2023 China Outdoor Sports Shoes and Apparel Industry Research Report | Zhiyi × Eri
Outdoor sports shoes and clothing丨Research report
This report is jointly released by Zhiyi Technology and iResearch
Core Summary:
This report examines the entire industry chain from the perspective of outdoor sports footwear and apparel brands. Evaluate the relationship between the brand owner and upstream enterprises such as raw material suppliers and foundries, the design and development of the brand owner itself, and the relationship between downstream sales channels and specialty stores. In the process of combing the industrial chain, it is intended to provide decision-making basis for brand owners, and try to reveal to the market how brand owners can better shape their own brands, go longer commercially, and have more weight on the industry.
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The category of outdoor sports shoes and apparel is more focused, so the role of objective economic laws is more obvious
Outdoor sports shoes and clothing are different from fashion, because of the clear sports label on their bodies, and the category covers less content in comparison, which makes the society more focused when looking at this industry, and the public has in their minds about the business model and successful experience that has been formed in the market, and it is easier to look at all the practitioners of outdoor sports shoes and clothing with a universal theory. Therefore, many of the economic laws reflected in the light industry itself are clearer in the field of outdoor sports shoes and clothing.
In 1992, Mr. Shi Zhenrong, the founder of Acer Group, an important technology industry in China, put forward the famous "smile curve" theory in order to "rebuild Acer" as Acer's strategic direction. And this theory can be applied to almost any industry with manufacturing as the core, and the business path of China's major brands of outdoor sports shoes and apparel is also based on the smile curve, slowly unfolding.
Development history: from industry to culture
China's outdoor sports footwear and apparel industry has a difficult road to build a smile curve
Since 1980, it has taken nearly 40 years for China's outdoor sports shoes and apparel to bring the industry into an era of real modern business warfare.
Health awareness is awakening, and professionalism has become the most important indicator
Users attach great importance to the quality of life, and professional institutions have become the most important industrial chain participants in influencing users' decision-making
In the 40 years of reform and opening up, the consumption mentality of Chinese residents has been fundamentally evolved with the improvement of their horizons. Although the eyeball economy can still expand its sales scale at special times, on the whole, rational consumption and healthy living conditions are the general trend. At the same time, as knowledge and culture occupy an increasingly high position in society, professional institutions and professionals have become the most important force influencing users' consumption decisions. The user's own consumption concept and the development of the external knowledge environment complement each other, especially in the field of sports and health, the professional effect will be further strengthened, which will prompt outdoor sports shoes and clothing brands to make adjustments on the business side.
Heavy research and development has become the future direction of sports brands
China's outdoor sports footwear and apparel brands have completed the basic wealth accumulation and begun to make efforts in research and development
From the perspective of supply and demand, the professionalism of outdoor sports shoes and clothing and the user's demand for professionalism tend to be in a state of double helix promotion. This also leads to the continuous investment in R&D of outdoor sports footwear and apparel brands for a long time to lead an important strategy to lead the next decade. The R&D investment of state-owned brands has gradually increased for three consecutive years, but the overall proportion of revenue has remained in the range of 2%, and the proportion of R&D expenses of international brands such as Nike has been as high as 10% in the same period.
Overall, it's still a novice to business
Existing problems in the design, production and sales of China's outdoor sports footwear and apparel industry
According to the General Administration of Sports of China, after 2017, the total scale of China's sports industry rose to the level of 2 trillion yuan, and in 2021, it will exceed 3 trillion yuan. Sugar-free beverages, healthy diets, and the quest for a healthy body driven by the influencer economy have all made exercise an important part of residents' daily lives. This also brings an opportunity for the outdoor sports shoes and apparel industry to compete with world brands. Brand owners' understanding of the smile curve has been reflected in its specific business level, but at the level of industrial chain, business environment and culture, there are still several issues that will become an important topic in the modern business war of the outdoor sports shoes and apparel industry.
