Brooks Running: Can This Legacy Brand Conquer the Chinese Running Market?
Meta Description: Brooks Running, a legacy American sportswear brand, is making a comeback in China after a seven-year hiatus, but faces stiff competition from established players like On, Salomon, and Hoka One One. Will Brooks Running be able to break into the lucrative Chinese running market?
Brooks Running, a name synonymous with high-performance running shoes, is back in China. After a seven-year absence from the mainland market, the brand is making a bold move, opening a new flagship store in Shanghai's Kerry Centre in July, marking its only store in mainland China. Plans for a second store in Shanghai and new stores in Beijing and Guangzhou are underway. Previously, Brooks Running had relied solely on online platforms like WeChat, Tmall, JD.com, and Douyin for sales.
The brand's return to China is gaining traction, fueled in part by the appearance of “Hawkeye,” Jeremy Renner, in a Brooks Running advertisement. Renner, known for his role in the Avengers franchise, chose Brooks Running to support his recovery after a snowplow accident that left him with 38 broken bones.
Brooks Running's association with Berkshire Hathaway Group is also a factor in its Chinese recognition. Founded in 1914, the brand gained prominence for pioneering the use of ethylene-vinyl acetate in athletic footwear, a significant innovation in the industry. However, aggressive expansion and operational challenges led to bankruptcy in the 1980s. In 2006, Warren Buffett acquired the brand, marking a turning point in its trajectory.
According to its Q1 2024 earnings report, Brooks Running's revenue grew by 9% year-on-year, with China's contribution to the growth reaching 180%. As Brooks Running celebrates its 110th anniversary, it unveiled its new global brand slogan, “Lets Run There.”
In the running industry, Brooks Running is often considered one of the "Big Four" running shoe brands, alongside New Balance, Asics, and Saucony. The brand's official Weibo account even boasts its status as "one of the world's four major running shoe brands." However, compared to its counterparts, Brooks Running has a relatively smaller presence and recognition in the Chinese market.
While Brooks Running claims that its Shanghai Kerry Centre store is its first in China, the brand actually made its initial foray into the Chinese market seven years ago.
Initially, Brooks Running opted for a bottom-up approach, establishing stores in smaller cities like Shijiazhuang, Tianjin, and Taiyuan. However, by the end of 2017, the company's expansion plans in China were put on hold.
According to the Beijing Business Daily, Anta, a leading Chinese sportswear brand, filed a lawsuit against Brooks Running for trademark infringement, alleging similarities between the two brands' logos. The lawsuit was accepted by the Quanzhou Court in August 2017, and a ruling was issued in December of the same year, ordering Brooks Running to cease infringement and compensate Anta for economic losses.
Following the court ruling, Brooks Running's Tmall flagship store was entirely emptied. In August 2020, the brand announced the closure of its sole authorized distributor, "Qi Zheng Overseas Exclusive Store," on Tmall Global. At this point, Brooks Running's official sales channels in China had completely ceased operations, leaving the brand to sporadically engage with its audience through Weibo and WeChat.
In April 2022, Brooks Running marked its return to the Chinese market with a WeChat post titled "Your Brooks Brooks can finally be bought!" announcing the launch of online flagship stores on Tmall and JD.com.
Brooks Running's comeback is not too late, as the Chinese sportswear market has witnessed rapid growth in recent years, with premium brands particularly popular among consumers.
While brands like On, Salomon, and Hoka One One have already expanded their presence in multiple Chinese cities, there is still significant room for growth in the premium running brand segment, with many upscale shopping malls eager to lease space to new brands.
However, the timing of Brooks Running's return may not be ideal either. Compared to outdoor activities like skiing and mountaineering, running is a more established sport in China, leaving less opportunity for consumer education. The market is also saturated with running shoes offering diverse technological advancements, price points, aesthetics, and trendy marketing strategies. While Brooks Running's cushioning technology might appeal to professional runners, the brand needs to find a way to stand out from the crowd.
Brooks Running, On, Salomon, and Hoka One One all boast flagship running shoes with official retail prices hovering around 1,000 yuan. The difference lies in the branding: On is associated with "middle-class preferences," Salomon with "ugly shoe trends," and Hoka One One with "designer collaborations" and "hunger marketing." Without its own trend, Brooks Running might be relegated to niche appeal.
Moreover, Brooks Running has yet to achieve a breakthrough product in China, a critical step for any footwear brand transitioning from a niche audience to the mainstream. Currently, the brand's overall revenue heavily relies on its North American market, accounting for $1 billion out of a total $1.2 billion in revenue in 2023, leaving less than $200 million from other global markets.
