I didn't have money to buy Li-Ning before, but now I don't have money to buy Li-Ning ......
In the past few years, in the consumption upgrade, as well as the continuous investment and development of various industries in marketingMany industry brands have enjoyed the dividends of domestic business. For example:The sports brand Li Ning takes Guochao as the user's mindis one of the core representatives.
So much so that in the past few years, Li Ning has been rubbing against the top in terms of revenue and stock price, constantly refreshing the height, and behind it, there is a grand occasion that the price of products is still sold out. However,The excitement didn't last forever. In the past two years, as people's wallets have become more and more shriveled, consumers have become more and more pragmaticThose goods that rely on marketing and sentimental premiums seem to be somewhat consumed. Since October 26, Li Ning's announcement made its stock price plummet directly and fell nearly 20% in a single day, and then opened today (December 11), falling more than 13% again, and now the stock price is only 18HK$3. Today's market value is only around 48 billion, and the market value has fallen by more than 70% during the yearThe share price has hit a new low since March 2020, and what is even more cruel is that its market value is now less than a quarter of Anta's. What happened to Li Ning?
The performance stalled, and the national tide premium failedA few years ago, under the conceptual wave of consumption upgrading, all business is worth being redone seems to have become the creed of brands in the consumer marketHow the hell is it redone?When the tide goes out, we look backMost of the core strategies are redone in marketing. In the sports market, the biggest change we see is that the design of the product has added more elements that young people like, followed by the tall store decoration, entertainment implantation and celebrity endorsement, as well as the continuous exploration of the productFrom the early 100 yuan, it has been up to several thousand, and even played out the financial attributes in the secondary market, ** up more than ten or twenty times.
From the national tide, to various IP co-branding, to the all-over glass curtain wall in the shopping mall, plus a variety of interactive marketing, it can be saidIt has created the strongest money-absorbing weapon in the new consumption era. Under this series of rework operations, Li Ning's revenue and stock price continued to make history. For example, in 2015, Li Ning's revenue was only 7 billion yuan, and in 2018, it was only 105100 million yuan, but in 2021,Li Ning's revenue exceeded 20 billion yuan, reaching 225700 million yuan, a year-on-year increase of 56%, and a net profit of 4 billion yuan, a year-on-year increase of 136%. And in this year,Li Ning has also created the highest market value of HK$280 billion in the capital market. However,Changing faces is faster than flipping through a bookIn three years, Li Ning has completed a big leap in revenue from 10 billion to 20 billion yuan, creating a market value of 280 billion Hong Kong dollars. However, in just two years, the market value is less than 50 billion Hong Kong dollarsIn two years, Li Ning's market value has shrunk by more than 80% from its highest point, evaporating by HK $230 billion. Especially in 2023, the first share price of Li Ning is even more amazingThe cumulative decline during the year is more than 70%.In particular, an announcement on October 26 made it **20% in a single day, and it opened again **13% today, with a total market value of only HK $48.2 billion.
The continuous decline in stock price and market value is the stall of performance, according to its latest release of the third quarter operating situation. In the third quarter of 2023, Li Ning's sales increased from 10%-20% in the middle of the second quarterThe decline was a mid-single-digit increase, compared to 40% to 50% in 2021Among them, it is worth noting that in the third quarter, the main brand of Li Ning (excluding Li Ning Young).The year-on-year growth rate of retail turnover across the platform was in the mid-single digits (4%-6%). It is worth noting that at the end of October, Li Ning's management lowered the company's full-year revenue growth forecast for 2023 from 15% to less than 10% at an internal meeting for investors. This means that in 2023,Li Ning's growth rate is already lower than 14 in 20223% up. If you stretch the timeline again, in the first half of this year, Li Ning's revenue was 1401.9 billion yuan, a year-on-year increase of 13%, while the revenue growth slowed down, its net profit attributable to the parent company was 212.1 billion yuan, down 311%。It has become the only brand among the four major sports brands with negative net profit growth.
