21st Century Business Herald reporter He Hongyuan and intern Tian Keyi report from Beijing
The "Double Eleven" discount promotion has become a common tactic for Nike, but on the other hand, buying a pair of Nike for over 200 yuan feels really good.
Hello everyone, I am Xiaohe. Welcome to this episode of Consumer Reference.
Nike had a very pleasant Double Eleven. On the Tmall Sports Outdoor Sales Chart, Nike ranked first, FILA ranked second, and Adidas ranked third. In the latest fiscal quarter, Nike's revenue in Greater China decreased by 4% year-on-year, and FILA also experienced a year-on-year decline.
Behind Nike's comeback is the super discount.
This year, Nike launched an online "More than 50% off" campaign, offering sports shoes as low as over 200 yuan. FILA has launched various coupon promotions.
It should be noted that ANTA and Li Ning also have a lot of activities. ANTA has launched some products online with a discount of 500 yuan for orders over 1000 yuan, while Li Ning has launched a 40% discount promotion. But obviously Nike sells better.
This indicates that Nike still has an advantage in brand value.
Why don't Nike, who are facing growth pressure, lower their prices?
Firstly, in terms of cost, Nike may be even higher. Setting aside research and development costs, Nike is more bold in marketing that everyone can see. For example, before Zheng Qinwen and Liu Xiang became famous, Nike was already calling for them. There are many sunk costs behind it.
In the latest fiscal quarter, Nike's gross profit margin was 45.4%, while Anta's was 64.1% in the first half of the year.
Moreover, high prices can indeed earn more money. In the first half of the year, ANTA's brand gross profit margin was 56.6%, while FILA's was 70.2%.
Finally, as a global brand, Nike's pricing must consider the global market. I have talked to several Chinese executives of international brands about pricing issues, but the final answer was vague. It is possible that the pricing power is not in their hands.
Finally, is it possible for Nike to lower prices?
The answer is significant.
Adidas global CEO Bjrn Gulden mentioned during the earnings conference that the Chinese market has never truly been fully priced.
So, it's better to join if you can't beat. Nike mentioned that it will focus on the market below $100 in the future.
If Nike really lowers its prices, it may be a single brand group like Li Ning that cannot sleep.