Li Ning aims for top-end market with new logo and higher prices
Li Ning, intent on transforming itself into a high-end global brand, has unveiled a new logo in an attempt to distinguish itself from Nike.
'We hope to become China's No1 in eight years,' chief executive Zhang Zhiyong said. 'Our plan is to become one of the top five [sports] brands in the world by 2018.'
For years, Li Ning's logo has been accused of bearing a resemblance to Nike's famous 'swoosh'. Zhang said the main reason for changing the logo was to distinguish itself.
'Consumers only come into contact with your logo and slogan,' he said. 'In terms of our logo, we took into consideration our future global expansion.'
Herald van der Linde, HSBC Asia-Pacific deputy head of equity research, agreed, saying it would be difficult for Li Ning to emerge as a global brand if it failed to distinguish itself from other products.
'A lot of Chinese brands look like Nike, no matter if they tick right or tick left,' he said.
Li Ning's new logo is an adaptation of the company's former one but features a cleaner cut and resembles the Chinese character for 'ren', which means people.
The sportswear brand upgraded 500 retail shops in first-tier cities by the end of last month, and will refurbish 1,000 stores by the end of the year.
Li Ning is the second-largest sports brand in the country, after Nike, according to Deutsche Bank research.
But Zhang said Li Ning falls behind international sports brands in first-tier cities and is also less popular among those below the age of 25.
Li Ning is planning to tackle this challenge by moving to the upper end of the market and raising prices, he said.
According to Deutsche Bank, Li Ning's average retail selling price is 300 yuan (HK$345) for footwear and 200 yuan for apparel.
The company plans over the next three years to increase the average price of footwear to between 400 and 650 yuan and apparel to an average of 300 yuan.
Ma Mengran, 15, a student shopping at the sportswear firm's newly refurbished store in Wangfujing, Beijing, said she had no preference between foreign brands and Chinese brands as long as they were of good quality.
Asked if Li Ning was worried about Nike's purported plans to lower prices and expand in second and third-tier cities, Zhang said the company had concerns. But that strategy would hurt Nike's high-end brand image, he added.