At the same time, Li-Ning's gross profit margin has also continued to decline, with Li-Ning's gross profit margin falling to 48.28 in 2022 from 53% in 20214%，The overall gross profit margin in the first half of the year decreased by 1 compared with the same period last year2 percentage points. The main reason is that the company has once again increased the discount of online channels and retail terminals, and in addition, the data also shows that the average inventory turnover days of Li Ning have increased from 55 days in 2022 to 57 days, and the backlog of goods is even more serious. That is to say,Li Ning has increased its discounts and efforts in the past two years, but it is still a little unsellable. In other words, consumers who are now willing to pay for Li Ning's high-end are becoming hesitant and a few years agoThe "national tide" that has made Li Ning a lot of money is beginning to fail under the new cycle。So today's Li Ning still has not come up with a new story that can replace the national tide, and the performance stall will become inevitable. There is no brand power but no product power, and there is no moat for fatness
As mentioned above, under the new wave of consumption, the so-called concept that all businesses are worth redoing all over again, at least we don't see a moat in Li Ning, which means that Redo has not made a real and impeccable core competitiveness. Against such a background,All premiums are lacking strong support, so how did Li Ning quickly rush to the top of the tower a few years ago?
In fact, this one doesn't need much argumentation, the thrust behind it mainly comes from Guochao and traffic stars, superimposed on the wave of consumption upgrading in previous years, followed by the optimization of the layout of channels. Taking Li Ning's 2021 year, that is, Li Ning's highest light moment, as an example, the financial report data shows that this year, Li Ning's cost of sales was 1060.3 billion yuan, that is, sales expenses reached half of the revenue.
And in this expenditure,Advertising and marketing costs amounted to 17800 million yuan.
And what about R&D?In 2021, Li Ning's annual R&D expenditure was 41.4 billion yuan,R&D expenditure to total revenue ratio was 18%，Compared to 2. in 20202% also declined. This kind of R&D expenditure performance is far inferior to that of peersNot to mention the international giant Nike Adi, where the R&D expense rate is generally around 10%. On the contrary, with an annual advertising and marketing expenditure of nearly 1.8 billion, Li Ning frequently uses various traffic stars to endorse and various advertising and marketingSecondly, the billions of sales expenses have also made the cost continue to soar. ButIt's okay if the cost is high, the product can be earned back, and a T-shirt can be sold for thousands, isn't it?This year, Li Ning's profit increased by 136% year-on-year to 4 billion.
But at the same time, this year, Li Ning's revenue and profit have hit a new high, that is, the proportion of R&D expenditure has decreased, but the cost of sales and advertising has risen, making Li Ning's products sustainable. Then eventually,In fact, these premiums are more in sales and advertising, that is, the more money consumers spend, more money is spent on marketing and sales of Li Ningon, and the product itself is not much. That is, the money has been spent, Li Ning'sThe brand power has gone up, but the product power is not necessarily.
So can such a model build a moat?If the economy has no cycle and has maintained high growth, it may be possible, but once it encounters an economic downturn, it will inevitably show its original shape. And moreoverSevere dependence can be formedIn 2022, its advertising and marketing spending increased by 28% year-on-year to 227.9 billion yuan, which has far exceeded the growth rate of revenue, which means thatIn 2022, it increased its advertising and promotion spending, but it did not translate into equal sales growth. In the first half of 2023, Li Ning's spending on advertising and marketing has decreased10. in the first half of 20234.2 billion yuan, but it is also obvious that the performance has stalled. This also means,Today's Li Ning is a bit dominated by marketing kidnappingIn this case, how can Li Ning's high-end road continue?Since entering 2023, discounting** has become a new topic for Li Ning, but even so, consumers don't seem to be as enthusiastic as in previous yearsLi Ning's nightmare may have just begun to ......The business under the banner of high-end is not so **2023 has come to an end, and Pinduoduo has been making great progress, making the two big players in the e-commerce marketMa Yun and Liu Qiangdong have spoken out for self-criticism.
This series of events is connected in series, and they are all answering the same questionThat is, all the businesses that shout high-end banners are not so good in today's era.
EspeciallySeven no's in the context of young people becoming the mainstream consumer group in today's societyWe have clearly entered a more pragmatic, low-desire era of consumption. As long as you can eat enough and be healthy, as long as you can wear clothes and shoes and keep warm, so thoseIn the past, the so-called high-end that relied on feelings and marketing premiums will gradually be thrown into the trash. Under today's hot search topic about Li Ning's Li Ning's stock price fell by nearly 70% during the year, many users also expressed their hearts. 「Li Ning is also getting more and more expensive, and later found that I bought a few pairs of high-end goods from a certain field, which are exactly the same and of good qualityI don't really understand the brand that has risen in price if it is a little famous, Li Ning used to be quite popular, but now it is really outrageous
It's too expensive, so I can only settle for AdiIt is foreseeable that in this context, if you treat fat as a muscle, once you fall, it will really be miserable!Shigowski
Author Xiao Chai No. 2.
Edited by Tan Song.