penchant for nearly 1000 yuan Nike products, distributor profits must be very considerable, Nike have to increase sales outlets
dealers will certainly an apple. The reality, however, this is not the case. The foreign brands distributor profits rather than actually domestic brand dealers low about 5
percentage points. This was partly due to nike air max store opened in prophase investment than homebred brand, on the other hand, foreign brand product price more transparent, dealers
decision-making price space also smaller. Moreover, because not enough channel system, product layers, markups flating terminal product price also more dealers are not
competitive. So, for most medium scale dealers are concerned, the same amount of inputs, they’d rather agent more profitable homebred brand.
In order to overcome these challenges, Nike are also is not entirely do.
First, in order to reduce costs, Nike need more factory transferred to the China inland, and in the product design and purchase, and sales link to reduce costs.
In channels, we should strengthen the construction, recruiting channel flating more local employees, send more management personnel with local dealers active communication. And
thereby more close to the consumer rapidly changing needs. For example, adidas was changed with only agent contact, the latter is responsible for manage dealers strategy, before
September established and the dealer docking team.
In marketing, should adopt brand of differentiated to attract consumers, and not on the price war to shihroudi competition. Softened brand in the consumers’ mind in high-end,
professional image, and then introduced the corresponding price more popular product, so as to avoid excessive about reducing, reduce consumer to brand image of low damage.
Previously, Nike and adidas these sports brand is emphasized professional, thus with ordinary consumers distance a little far. Professional sports product has a “single multi-
medium consumption patterns, it is to point to a professional consumers will buy suitable for different functional need sports apparel. For example, running to wear running
shoes, there are basketball shoes, playing tennis shoes, football shoes, etc. But, for most two three-wire urban consumers, but usually or “single sheet is tasted” consumption
patterns, sports apparel often need to fit a variety of movement, or even for everyday wear. In view of this situation, into these markets western brands can try shape more
lives, the fashion brand image. For example, adidas advertisement, please LiBingBing make brand spokesperson, sports is more lack of yoga.
In order to lower the price any while does not damage the brand image, also can consider to pass a special son brand to launch ZhongDiDuan products, avoid to use the company’s
main brand. Such as Nike can be its kanway and feed treasure two brands as low pioneer, but let the Nike brand just stick high-end. Adidas also can first will its reebok price
downward adjustments.
Nike Air Max is a line of shoes first released by nike.inc in 1987.Now Nike Air Max has became the main products of Nike shoes. Since its introduction,Nike has frequently introduced new and updated models of the Nike Air max shoes.http://www.nikeshoes-zone.com/
