The "new shoe king" that attracts more than 30 billion yuan, with a growth rate exceeding Nike Adidas, sells explosive in China!

As time goes by, the Onitsuka Tiger brand and its parent company Asics have also gained a large number of fans in the Chinese market. According to ASics' financial report for 2024, the group's net sales reached 678.5 billion yen (about 33 billion yuan), an increase of 18.9%.

Sales in China are growing rapidly. From the fiscal year 2022 to the fiscal year 2024, ASics' net sales in the China market were 62.4 billion yen (about 3.03 billion yuan), 77.615 billion yen (about 3.77 billion yuan) and 100.498 billion yen (about 4.88 billion yuan), showing a straight line growth trend. In fiscal year 2024, the Chinese market became ASics' third largest market by sales, followed by Europe (net sales of 179.3 billion yen) and North America (net sales of 135 billion yen).

For sports brands, the importance of the Chinese market is self-evident. The outdoor Industry Research Report released by Shanghai Securities shows that the penetration rate of outdoor sports in China is only 28%, compared with the penetration rate of over 50% overseas, there is still a large room for growth. In addition, according to data released by the State General Administration of Sport, it is expected that by 2025, the total scale of China's outdoor sports industry will exceed 3 trillion yuan.

China's outdoor sports trillion market, high growth space, attracted many international giants to pour in, ASics is one of them. In the fierce competition in the industry, how did ASics rise? In the era of the rise of international giants and domestic goods, what kind of survival rules did Arthur find in the cracks?

$30 billion a year, running shoes are a revenue engine

In fiscal year 2024, Asics delivered a stellar report card.

According to the financial report, ASics net sales reached 678.5 billion yen (about 33 billion yuan), an increase of 18.9%; The annual operating profit exceeded the 100 billion yen mark for the first time, an increase of 84.7%. Net profit increased 80.9% year-on-year to 53.8 billion yen (about 2.6 billion yuan), and all financial indicators hit a record high.

Asics' high growth is in stark contrast to other sports brands. Take Nike as an example, in the fiscal year 2024, Nike Group revenue was $51.4 billion, an increase of 1% on a constant currency basis. It was Nike's slowest annual sales growth since 2010. Nike's fiscal year 2024 net profit of $5.7 billion, an increase of 12%, the growth rate is far less than ASics.

In terms of business areas, Asics divides its business into five segments, namely, performance running (P.UN), core functional apparel business (CPS, including tennis, volleyball, table tennis, badminton, etc.), clothing and equipment business (APEQ), sports fashion business (SPS) and Onitsuka Tiger (OT).

Among them, the performance running business has always been the core pillar of ASics, but also the foundation of ASics. In the 2024 fiscal year, the business generated 326.9 billion yen in revenue, up 14.3% year on year, and contributed 48% of the group's revenue.

The stable development of performance running business is inseparable from ASICS technology - GEL cushion-cushion-adhesive technology. According to ASics, GEL cushionable rubber is a jelly-like colloidal material that can enhance the comfort of running and the softness of the sole, thus playing a buffer and protection role, and the foot feels "stable with ammunition". GEL series running shoes have also become ASics' revenue engine.

In 2024, the sports and outdoor industry set off a retro trend, which also brought good sales for ASics GEL series running shoes. The Asia Tmall flagship store shows that the sales of a number of GEL series running shoes have exceeded 100,000. According to transaction information on the Dewu platform, the GEL-KAYANO 14 vintage shoes have been purchased by more than 33,000 people. At the release of the interim financial report of the fiscal year 2024, Gao Kai, president of ASX China, mentioned that "the data presented in the financial report can indeed see that the millennium retro trend has a certain boost for the sales of trendy life products." Asics will invest more in running shoes in the future."

In terms of net sales, in fiscal year 2024, following the performance running business, the sports fashion business and Onitsuka Tiger business grew strongly and became the other two pillar businesses, with net sales of both businesses approaching 100 billion yen.

Specifically, the sports fashion business contributed 98.4 billion yen in revenue, up 66.1% year on year, and the profit margin was 27.3%, 7 percentage points higher than the previous fiscal year; The Onitsuka Tiger business contributed 95.4 billion yen in revenue, up 58.3% year on year.

The other two businesses, core functional apparel sales of 78.6 billion yen, net sales increased by 9.0%, mainly due to sales growth in the European region and Southeast and South Asia region. Clothing & Equipment business sales of 38 billion yen, net sales increased by 5.2%, mainly due to the growth of sales in Europe, the business profit increased significantly 333.2%, mainly due to the improvement of gross margin.

Generation Z, buy ASics $100 billion in revenue

"Going into Asics' pit, it's so versatile." "More than 300 won, wearing effortless." "Asics helped me discover the new world of vintage."

In the past two years, the outdoor sports market, retro, Y2K and other wearing styles have become a trend, in the social platforms such as Tiktok and small red book, the recommended content of "retro running shoes to wear" has almost become a traffic password, and the simple lines and classic patterns of Asics have taken advantage of this trend and become one of the main brands of bloggers.

These Generation Z have also bought ASics' high growth performance in the Chinese market.

