Where Li Ning went wrong
23/01/2015
Advertising executive Tom Doctoroff of JWT told the newspaper that Li Ning’s reliance on the popularity of its founder, former Olympic gymnast Li Ning, became a “strategic opiate” for the brand.
Mr Li stole the show at the opening ceremony of the 2008 Beijing Olympics by appearing to fly around the roof of the famous Bird’s Nest stadium, and in the surge of publicity that followed, his company decided it was time to leave behind its traditional value proposition of offering decent-quality sports shoes and clothes at a much cheaper price than Chinese consumers were being asked to pay for products from premium international sports brands. Li Ning began to charge high prices too, leaving rival local brands such as Anta to fill the gap.
Daniel Han Ming Chng of the China Europe International Business School in Shanghai told the FT that this change in strategy had left many Chinese consumers unable to see the value in paying 20% more than they would pay for Anta for shoes and clothes from Li Ning. If consumers choose to pay a premium, he said, they feel that they may as well buy adidas or Nike.
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