Outdoor sports shoes and clothing have a good mass foundation
The reflection on physical health has led to the fact that outdoor sports footwear and apparel users have surpassed the sports crowd
According to data from the General Administration of Sport of China, the number of people who regularly participate in sports in China exceeded 400 million in 2016 and has been steadily rising since then, and it has not even stopped during the pandemic, reaching 445 million in 2021. Therefore, from the level of basic users, the environment of China's outdoor sports shoes and apparel market is very favorable. And with the awakening of workplace pressure and self-pleasing consciousness, ordinary users are willing to choose more comfortable shoes and clothing for daily wear, which makes sports shoes and clothing the best choice, and light outdoor and sports fashion have also become the categories actively deployed by major footwear and clothing brands, which further stimulates more people to become consumers of outdoor sports shoes and clothing.
A strong comeback after the pandemic
There are few professional outdoor sports categories, but the pan-outdoor sports category contains a lot of content
According to the market data of different institutions, in 2020, China's outdoor sports shoes and apparel market will show a slight negative growth trend for the first time. However, in 2021, it will return strongly and surpass the level of 2019, and the scale of China's outdoor sports shoes and apparel industry is expected to exceed 500 billion yuan in 2023. According to the definition of traditional outdoor sports, outdoor sports only include camping, skiing, cycling, water sports and fishing, and the total scale of these outdoor sports is only about 50 billion, but for the social environment where the boundary between contemporary sports and life is gradually blurred, the connotation of outdoor sports will be greatly amplified. The outdoor sports footwear and apparel market was also stimulated by this social background and received a strong boost before the epidemic. In the future, this trend will continue to a certain extent, but whether the new surge can happen again depends on the breakthrough in the production and manufacturing links of the footwear and apparel industry.
Atlas of China's outdoor sports shoes and apparel industry chain
The upstream, midstream and downstream have a clear structure of the traditional garment manufacturing industry
Upstream fabric opportunity analysis
Professional sports brands are increasingly focusing on technological innovation and diversifying innovation channels
Although the concept of sinking market and light outdoor/leisure outdoor is prevalent, there are still technical barriers in the field of outdoor footwear and clothing, and the field of professional materials needs to accumulate and precipitate technology. From "Li Ning" technology to ANTA Shoes Innovation and R&D Center, from Xtep ACE Cushioning Technology to 361-degree R&D Center, sports brands are focusing on the R&D and upgrading of sports technology, optimizing product performance and promoting the R&D of functional materials from different entry points. ANTA Group expects to invest RMB4 billion in sports technology research and development in the next five years. The R&D investment of the four major sports brands in 2022 will increase to varying degrees.
For the expansion of the brand, it is necessary to combine the brand's own genes; Light sports brands can be rolled out by design, but professional sports brands rely more on technological innovation. At present, the technological innovation of sports brands is mainly focused on the innovation of various categories of fabrics (environmental protection, etc.) and the innovation of ergonomics-related footwear and clothing silhouettes. The form of technological innovation is mainly through the non-exclusive self-owned technology accumulation of suppliers, the core technology mastered by the brand and the innovation implementation carried out in cooperation with various laboratories.
Brand track and sales model differentiation
The cost loss of domestic brand channels is low, and the advantages are obvious; The increase in the number of outdoor sports segments brings new opportunities
Foreign brands enter the market as outsiders and have limited understanding of the local market, and usually part of the sales channels and marketing need to rely on local agents to help the brand better adapt to the local market and reduce the risk of entry, thereby reducing the management burden of foreign brands in the market, which allows them to focus on product design, production and brand building; However, at the same time, it leads to high management costs, low profit margins and the inability to get involved in low-price products
Domestic brands are familiar with the local market and enter the regional market more vertically through direct sales, which allows the brand to better control product quality, sales channels, pricing and market image; At the same time, it can also better reduce channel expense loss to improve profit margins and control pricing. Emerging domestic outdoor brands are currently often targeting the sinking market
Consumers' channel preference for purchasing sports and outdoor categories
There are various channels for users to purchase products, which tests the brand's market expansion in different channels
Due to the breadth of the reach group and the efficiency of furnishings, the footwear and apparel industry is an inevitable trend for the spread of online channels; The diversified nature of online sales channels also enables different categories of sports and outdoor brands to reach user demand scenarios in a timely manner. At present, 92% of consumers choose online integrated e-commerce among the purchase channels of sports and outdoor categories, and 31% of professional sports retail stores in the same period.
