On the evening of July 10, the arrival of the star Shu Shu, the AsiaWorld-Expo in Hong Kong, caused the most violent commotion in the audience.
But this is not the scene of entertainment, where Anta Sports hosted a group of "friends" including partner Shu Qi to celebrate the 10th anniversary of the local sports brand's listing on the Hong Kong stock market - the market value increased nearly six From the time to HK$70 billion, the Group's annual revenue has nearly quadrupled, reaching RMB 13.35 billion last year.
On the same day, Shu Qi appeared in the cooperation between FILA and the famous Chinese designer Jason Wu. The “F†logo on the T-shirt is particularly prominent. As the former spokesperson and the identity of the current brand, Shu Qi is the FILA “station†of the high-end fashion sports brand of Anta Group, and is focused by countless flashes along the way.
In fact, not only Shu Qi became the most high-profile guest of this dinner, Anta's 10th anniversary, its FILA trademark is also one of the most eye-catching stars in the group. From the FILA China business that bought losses in doubts eight years ago, and now it has become an important driving force for the Group's performance growth, Anta has proved that it is right.
a questioned start
Biella, a small town at the foot of the Alps, is also a major Italian fabric and textile town – in 1911, FILA was founded. From the original family textile company to the ranks of world-renowned sports brands in the 1970s, this Italian brand adopted a high-end diversification strategy, mainly developing golf, tennis, fitness, yoga, running and skiing products.
However, as a world-renowned century-old brand, FILA's initial development in the Chinese market is not smooth. After entering China in 2005, the old Italian brand failed to open this huge sports consumer market for many years.
The reason for this is that the external evaluation is relatively consistent. The Belle Group behind the brand has its products and channel advantages mainly reflected in women's shoes and lacks experience in developing international sports brands in China. Therefore, the market has not been successful. At the same time, around 2008, the financial crisis led to weak consumer demand, and FILA positioned in the high-end market segment was affected to some extent.
At the time, Full Prospect and FILA Marketing were wholly-owned subsidiaries of Belle, owning and managing the FILA China trademarks in Hong Kong, Macau and the Mainland, and were responsible for retail sales of sportswear, footwear and accessories bearing the FILA China trademark. According to the data, Full Prospect had a net loss of RMB 5.53 million in 2007 and expanded to RMB 32.182 million in 2008. FILA Marketing had a loss of HK$5.43 million in 2007 and a loss of HK$6.996 million in 2008.
Although the performance figures are not optimistic, Belle still successfully sold FILA's Chinese trademark rights and business. The buyer is the domestic sports brand Anta. In August 2009, the Hong Kong-listed company headquartered in Jinjiang, Fujian Province announced that it had acquired the trademark rights and franchises of Belle International's sports brand FILA in China for a total consideration of approximately HK$600 million. In other words, Anta owns 85% of Full Prospect and 100% of FILA Marketing and is responsible for the promotion and distribution of FILA China trademark products in Mainland China, Hong Kong and Macau.
In fact, prior to the acquisition in 2008, Anta sold the agent retail business of three international brands, Adidas, Reebok and Kappa, due to unsatisfactory profitability. The important factor in giving up the agency of Adidas is that German brands are interested in self-employment. Inevitability, but the choice of the latter two to leave or poor performance. At that time, Anta said frankly that due to factors such as the financial crisis, the international brand retail business suffered consecutive losses in 2006 and 2007, and the net loss in 2007 reached 5.5 million yuan.
In this regard, the outside world once wondered why Anta, whose international business is sluggish, had to spend a large sum of money to acquire a loss-making business. Many analysts believe that the FILA business will not have a significant impact on Anta's earnings in the short term, because the brand's recognition in the Chinese market needs to be improved and is still at a loss. On the day of the announcement, Anta’s share price fell slightly and did not seem to be optimistic.
However, Anta is confident. They claim that it is precisely because of the unsatisfactory international performance that the group is determined to focus on the sportswear brand management business, rather than “making a wedding dress for others†in the form of acting as an international brand retail business. As a result, FILA in the crisis became the first international brand of Anta, which is more like a result of mutual needs.
In addition to his determination to operate and manage his own brand, Zhang Tao, then vice president of Anta, said that the acquisition of FILA is also to achieve complementary advantages. The old Italian brand mainly takes the high-end sports route and has obvious advantages in international brand effect and technology research and development. The domestic high-end segmentation sports consumer market still has great potential. In addition, Anta's local influence and sales channel resources, FILA's entry is conducive to grab the high-end sports market share.
Along with the suspicions of the outside world, Anta is looking forward to the fact that FILA, which had been in the Chinese market under Belle, can be revitalized in its own hands.
Repositioning: "Return" fashion
Shortly after the Chinese business "entered" Anta, in 2011, FILA ushered in the 100th anniversary of the old sports. At the same time, China has welcomed a CEO who is experienced in the fashion industry, Yao Weixiong. From the fashion field to the sports brand company, Yao Weixiong from Hong Kong said in an interview with the interface news that he is not "field". Due to daily hobbies, it is not difficult to work for a sports company.
