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Li Nings initialsuccess can be attributed to four major factors

1. Li Ning relied on his fame and charisma, being a national sports hero and iconic figure helped attract attentionand

publicity. This brought immediate credibility and acceptance to a new brand based on his name ( local brand )

2. Li Ning has good connections, local knowledge and an extensive distribution network covering many ofChinasthird and fourth tier cities

3. Li Ning sponsored key sporting events in China and signed up many of Chinas top athletes including Olympic

gold medal winners Wang Liqin, Zhang Yining, Guo Jingjing amongst others

4. Li Nings 'value for money' proposition resonated well with the Chinese population, particularly those from thelower middle class and below. Li Ning products typically retail at half the price of Nike/Adidas, but are

of comparable quality ( value for money positioning )

STRATEGY

( local legend so unparalleled awareness in china) Firstly, they have the well-

penetrated brand LI-NING, associated with the man of legend and Chinese national pride.

Secondly, they have broad retailing network & integrate S C M

established by leveraging their first movers advantage.

Lastly, by thecombination of above 2 factors, they are in good position on the Productivity

Frontier.

CORE OF POSTIONING

Thanks to its unique brand positioning and well-developed supply chain, Li Ning established

SPA (Specialty store retailer of Private label Apparel) type business model effectively.

For many Chinese customers, LI-NING is a brand of familiar, accessible (physically),

affordable, and satisfiable choice. Li Ning, as a company, has achieved its success by

providing these practical choices to massive amount of Chinese customers through Li-Ning

Brand ( main funda.. people who want nike addidas but not able to afford satisfied with li

ning )

Challenges :

it is projected that in 2025, Lower Aspirants will shrink to 15% and consume almost same

amount as in 2005 in total,and Upper Aspirants will expand to 61% and their

consumption will reach over 12 trill ion RMB. If LI-NING continues to be perceived as

low-end brand, Li Ning will be forced to lose its position even in China by the change of themarket ( so people who wanted nike adidas but were buying li ning to satisfy their needs

will move away from li ning )

1. One is to adjust high dependency on LI-NING Brand and Chinese Market ( li ning is

growing old and fat hence how many school kids would want to associate themselves

with the brand ).

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2. Address global perceptions that it is a me-too/copycat, made in China brand, with similar logo andadvertising style as Nike. Or else it won't be able to gain credibility and expand market share.

3. Move away from its "China" nationalist image, even within China. They have gotten well known globalcelebrities but somehow that isn't getting as much exposure as, say, David Beckham in an Adidasad. -

4. to respond to the upward change of disposable income of Chinese middle class

( should it really stick to its low price model )

Address the growing individualism of

Chinese youths, who now have more exposure to Western values, media, information

(even with great Firewall of China); the one child policy + increasing affluence and

growth of the middle class = more spoilt kids who can afford to wear better brands.

5. And the last is to compete with Horizontal-division business model of Nike & Adidas.

Recommendations :

1. Li Ning should focus on the fashion aspect of sportswear: urban wear or similar; all

other Chinese brands seem to emphasize physical activity and this fashion statement

is a valuable niche that might have an appeal in the West aswell, more so than

sports-

2. create a brand that is more easily understood by foreigners and that is detached

from the personality of Li Ning- e.g. Shanghai Tang (something similar): name with

Chinese characteristics, but palatable to a foreign audience- this can be similar to

what Air Jordan is to Nike - the Nike component is under emphasized, while the shoe

brand and the celebrity endorsement is over emphasized-

3. Li Ning would be the brand to be used locally and the new brand would be usedinternationally; same products, maybe minor differences-

4. for endorsements, try the European basketball market: not as expensive as NBA, yet

powerful and with dedicated fans (teams: Spain, Greece)- sponsor (for example) the

Greeks at Olympics - a few years ago they beat the US and if they repeat it, there will

be a lot of coverage- so drop Sudan and other unknowns (was ok for gaining

experience, but now must focus on real results)

segments

sports accessories

soccer product line

high school line