In the early days, when the footwear and apparel industry was rolled out on the online platform, the platform had a large bargaining power due to the volume of e-commerce and the significant head effect. At present, the situation has been alleviated with the increase in demand for O2O and the consideration of maintaining brand value. Compared with other footwear and apparel tracks, the customer base of outdoor footwear and apparel 35-45 years old who relatively lack online purchase habits is larger, and most sports and outdoor brands are slow to roll out online; Secondly, sports and outdoor brands are still lacking in terms of purchase channels and social media management. Brand-side offline stores tend to maintain brand image through small price fluctuations; The price of online products is affected by the discount policy of the platform itself and the promotion cycle, and the price fluctuates relatively largely. Except for footwear and apparel groups with relatively sufficient operational experience, such as NIKE, Anta and VF, most outdoor brands only conduct price regulation 2-3 weeks before the launch of new products, resulting in messy online prices for outdoor brands. At the same time, although social media has become the main grass planting channel for sports and outdoor brands, brands still pay less attention to the presentation of social media brand value and lack unified management.
The relationship between the smile curve and the industrial chain
The upstream of the industrial chain is the middle of the business process, and the profit distribution is related to the trade-off
Regardless of the type of manufacturing, it generally follows the law of the smile curve. From the perspective of the industrial chain, the upstream of the outdoor sports shoes and apparel industry is raw materials and some garment manufacturing factories, and brand owners operate these business relationships with a supplier system. However, from the perspective of business processes, fabric raw materials and production and processing belong to the midstream, so they can still only eat the thinnest profit zone.
Self-upgrading in the middle of the smile curve business chain
The global trend of sustainable development influences the entire industrial chain through outdoor sports shoes and apparel brands
The current market size of the outdoor sports shoes and clothing industry has exceeded 500 billion, and as the oldest manufacturing industry of human civilization, the industrial division of labor has been very fine and fixed. Therefore, the improvement and upgrading of the industrial chain will be carried out very slowly, and a diffusion path of the brand-based model has been formed. At present, the competitors faced by China's outdoor sports shoes and apparel brands are basically international giants with strong capital strength, so the traditional rough business entity cannot be their opponent. Since 2000, after the leading enterprises of China's outdoor sports shoes and apparel brands landed in the capital market, it is destined that every move of this industry will be affected by the trend of the capital market. And since most Chinese outdoor footwear and apparel brands are listed on the Hong Kong stock market, if companies want to get more resources injected, they will inevitably have more investment and consideration in sustainable development.
Therefore, brands in the center will use effective means to influence and drive the sustainability strategy of their suppliers. This means usually focuses on the following aspects, more refined orders, the selection of benchmark suppliers, and the self-application of more advanced production technology. It is also an important soil for the digital and intelligent upgrading of various industries across the country.
Sales of single products increased in summer and winter
Seasonal fluctuations are driven by major categories, and product characteristics are adapted to the scenario
Compared with the professional outdoor market, the light outdoor market has greater potential and volume. It has a wider range of application scenarios and a large category grading width, which can attract customers of all ages and consumption levels. Light outdoor products emphasize practicality, versatility, comfort, and do not pursue extreme performance, which makes them ideal for everyday life and outdoor adventures; Mainstream brands of light outdoor have cleverly combined online and offline channels, emphasizing the organic integration of the offline physical experience of products with online activities and promotions, providing consumers with a richer and more interactive shopping experience.
