Reebok'S Market Rescue In China

In the early days of mergers and acquisitions, Adidas group CEO Herbert Haina (

In the afternoon of September 1st, BillDoyle, the new Reebok general manager of China, who grew up from Adidas, said in an interview that his task is to change Reebok's business model in China.

BillDoyle did not disclose the number of Reebok stores in China, but he elaborated on his strategy. The speed was very fast and it sounds confident.

In China, few people know that the American sports brand Reebok started with women's sporting goods.

BillDoyle said Reebok has been unsure of its position in the Chinese market after its acquisition, so in the past 9 months, Reebok has reduced its advertising in China. They need to take this time to think clearly about Reebok's clearer positioning and direction.

XTEP's vice president, ye Qi, is fresh in memory. In the late 90s and early 2000, Reebok ranked third or fourth in China's international sports brand, and ranked first tier with Nike and ADI.

However, after joining Adidas group, Reebok has gone from bad to worse. Now it is the fourth tier of Chinese market sports brand, with annual sales of 1 billion yuan.

BillDoyle said that the focus of the work is two, one is the continuous development of innovative products, the two is to strengthen cooperation with distributors Baosheng international.

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In 2008, Reebok stood on the 40 foot tall statue of 47.00,2.10,4.68% in Wangfujing, Beijing, which is impressive. But in addition, China's sports marketing circles believe that Reebok did not play the role of Yao Ming. Consumers remembered Reebok and could not associate with Yao Ming, and the brand did not have a clear positioning for Reebok.

BillDoyle believes that in the past 9 months, Reebok has reduced its advertising in China because it is necessary to use this time to rethink clearly the positioning of Reebok brand. It should first make a clear positioning and then put advertisements on consumers to issue signals consistent with brands.

Since 2009, Reebok stores in the first tier cities have been shut down, although some of them have been opened after rectifying this year, but some of them have been abandoned and no longer opened, such as the shops in Nanhui District of Shanghai.

According to one industry data, Reebok has closed hundreds of stores in China since 2009, and the data have not been confirmed.

It is wrong to judge the sports consumption potential of the Chinese market after the Olympic Games. This is not a single problem for Reebok. It is a decision making error of the whole Adidas group. CEO, Zhang Qing, a sports consultant company in Beijing, said this.

In 2008, Adidas was a partner of the Beijing Olympic Games. Its performance was very beautiful. It once rushed to the first place in the sales volume.

It was in that year that Adidas group CEO Herbert Heiner announced the ambitious ambition of the group when interviewed by Chinese media. He said that Adidas will have 6300 stores in the Chinese market by 2010, and 1135 new retail outlets in 2008, while Reebok will increase from 800 to 2200 in 2010, and about 250 new stores will be opened each year.

According to one research data, by the time of the 2008 Beijing Olympic Games, Reebok opened almost every two days, and planned to increase more than 1300 stores in the next four years.

And take up 14% of total revenue to support the operation of the Chinese market, which is 10% higher than the industry average.

But BillDoyle did not confirm this. During the Olympic Games, BillDoyle did not take office.

He said that businesses generally do not disclose the number of stores and specific financial data, but it is true that since the end of the Olympic Games, Reebok has also closed some stores at the same time.

In 2008, when the European and American market shrank, and saw the opportunity of the Beijing Olympic Games, millions of dollars were invested in the American enterprises that wanted to be placed in the Chinese market. At that time, Reebok was a typical one.

In addition to China, in other parts of Asia, Reebok had also made plans to expand its stores, such as accelerating the pace of expansion in India.

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Grim situation

In 2009, Adidas was suddenly surpassed by Lining, who has always been ranked third.

Because of the optimism of the market situation after the Olympic Games, inventory has become a big problem.

The situation in Reebok is even worse.

Adidas Group believes that after the Olympic Games, China's sports consumption market will be greatly improved.

In fact, the whole nation's sports potential consumers have maintained the tradition of high attention and low participation for a long time.

The sports consumers in China present a typical saddle shaped structure, that is, both the youth and the elderly participate more, while the participation of the main consumer groups is very low.

Moreover, Zhang Qing believes that there is another serious problem in Adidas and Reebok, that is, there are only two to three large distributors in the Chinese market. BELLE, Baosheng international and sports 100 have occupied almost all of Adidas, which is dangerous because they have too much bargaining power.

When the decision level is wrong and the product is precipitated in the channel, the big dealer's instinctive reaction is to open more discount stores. This will bring great pressure to other distributors, and then vicious circle, resulting in more and more shops with less gross profit or even loss.

By contrast, Nike's distribution channels are more secure, and there are several distributors to distribute and check each other's checks and balances.

