During the 2021 Tokyo Olympics, a hot search of ‘marathon bronze medalist wearing Peak’ attracted attention, so Peak(匹克), a Chinese sports brand established for more than 30 years, became a hit again.
In fact, Peak's achievements in this Olympics are far more than that. In cooperation with seven National Olympic Committees, including Brazil, Ukraine, Slovenia, Romania, New Zealand and so on, providing the Olympic delegation equipment, Peak also sponsored Germany, Nigeria and Iran men's basketball, Serbian women's basketball, women's volleyball, as well as the men's 3x3 national team of Serbia and Latvia and other individual sports teams, becoming the sports brand that has signed the largest number of Olympic delegations in China and the third largest in the world.
In the Tokyo Olympics, the Peak delegation finally shone in the world with 23 gold, 23 silver and 33 bronze medals, writing a new chapter in the history of Chinese sports brands in the Olympic Games. With 79 times showing on the Olympic podiums, Peak has also opened a new phase of internationalization through sports sponsorship.
At the very beginning of its establishment, Peak clearly defined the strategic goal of responding to globalization and going international, and then made unremitting efforts to achieve this goal, and has also made extraordinary achievements. How does the 34-year-old Peak implement its internationalization strategy? According to Allied Market Research, the global sports apparel market reached USD 230.6 billion in 2022 and is expected to reach USD 410.8 billion in 2032, growing at a GAGR of 6%. In the face of broad market prospects, major sports brands are all making moves, hoping to fight for more share in the market. What does Peak plan to rely on to occupy a place in the highly competitive market, and what challenges exist in the future?
Clarify the Internationalization Strategy and Prepare for International Integration
Peak was born in 1989. In the same year, the first pair of ‘Peak’ brand sports shoes were on the market. At that time, it was called Fengdeng, meaning ‘plentiful harvests’. In 1991, Xu Jingnan(许景南), the chairman of Peak, put forward the idea of ‘creating an international brand’ and planned Peak's internationalization ‘six-step’ strategy, i.e. the internationalization of name, trademark, standard, brand, capital and market. In this year, Peak took the first step to change the name of Fengdeng to ‘Peak’ with more international characteristics.
Subsequently, Peak began to gradually implement the content of the ‘six-step’ strategy. 1993, Peak began to register trademarks globally. As of this year, Peak has registered trademarks in 185 countries and regions, with 25 international products and 45 domestic products registered. In 1995, Peak passed the ISO9001 quality management system, ISO14001 environmental management system and OHSAS18001 occupational health and safety system certification, becoming the first Chinese sports brand to pass the quality system certification. In 2013, Peak was awarded the certificate of ‘Export Exemption Brand’ by the General Administration of Quality Supervision, Inspection and Quarantine of China, obtaining the ‘Gold Medal Pass’ to the international market and truly realizing the internationalization of standards.
In 2005, through a series of initiatives such as sponsoring top international tournament organizations such as NBA, FIBA, WTA and Olympic Games, and signing sports stars, Peak presented its brand to the world, continuously expanding its influence overseas and laying a solid foundation for entering the international market. Meanwhile, Peak’s sales overseas have been steadily advancing. By the end of 2016, Peak had established a mature brand operation system combining production and sales, with export business across five continents - Europe, the United States, Asia, Africa and Australia - and more than 200 sales outlets. At the early stage of its birth, Peak had the vision of going international before many of its peers and formulated a strategic plan to point out the direction for its road to the global market.
Launching Brand Internationalization with Sports Sponsorships
While realizing the internationalization of its name, trademark and standard, Peak also knocked on the door of brand internationalization.
In 1997, Peak’s intangible assets amounted to RMB 190 million, establishing a leading position in China's athletic shoe industry. In the next few years, Peak began to sponsor the domestic men's basketball league, invited Liu Yudong(刘玉栋) to be the brand spokesman, and entered into strategic cooperation with CBA. This move was very well received and helped Peak to become the No. 1 basketball brand in China.
Later on, Peak extended its strategy of expanding its popularity through basketball sponsorships overseas. In 2004, Peak provided special equipment for Uzbekistan, Greece and other national basketball teams, and in 2005, Peak launched a comprehensive brand internationalization strategy.
International competitions have always been an excellent stage for sports brands to show themselves to the global market. In April 2005, Peak became the equipment sponsor of the EuroBasket All-Star Game, in August, it became the strategic partner of the Stankovic Cup Intercontinental Basketball Championships, and in September of the same year, Peak sponsored the Houston Rockets' home court, becoming the first Chinese brand to enter the NBA arena. Through the broadcasting of world-class matches, Peak was also brought to the world. This epoch-making operation helped Peak gradually build up brand recognition in overseas markets.
