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Old 09-01-2014, 09:12 PM   #1
eliteballer
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Default Li-Ning in Trouble?

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China's Li Ning stumbles from gold medal position to no man's land

Now, the Li Ning (2331.HK) business is more reminiscent of the ex-sportsman's exit from the 1988 Olympics without a podium finish. As customers have turned to aspirational global brands like Nike Inc (NKE.N) or cheaper local firms, Li Ning has racked up heavy losses, losing four-fifths of its market value.

The company has long pinned a turnaround plan on targeting trendy, fast-growing areas of sport in China, like basketball, hoping to attract younger consumers with a mid-range pricing strategy. But company watchers fear what Li Ning sees as the middle ground could turn out to be a no-man's land, while still-loyal older customers may be turned off by the focus on youth goods.

"They tried to go younger, but in the course of doing that they lost a lot of those aged over 30 who were traditionally a more loyal customer base," said James Roy, senior analyst at China Market Research Group in Shanghai.

qually, many younger customers have yet to buy into the strategy.

"It seems like (Li Ning) products are targeted mostly at students aged 13 or 14," Ding Jianan, a 22-year-old student, told Reuters in China's commercial capital Shanghai. "I can afford higher-priced items from Western brands, which offer better quality. In college, people like to compare each other's outfits so the peer pressure will push us to buy Nike or Adidas (ADSGn.DE)."

Li Ning, backed by private equity powerhouse TPG Capital [TPG.UL] and Singapore wealth fund GIC [GIC.UL], last month reported a first-half net loss of nearly $100 million, more than three times that of the corresponding period a year earlier.

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"They're trying to say they're a high-quality brand and are at the same level as foreign players, but at the same time it is very visible that they're dumping inventory at very low prices," he said.

The company has said it is prepared to take the time it needs to achieve its goal of making Li Ning the only brand that represents the "Chinese Dream" - the ideal of individual success in the country's society - across all categories of sportswear.

"I think Li Ning is so tied in with the Chinese Dream ... it's more a part of national positioning than it is sports positioning," Button said.

http://finance.yahoo.com/news/chinas...215256163.html
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Old 09-04-2014, 02:37 PM   #2
SamuraiSWISH
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Default Re: Li-Ning in Trouble?

It's a shame they never made a splash in the states. I mean that market is dominated by Nike / Jordan, with Adidas scavenging the rest of the market. But I hear Li-Ning made quality hoop shoes. Especially the Way of Wades which were unique in design, aesthetically pleasing, and used premium old school materials like leather. Like a 90's / early 2000s basketball shoe. Something that was durable.
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Old 09-04-2014, 11:28 PM   #3
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Default Re: Li-Ning in Trouble?

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Originally Posted by SamuraiSWISH
It's a shame they never made a splash in the states. I mean that market is dominated by Nike / Jordan, with Adidas scavenging the rest of the market. But I hear Li-Ning made quality hoop shoes. Especially the Way of Wades which were unique in design, aesthetically pleasing, and used premium old school materials like leather. Like a 90's / early 2000s basketball shoe. Something that was durable.


They need to do some commercials, and promote their shoes into the US Market.
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