According to a research report published by Global Industry Analysts, Inc., the global market for Sports and Fitness Clothing is projected to reach US$231.7 billion by 2024. Growth in the market is driven by a growing portion of the population living healthier lifestyles and stronger participation in sports and fitness activities. The research also indicates that technological developments designed to improve comfort and performance have also led to the growth in sales of sports apparel. As a result, sportswear is turning into a highly popular style statement and fashion trend. The report points out that the Asia-Pacific region is expected to be the fastest growing region, with a CAGR of 6.9% over the forecast period.
Fitness legging market in China
The fitness legging market in China is one of the largest and fastest-growing in the world, and is driven by several factors, including the presence of a large millennial population, an increase in active lifestyles and sports participation among the population, and the popularity of sportswear as an extension of casualwear in fashion, as epitomized by athleisure.
China’s sportswear market grew 12% to ¥212.1 billion ($31.4 billion) in 2017, making it the second-largest sportswear market globally after the US, according to Euromonitor International. The sportswear industry in China is expected to maintain its momentum, with an average annual rate of 11% growth in the five-year period through 2022.
Several factors have been contributing to the strong growth of the sportswear market in China, including
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The growth of the broader sports industry: China’s sports industry—which includes the production of sporting goods and the provision of services such as sports management activities, training and education, and media services—grew 11.1% year over year to ¥1.9 trillion ($295 billion) in 2016 (latest, released on January 13, 2018,) according to the Chinese National Bureau of Statistics. There is still scope for further growth, as the sports industry in China is still immature. Competitive sports are not as prevalent as they are in the US, and participation is more for enjoyment rather than competition, according to Azoya, a cross-border e-commerce service provider that partners with international retailers to expand their businesses in China.
- Large millennial population: Millennials are the main target market for both performance and lifestyle sportswear, and this segment is huge in China. There are about 400 million millennials in China, according to our analysis of World Bank data, more than the entire US population.
- Government investment in sports: The Chinese government is promoting sports and a more active lifestyle among the population to encourage the economic benefits that sports participation generates. It is also encouraging a healthier lifestyle among the population, which, in the long term, should reflect positively on healthcare costs.
- Big sporting events: Large sporting events raise interest in sports among the population and encourage active participation. In China, this process is often helped by government initiatives. For example, in preparation for the Beijing Winter Olympics in 2022, the Chinese government has been promoting winter sports and is looking to increase the number of ski resorts to 1,000 by 2030 from 500 currently, and to boost the number of skiers to 300 million from about 5 million currently, according to the Financial Times.
- Appetite for foreign brands: On Adidas’s fiscal 2017 earnings call earlier this year, CEO Kasper Bo Rorsted said that the attractiveness of global brands and the image they project are still quite high to the typical Chinese consumer. This should continue to create opportunities for further expansion for international sportswear brands in the market.
- Increased interest in sports: Beyond active participation, interest in following sports has been growing in China, particularly for popular sports such as basketball and soccer. Nearly 200 million viewers watched the 2017 NBA finals on their mobile phones, according to the South China Morning Post in September 2017. At the time of writing, the NBA’s Weibo account had 34.6 million followers. By comparison, the NBA’s Twitter account had “only” 27.2 million. There are currently more than 300 million active basketball players in China, almost equivalent to the entire US population, according to the Chinese Basketball Association, and an estimated 307 million soccer fans in China, the English Premier League website reports.
- Increased health and wellness awareness and physical activity uptake: Active lifestyles have become increasingly important among Chinese consumers. The figure below shows that regular exercise is regarded as the main way to stay healthy by the majority of respondents to a survey of Chinese consumers undertaken by Prosper Insights & Analytics in June 2018.
How can fitness legging brand properly enter the Chinese market?
An official website based in China
Most Internationals Brands have their own official website that’s set up out of China. This makes it easy for the brand to manage and maintain.
