by Coresight Research
The China Sportswear Market: A Large and Fast-Growing Category
- Consumers use social media such as WeChat and Weibo to post snapshots of themselves working out at the gym or of their athleisure outfit.
- Chinese fitness app Keep reached 100 million registered users in August 2017.
- Fitness key opinion leaders (KOLs) on platforms such as Weibo and WeChat have thousands of followers and are a powerful marketing tool for companies.
- The growth of the broader sports industry: China’s sports industry—which includes the production of sporting goods and the provision of services such as sports management activities, training and education and media services—grew 11.1% year over year to ¥1.9 trillion ($295 billion) in 2016 (latest, released on January 13, 2018,) according to the Chinese National Bureau of Statistics. There is still scope for further growth, as the sports industry in China is still immature. Competitive sports are not as prevalent as they are in the US, and participation is more for enjoyment rather than competition, according to Azoya, a cross-border e-commerce service provider that partners with international retailers to expand their businesses in China.
- Large millennial population: Millennials are the main target market for both performance and lifestyle sportswear, and this segment is huge in China. There are about 400 million millennials in China, according to our analysis of World Bank data, more than the entire US population.
- Government investment in sports: The Chinese government is promoting sports and a more active lifestyle among the population to encourage the economic benefits that sports participation generates. It is also encouraging a healthier lifestyle among the population, which, in the long term, should reflect positively on healthcare costs.
- Big sporting events: Large sporting events raise interest in sports among the population and encourage active participation. In China, this process is often helped by government initiatives. For example, in preparation for the Beijing Winter Olympics in 2022, the Chinese government has been promoting winter sports and is looking to increase the number of ski resorts to 1,000 by 2030 from 500 currently, and to boost the number of skiers to 300 million from about 5 million currently, according to the Financial Times.
- Appetite for foreign brands: On Adidas’s fiscal 2017 earnings call earlier this year, CEO Kasper Bo Rorsted said that the attractiveness of global brands and the image they project are still quite high to the typical Chinese consumer. This should continue to create opportunities for further expansion for international sportswear brands in the market.
- Increased interest in sports: Beyond active participation, interest in following sports has been growing in China, particularly for popular sports such as basketball and soccer. Nearly 200 million viewers watched the 2017 NBA finals on their mobile phones, according to the South China Morning Post in September 2017. At the time of writing, the NBA’s Weibo account had 34.6 million followers. By comparison, the NBA’s Twitter account had “only” 27.2 million. There are currently more than 300 million active basketball players in China, almost equivalent to the entire US population, according to the Chinese Basketball Association, and an estimated 307 million soccer fans in China, the English Premier League website reports.
- Increased health and wellness awareness and physical activity uptake: Active lifestyles have become increasingly important among Chinese consumers. The figure below shows that regular exercise is regarded as the main way to stay healthy by the majority of respondents to a survey of Chinese consumers undertaken by Prosper Insights & Analytics in June 2018.