Anta Group's e-commerce turnover exceeded 10 billion last year and plans to complete the DTC transformation by the end of March

After the H&M Xinjiang cotton incident broke out, domestic brands that were usually ignored, such as Anta and Li Ning, quickly became the hot search on Weibo and became the next fashion shopping destination for many Chinese consumers. As one of the "glories of domestic products", the "never-stopping" Anta will usher in its "30th anniversary" in 2021, and Anta's DTC brand transformation may also be successfully completed at the end of March this year.

ANTA is a domestic professional sports brand targeting the general public and the world's third largest sports brand. It is mainly engaged in the design, development, manufacturing and marketing of ANTA brand sports products, including sports shoes, clothing and accessories. On March 24 this year , ANTA released its 2020 performance report. The report showed that ANTA Group achieved revenue of 35.512 billion yuan in 2020, a year-on-year increase of 4.7%; operating profit was 9.152 billion yuan, a year-on-year increase of 5.3%; net profit was 5.569 billion yuan, a year-on-year decrease of 1%.

As the leader of the fashion sports group in the three major sports brand matrices of Anta's professional sports group, fashion sports group and outdoor sports group , the FILA brand has surpassed the Anta main brand to become the group's main revenue source. The financial report shows that FILA achieved revenue of 17.45 billion yuan last year, an increase of 18.1% year-on-year, accounting for 49.1% of the total revenue; while the revenue of Anta's main brand was 15.749 billion yuan, a year-on-year decrease of 9.7%, accounting for 44.3% of the total revenue.

FILA's super-high growth rate has given the steadily developing Anta main brand some breathing space, but its relatively high-end positioning has determined the limitations of its development scale. In addition, the development momentum of its competitor Li Ning in recent years has also posed a considerable threat to Anta, and may even cause it to lose its position as the top domestic sports brand.

In order to save itself and increase the proportion of online sales and offline store efficiency, Anta has formulated a DTC strategic transformation plan, and will focus on directly facing consumers, connecting "people, goods, and places" to create value for consumers in a more effective way.

In the transformation to the DTC model, Anta divided it into two parts: one is to vigorously develop e-commerce, and the other is to transform offline store distribution into direct operation.

In terms of e-commerce, Anta Group focused on upgrading its brand's official website, making its products smarter and enhancing member value. It aims to become a technical middle platform that connects online and offline and supports internationalization, in order to improve the overall efficiency of its e-commerce business.

(Anta brand official website)

Data shows that in 2020, Anta Group's e-commerce business grew by 53%, accounting for 26% of its revenue, a significant increase from 18% in 2019. In addition, on Tmall's Double 11 last year , Anta Group's e-commerce transaction volume reached 2.84 billion yuan, an increase of 53% over last year, and Anta Group's e-commerce turnover in 2020 also exceeded 10 billion yuan.

In terms of offline store transformation, Anta implemented a mixed operation model in 11 regions across the country in 2020, involving about 3,500 Anta stores, of which 60% were directly operated and 40% were operated by franchisees in accordance with Anta's new operating standards. It is worth mentioning that the transition from distribution to direct operation has helped Anta increase its sales gross profit margin by 3.4% to 44.7%.

It is reported that in the past six months , Anta Group's DTC transformation has progressed smoothly, so it is expected that this transformation plan will be fully completed by the end of March this year .

Looking ahead, Zheng Jie, president of Anta Group, said that Anta Group will continue to promote brand innovation this year, increase investment in technological innovation, and continue to accelerate the promotion of online business, striving to increase the proportion of online business in the overall business to 40% in the next five years.

Anta

DTC