[Hidden Business Story] Annual Sales of $2.77 Billion... 'Anta,' the World's 3rd Largest Sports Brand
'Table Tennis Emperor Gong Linghui, NBA Star Klay Thompson Chosen as Models to Boost Market Share
Building a 'Global Brand' Image through China Operations of Fila, Kolon Sports, Descente, and More
[Asia Economy Reporter Shinwon Yoon] There is a sports brand that originated in Fujian Province, China, known as the sanctuary of counterfeit goods, and competes with Nike and Adidas. It is 'Anta Sports (hereafter Anta)'. Although it may be somewhat unfamiliar in Korea, it ranks third worldwide with annual sales of $2.77 billion (about 3.4 trillion KRW as of 2019), representing China’s leading sports brand.
Anta was founded in 1994 by Chairman Ding Shizhong. Growing up under a father who operated a shoe OEM factory in Fujian Province, he helped run the shoe factory from a young age. At 16 in 1986, he took 10,000 yuan (about 1.73 million KRW) from his father along with 600 pairs of shoes made by his father and headed to Beijing. After four years, he earned 200,000 yuan but realized that even shoes made in the same factory had different prices depending on the 'brand.' He then returned to his hometown and established 'Anta' with his father in 1994.
When Anta entered the market, the global top two brands Nike and Adidas already dominated the sports apparel industry in China. Among domestic brands, only 'Li Ning,' well known even in Korea, was competing with global brands. Therefore, Anta launched bold marketing. In 1999, they hired the legendary table tennis emperor Gong Linghui, who won a gold medal at the Atlanta Olympics, as their model for 800,000 yuan (about 138 million KRW). Since this amount was equivalent to Anta’s annual sales at the time, the industry criticized Anta’s decision as a mistake.
However, this strategy worked in the market. Gong Linghui became a sports hero by winning gold and silver medals at the 2000 Sydney Olympics following the Atlanta Olympics. Anta capitalized on this momentum by airing a TV commercial featuring Gong Linghui saying, "I choose, what I like." This advertisement is still remembered in China as a patriotic marketing campaign. At that time, Anta raised its market share in the Chinese sneaker industry to the 10% range.
Subsequently, Anta entered the basketball shoe market. Chairman Ding Shizhong analyzed why Chinese people liked basketball but did not wear basketball shoes. The conclusion was 'price.' Nike basketball shoes usually cost over 1,000 yuan (about 170,000 KRW), while Anta offered basketball shoes priced between 300 and 500 yuan, about half the price. Since the shoes were produced and consumed only in China, the low distribution costs also helped keep prices down.
In 2014, Anta signed an advertising model contract with NBA star Klay Thompson (Golden State Warriors), and in 2017, Klay Thompson took charge of producing the basketball shoes he would wear on the court until 2027. Anta also established ties with the NBA. In 2014, Anta was selected as the official marketing partner of the NBA, the first time for a Chinese brand. This contract allowed Anta to use NBA professional basketball team logos on basketball shoes and equipment.
While hiring such sports stars as models, Anta also strived to produce products of matching quality. In 2005, Anta invested 30 million yuan (about 5.2 billion KRW) to build the first research and development (R&D) center among Chinese sports brands. Anta still consistently spends 3-5% of its total sales on R&D.
Anta gradually expanded its presence in the Chinese sports apparel industry and surpassed Li Ning, the top domestic brand in 2011. Until 2010, their market shares were 9.7% and 8.5%, respectively, but Anta overtook Li Ning the following year and has maintained a market share in the 10% range in an industry where domestic brands are struggling.
Although Anta has established its position within China, its status as a global brand is still insufficient. The prejudice of 'Made in China' has also been a hindrance. Therefore, Anta adopted a strategy of acquiring the Chinese operating rights of global brands. Currently, the brands Anta operates in China include the Korean brands Fila and Kolon Sports, Japan’s Descente, and the British brand Sprandi. These brands contribute to building a global brand image and elevating Anta’s prestige.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