Peak sponsored the Houston Rockets' home court
The successful cooperation with the NBA has strengthened Peak’s strategy of exploring the brand's international development, and they have also placed their vision of going overseas in the broader international basketball market. After that, Peak allied with top international tournament organizations such as FIBA and NBA, cooperated with top NBA teams such as Houston Rockets, Miami Heat and San Antonio Spurs, signed more than 20 top NBA stars such as Howard and Parker, and supported more than 10 national teams such as Iraq and New Zealand.
The layout of Peak in the world of basketball has boosted its growth in the global market and established Peak's leading position in the basketball market, said Peak CEO Xu Zhihua(许志华). Today, Peak has established a four-dimensional basketball marketing network consisting of ‘World Championships, national teams, professional leagues and top stars’, which can provide a stable guarantee for Peak's marketing in the international arena.
Science and Technology Innovation to Build a Solid Foundation for Brand Internationalization
Currently, Peak has established a brand sales system in more than 110 countries and regions around the world, realizing the leapfrog development from commodity export to brand export. Xu Zhihua said the next step of Peak's goal is to become a global leading innovative sports technology company.
As early as a few years ago, Peak began to build up its strength in science and technology research and development. In 2017, Peak launched first pair of 3D printed running shoes in China, and in the same year, launched the world’s first pair of 3D printed basketball shoes. In 2022, Peak's 3D printed shoes ‘Yuan Xing(源型)’ won the German IF Design Award and the Reddot Award.
3D printed products from Peak
In 2018, Peak held its annual technology conference in Beijing, releasing the new Peak independent innovation technology - intelligent adaptive midsole technology Peak ‘Taichi(态极)’. The series of products equipped with this technology have extremely strong adaptive cushioning and instant rebound performance, and have attracted the attention of many consumers at home and abroad since their release, and have now developed to the fifth generation. According to the annual sales data released by Amazon in September 2020, Peak ranked fifth in the basketball category with a market share of 2.1%, topping the overseas market share of Chinese brands.
At the Peak 125-Future Sports Technology Conference held in 2022, Xu Zhihua pointed out, ‘Peak, which has the only R&D center for sports materials and the only smart manufacturing center that realizes the integration of 3D printing design and manufacturing in the world, is the one with the power to change the entire sports equipment market." Currently, Peak has set up international design and R&D centers in Beijing, Guangzhou, Xiamen, Quanzhou and Los Angeles, and has also established a strong database of foot shapes, which helps realize many possibilities such as parametric design, AI intelligent customization, to achieve more breakthroughs in product design, manufacturing and application. In the future, Peak will still focus on the development of technology research and development of professional lines, drive development with technological innovation, and build a solid foundation for brand internationalization.
In Competitive Global Market, Investing Heavily in Marketing Is Double-edged Sword
According to Statista data, in the global sneaker market in 2022, Nike, Jordan, Adidas, Skechers, Vans, Moonstar, Converse, and New Balance, the eight major brands accounted for a total of 65% of the market share, of which Nike occupied 18% of the market share, to the absolute advantage of the first, followed by Jordan occuping 11% of the share, and Adidas occuping 9% of the share.
Peak's internationalization achievements belong to the head of the Chinese brands, but in the international market, it seems a bit inadequate. The absolute control of the market by internationally recognized brands makes it difficult for Peak to make a big impact.
Although Peak has been plowing the field of basketball cooperation, and its sponsorship group in the basketball World Cup held this year also achieved remarkable results - Germany and Serbia men's basketball team both advanced to the semi-finals, and engaged in a showdown with Nike sponsored teams from the United States and Canada. However, in the network selection of the most popular/best basketball sneakers, Peak rarely appears. This actually reflects that, Peak's sponsorship vision is unique, and due to the achievements of the competitions , it continues to expand brand awareness, but there is still a big gap between Peak and the big brands in the network awareness and user favoritism, which means just through the game marketing output brand is still not enough for it.
According to McKinsey Sporting Goods 2023, as people's lifestyles continue to change in the information age, it is more important than ever to build brand heat and loyalty as consumers today rely more on brands when shopping. This requires sporting goods companies to go directly to consumers, engage in community and online marketing, and try to link up with other brands. This also suggests to Peak that, on the basis of research and development to ensure quality, increasing innovation in online and offline marketing to increase brand heat, may be a path for it to break through to the international market.
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