However, this option has several major drawbacks. First, as the servers are not in China, it may be difficult for users to access. Also, another huge disadvantage is the challenge of delivering customer service. As all the services are located outside of China, it is difficult for brands to provide quality after-sales service, refunds, and product exchanges.
As shown, it is a requirement to host your website in China, by using Baidu SEO for example. Otherwise, your website will experience slow loading and display delays.
An outlet on the most popular e-commerce platforms
There are large online malls that have been developed in China such as Taobao, Tmall and JD.com which are extremely well known. They seem like a simple option, let’s have a look at how they work.
There’s a common misconception in the West that Taobao and Tmall are the same platforms but that’s not really the case. Taobao and Tmall are both operated by the Alibaba Group but they use different unapparent models. Taobao is a C2C (Customer to Customer) platform for individual vendors while Tmall is B2C (Business to Customer) platform for official manufacturers brands or organizations that have a legal entity in China.
To open an online store on Taobao, Tmall, or JD.com, you need to be a Chinese national or have a legal business entity in China. As an option for foreign brands and manufacturers who want to sell to China, both Tmall and JD.com have developed new platforms for cross-border e-commerce – Tmall Global and JD Worldwide. They are also the most popular cross-border e-commerce platform in China. Other platforms include Suning Global and Amazon China Global Store.
These platforms can provide a great deal of access, but online stores on these malls require costly setup fees and commissions. Brands may also need to pay extra advertising and marketing costs.
Unlike the online malls introduced above, online hypermarkets function on a B2B2C (Business to Business to Customer) system. These online hypermarkets operate as intermediates. They purchase an extensive range of goods from overseas suppliers or manufacturers at wholesale prices and sell them at retail marking their profit from the markup.
They are different from online malls in a few ways. Online hypermarkets do not have individual online storefronts for the overseas brand to operate. Storage and distribution are also managed by the hypermarket. Distinguished online hypermarkets in China include NetEase Kaola and Jumei.
While these platforms can pledge a significant deal of access, setting up an online store on these malls requires high setup fees and commissions.
Using social media
The most popular and used social networks in China are WeChat and Weibo. Therefore you can promote your sportswear business through these two platforms which can push your business reputation online to a new high level if the methods are appropriate.
WeChat, developed by Tencent has more than 800 million active users every day. The social media platform is more than only a social media app. Tencent developed a lot of other services to adapt their content to users’ needs.
It’s also very convenient for brands to communicate with their target. The platform is known for its communication services in which users can send messages, share images and videos, voice call and video call other users on a closed network. Having an account on WeChat enables you to promote your brand via mobile or tablet.
Weibo is the second-most mass-used social networking site in China, with around 82% penetration rate across the country and more than 50 million active users per day in 2016. Weibo is very popular because it’s the first place where Chinese users can express themselves without suffering from the government’s censorship. For the first time, Chinese people can speak about every subject and they love it.
The social microblogging network has also attracted more than 130,000 companies. It’s very important for sportswear brands to create their own Weibo Official Account, and get their account verified. If your account is signed as verified, you will have more followers because it’s legitimacy proof for Chinese users who know that the Weibo process to have a verified account is complicated and long but ensure the legitimacy of a brand.
More than 56% of Weibo users follow at least one brand on Weibo. In addition, on Weibo, you don’t need to be connected first to follow a brand.
Engaging influencers, known as KOLs (Key Opinion Leaders) in China, is one of the most effective ways to promote an official account, content, or campaigns on social media.
KOLs have their own follower bases that see their opinions and suggestions as credible and influential. Many also excel in driving online sales. Sharing brand information or launching campaigns with bloggers can help to raise brand awareness, attract new followers and contribute to a brand’s credibility.
The price of KOL cooperation differs primarily based on their industry, interest category, follower base, content quality, and the prominence of their posts. The more followers, the higher the content quality, the higher the cost of a contract.
While WeChat is a semi-opened platform that has a personal or private purpose for users, Weibo has a simple working model with entertainment at its heart. That can explain to us why Weibo KOLS are cheaper than WeChat KOLs.
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