The impact of fabrics on the textile industry
Chemical fiber fabrics are still the mainstream, and the potential of technical fabrics is gradually emerging
Compared with traditional natural fabrics, chemical fiber fabrics represented by spandex, polyester and nylon have more use scenarios. Chemical fiber fabrics usually have high abrasion resistance and can resist friction and wear in different outdoor scenes; At the same time, compared with natural fibers, clothing and footwear made of synthetic fiber fabrics are lighter, which helps to be flexible and comfortable in outdoor activities. And it is more waterproof and color stable. From the perspective of brand economic cost, chemical fiber fabrics usually have lower costs, making production more efficient, reducing resource waste, and more cost-effective; The performance and properties of the fabrics can be more easily controlled in the production of synthetic fabrics, so that they can be adapted to the needs of specific outdoor scenes.
The rise of domestic outdoor brands has seized the sinking market space with high cost performance
Affected by the epidemic, consumers are enthusiastic about domestic products, and the high cost performance of domestic outdoor brands and the gradual rise of brand recognition have gradually expanded their market share. As the main force of consumption, the inherent brand awareness of the post-00s generation has gradually weakened, resulting in consumers becoming more and more reluctant to pay for brand premiums. At the same time, with the change of business model, online shopping and live shopping have reduced transaction costs and accelerated the circulation of goods.
Good Case
Bananaxia: Technology reuse breaks through regional/seasonal restrictions
Insight into the needs of outdoor cross-scene lightweight outdoor advantages
In recent years, many new scenes have emerged in the outdoor sports industry, such as frisbee, fishing, camping, and so on. Jiaoxia saw such an industry trend as early as 2013, and began to lay out on this track, opening a strategic development path of lightweight outdoor. Under the guidance of this strategy, Jiaoxia is oriented to the four major scenarios of lightweight outdoor, based on the needs of different scenarios throughout the year, and provides five major product categories demanded by the public through the advantages of the four major lightweight outdoor products.
Zhiyi Technology: AI helps the apparel industry
"Digital service" two-wheel drive, AI technology to help the textile and garment industry
Hangzhou Zhiyi Technology Co., Ltd. is a national high-tech enterprise driven by artificial intelligence technology, which is committed to standardizing the output of data-based trend discovery, explosive mining and supply chain organization capabilities, and creating a supply chain platform for intelligent clothing design. It provides key link digital services such as planning, design, boarding, sample management, and work collaboration for the operation of apparel enterprises, and at the same time explores the AI-enabled supply chain model, gradually forming a two-wheel drive of "digital services". The company's two core businesses are: Zhiyi, a digital service provider associated with the apparel industry; From selection to production, a one-stop clothing supply chain service provider - Zhiyi Supply Chain. At present, it has established a strategic layout in key regions across the country such as Guangzhou and Shanghai, and started overseas business exploration and layout in May 2022.
Zhiyi Technology: AI helps the apparel industry
"Digital services"Two-wheel drive, AI technology to help the textile and garment industry
To help enterprises realize the specific form of their external business in the apparel industry, they can have such capabilities, which are the world's leading software and digital capabilities with extremely high data thresholds. At present, based on high-precision AI technology, Zhiyi has built the industry's largest structured clothing database, and has a strong ability to precipitate high-quality clothing data assets, with a total of more than 1 billion clothing picture materials, more than 100 billion structured design elements, and more than 600 fashion trend tags. Through the latest deep learning algorithms, they have a recognition accuracy rate of more than 90% in more than 500 professional clothing labels, which is close to the recognition ability of professional clothing designers. And through image search technology, it helps designers find inspiration faster.
