Summary of Key Points
Against the backdrop of declining sales in its basketball products, Li Ning has entered into a long-term “brand collaboration” with NBA star Stephen Curry, who owns his own Curry Brand. This partnership is neither a simple endorsement nor an acquisition; rather, it involves joint brand management. Li Ning aims to leverage Curry’s global influence to strengthen its position in the basketball market, expand into Europe and America, and enter high-end sports segments such as golf. In return, Curry seeks Li Ning’s supply chain support and access to the Chinese market. This marks a new attempt by a Chinese sports brand to go global, with industry observers awaiting the results with skepticism.
1. Investing in a Downward Basketball Market: Li Ning’s Bet on Future Growth and Curry’s Appeal
Basketball shoes have not been selling well in recent years, leading to a decline in Li Ning’s basketball-related revenue. However, the management insists on making investments despite the market downturn. Their strategy is straightforward: by maintaining a leading position now, they can regain market share once the basketball market recovers. Curry is at the heart of this plan; with 150 million followers worldwide, he is a top-tier athlete. A previous collaboration with Under Armour resulted in the sale of 160 million dollars worth of signature shoes in one year, boosting Under Armour’s basketball shoe sales by 350%. Li Ning sees Curry as a key asset for retaining and attracting younger consumers in the basketball sector.
2. A Collaborative Approach to Brand Building, Not Just an Endorsement
This partnership is distinct from traditional athlete endorsements. When Curry parted ways with Under Armour, he retained all trademarks and intellectual property rights (for a substantial fee), giving him significant control over his brand. Li Ning describes it as “brand collaboration”—both parties will manage the brand together, neither acquiring Curry’s brand nor just paying for advertising. Some compare this to Nike’s Air Jordan series, which became even more successful after Jordan retired, selling for 6.6 billion dollars in 2023. The industry is curious whether this strategy can replicate that success.
3. Expanding into Europe and America with Curry’s Help: A Challenging Path
It is difficult for Chinese brands to establish a foothold in Europe and America. Established brands like Nike and Adidas have been in the market for decades, and consumers are accustomed to their products. Emerging brands such as HOKA and ON are also competing for market share. Chinese brands face two major hurdles: access to distribution channels (European and American markets primarily rely on large retailers, while Nike once experimented with direct-to-consumer sales but later returned to wholesale models), and brand recognition (consumers in these regions generally view Chinese brands as “good quality but not the first choice”). Therefore, leveraging Curry’s influence to enter these markets is a new and uncertain endeavor.
4. Beyond Basketball: Expanding into High-End Sports
Li Ning’s collaboration with Curry extends beyond basketball; they also plan to explore golf and other high-end sports. Golf is a high-end market with higher average transaction values, which can enhance the brand’s prestige. Brands like Lululemon and Fila have recently launched golf products and are prominently displaying them in stores. Li Ning hopes to use Curry’s influence to enter these niche markets and attract consumers willing to pay for premium products, thereby shedding the label of a “mass-market” brand.
5. The Chinese Market: A Crucial Platform for Both Parties
Curry sees the Chinese market as an essential opportunity for expanding his business, given its large population and strong consumer power. He has previously engaged in charitable initiatives in China (such as the “Basketball Without Borders” program with the Yao Foundation) and has a positive reputation there. As a local brand, Li Ning understands Chinese consumers well and can help Curry’s brand take root. Additionally, while brands like Lululemon’s North American market saw a 3% decline, its Chinese market grew by 30%, and On Running opened over 80 stores in China with plans for further expansion. These factors highlight the market’s potential, making it a priority for both parties.