Nike sets China target

13 October 2011

BEIJING: Nike, the sporting goods group, hopes to double its revenues in China by 2015, a goal that could require changing current consumer habits.

Speaking to the China Daily, Charlie Denson, president of the Nike brand, reported that the US multinational intends to ramp up its expenditure in the country.

"We certainly will continue to invest in China, and very aggressively. We are very excited about the growth opportunities here," he said.

Nike has been active in China for exactly three decades, and while the company had to wait 26 years to generate sales of $1bn locally, this figure had surpassed $2bn by the end of May 2011.

As a result, China, where Nike has a presence in some 7,500 retail stores, is now Nike's second-largest market, behind the US. "We will continue to grow as we move into the lower tier cities - athletes still want the same products," said Denson.

"I think the great thing about sports is that it doesn't matter if you live in Shanghai or Beijing or Wuhan, or wherever, I think you're still looking for the best and the most innovative products available, and that is what gives us such confidence,"

More broadly, the organisation will place a heavy emphasis on activities including running, as items like sweatbands and trainers often serve as entry-level goods that stimulate shoppers to buy other offerings from its stable.

Skateboarding and snowboarding constitute another area of focus, and the company opened a Shanghai store specialising in these fields two months ago. It also plans to hold a snowboarding competition near Beijing in 2012.

"China has one of the biggest populations who are tuned in to sports, but they aren't yet participants," said Don Blair, Nike's CFO.

Tie-ups with the government to encourage exercise in schools, university running clubs and holding classes solely for women are among Nike's strategies to change this situation.

Marketing campaigns featuring Liu Xiang, the 100-metre hurdler, and Li Na, the tennis player, will also provide the basis for its efforts in the country.

"A decade ago, no one would have thought a Chinese athlete could have become a global star," said Denson. "But China is putting more people in the global game, creating more interest in sports."

Data sourced from China Daily; additional content by Warc staff