Question

Do small rivals like China’s Li-Ning pose a serious threat to Nike? Could private-label athletic shoes challenge Nike, especially in poor economic times?

Answer 1

Although Chinese Sports Brand Li-Ning may be a small rival to Nike but it does need to consider the potential threat that Li-Ning may pose if Nike wishes to establish its brand in China because Li-Ning is China’s leading Sports Brand. Li-Ning, being a local brand, use cheaper manufacturing products thereby making the rates of their products more lucrative for the basic Chinese audience to go for the same. On the other hand, Nike products are relatively much durable in nature however, on a heavier price range. Nike has to especially compete with Li-Ning when it comes to establishing popularity among the teenagers who may fall short of disposable income to go for the Nike products at a premium range. However, in the long run, it is to be certainly noted that these small rivals are not really a serious threat to Nike. Nike comes into the China market with heavy investment of research and development thereby its marketing expertise help in gaining overall, a considerable share in the world economy. The local brands like Li-Ning, at times use outdated products for their inputs to ensure the cost factor is in control whereas Nike believes in investing in latest technology, durability and comfort of its items that could be provided to its consumers. Here, Nike overpowers Li-Ning. Further, the consumers are also in the belief that in terms of Nike Footwear, the soles are good and designs are highly contemporary in the market. Therefore, Nike outperforms such local brands and cannot get threatened by Li-Ning in this regard. It is gradually taking the market share towards its favor in fact.

Private-label athletic shoes cannot really challenge Nike even in poor economic times because there are consumers who go for quality as well. The quality issue with the private labels are a matter of concern although it calls for diversity in options on the part of the consumers. In this regard, if National brands manufacturers are also supplying private label brands in poor economic times in a given Country, then care should be taken that the emotions of the consumers are not played with. There should absolutely be no room for compromising with quality. Seeking the advantage of Consumer’s loyalty towards certain national brands and in the process, supplying certain lower quality products to them, is hence not acceptable. Therefore, if quality aspect is taken care of, then the National brands manufacturers could also supply to Private labels and make it more successful than the global brands like Nike, otherwise, the survival of private-label athletic shoes are also difficult and cannot challenge Nike because Nike does not compromise with quality.