China Garment Science and Technology Innovation Research Institute
Digital transformation empowers the sustainable development of the apparel industry
China Garment Science and Technology Innovation Research Institute is affiliated to China Garment Association, and the guiding unit is the Consumer Goods Industry Department of the Ministry of Industry and Information Technology. It is a national scientific and technological innovation service platform and innovative R&D institution, which has formed ecological cooperation with 20 universities, 370 science and technology enterprises and thousands of garment enterprises by the Orange Weaving Industrial Internet Platform to form a complete closed-loop innovation ecosystem of production, learning, research and use. It is a national-level force leading the digital and intelligent upgrading of China's garment industry.
China Garment Science and Technology Innovation Research Institute
Digital transformation empowers the sustainable development of the apparel industry
Trend 1: Everything is ready and waiting for the dawn
The cognitive space of state-owned brands has been opened, and the competition pattern that has lasted for half a century may be reversed in the future
Since Nike entered China in 1980 and opened the curtain of the modernization of China's garment industry, half a century has passed unconsciously. In the past half century, foreign outdoor sports shoes and clothing brands have almost firmly controlled the minds of users, solidifying the words quality and fashion in the hearts of Chinese consumers, and once put local brands at risk of collective bankruptcy. But everything may change with the rise of state-owned brands. From 2022 onwards, the sales gap between domestic and foreign outdoor sports shoes and apparel has gradually widened, which shows that the quality of state-owned brands is being recognized by more and more consumers. From the perspective of the exposure of Chinese brands in major sports events and the operation of sports stars, domestic products have initially become competitive on the brand side of the smile curve. Within the brand, more and more R&D investment, moistened by the national scientific and technological wind, has gradually smashed the market positioning of domestic products as a cheap substitute, and formed its own advantages in the R&D section of the smile curve. It is conceivable that under the background of the end of the epidemic and the global economic recovery, the business war between domestic products and overseas brands will become more intense.
Trend 2: Different paths to the same end, borrowing strength
Based on the production of shoes and clothing, it will connect with the new ecology of the Internet celebrity economy and generate strategic synergies
The outdoor sports shoes and clothing industry is huge, and it affects the whole body. Nowadays, footwear and clothing have become an indispensable backbone of China's social and economic operation. Therefore, the opportunities in this field are structural, and it is difficult to achieve them overnight, whether it is a new enterprise or an old brand industrial upgrading. At the same time, another market is full of vitality under the nurture of China's new digital economy, and after 2019, the development of professional Internet celebrities and MCN institutions across the country is in full swing, which has a far-reaching impact on China's economy and truly achieves the universalization of the right to speak. It has challenged almost all links in the traditional manufacturing industry chain by itself, because if it can take advantage of this new force, it will go more smoothly on the road of business.
At present, there have been a number of companies in the market that focus on the Internet celebrity ecology and use AIGC and other technological means to turn Internet celebrities into brand managers, and the traditional concepts of "entrepreneurship" and "management" will be subverted. Therefore, outdoor sports footwear and apparel brands should not limit their perspective to the footwear and apparel industry, but should leverage more to generate strategic synergy.
Trend 3: Digital upgrading, intelligent production
Digital transformation empowers the sustainable development of the apparel industry
At present, the technology of the outdoor sports footwear and apparel industry has accelerated the reshaping of the market, and the competition is becoming increasingly fierce. The demand for personalized, diversified and real-time consumption and customer demand is also becoming more and more obvious, resulting in the need for continuous improvement of efficiency and innovation mode in supply, and the use of new technologies and new capabilities to improve customer acquisition, reduce costs and increase efficiency, develop and innovate products, and obtain market advantages and sustainable development.
At present, garment manufacturing enterprises in the digital transformation, the main focus is on the benefits of digitalization for enterprises, for traditional garment enterprises, need to achieve two major reconstruction: one is the reconstruction of business model, the other is to complete the reconstruction of digital information system. At present, enterprises first need to complete the reconstruction of their business models. In this process of reconstruction, enterprises must closely integrate the transformation of business models with digital transformation. It can even be said that the reconstruction of the entire business model can only be completed by relying on the support of digital information technology.
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