Chinese Sports Apparel Company Li Ning In The Midst Of A Major Overhaul
Chinese sports apparel company Li Ning CEO Jin-Goon Kim said that the brand "is now in the midst of a major overhaul," aiming to increase "its China market share by as much as 40% in the next two years," according to Laurie Burkitt of the WALL STREET JOURNAL. The ambitions "come at a rocky time for the company: Li Ning has brought on four new senior execs since replacing its CEO in July." First-half profit "was down 85% from a year earlier, with revenue off 10% to 3.88B yuan ($621.6M)." The company "has closed nearly a thousand stores this year, as its share price has fallen 35%." Now, "scaling back its plans for global domination in athletic shoes and apparel, the brand is embarking on a three-year transformation program to win a bigger slice on the home turf and improve profitability." Kim said that the Beijing-based company's goal "is to win the mass market in China by targeting consumers moving to big cities from the countryside." Kim said, "We want to be the leading brand in China, as opposed to the leading brand here and overseas." China Market Research Group senior analyst Ben Cavender said much of Li Ning's problem is that "it has waffled between positioning itself as a premium and a low-end brand." Cavender said that "business strategy will matter more than brand positioning" (WSJ, 11/20).