Bags / Shoes & Accessories

The most inspiring story in the field of sports over the past year has been the rise of Soconni in China. As one of the "Four Big Running Shoes in the World", Soconni has been defeated twice, but with the help of special measures, it has risen again and achieved counter trend growth last year, as reported by Huacheng Import and Export Data Observation.

This kind of performance also greatly inspires the confidence of both parties in cooperation. According to Huacheng Import and Export Data Observation, on May 15th, Tebu International (1368. HK, hereinafter referred to as "Tebu") Shanghai Operations Center was officially put into use, and Sokoni became the first brand to enter the Tebu Shanghai Operations Center.

Brendan Hoffman, President and CEO of Wolflin Group, also appeared on the scene of the launch of the Special Operations Center in Shanghai. It is worth mentioning that this is the first time in four years that the top management team of Wolflin has come to China, and its level of attention is evident.

In 2023, Tebu will continue to increase its sales to Soconni, and its stores will also experience upgrades. An important change is that Soconni will launch 3.0 stores, evolving from a professional sports image that highlights technology and functionality to a multi scene and youthful sports venue that provides a more diverse combination of clothing and a more user-friendly consumer experience for the general public.

With the comprehensive opening of the 3.0 store, Soconni's journey to China will enter a new stage. Not surprisingly, the modern version of the story of "Bole and Qianlima" between Tebu and Soconni will continue to unfold.

/01/Transformation, from consecutive setbacks to counter trend growth

In 2022, Soconni is undoubtedly the most beautiful "kid" in the Tebu Group. From the financial report, Soconni's professional sports division has grown by 99%, and its proportion in the revenue of special walking has also increased from 2% in 2021 to 3.1%, according to Huacheng Import and Export Data Observation.

Behind the counter trend growth in performance is the comprehensive flowering of Soconni's operational data. In terms of channels, as of the end of 2022, Sokoni has a total of 69 stores nationwide, located in 17 key cities such as Beijing, Shanghai, Guangzhou, Shenzhen, and Hangzhou, and has entered high-quality commercial districts and mid to high-end shopping centers.

While the channels are fully expanded, Soconni's channel efficiency is increasing instead of decreasing. Offline, in 2022, Soconni's same store sales increased by 61% year-on-year, with Shenyang Shanshan Aolai Store and Hangzhou Yintai Wulin Store achieving a monthly breakthrough of 1 million. Online, Sokoni's online sales are even more outstanding. During the 2022 "Double 11" shopping festival, online sales increased by 95% year-on-year, ranking among the top three growth rates of similar brands for three consecutive years, with a compound growth rate of 100% and a sharp increase of 135% year-on-year in 618 online sales.

The rapid progress in sales has also greatly improved Soconni's profit nodes. Previously, according to the special report, Soconni has not yet made a profit and is expected to achieve its profit target by 2024. But in an interview at the beginning of this year, Xu Longfei, the general manager of Soconni's Chinese brand, stated that Soconni is expected to achieve profitability in 2023.

Upon seeing this, you may be curious why Soconni, who had once been acclimated to the harsh environment, came back to power with special steps? In my opinion, differentiation and complementarity are a core reason.

At present, Soconni and Tebu are highly complementary in terms of consumer groups, product prices, and market levels. Taking price as an example, the price coverage of Tebu brand running shoes products ranges from 300 to 1200 yuan, while the price coverage of Soconni running shoes products ranges from 699 to 2199 yuan. In terms of market hierarchy, Tebu mainly focuses on third and fourth tier cities, while Sokoni, as a brand positioned as a channel for high-end cities, mainly targets first and second tier markets.

Comprehensively complement each other to form a good chemical reaction between Tebu and Soconni. For Sokoni, leveraging the advantages of the main Tebu brand in the supply chain, marathon and running events, and a large retail network can increase brand exposure and drive performance growth. For example, with the help of special steps, Soconni became a sports business partner of the China Athletics Association in 2020, further expanding its influence.

For Tebu, through cooperation with Soconni, Tebu not only has a more complete coverage of running product price bands and stronger competitiveness, but also can reach mature customers in higher tier cities through Soconni, enhancing brand tone.

Looking at the layout of Tebu on Soconni, establishing an efficient channel system online and offline is an important reason for helping Soconni find a path to localization in China. In 2023, with the launch of 3.0 stores, Soconni's channels will once again experience upgrades, as reported by Huacheng Import and Export Data Observation.

/02/Iteration, Advanced from Sports to Lifestyle

Since the beginning of this year, Tebu has undergone a comprehensive upgrade of its Soconni store. One of the major changes is that the positioning of the store has evolved from a professional sports image that highlights technology and functions to a multi scene, youthful, and comprehensive sports venue that provides a richer combination of clothing and a more user-friendly consumer experience for the general public. According to the special plan, 3.0 stores are positioned as the main image stores with regular prices, and more than 25 3.0 stores will open in 2023.