Lining has more than 120 distributors, none of which has a market share of more than 10%.

Foreign sports brands hold a view that the number of large distributors is very unfavorable to enterprises and easy to disperse.

But the regional difference in the Chinese market is very large, it is difficult to say that the too dispersed channel is not a good way.

Too few large distributors will direct their bargaining power, discounts and discounts, and the less they get in, the bigger the brand's stock.

According to Zhang Qing analysis, Reebok's problem is more serious than Adidas's.

Ye Qi, vice president of XTEP, recalled that in the late 90s and early 2000, Reebok ranked third and fourth in China's international brands.

But after being bought by Adidas, Reebok has lacked a clear and clear position in China.

In terms of turnover, Reebok can only be counted as the fourth tier of sports brand in China, with an annual sales volume of less than 1 billion yuan.

In China, the annual turnover can reach dozens of local sports brands which are quite large scale with Reebok. Therefore, unclear positioning will be fatal.

Nike and Adi take the competitive route. XTEP KAPPA is the fashion line. Chinese consumers think of Reebok, but it is hard to have a specific impression.

The industry believes that Reebok has wasted Yao Ming's valuable resources. In recent years, it has not even done any activities, and even has not seen any advertisements in CCTV.

Unlike fast opening stores before, Reebok is now closing shop in first tier cities and coastal cities.

Two years later, Reebok is rethinking how to cope with the challenges of the Chinese market.

Reebok's serious overstock is called "Olympic sequela" by analysts.

ChristopherSvezia, a sports shoes analyst at Susquehanna International Group, said that because of China's economic slowdown and indigestion, there has been a significant slowdown in the industry. At the same time, Reebok has opened up too many stores, and the market is not yet ready to digest the brand.

Herbert Heiner once said in a telephone conference that the choice of Reebok store's address appeared two years ago, but now it is no longer worth it, because the passenger flow decreases and slows down.

Haina said, "consumption in some parts of the city has decreased, and we do not want to continue to operate non profitable stores.

Maybe we started shop in 2007 and 2008 a bit too fast, and this is what we are correcting now.

In recent days, Reebok is trying to clear excess inventory discounts for sale and close hundreds of unprofitable stores.

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Rescue plan

BillDoyle said that the position and direction are now clear, and Reebok will focus on market segmentation.

But this concept did not exist in the United States a year and a half ago. He said it could be imagined that promoting such products in China would require more time to be fully understood.

But in the past 9 months, the product has been successful.

Many industry insiders expect that Yao Ming will not cooperate with Reebok when the contract expires at the end of this year or early next year. It is reported that there are already many local brands competing for Yao Ming.

Yao Ming's sports career is becoming shorter and shorter, and the cooperation with local brands will expand Yao Ming's brand and become a sub brand of local brands. This will not only earn the cost of endorsement, but also gain brand profits, and local brands can also enhance the international popularity by Yao Ming, which is a win-win situation.

Zhang Qing believes that if Reebok wants to open up the situation quickly in the Chinese market, the best way is to maintain the contract with Yao Ming.

Earlier this year, Reebok announced its cooperation with Baosheng, China's largest shoemaker.

Baosheng will help Reebok design and produce products that are more suitable for the Chinese market, instead of using the ideas of American designers. This is Reebok's sense of localization.

But Zhang Qing believes that Reebok still needs to be more localized. Only localized management can make the decision of Greater China more flexible, and consider granting a new governance body in Greater China to ensure a faster response to the market.

Ye Qi believes that if Adidas group does not give Reebok enough financial support and patience, it is only blindly changing channels to accelerate the opening of stores in the first tier cities, which will be even more dangerous.

Now, outdoor sports brands are catching up. With the listing of 24.870,1.11,4.67%, it means that the pattern of consumers is changing and sports products begin to subdivide in big cakes. Reebok's living environment is more severe.

Zhang Qing believes that either Reebok or Adidas will be the same as Adidas, but it is more difficult to push Reebok down and strictly distinguish it from Adidas.

But as early as 2007, Haina had made an answer to this question.

He said, "no one will be foolish enough to buy a brand with 3 billion euros in order to reduce its market position.

I firmly believe that Reebok's enormous potential in the past 5 to 10 years has not yet been completely released. "

Ye Qi and Zhang Qingdou, a local sports brand in China, think it is better to put a low profile and open stores in the two or three line market.

But Reebok doesn't think so.

BillDoyle believes that it is still concentrated in the first and two tier cities, with emphasis on the first tier cities.

Reebok's newly developed innovative products, EasyTone women's sports shoes and ZigTech running training shoes, range from 740 yuan to 820 yuan.