High Inventory Top Sports Brand Betting Olympic Marketing Is A Blessing Or A Curse

The annual growth of sports goods from 30% to 50% is past. High inventory Crisis has become a problem for every Chinese sporting goods company.

The practice of increasing profits by relying on open shop seems to have come to an end.

Just 3 days of the Dragon Boat Festival holiday, let sporting goods shop guide Lu Tao busy gasping for breath, long absence of busy, let him tired and happy.

This year is the Olympic year. 4 years ago, during the Beijing Olympic Games, the sales performance rose straight, so that Lu Tao is still fresh in memory. The pressure of high inventory this year has been troubling them. They expect London Olympic Games to rush, but sales have been very mild until the Dragon Boat Festival. To this end, he complained that his advertising in the Olympics was too late. But luout keeps comforting himself and his colleagues: "a half month of the Olympic Games, business is as good as the Dragon Boat Festival every day."

With the Olympic Games approaching, major sporting goods brands have been launched. Olympic marketing During the war, when high storage pressure and channel development were blocked, Olympic marketing was the same choice for domestic sporting goods companies. But can expensive Olympic marketing improve the performance of Lu Tao? Is Olympic marketing a blessing or a curse?

One

Phenomenon

Preparing for the 3 year sports brand and launching the Olympic marketing campaign

More than 2 months before the opening of the Olympic Games, Anta announced the launch of the Olympic marketing strategy and will cooperate with the "Chinese home" established by the Chinese Olympic Committee. Lining also launched the "1992 Lining Olympic award winning shoes" re engraving products, and a series of cultural T-shirts. Peak Jordan's Olympic marketing advertising has also been launched.

In fact, the battle of major brands competing for London's Olympic resources needs to be traced back to 3 years ago. After the end of the Beijing Olympic Games, Anta became the "strategic partner" of the highest level of the Chinese Olympic Committee through nearly a year's negotiations. Subsequently, Lining will also gymnastics, diving, shooting, table tennis, badminton and other 5 Chinese dream team sponsorship proceeds to provide sports equipment for them.

Jinjiang's brothers, such as PEAK and Jordan, have more unique vision. PEAK successfully signed contracts with 7 Olympic committees such as Iraq, New Zealand and Algeria. Jordan sponsored the Mongolia and Turkmenistan National Olympic committees, and Hongxing Erke also reached an agreement with the Iran Olympic Committee. In London Olympic Games, the brand of Chinese sports brand will be everywhere.

Two

Probe into

High inventory crisis hits

China's sports goods enterprises have some desperate marketing campaigns, but they are actually helpless. 30% years to 50% years of high growth gold ten years has become the past, high inventory crisis has become a matter for every Chinese sporting goods company to consider carefully.

The annual report of Chinese sporting goods enterprises listed in Hong Kong showed that the stock of Lining in 2011 was 1 billion 133 million yuan, up 40.57% from the same period of 806 million yuan in the same period last year, while Lining's net profit was only 386 million yuan in the same period, which was 65.2% down compared with the same period last year. The stock of PEAK increased by 25.67%, and the amount of stock in China even increased by nearly 60% over the previous year. Anta and XTEP were also not immune.

Low demand and high storage pressure have made sports goods enterprises in a difficult situation. "The eye effect created by the Olympics can stimulate sales in the short term." Tang Shuangshuang, an analyst with the textile and garment industry of Huachang securities, said that the Olympic Games are still the most competitive sports events in China. The Olympic strategy will be the most important task for most enterprises this year.

Channel expansion blocked

The practice of increasing profits by constantly opening stores seems to have come to an end. The speed of "enclosure movement" in the past also slowed down significantly. In 2011, the industry leader Anta only opened 229 new stores, and even closed hundreds of inefficient stores all year round. The number of new stores added by Lining was half that of 2010, but the Kappa brand's parent company even had a negative growth in the number of shops for the first time, a decrease of 632 compared with the previous year.

"It is unrealistic to attempt to sustain high profits and high growth through new stores and channels." Tang Shuangshuang told reporters that China's sporting goods enterprises generally adopted the sales model of agents at various levels. With the profit being diluted, the money that had fallen on the dealers had not been enough, making the channel development lack of practical motivation, and the channels for domestic sporting goods enterprises had already been very depressed, even the villages and towns had stores.

Nike, Adidas and other international first-line brands have stepped up their efforts, which has further squeezed the survival space of domestic sporting goods companies. Tang Shuangshuang said that the R & D capability of Nike and Adidas is much better than that of domestic enterprises. In order to compete for share, the price has already taken the "civilian" route, and the low price advantage of domestic sporting goods no longer exists, and Olympic marketing can increase brand exposure and recognition.

Three

pressure

Sponsorship fees soared

On the other hand, Olympic resources continue to raise prices, becoming the biggest problem that manufacturers have to face. Lining won the 2008 CCTV sports staff clothing sponsorship for more than 6000 yuan, a year later to the 31st hand has doubled to 125 million yuan.

Although International Olympic Committee did not disclose the highest price of TOP sponsors, many industry insiders said that the threshold of TOP sponsorship for Beijing Olympic Games in 2008 was about $60 million, and the sponsorship cost of TOP sponsors of the London Olympic Games has risen to a minimum of $80 million.

In 1984 the Losangeles Olympic Games, the threshold of sponsoring the Olympic Games was only 4 million dollars, and the increase in 28 years was over 20 times.

"Getting the qualification of Olympic sponsors is just the first step in Olympic marketing." Yang Runzhang, director of Beijing interstellar sports marketing, said that sponsorship qualification is actually only the right to promote the use of Olympic brand. Later, consumers need to connect their brands with Olympic brand by means of ground activities, media advertising and athletes interviews.