Suo Kangni's 3.0 stores located at Shanghai Zhengda Plaza

From the underlying logic, the upgrade of store versions 2.0 to 3.0 fully reflects the advancement of brand development concepts. To truly understand the internal logic behind the changes in the development philosophy of the Sokoni brand, it is first necessary to understand the driving factors behind the rapid development of the sports market in recent years.

In recent years, the sports market has undoubtedly become a major trend in the consumer market. According to the "National Fitness Plan (2021-2025)", it is expected that by 2025, the total scale of the national sports industry will reach 5 trillion yuan, and higher level supporting measures for national construction will be further improved. You should know that the total scale of the national sports industry in 2019 was only 2948.3 billion yuan

Among the catalytic factors for the rapid growth of the sports market, in addition to economic development, there are also changes in consumer attitudes towards sports. One important trend is that with the development of sports towards lightweight, youthfulness, and socialization, sports will become an important leisure lifestyle for residents. In the future, sports scenes will continue to extend and consumption attributes will be further enhanced.

The change in philosophy means that sports not only benefit from the short-term stimulus after the outbreak, but also a release of long-term demand. Simply put, as a "normalized lifestyle", sports will deepen with the deepening of urbanization and have a certain degree of irreversibility.

To some extent, the current sports craze is a historic opportunity for all sports brands. For Soconny, this is even more so. The reason is not difficult to understand. On the one hand, the running shoe category it occupies is already the core scene of sports, which makes it easier to expand from running shoes to other sports categories; On the other hand, as one of the "Four Big Running Shoes in the World", Soconni has excellent product strength and extremely high brand appeal, and can benefit from the dividends of sports consumption first. Its excellent store and floor efficiency are the best proof.

From this perspective, the upgrade of the store will once again strengthen Soconni's advantage in the field of sports and help it take the lead in this wave of "sports" competition.

/03/Taking root and building a brand moat with professional strength

In addition to upgrading channels, Soconni's product strength cannot be ignored. As one of the four major global running shoe brands, Soconni's success comes from a close attention and high devotion to the runner community and the sport of running. Simply put, by focusing on running for a long time, Soconni has created a professional and comprehensive product matrix, which is highly recognized by the running circle.

On the product side, Soconni has successively released a series of running shoe products, including Triumph Victory, Kinvara Elite, Ride Yutu, Tempus Tantu, Peregrine Falcon, and has won awards such as "Editor's Choice", "Best New Product", and "Best Series" from the world's authoritative running magazine Runner's World. In 2022, the Sokoni flagship carbon board racing shoe Endorphin Pro Feipeng 3 was named the best racing shoe of 2022 by the authoritative running media "BELIEVE IN THE RUN".

Soconni's professional temperament runs throughout the entire running track. Especially after reaching a partnership with Tebu, Soconni accelerated its efforts to delve into the Chinese running market, gaining recognition from more popular runners, and further establishing its reputation in the Chinese running industry.

In recent years, Soconni has had a strong sense of presence in marathon events. In 2022, Sokoni ranked among the top three international brand top three runners in the Beijing Marathon, Shanghai Marathon, and Xiamen Marathon. In the 2023 Xiamen Marathon, Sokoni running shoes ranked second only to Nike in terms of foot penetration among international brands, becoming the runner up in foot penetration on the international chart; In the 2023 Wuhan Marathon, Soconni achieved a foot on rate of 5.87% in the finished running shoes, ranking third among international brands. Huacheng Import and Export Data Observation Report.

At the same time, Soconni also enhances its brand influence among runners by sponsoring a series of professional running events. Starting from 2021, Soconni has partnered with a well-known domestic team in the running relay event, the Hood To Coast, to become a gold medal partner.

In this event, Sokoni not only provided runners with running equipment and runner service support, but also shared the stories behind the team, the shining moments in the event and other high-quality content on social media such as Xiaohongshu, Weibo, Tiktok through the running circle media and opinion leaders, so as to convey the charm of this running relay race to more people from different dimensions.

At present, Sokoni has achieved excellent market feedback by relying on the professional strategy of the runner group. In 2022, the global sports brand market was generally sluggish, but Soconni achieved excellent results in doubling its revenue, which is precisely the result of Soconni's focus on running sports.

Looking at the extended timeline, Soconni's continuous deepening in the professional running field has accumulated huge development potential for the brand. Throughout the history of sports brand development, the profession is the masses. Brands with strong influence in the professional field often have the advantage of "reducing dimensionality and cracking down" when entering the mass sports market, and their commercial achievements generally show a trend of accumulation and thin development. Sokoni, rooted in the sport of running, is expected to use its professional advantages to transform the brand's potential into development momentum and achieve faster development.

It can be expected that with the continuous improvement of people's health awareness and sports philosophy, the development momentum of Sokoni will further accelerate, and it is expected to become the second growth curve supporting the development of Tebu International Strategy.