Chapter 33 Chapter 10 Competition (2)

This once big guy is now a big guy again.Adidas entered the Chinese market quite early, having established a representative office in China in 1995, but it was not until 2003 that Adidas Greater China was established to vigorously develop the Chinese market. In 2005, Herbert Hainer made a bold statement to the market in Beijing: Adidas will regard China after 2005 as "the second largest market after the United States" in the single market map of Adidas.In fact, for such an important market, Adidas has prepared a comprehensive plan and is fighting hard. Nike "do it boldly" Although Adidas is catching up, but now the world's largest sporting goods company is still Nike.

Nike, founded in 1971 by sports enthusiast Phil Knight from scratch, followed the Adidas pyramid marketing model in the early days, but the difference is that digging deep into the emotions contained in sports is one of the secrets of Nike's miracle.The type of athlete Nike is looking for is different from Adidas. They are mavericks, strong personalities, and aggressive.The product connotation of "Just Do It" proposed by Nike is frequently used as a metaphor for the characteristics of the "Baby Boomers" in the United States, and is even considered to have "influenced a generation of Americans".In this regard, Nike's rapid rise in the United States. In 1980, Nike went public in the United States.Until 1983, Nike's total sales revenue reached 700 million US dollars, surpassing Adidas, which seemed huge and invincible at the beginning, and became the world's number one brand.

However, Nike has repeatedly encountered crises in its short history.The first big crisis was in 1983, when Knight withdrew from the company's daily management, and the company began to decline: inventory backlog, sales decline, important people resigned, and there were even rumors that Nike was about to go bankrupt.There were many reasons for the setback, one of which was that Nike's venture into the fashion industry and into Europe stretched the company's resources.But the most obvious reason for the company's setback was that Nike was unprepared and was blocked by Reebok.

Reebok's 1982 sales were $35 million, and by 1985 they had ballooned to $300 million.Its trick is that the products cater to the trendy pursuit of consumers in the American market at that time, especially women's pursuit of comfortable, fit and lightweight clothing.Even at the Emmy awards ceremony that year, there were movie stars wearing orange Reebok shoes and evening dresses to participate.Reebok caught the new round of market changes in consumer demand for products faster than Nike and Adidas, and thus began to rise in a straight line. The mistakes Nike made in spotting and responding to this momentum bear striking parallels to the mistakes Adidas made a few years ago when the jogging craze took hold.Nike is not sensitive to situations other than the "pyramid marketing model". It is not interested in women's bodybuilding, an area where athlete spokespersons and college coaching advisory groups can't play a role. Nike also feels that Reebok's shoes are too fancy and of poor quality , not for serious runners and athletes.

The decline of Nike also reflects a key rule in the sporting goods industry.At this time, Knight realized that the modern sneaker kingdom has experienced many ups and downs under the laws of natural cycles. "First, Converse rose, then Adidas, then Nike," recalls Knight, "and this cycle allowed us to go from zero to billions of dollars in a very short period of time." In one book, Knight said: "Then, suddenly, Reebok appeared, enjoying its glorious era like the sun's rays." In order to save this situation, Knight took over the company again, redefining Nike's brand identity, redefining Judge what Nike is and isn't.Casual wear and casual shoes are not Nike, but basketball shoes are.Another conclusion is that there is an emotional connection between Nike and consumers. Therefore, Nike changed its previous practice of emphasizing the number of celebrity endorsements and ignoring market communication, and focused on a small number of very influential athletes. The brand is pushed to the public.Michael Jordan is both a tool of this new policy and a new symbol for Nike. In 1984, Nike signed Jordan for 5 times more than Adidas or Converse.Both companies thought that Jordan was just another product spokesperson, but they didn't expect him to become the core of a marketing strategy and the entire production line of sports shoes and sportswear.As a result, Nike began another 10-year period of glory.

In 1986, Nike's performance rebounded and became a company with annual sales of 1 billion US dollars, starting a new round of incredible growth. In 1990, its sales rose to $2.2 billion, in 1994 to $3.8 billion, and in 1998 to a peak of $9.6 billion. However, in 1998, what Knight called the "circular law" came into play again: Nike's second major crisis appeared, and Jordan's resignation made Nike almost lose its brand appeal. Near flameout.At the same time, consumers have put forward new fashion requirements for the market.This year, the global sales of Nike sports shoes decreased by 14%, and sportswear decreased by 9%. Nike laid off 1,600 employees that year, and its marketing budget was reduced by 1/3.