Brooks Running's Challenges in the Chinese Market
Brooks Running faces several hurdles in its pursuit of conquering the Chinese running market. Here are some of the key challenges:
Competition from Established Brands
The Chinese running market is already crowded with established brands like On, Salomon, and Hoka One One, each with its own loyal customer base and strong market positioning. Brooks Running will need to differentiate itself and carve out a unique niche to stand out from the competition.
Building Brand Recognition and Awareness
Brooks Running needs to build significant brand recognition and awareness in China, particularly among a younger generation of runners. This will require targeted marketing campaigns and collaborations with influencers and key opinion leaders.
Developing a Winning Product Strategy
Brooks Running needs to develop a product strategy that resonates with Chinese consumers' preferences and needs. This could involve introducing new product lines specific to the Chinese market or tailoring existing products to local tastes.
Navigating the Complex Retail Landscape
The Chinese retail landscape is highly competitive and complex, with a mix of online and offline channels. Brooks Running needs to carefully navigate this landscape and develop a multi-channel strategy that reaches its target audience.
Adapting to Cultural Nuances
Brooks Running needs to understand the cultural nuances of the Chinese market and tailor its marketing and branding efforts accordingly. This includes recognizing the importance of social media and influencer marketing in reaching Chinese consumers.
Brooks Running's Opportunities in the Chinese Market
Despite the challenges, Brooks Running has several opportunities for success in the Chinese market:
Growing Demand for Premium Sportswear
The demand for premium sportswear is rapidly increasing in China, creating a lucrative market for brands like Brooks Running. Chinese consumers are becoming increasingly discerning about the quality and performance of their sportswear, and are willing to pay a premium for brands that deliver on these values.
Focus on Running Performance
Brooks Running has a strong reputation for high-performance running technology and innovation. The brand can leverage this reputation to target serious runners and athletes in China who prioritize performance and comfort.
Leveraging the Brand's Legacy
Brooks Running's long history and legacy as a trusted running brand can be a significant advantage in the Chinese market. The brand's association with Warren Buffett and its pioneering role in running shoe technology can help build credibility and trust among Chinese consumers.
Collaborating with Local Partners
Brooks Running can collaborate with local partners in China to enhance its market reach and understanding of the local market. This could involve partnerships with retailers, influencers, or sports organizations.
Embracing Digital Marketing
Brooks Running should embrace digital marketing strategies to reach its target audience in China. This includes utilizing social media platforms like WeChat, Weibo, and Douyin to engage with consumers, create content, and build brand awareness.
Key Takeaways
Brooks Running's return to the Chinese market is a strategic move, but one that will require careful planning and execution. The brand faces stiff competition from established players, but also has opportunities to capitalize on the growing demand for premium sportswear and its strong reputation for running performance. Success will depend on the brand's ability to differentiate itself, build brand awareness, develop a winning product strategy, navigate the complex retail landscape, and adapt to cultural nuances.
FAQs
Q: What is Brooks Running's target audience in China?
A: Brooks Running's target audience in China is primarily serious runners and athletes who prioritize performance and comfort. The brand also aims to appeal to consumers who are interested in premium sportswear and appreciate the brand's legacy and heritage.
Q: What are Brooks Running's key marketing strategies for the Chinese market?
A: Brooks Running is utilizing a multi-channel marketing approach, including online platforms like WeChat, Weibo, and Douyin, physical stores, and collaborations with influencers and key opinion leaders. The brand is also focusing on building brand awareness and promoting its innovative running technologies.
Q: How does Brooks Running differentiate itself from competitors?
A: Brooks Running differentiates itself through its focus on high-performance running technology and innovation, its legacy as a trusted running brand, and its commitment to providing comfortable and supportive footwear.
Q: What are Brooks Running's main challenges in the Chinese market?
A: Brooks Running faces challenges from competition from established brands, building brand recognition and awareness, developing a winning product strategy, navigating the complex retail landscape, and adapting to cultural nuances.
Q: What are Brooks Running's opportunities for success in the Chinese market?
A: Brooks Running has opportunities to capitalize on the growing demand for premium sportswear, its strong reputation for running performance, its legacy as a trusted running brand, and its ability to collaborate with local partners and embrace digital marketing strategies.
Conclusion
Brooks Running's return to China marks a significant step in its global expansion strategy. The brand faces a challenging market with fierce competition, but also has numerous opportunities for growth. Success will depend on the brand's ability to navigate the complex environment, adapt to local preferences, and leverage its unique strengths. If Brooks Running can effectively execute its strategy, it has the potential to become a major player in the lucrative Chinese running market.
