MOVING FORWARD
Fitness drive inspiring Chinese for sport
What’s China’s biggest achievement over the past five years and the most notable change?
For me, one of the most profound achievements over the past five years concerns the government’s drive to put health and fitness at the top of the political agenda.
Much of this drive has been led by President Xi Jinping himself, a huge sports fan who has spoken frequently about the important role sport and fitness have to play in China’s rejuvenation and realizing the Chinese dream of a moderately prosperous society.
To this end, the government has embarked on a number of programs and initiatives that are having a serious impact in terms of encouraging more and more people to engage in sport. We’re delighted that this strong commitment to sports development was once again given prominence in the 19th National Congress of the Communist Party of China.
Excellence in sport is also seen as an invaluable opportunity for China to distinguish itself on the world stage and promote a greater sense of national pride and unity.
One of the key areas in which China wants to make an impact is soccer, with President Xi in 2016 personally outlining his goal to make China a soccer power in Asia in 2030 and a world-class competitor by 2050, with plans afoot to soon bid to host a World Cup.
This is something Adidas is making a significant contribution to, leveraging our influence as the world’s leading soccer brand not only through our range of high-performance products but also our support of grassroots soccer through our school soccer training collaboration with China’s Ministry of Education.
Another of the significant outcomes of the past five years or so has been the recognition of sports potential as a driver of economic growth, as China diversifies its economy and looks for new areas of opportunity. According to China’s 13th Five-Year Plan (2016-20) released in 2016, the government has plans to develop a domestic sports industry worth 5 trillion yuan ($780 billion) by 2025.
Right now, it is still at a relatively early stage of development and the opportunities for growth are immense.
Adidas is, of course, benefiting tremendously from the current environment. In recent years, we have gone from strength to strength in China. But we’re also playing a leading role in driving this development.
Guided by our Creating the New Greater China strategy, first revealed in 2015, and our belief in sport’s power to change lives, we’re responding to the increased demand for sports products from Chinese consumers by doing what we do best – delivering top-of-therange, cutting-edge high-performance products and inspiring campaigns, strengthening our position across key categories such as women, running, kids and soccer, and also investing heavily in our grassroots initiatives.
We’re also rapidly expanding our retail presence across China both in upper and lower-tier cities. We’re targeting to operate a total of 12,000 stores by 2020. We’re also improving our retail capabilities as well as leveraging the significant opportunities afforded by China’s digital transformation by improving our retail capabilities online with an omnichannel approach, to ensure that our consumers can interact with our brand at every touchpoint.
The goal of Creating the New Greater China is simple: to become China’s best sports brand and in turn help to nurture an authentic, lasting legacy of sport in China. With excellent performance over the past few years, I’m very pleased to say we’re well on the way to achieving that.
Can China’s experiences be used to solve pressing global problems?
China’s story of rapid economic growth over the past few decades has gripped the world, helping lift over 800 million out of poverty and raising living standards across the board for millions more.
With rising prosperity, however, a different set of challenges have emerged, as China’s population continues to live longer and chronic health problems associated with physical inactivity and modern lifestyles exact an increasingly serious toll on the economy, healthcare system and wider society.
These challenges are by no means unique to China, but I feel the way China is responding to them is.
The Chinese government has shown a lot of foresight in drawing the link between a healthy and fit population and the strength of the country as a whole, not just in terms of being competitive on the global stage but also empowering individuals and communities.
I hope that this can serve as a powerful model for other countries around the world.
How do you view China’s role in today’s world?
China has become an important advocate of globalization in recent years, which is no surprise given how deeply its economic prospects are entwined with those of the rest of the world.
I hope it can continue to leverage its significant achievements in diverse areas, such as digitalization, sustainability, technology and innovation, as well as initiatives such as the Belt and Road Initiative, in order to play a more prominent global leadership role.
What’s the most unforgettable experience you’ve ever had in China?
Without a doubt, the Beijing Olympics in 2008. The energy, excitement and sense of optimism around that time made a deep impression on me, as it did on the rest of the world.
It was a very special moment in China’s modern history that showed the unique power of sport to unite people as well as to build bridges and promote greater understanding and cooperation.
Looking back to this time, I think it marked an important turning point in China’s relationship to sport and its awareness of the possibilities that lie before it.
Which sectors do you think offer the most opportunities for development?
China is truly leading the world when it comes to digital, in all kinds of areas from robotics and artificial intelligence through to e-commerce and mobile payments.
It is now the world’s largest e-commerce market, for example, accounting for more than 40 percent of the value of worldwide e-commerce transactions — up from less than 1 percent about a decade ago. The value of its mobile payment transactions meanwhile is 10 times that of the United States.
Singles Day (11.11 or Double Eleven) is a great example of the gargantuan size of the China e-commerce market as well as its enormous potential.
Over the past few years, it has turned into the most eagerly-anticipated online and mobile shopping festival in the world, and it just gets bigger and bigger each year.
This year it hit a new record, generating a total of $25.3 billion in sales in a single day. That’s more than twice what Black Friday in the US generated.
It was also a momentous occasion for Adidas, a total of 2.5 million orders (50 percent of which were placed in the first hour!) came through our Tmall and Adidas online stores, ensuring we were able to smash yet another record.
The pace of change in China is truly staggering and it’s something you can only really appreciate if you’ve spent any amount of time here.
Adidas has a comprehensive digital strategy in place to harness the power of digital in order to help us better serve and engage with our consumers — and we’re very ambitious.
As part of our global 2020 ambition for digital and e-commerce, we are targeting to quadruple our e-commerce revenues by 2020 to 4 billion euros ($48.9 billion).
Needless to say, we’re very excited and optimistic about what the future holds in store.