After taking over FILA China, Yao Weixiong took the lead in doing one thing - he persuaded FILA Global CEO to move the brand's global centenary celebration from Italy to China for the first time. An obvious signal is that the Chinese market, which was previously unsuccessful, is still an area that Italian brands place very much.
Also in 2011, FILA made a strategic shift in the Chinese market, that is, the brand positioning "return to fashion."
At that time, Yao Weixiong led the team to do a lot of market research, especially for young people aged 25 to 35, to explore the needs of the future consumer group. The results show that the target group most needs a sports fashion brand, but there are not many brands that can meet the fashion requirements at that time. "With the strength of FILA in 2011, it is impossible to challenge Adidas and Nike, but the demand for sports fashion has not been met at that time and even today," Yao Weixiong said in a public speech.
The reason why it is “returning†to fashion is that in the 1970s, the most glorious period of FILA was achieved in the context of fashion sportswear, among which tennis apparel was the most representative. In 1973, FILA took the lead in boldly applying color striking patterns on sportswear to realize the fashion revolution of tennis sportswear. Soon after, the Swedish star Bjorn Berg became the brand spokesperson. The FILA tennis series won the six-time French Open Championship and the five-time Wimbledon champion, which made the brand a glorious period in the 1970s.
But since then, FILA has deviated from the casual fashion line, focusing on the field of professional functional sports equipment. “FILA in the 1970s was a high-fashion sportswear, but before 2010, we went to the tonality of purely functional sports. I think this is contrary to the original intention of FILA,†said Yao Weixiong. In the past seven years, we have made a very important position to return to the most fashionable sportswear that is most impressing consumers."
When the market trend has shifted from functionality to fashion, FILA's positioning is undoubtedly a trend in line with global sports consumption trends - Adidas' fashion trend is sweeping the streets, last year its street series Adidas Originals business growth of up to 45%; Sports-functional Nike, marketing has changed to young and women's fashion; Under Armour even once publicly "reflected", not fashionable products to make them out of the consumer.
Brand positioning returns to fashion, but it does not mean ignoring the development of sports professional performance. Yao Weixiong said that while the product fashion is constantly improving, the sports functionality will also advance with the former. "Sports and fashion are two lines that are not mutually exclusive."
From product, channel to marketing localization
Although the Chinese business was brought under Anta, the latter gave FILA a huge independent operating space. After the brand positioning was established, including product design, sales channels, supply chain and marketing, FILA made corresponding adjustments for all aspects of the Chinese market.
In terms of product design, not only "sports fashion" is more and more, the style conforms to the characteristics of Asian people. In order to follow the trend of co-branding in the fashion industry, since the end of 2015, FILA and famous Chinese designer Jason Wu have launched a series of high-end sports fashions, from tennis clothes to pool slippers, and many of the classic styles of the brand in the 1970s have been re-interpreted. The external evaluation, the brand positioning of sports and fashion, performed the best in Jason Wu's joint design.
At the same time, Yao Weixiong admits that in addition to design factors, innovation is one of the most important indicators in his product chain. "I require no less than half of the innovative fabrics in each season. This is in the merchandise team, planning. team, production team of KPI. second, our proportion of imported materials, requiring less than 40%. "
After the product segment, the most prominent change in FILA in China is the sales channel. In three years, the brand reclaimed almost all stores from dealers and changed into a direct mode. At the same time, FILA re-elected the store's high-brightness decoration design and display layout, and abandoned the cautious style of the general sports store to enhance the fashion sense.
According to official data, the proportion of direct sales of FILA in the Chinese market has been above 80%, and flat management has been formed from headquarters to retail. Yao Weixiong said that although the time and energy costs within the company increased, the gross profit margin of the products was also increasing. In addition, another advantage of the flattened direct mode is the rapid response to market consumption trends, which is undoubtedly crucial for a stylish sports brand.
As for the market promotion closest to the public, FILA adopts a marketing layout based on entertainment fashion stars. In the Chinese market, whether it is Shu Qi, Yang Yang and Gao Yuanyuan, a number of co-stars have attracted many young consumers to FILA. The sponsored variety show “Where is Dad?†is also trying to reduce the age of the consumer group. Next, the brand will continue its consistent entertainment star strategy and dig deep into the audience resources of the middle class in China from 20 to 45 years old.
FILA's new role in ANTA: performance drivers, "templates" for international high-end brands
When Anta's main brand grabs the mass market share in the third- and fourth-tier cities, FILA is fully committed to the mid- to high-end consumer groups in the first- and second-tier cities. The first publicly available data in mid-2015 showed that FILA opened more than 500 stores in the Chinese market, and the brand began to turn around in 2014 and achieve profitability.
Until 2016, FILA, which was at a loss early in the acquisition, had a new role in Anta: the performance driver.
