People are keen to compare the two top domestic sports brands, Li Ning and Anta.
Before this year, the two groups were on different paths: Anta relied on buy buy buy to acquire international brands such as FILA and Arc’teryx parent company Amer Sports; Li Ning always relied on buy buy buy to acquire international brands such as FILA and Arc’teryx parent company Amer Sports. One brand dominates the world, creating the “China Lining” series by creating trendy brands and increasing national identity.
Although Li Ning mentioned in its semi-annual report released not long ago that it will “adhere to the strategic direction of “single brand, multiple categories, and multiple channels”. But from its actions, it seems that the two companies The distinction between business models seems to be less obvious.
Li Ning has also begun to purchase brands. In May this year, it acquired Hong Kong’s “former trendy brand” Bossard at a low price of 30% off. In fact, early In August last year, Li Ning revealed that it had established a private equity fund with Lane Capital of Hong Kong, China, hoping to invest in foreign consumer and sports brands through the fund. The chairman of Lane Capital is Li Ning himself.
Now, Li Ning They plan to spend money again, and their target is the British leather shoe brand Clarks.
This shoe company with a history of nearly 200 years has continued to decline in profits after 2014, and in 2018 it will Loss. Last year, after losing 82.9 million pounds, it experienced store closures and layoffs in the UK. After the epidemic, the United States will also close 25% of its local stores.
“E-commerce Online” interviewed Several former Clarks consumers, as well as several young people born in 1995, said, “I bought it a few years ago, but I haven’t bought one in a long time.” Dull”.
Will a brand that is losing money, closing stores, and having a dull brand image be a good investment target?
Although the acquisition of Clarks has not yet been finalized, we can make an analysis based on the cards Li Ning currently holds and the current development of Clarks: Why does Li Ning want to buy Clarks, and what will it bring to Clarks who is in crisis? What changes will come?
01 Clarks is no longer cool?
The story of Clarks originated from the transformation of a sheepskin carpet company. In the 1920s, the founder used carpet scraps to make the first pair of wool slippers, which became a hit and started the shoe business.
After 1950, Clarks has become the largest leather shoe brand in the UK. The first flagship store was opened in London’s most prosperous and fashionable Regent Street. There will also be a Clarks on the streets of every city. Rock bands The Beatles and Oasis are fans of it.
Clarks and Stussy’s joint model
In the early years, Chinese people who traveled to the UK would probably put a pair of Clarks in their luggage when they returned home. In an era when high heels and leather shoes still occupied the largest space in fashion magazines, such a British brand was undoubtedly a representative of high-end and quality. At that time, the athleisure style had not yet taken over the market, and formal outfits with sneakers still looked unconventional.
And its decline is precisely related to the changes in fashion trends and social trends – “athletic style” has been popular in the market for several years; the status of Internet companies has risen, and they are “not particular about dressing up”. ” has also led other companies to relax dress code restrictions – all of which have caused sales of brands that focus on dress shoes to plummet.
2018, when Clarks began to suffer losses, happened to be the year when the global sports and leisure trend was at its peak.
Looking at the hot-selling shoes that have flooded social networks in recent years, or the shoe brands that were once brilliant but are now declining, their fates have been different, all because they have gone against or followed the trend. . The former are all in the field of sports and leisure, such as Adidas’ white shoes, Balenciaga’s dad shoes, and Yeezy Boost and AJ, which are hot in the sneaker market; the latter is like Belle, the silent shoe king.
In recent years, brands have released more casual styles in order to cater to the trend. Clarks also sells casual shoes, and has launched co-branded shoes with trendy brands such as Stussy, Palm Angels, and Todd Snyder.
In October, Clarks’ classic kangaroo shoes and Palm Angels launched a joint brand
But perhaps because the domestic audience of these brands is too narrow, Clarks’ external image has not changed. Its best-selling product in the Tmall flagship store is a pair of formal leather shoes, Derby shoes. 799 yuan a pair, with monthly sales of nearly 500 pairs. Everyone gives it high marks: comfort, quality, and good service.