In the fiscal year 2024, ASics sales in the Chinese market exceeded 100 billion yen, achieving a rapid growth of 29.5%, becoming the second largest growth market, the fastest growth is Southeast and South Asia, achieving a high growth of 37.6%; In the Chinese market, ASics' operating profit increased by 47.5% to 19.3 billion yen in fiscal year 2024. The operating margin reached 19.3 percent.

Asics can achieve success in the Chinese market, can not be separated from the localization strategy.

In 2019, ASics established a China R&D Center to develop products for the local Chinese market. For example, in response to the widespread situation of Asian feet being wide, Asics launched a "wide last shoe" to solve the problem of adaptation.

In addition, there is the TECH PLUS technology fabric series, which also comes from this research and development team. The fabric series has anti-sweat stains, sweat absorption and quick drying, AAA antibacterial D.RESH technology fabric; 7D ultra-thin graphene fabric with thin breathable, UV protection and other functions; The main function of the Adaptive fabric ice cooling, anti-sweat anti-stains and other functions. According to the different characteristics of these fabrics, Asics has also subdivided the protective, cushioned and other product lines.

Asics also mentioned in its earnings report that its growth in China is due to products produced and developed according to local needs.

In addition to targeted research and development of products, Asics also keeps pace with The Times in marketing and actively promotes the channel development strategy of online and offline integration. Offline, create different types of stores with higher specifications; Online, together with Tmall small black box and other platforms to hold new product launch, expand influence.

Asics is also sponsoring local events in China. For example, it has become the official strategic partner of Chengdu World Heritage Marathon 2025, the sponsor of the "Shanghai 10km Classic", the designated sponsor of the "Shanghai Rolex Masters" tennis tournament, and launched the "Chinese Runners X ASICS ASICS Breaking Speed Training" activity, "ASICS ASICS Junior Tennis Tour" and other events.

These high-quality events have not only helped ASics secure its position in the hearts of professional consumers, but also further expanded its influence among mass sports enthusiasts and accumulated brand equity.

Onitsuka tiger turn over, the most profitable sub-brand

"What is the relationship between Asics and the Onitsuka tiger?" On social media, many consumers have raised questions.

From the founding time, Onizuka tiger in the front, Arthur in the back. In 1949, the 32-year-old Onizuka Kihacho founded the Onizuka Tiger brand, at the beginning of the Onizuka Tiger production basketball shoes, but due to poor sales, then turned to the development of running shoes, and in 1951 launched the first pair of running shoes "tiger" series.

In 1953, Japanese athlete Shigeki Tanaka won the Boston Marathon wearing Onitsuka Tiger running shoes, which instantly increased the brand's international popularity. Subsequently, in the 1964 Tokyo Olympic Games, Onitsuka Tiger once again launched RUNSPARK cleats, determining the recognizable "well" character logo, and thoroughly launched the brand reputation.

There was another episode. At that time, the American Phil Knight noticed the Onitsuka tiger and wanted to sell its products to the United States, for this reason and William Bowerman (William Bowerman) in 1964 each invested $500 to set up Le Cordon Bleu company, to act as the Onitsuka tiger agent, and the two Americans, The founder of sports giant Nike.

During the introduction process, Bowerman found that Onitsuka Tiger's Mexico 66 running shoe had some shortcomings, so he added a midsole, and Onitsuka Tiger Tiger agreed with this design, and thus produced the well-known Onitsuka Tiger Cortez running shoe. In 1971, after participating in the design of Onitsuka Tiger running shoes, Blue Ribbon company jumped from an agent to a manufacturer, began to produce their own running shoes, and redesigned the logo, to Onitsuka Tiger running shoes as inspiration, designed the later famous Nike "Gump shoes."

By 1977, the momentum of the Onitsuka Tiger and sportswear and merchandise manufacturer GTO and sportswear manufacturer JELENK merged to form the ASics Group, Onitsuka Tiger also changed its name to "ASics", and briefly left the eyes of consumers. However, the integration of Asics and GTO and JELENK was not smooth, but they had different business concepts and eventually parted ways. Onitsuka Tiger also regained its brand name at this time and separated.

However, Onizuka tiger in the "disappear" within a few years, the sports market turned to the professional era, the retro leisure style Onizuka tiger lost the market, business difficulties. In 1999, ASics acquired Onitsuka Tiger and repositioned it as a sports fashion brand, relaunching it in 2022.

Fashion is a cycle, sports outdoor market is no exception.

In recent years, with the popularity of retro style, Onitsuka tiger's performance has also skyrocketed. In the fiscal year 2024, Onitsuka Tiger achieved sales of nearly 100 billion yen and became the "profit king" of ASics Group in 2024 with a net profit rate of 34%.

The latest Big Facts Trend report released on the well-known trend trading platform StockX shows that the growth of Onitsuka Tiger brand is particularly obvious in 2024, with its Mexico 66 shoes trading volume increasing by 845% year-on-year. In addition, the most searched shoe type, Onitsuka Tiger Tokuten, was in the top five, with a 2,607% increase in searches in the third quarter of 2024 compared to the same period in 2023.

When Nike footwear business growth is weak, Adidas struggling in the aftermath of Yeezy, Asics with the "main brand technology building base + Onitsuka tiger trend broken circle" double helix strategy, ripped open a new track.

But the crisis is also surging, HOKA, Soconi and other new forces are eyeing, the next step of Asics may be whether it can continue to maintain the basic disk, and break through innovation, and seize every trend of The Times.

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