Lining Tries Water America Electric Business &Nbsp; Expansion Strategy Causes Controversy.

In the past two years, the Chinese movement in the domestic market is rather awkward.

Lining opens up overseas markets

Although many Americans do not know Lining's Chinese brand at all, it does not hinder the company's determination to go out.

A few days ago, Lining's Digital Corporation began to launch online sales business in the United States, mainly selling basketball, women's sportswear and running shoes.

Statistics show that the Digital Corporation is a joint venture between Lining and a brand consultancy and private equity firm in Chicago.

In the new company, Li Ningzhan has a 20% share.

For sale online in the United States, Lining stressed that the move is just a trial run, and the joint venture company will not be able to invest too much.

"Lining's overseas expansion

George Lu, President of Digital Corporation Lining, said he had hired 20 employees to design a new image for Li Ning Co, aiming to make Americans understand the eastern culture.

Today, on the Li Ning Co website, a pair of men's running shoes, priced at $80, are made of mesh materials and can "adapt to natural gait".

The lotus pattern yoga pants are priced at US $55 and are suitable for making "accurate posture".

Internationalization strategy has a long history.

In fact, in China's domestic sports brands, Li Ning Co has always been an "example" to actively expand overseas. Especially after the 2008 Olympic Games, Lining was once defined by the global sports giant as a challenger from China.

Lining set up a headquarters in the United States, opened a retail store in Poland, bought Italy brand Lotto and so on.

This time, Lining also made careful planning in the US test.

According to George Lu's plan, American consumers will be able to contact O'neal's community events and sporting goods stores.

For Lining's electricity supplier strategy, China Consulting Co., Ltd. clothing industry analyst Liang Venlo believes that the electricity supplier network takes into account brand and sales, "cost performance" relative to domestic brands in the NBA "hit" advertising is high.

But there are different opinions in the industry.

The founder of Wolf Asia Group, a market research firm, questioned the timing of Lining's expansion in an interview, saying that it is too early to take this step.

Internationalization may reduce ethnic color

Many people still remember that in the mid 90s of last century, the image of Li Ning Co was the national team of sportswear, sponsoring many competitions such as gymnastics, diving, shooting, table tennis and so on.

In fact, this positioning is also very precise, because at that stage, the national sentiment was unprecedentedly high, and Lining's personal influence was still there. Too many people placed a national feeling on Lining.

Lining represents virtually the image of a country.

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In 1997 and 1998, Li Ning Co sales were close to 1 billion yuan.

At that time, the giants such as Adidas and Nike were still quietly laying the foundation and feeling in the Chinese market. The brand of the Fujian sports brand that was rising later was just a grass root product that was not too high in the streets and lanes.

In 2000, Chen Yihong, then general manager of Li Ning Co, put forward the goal of "internationalization".

In his view, Lining wandered for years because of the lack of brand appeal, and "need to go out and play a bigger role".

Marketing expert Lu Yiqi pointed out that Lining represents the glory of Chinese sports for a time, and has been pursued like a national hero.

But at the moment, Lining's peak is too far away from consumers.

Lining's brand role as a sports star is negligible for consumer groups.

Therefore, even if internationalization has made the brand lose its national color, its advantages outweigh its disadvantages.

Why did Lining lose his domestic market?

In July this year, Li Ning Co suddenly issued a profit warning. According to the current order price, the overall sales revenue in 2011 will drop by about 5% compared to the same period.

At the same time, because of the efforts to increase channel reform and speed up inventory clearance, it is estimated that the net profit margin in the first half of this year will decrease from 12.9% in the same period last year to 6%-7%.

With the news, its share price plummeted 15.77%, a 27 month low.

As early as May this year, the original COO Guo Jianxin and some key employees also left the Li Ning Co.

For a time, the bottleneck of internal development and the external media were condemned. Lining was caught in a crisis.

After the earnings warning report was released, Lining, the founder of the company, sent a "letter to employees" from Hongkong.

In his letter, he stressed that "the board and management have reached a consensus on the goal of active change, and fully support CEO and management's implementation plan for achieving the goal of change."

Many people in the industry believe that Lining's crisis is closely related to brand pformation.

In 2005, Lining hired professional agencies to investigate the brand status quo.

The survey showed that consumers accounted for 50% of consumers aged 35-45.

In order to win the favor of young consumers and expand the consumption crowd, Lining positioned the brand consumer group as "the 90s" in the three quarter of last year.

At that time, some experts pointed out that Li Ning Co's price positioning is not suitable for "post-90s".

As we all know, the price of Lining products is slightly lower than that of foreign brands such as Nike and Adidas, but higher than that of Anta, XTEP and other domestic brands.

Wang Zhiqiang, an independent financial observer, said that most of the "post-90s" consumer groups did not have a stable economic source, but they pursued a new high-end.

They either can't afford to buy Lining or simply choose foreign brands such as Adidas and Nike.

In addition, at the beginning of its establishment, Lining's position was a professional sportswear clothing brand. However, today's Lining is somewhat unpredictable and keeps swaying between professional and fashion.

This can be seen from the spokesperson of Lining's image: O'neal, Lin Dan, Wu Minxia, Powell, Isinbayeva, China badminton team and Chinese diving team. In March this year, Lining also signed a new spokesman.

Lining appears greedy, not only to get involved in sports products, but also to create himself as a fashion brand.

The result is that if you ask Li Ning Co what products are most prominent, the answer is No.

Li Ning Co now admits tactically mistakes in tactics.

"As the first national brand to eat crabs, the Li Ning Co has accumulated more experience in the groping," said Li Wei, a new Lining spokesman.

In spite of setbacks in a short time, initiative growth is always better than passive. "