In the eyes of many Chinese, Clarks is like a conservative British man, reliable but boring. The most classic desert boots and kangaroo shoes are not very attractive to young people who only have Nike and Yeezy in their eyes today.
Top picture: kangaroo shoes; bottom picture: desert boots
Then why does Li Ning still want to acquire it?
02 Li Ning’s anxiety andBelle International, which has the right to operate the brand, is deeply involved in the aging crisis and hopes to make FILA a brand targeted at people over 40 years old. The result is naturally a failure.
But after Anta took over FILA, it targeted consumers between the ages of 18-26. It gradually took back the operating rights left in the hands of dealers and used its channel resources to open many directly-operated stores in core business districts or high-end shopping malls. This not only allows the brand to respond quickly to market trends, but the format of large stores or flagship stores also gives FILA a higher tonality.
The brand’s image change is also carried out at the same time. When Li Ning built China Li Ning, it did not invite foreign aid, but Li Ning’s original design team was responsible for the design. Anta spent money to invite Korean designers, and launched a subdivided trendy brand FILA FUSION under the FILA brand. Sponsoring hip-hop variety shows, releasing joint models… FILA has also used these basic actions to make the brand younger.
The dad shoes released by FILA
In the fashion market, Taking down young people means taking down everything. Soon, FILA became Anta’s most powerful growth engine.
Anta (including ANTA children’s independent stores) has more than 10,000 stores worldwide. The number of FILA stores in mainland China, Hong Kong, Macau and Singapore (including FILA KIDS and FILA FUSION) is only 1/10 of Anta’s. But it created more revenue than the former.
In the first half of this year, Anta’s entire group revenue was 14.669 billion yuan, of which FILA accounted for more than half, 7.152 billion yuan. Even after the epidemic, FILA’s revenue still maintained a growth of 9.4%. During the same period, Anta’s revenue fell by 10.7%.
Li Ning, which has entered its 30s, also has a variety of rich channel resources. Li Ning often mentions its multi-channel advantages in its financial reports: core business districts, traditional department stores, and inventory clearance channels such as outlets. According to the current path of rejuvenating or high-end brands, opening large stores in high-end shopping malls is almost a must-have – China Lining has occupied a place in core business districts such as Shanghai RI-Taikoo Hui, Raffles City, and Lujiazui Center Store.
China Li Ning in Shanghai Daning International Center
This advantage is particularly valuable when Clarks is facing store saturation in the European and American markets and a large number of store closures: Although in new first-tier cities like Hangzhou, Clarks has already entered shopping malls such as Intime Department Store or Joy City. But in Shanghai, most Clarks stores are opened in old department stores such as Printemps and Bailian, or in discount stores such as Yiou Lai and Florence. Li Ning’s channel resources can help Clarks expand into younger stores or flagship stores that showcase the brand image.
Li Ning and Clarks each have quite mature operating experience in e-commerce, which may give both parties room to improve each other. In the first half of this year, Li Ning’s revenue share (27%) exceeded offline retail (21.6%). Clarks has also done well in its digital foundation: not only has it opened a flagship store on Tmall, with more than 1.3 million fans, but it also uses live streaming and other methods in the store. The WeChat official account can jump directly to the brand’s JD Mall.
As for Clarks’ style, will it change in line with the trend? Our answer is: no.
Clarks’ fellow British brand Dr. Martens is also making a name for itself with several classic shoes. It’s just that Dr. Martens looks more “rebellious” and seems to be bound to underground subcultures such as rock music. When rock music and hip-hop, which were once buried underground, were brought to the surface by several variety shows, their corresponding consumption methods and consumer brands naturally became popular.
Desert boots and kangaroo boots can also be cool again. Clarks’ “formal casual” positioning in the eyes of Chinese people can bring more possibilities to Li Ning, who focuses on sports. This allows a group to always hold a ticket in a market where fashion trends are changing rapidly.
Who can guarantee that the next “exquisite era” will not come?
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