Li-Ning is a leading sportswear brand in the Mainland China and they aspire to be a world’s established brand in the sports goods industry. The company has been immensely successful in maintaining and increasing its market share in China while facing strong competition from Nike and Adidas. The competitive edge of the company is maintained by its strengths such as; strong distribution channel, R&D, endorsements from major athletes and sponsoring sports events. Their biggest strength is brand loyalty and recognition in the Chinese market. These strengths have enabled the company to achieve a prominent and successful position in the sports wear industry in Mainland China.
They have a rich and extensive product line which focuses on running and badminton. One of the main things that the company uses to maintain its competitiveness is it pricing strategy. Their quality is as good as Nike and Adidas but the prices are less which attracts customers. Their pricing and distribution strategy allows them to avoid severe competition with Nike and Adidas because their prices are lower and their primary presence is in second and third tier Chinese cities. The current pricing strategy of Li-Ning has been successful in attracting their primary target customers; the youngsters. Youngsters are often looking for value for money products due to lack of funds and find Li-Ning’s products attractive. Li-Ning has successfully attracted this segment of the market because it appeals to them as value for money product as well as meets their needs.
As mentioned in company’s mission statement they strive to be an international brand. They have made several attempts to capture international market share. Some of the company’s other efforts to increase their competitive nest in the international and domestic market are export activities, international marketing efforts, the establishment of R&D centers in Portland, Oregon and distribution agreements with foreign sport fashion brands. They also hired Alan Hardy, who was a senior designer at Nike and design director at Converse, in order to support their R&D efforts. To support their mission statement, the company has opened several flagship stores in Netherlands, Singapore and several other Asian cities.
As mentioned above, Li-Ning faces tough international and local competition from sports giants such as Nike and Adidas especially in the first tier cities. In terms of brand positioning, Li-Ning had started to focus on going global. They strive to build their image as a prestigious international sport’s brand. Li-Ning’s success is based on its value for money, quality and also that Li-Ning stands for a Chinese product and natives of Mainland China can relate to it as their “own” brand which creates brand loyalty with Chinese customers. The company uses this image to their advantage both in domestic and international market. This can also help them build a distinct brand image from their competitors such as Nike and Adidas.
The primary objective of the company is to increase its overall international presence and also maintain its first place in China sportswear market against multinational strong players such as Nike and Adidas. Li-Ning has used the legacy of its founder, who was an Olympic Gold Medal gymnast, to build the image of this company and to land important assignments such as torch rally of the 1990’s Asian games. It is obvious by company’s efforts that endorsing is a key ingredient of their marketing strategy. They have sponsored Olympic Games, many NBA players and other international level sports players to build their brand image. They had partnered with NBA and sponsored NBA players and as indicated by the company’s legacy, Li-Ning’s success comes from an oriental theme combined with international marketing.
Li-Ning’s low pricing strategy, well spread distribution channel, endorsements and brand loyalty has provided beneficial in maintaining their domestic market share and it might even help them increase their market share in first tier cities. Maintaining their position in second and third tier cities and trying to gain a foothold in first tier cities and international market is the key a larger domestic and international market share for this company.
Krug, A. (2007). A Grand Entrance? Li Ning’s Emergence as a Global, Chinese Brand.