Sportswear brands have spent years fighting, toe to toe, over the Chinese market. At the turn of the decade, competition was especially fierce. Domestic brands fought bloody battles with global heavyweights such as Nike and Adidas.
The sector seems to have settled. Nike looks established as the market leader, this year reporting $2.6bn in China revenues. Adidas is a distant second, delivering $1.7bn of sales. For both, the market is just a tenth of the top line. But domestic players have struggled to recover from the intense competition of the past few years. Last year’s sales at former market darling Li Ning were down one-third from a peak of $1.4bn in 2010. The collapse at Dongxiang was twice as severe.
It has not all been bad news for China’s home-grown brands. Last year, Anta achieved sales of $1.2bn, up 8 per cent since the 2010 shakeout. And 2014 first-half revenues grew by a fifth year on year. The company has been canny. As Li Ning took on the global brands in the premium segment, Anta grabbed share in the mass market. And through ownership of China licensing rights to Italian brand Fila, Anta had a different brand for the higher end. It does not split out its Fila sales. But JPMorgan estimates that in the first half of this year Fila contributed around one-tenth of group sales, or $60m, with strong year-on-year growth.