Li Ning: The Dream Of "World Famous Brand" Has Run Aground

Just after the Spring Festival, a wave of Layoff The tide surged in. After Nokia, the mobile phone company, laid off 4000 people, PepsiCo also announced the reduction of about 8700 people. Maybe it's just a coincidence, Li Ning The company also joined the wave of layoffs. Affected by this, already in Hong Kong list Li Ning's share price fell 5.386% to HK $8.08.

For this move, although Li Ning claimed that it was only to adjust the organizational structure and reduce personnel costs. However, insiders believe that this behavior shows that Li Ning has fallen into the dilemma of market growth.

Of course, this analysis is based on more than Li Ning's layoff. Since 2010, Li Ning has gone downhill. By 2011, Li Ning, whose revenue and profit had both declined, not only lost its second place in China after Nike, but also was caught up by Anta, a rising star.

According to the 2011 performance forecast and 2012 outlook released by Li Ning in January, the company's revenue in 2011 is expected to decline by 6~7% compared with 2010 due to the sluggish order growth and the recovery of some dealers' inventory. Among them, the net interest rate dropped by about 7-8 percentage points.

In terms of time alone, the brand transformation is the direct trigger for today's "down and out" of Li Ning. After experiencing the crazy expansion during the 2008 Beijing Olympic Games, in June 2010, Li Ning Company announced to open the brand remodeling, locked the consumer population to "90", and launched a new brand logo and a new slogan of "Make the Change".

To Li Ning's surprise, a subsequent order meeting gave him a blow. At the order meeting, the order quantity of Li Ning's clothing products and shoes products decreased by more than 7% and 8% respectively, and the total order amount decreased by about 6% year on year. This stick was seen as the painful price Li Ning paid for abandoning the loyal fans who originally occupied most of his consumer groups between 35 and 40 years old, and also the beginning of Li Ning's dilemma. After that, Li Ning's performance declined, which also triggered the resignation of several core executives of the company in that year.

However, if the case of Li Ning Company is taken as an example of the whole domestic sports brand, or even the whole "Made in China", Li Ning's dream of "world famous brand" has been doomed. Plagiarism, imitation, and focusing more on sales are the obstacles to most sports brands like Li Ning, which are difficult to be effective despite the banner of innovation.

This can be seen from Li Ning's previous advertising slogan "Anything is possible" and Nike's "JUSTDOIT" almost "coincidentally".

In fact, it is not only Li Ning who has smelled the cold in the late spring. The data of the 2012 latest order meeting, inventory backlog and planned new stores of domestic listed sporting goods enterprises such as Anta and Tebu are also at the lowest level in recent years. Li Ning's layoff may just be the first domino for domestic sports brands to encounter a turning point collectively.

In this way, we may interpret Li Ning's layoff as a wise move to "preempt others". And no matter whether the dream of "world famous brand" caused by this layoff is stranded, whether the transformation can be carried out smoothly, and when to break out of the predicament, from now on alone, he has realized that "the transformation of Li Ning is a must, otherwise there is only a dead end." Maybe we should also give Li Ning some time and space.

At the same time, we should pay more attention and think about the future of "Made in China" while lamenting the various achievements of Li Ning.