In February of this year, Anta released its 2016 performance report, showing that the annual revenue was 13.35 billion yuan, the growth rate exceeded 20% for three consecutive years, the net profit increased by 16.9% year-on-year, and the market value exceeded 60 billion for the first time. Among them, FILA performed outstandingly. The brand successfully broke through the sports category and achieved cross-border fashion. The sales ratio increased, driving the gross profit margin of apparel products to increase by 3.2 percentage points to 51.0%, and driving the company's overall gross profit margin to increase by 1.6 percentage points. 48.4% - Obviously, the shift in direct marketing strategy has contributed to the improvement of gross profit.
In addition, in October last year, Anta announced its third quarter 2016 operating data. In this regard, Credit Suisse published a research report that the non-Anta brand retail sales growth rate in the quarter was as high as 60% to 70%, higher than the first half of the 40 to 50%, and the growth rate is mainly contributed by the FILA brand, so The strong increase is enough to leave behind the big international brands.
According to official data, as of the end of 2016, FILA has more than 750 stores in the Chinese market. By the end of 2017, this number is expected to exceed 900, and the number of channels will maintain a steady growth of more than 100 per year.
As for the 2016 results that have received much attention, FILA said it is probably a range of values ​​of “tens of billionsâ€. Yao Weixiong revealed that in the past at least six years, the brand has maintained a high double-digit annual growth. Between 2010 and 2015, its growth rate will exceed 50%, and it will maintain a growth rate of more than 30% from 2016 to 2020. Currently, FILA's revenue share has reached 20% of the entire group, almost one of the most important performance drivers.
In addition to driving the Group's performance growth, FILA has another more forward-looking strategic role in Anta: the “template†into the high-end segment.
As early as 2015, when the group's annual revenue exceeded 10 billion yuan, Anta said that its next step is to seek more overseas acquisitions. At present, Anta's international brands with operating rights in China not only have the earliest FILA, but also Korean outdoor brand Kolon, mountaineering brand Sprandi and winter sports brand Descente. This means that Anta's brand has basically covered all types of sporting goods segments.
As the Group's first international brand, FILA is not only confident in bringing multi-brand operations to Anta, but also provides management experience in international high-end brands. “The first person who eats crabs already knows how to do it. When other brands in the latter group are building, they have experience to learn from,†said Yao Weixiong. “Because each company has its own unique business model and method, The experience of FILA can effectively draw on other brands in the group."
It is worth noting that on March 22 this year, Anta announced that it has raised HK$3.79 billion for future acquisitions, targeting international sports brands. Subsequently, Anta’s intention to acquire the well-known international brand Puma was spread in the industry, but it has not been confirmed. In any case, after the successful operation of FILA, Anta seems to have reached a consensus within it. It is more effective to acquire overseas famous brands than to directly attack the global market with Anta brand.
Future goal: to reach 10 billion clubs with an annual growth rate of over 30% within three years
In January of this year, the China Sports Industry Special Report released by the well-known business magazine The Economist showed that as many as 34% of Chinese people regularly participate in physical exercise, which is a significant increase from the 28.2% of data seven years ago. At the same time, consumer upgrades are quietly taking place, and high-end sports consumption, including skiing and mountaineering, will usher in a market dividend. In addition, taking into account factors such as national planning for national fitness, FILA is optimistic about the future of the domestic sports consumer market.
As for the next performance target, FILA said that it hopes that the annual sales will reach 10 billion clubs in the next two to three years, keep the annual growth rate of sales flow more than 30%, and upgrade from a sports upstart to the top three in the domestic revenue. High-end sports brand.
Although FILA's own development trend is good, with the entry of international big names and the rise of local brands, the Chinese sports consumer market is showing a fierce competition. Even FILA, which seeks breakthroughs in the mid-to-high-end fashion segment, is inevitably facing market pressure. In the context of first-line sports brands such as Adidas and Nike, second-tier brands are eagerly looking at market segments.
In addition, the stylish FILA has a higher market response requirement. “Chinese consumers are opening very fast, because there is more and more contact with the outside world,†Yao Weixiong said when talking about the difficulties faced by the brand in the Chinese market. “You think that it will not be popular today, it may be popular in China. So, to follow the tastes and tastes of consumers and understand their dynamics, this is a constant work challenge, just like all fashion. If you don’t keep up with the dynamics of the market, the tastes of market consumers, It will be very passive."
Faced with fierce competition in the Chinese market and changing consumer demand, FILA proposed its own response plan. Next, the brand will launch more different sports product lines to meet the needs of consumers in different situations, and secondly, launch more fashion product lines for young people. “Our users are multi-scenarios. Now it may be professional sports, work during the day, and socializing at night. The wear requirements of these scenarios are different. FILA can find the right way to provide the right products to meet the consumption. The needs of these three scenarios," Yao Weixiong explained.
When brands begin to compete to increase market share by increasing attention and penetration in the segmentation field, consumers will have more choices. After eight years of standing firm in China, FILA's battle to seize the domestic mid-to-high-end market share may have just begun.
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