China News Service, August 15 (Zhongxin Finance and Economics Zuo Yuqing) As one of the foreign sports brands that is popular in the Chinese market, the CEO of Adidas recently admitted that he "made a mistake" in the Chinese market, and once appeared on Weibo hot search .
Sales in Greater China have suffered for 5 consecutive quarters, and the profit target for 2022 has been lowered... Can Adidas win back the Chinese market?
Adi CEO: Made a mistake in China
Recently, Adidas CEO Kasper Rorsted said in an interview with foreign media that Adidas’ revenue in Greater China fell by 35% in the first quarter. mistake".
Adidas' second-quarter 2022 financial report released on August 4 shows that the company's second-quarter net sales were 5.596 billion euros, a year-on-year increase of 10.2% from 5.077 billion euros in the same period last year; net profit was 309 million euros, a year-on-year decline of 24.2% %.
Although Adidas' overall performance in the Asia-Pacific region increased by 14%, the Greater China region continued the downward trend of performance in the first quarter, and fell again by 35% in the second quarter.
Adidas said weakness in Greater China weighed on overall revenue in the second quarter, and declining sales in the region also weighed on overall gross margins.
Data map: Adidas appeared at the exhibition.
Photo by China News Agency reporter Zhang Hengwei
Apparently, the "reshuffling" measures of the head of the Chinese business earlier did not make Adidas escape the negative growth for the fifth consecutive quarter in Greater China.
Adidas also had to lower its profit forecast, adjusting its expected full-year profit of 1.9 billion euros to around 1.3 billion euros.
Moreover, Rhodes did not deny that if the response of the Chinese market is less than expected, it may destroy Adidas' revenue target by 2025.
Good news for domestic sports brands
Different from Adidas' worries about performance, many domestic sports brands have reported good performance frequently.
Li Ning's recently released 2022 interim performance report shows that despite the impact of the new crown epidemic in the first half of the year, its performance has maintained an upward trend.
According to the report, Li Ning’s revenue in the first half of the year was 12.409 billion yuan, an increase of 21.7% year-on-year; gross profit was 6.201 billion yuan, an increase of 8.8% year-on-year; the profit attributable to the group’s equity holders was 2.189 billion yuan, an increase of 11.6% year-on-year .
A certain Chinese Li-Ning sports brand store.
Photo by Zuo Yuqing
Xtep International also recently announced a profit forecast. The forecast shows that in the first half of the year, Xtep's comprehensive revenue growth is expected to be no less than 35%, and retail sales including online and offline channels are expected to increase by 20-25%.
In addition, 361 Degrees also released a positive profit forecast for the first half of the year.
With the rise of the national tide, Adi is "unacceptable"?
Why are the old sports giants losing ground in the Chinese market?
What did Adidas do wrong?
In addition to the impact of the new crown epidemic and the Xinjiang cotton incident, Rothde admits: "We don't know enough about consumers, so we leave room for Chinese competitors who do better." Compared with before, "China's consumption today Those who like (products) have a 'Chinese feel'."
In recent years, the rise of the national tide has been particularly prominent in the field of sports brands. A number of domestic sports brands such as Li Ning, Anta, Xtep, and Hongxing Erke have taken advantage of the situation.
In addition to paying more attention to design and research and development, many domestic sports brands are also closer to young consumers, launching diversified products and localized marketing methods, forming their own product matrix and brand influence.
In addition, "Putian Shoes", which once worked as an OEM for well-known brands such as Adidas and Nike, also applied for a collective trademark, trying to "get a share" in the sports brand market.
Data map: Hongxing Erke with some shelves sold out.
Photo by He Penglei
In contrast, international sports brands such as Adidas appear to be stagnant.
Some foreign media pointed out that Adidas and other international sports brands are "frustrated" in China not only because Chinese consumers are less reliant on Western brands or even boycott them, but also because they underestimate the importance of online sales channels.
Zhongxin Finance noticed that under the influence of the new crown epidemic on offline sales, the sales of Li Ning and 361 Degrees online retail channels have both increased. Anta has also actively promoted online sales to offset the suspension of some offline stores. influences.
Regarding the future development of the Chinese market, Rothde said that in the long run, he is still optimistic about China.
And Adidas is also taking a series of actions, such as expanding electronic sales channels, to strengthen its influence on the Chinese market.
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