Li Ning’s consumer group is relatively older, and future competition lies in the competition for young consumers. Li Ning is rebranding by changing its label.

From symmetrical to asymmetrical, from "anything is possible" to "let change happen", June 30, 2010, Li Ning (China) Sporting Goods Co., Ltd. (HK.2331, Part 2 (called "Li Ning Company") released a new LOGO (logo) and Slogan (slogan).

“Through external research, consumers feedback from the preference and the intuitive feeling of the original LOGO, Li Ning gives people a positive, potential, Chinese characteristics, approachable and trustworthy brand image, but in We are lagging behind in terms of fashion, coolness and international outlook, and we must change it.” In the next few years, Fang Shiwei may have to repeat similar words N times.

Fang Shiwei is the vice president and CMO (chief marketing officer) of Li Ning Company. He entered Li Ning Company in June 2007. In the past three years, one of his most important tasks has been the rebranding of Li Ning.

For Li Ning CEO Zhang Zhiyong, the release of Li Ning's new logo means more: Li Ning's consumer group is older, and the future competition lies in the competition for young consumers; the domestic sporting goods industry In the past, opening a store could increase revenue, but now it needs to face more direct competition from international brand giants in the industry. Li Ning needs to shift its main battlefield from domestic second- and third-tier markets to first-tier and mega cities.

Intention to raise prices

The 2009 financial report showed that Li Ning's sales increased by 25.4% year-on-year, achieving sales revenue of 8.387 billion yuan. This figure exceeds industry estimates of Adidas China's 2009 sales. In other words, this is the first time that Li Ning has regained the "second place" position after 5 years since its domestic sales revenue was surpassed by Adidas in 2004. Still at the top is Nike China. According to industry estimates, Nike's domestic sales in 2009 were approximately 10 billion yuan.

However, Zhang Zhiyong noticed that before 2008, the annual growth rate of the domestic sporting goods industry was about 30%, in 2009 it was about 11%, and in 2010 it is estimated to be 15% to 16%. Li Ning's own growth is slowing as its scale increases: the company grew by more than 60% in 2008 and only 25.4% in 2009.

"The driving force for market growth has changed. Over the past many years, the driving force for the growth of sporting goods has been distribution. We call for opening more stores. The Chinese market is very large. In order for people to buy it, there must be stores. Convenience for consumers to purchase has made this industry develop very fast. Now that the stores are almost open, it will return to the core and critical stage of competition, which we call product innovation and brand innovation," Zhang Zhiyong told a reporter from China Business News. .

"For product and brand innovation, to do these two things, you must first have a true brand positioning. Without this positioning, you cannot do the following things. To consumers, brand positioning actually presents the brand's Tonality, product characteristics, slogans, and LOGO, these four parts usually form the brand personality that consumers see." Fang Shiwei said.

From 2006 to 2007, Li Ning Company’s market research report on consumers showed that the actual consumer groups of Li Ning brand have deviated to a certain extent from the target consumer groups. The crowd was over 50%. However, the main target group of 13 to 26 years old, who is regarded by Zhang Zhiyong as a new generation of creators (Generation 1 Creator), often feels that Li Ning is not "cool" enough.

This gives Zhang Zhiyong a headache. After all, Li Ning, the founder and chairman of Li Ning Company, has always wanted to be an "international Li Ning" rather than a "Chinese Nike". Even if it is just to be "China's Nike", the Li-Ning brand is bound to face an "upward" movement from second- and third-tier cities to domestic first-tier and mega-cities. Therefore, it has become inevitable to inject more vitality and fashion elements into the Li Ning brand.

However, the cruel reality is that store rents in first-tier and mega-cities in China are rising rapidly. It seems that Li Ning will face more difficulties even if it wants to maintain its current profit margins. Product price increases seem to be the only way out.

Zhang Zhiyong said that under the general trend, Li Ning Company will first make more young people like this brand; only when these are done well can the rise in Li Ning product prices find a reason and foundation.

Inventory risk

Even though Li Ning has been preparing for three years, Zhang Zhiyong still admitted that Li Ning's road to rebranding and rebranding will not be smooth.

"From the perspective of temporary risks, the first one is the inventory of the old LOGO, because we cannot foresee what impact the new LOGO will have on the old LOGO, because the products are rising level by level. There are more and more products of this kind and less and less of that product. According to our past experience, the inventory must be cleared within 24 months, so we have to speed up this matter," Zhang Zhiyong said, because he has no experience in this area. Among domestic companies that have changed their logos, only Lenovo has successfully implemented the switch.

In addition, Zhang Zhiyong’s second worry is that Li Ning’s new LOGO will make consumers aware that the company must maintain creative consistency and sustainability from product design to marketing. "In other words, all creative ideas must be consistent between different sports within five years, which is much more important than the creative ideas themselves."

In order to reduce the risks that may arise from label changes, Li Ning Company has made internal adjustments in the market system, product system and sales system.

In terms of product design and research and development, Li Ning's original parallel business divisions of clothing (including accessories) and sports shoes have become a matrix organizational structure focusing on sports categories such as basketball, running, and badminton.

In terms of channel upgrading, Li Ning’s “sixth generation store” has begun testing. Ring-style door handles, stadium-like floor decorations, Chinese red and other design elements are now available. The national market is divided into North District, East District and South District, and general managers of the three regions are established to carry out targeted marketing according to the regional market.

Whether Li Ning’s transformation can be successful remains to be tested by the market.