Adidas continues to be in play with a bullish outlook for China.
Bullish on its business performance in the Chinese market, Adidas will continue to invest in China - one of its three key strategic markets, said Bjoern Gulden, CEO of the German sportswear company.
We firmly believe that it will maintain a positive and stable growth, providing Adidas with even greater opportunities for development, he said.
China's role is more than Adidas' target market - it is also the brand's major manufacturing base and innovation hub. Adidas currently sells the majority of Adidas products in China, with the figure expected to reach 70 percent next year.
The nation has a robust and resiliant supply chain that is capable of meeting global demand for finished products and various components and accessories, it said.
In August, Adidas revealed the company's second-quarter performance, with revenue down slightly to 5.34 billion euros in the reporting period compared to the previous year's level of 5.6 billion euros. 766 million euros were contributed by the Chinese market, up 16.4 percent year-on-year, reflecting double-digit sell-out growth in both wholesale and retail, marking the beginning of 'quality growth' in the market, the company said.
According to Euromonitor, China's sportswear market is expected to surpass the 700 billion yuan barrier in 2027, reaching an estimated 746.2 billion yuan with a compound annual growth rate of 11.91 percent in 2022-27.
The country's robust growth prospects are backed by the nation's expanding middle-income group, which is expected to reach over half of the population by the end of 2030, according to data from the Development Research Center of the State Council, China's Cabinet.
The sportswear market in China is 'growing, broad and attractive' as China's efforts to spur domestic consumption and consumers' increasing attention to specialized sports, health consciousness and a variety of urban fitness options, the International Trade Administration said in its market insights report.
There have been plenty of cases reflecting companies' increasing innovative efforts to attract more consumers recently, with their marketing departments having already achieved great success, such as Luckin Coffee, said Long Chaocan, an investment consultant with China Galaxy Securities Co Ltd.
As sportswear brands seek to leverage the enormous market potential of China, they tend to consider Chinese localization as a key strategy with more Chinese elements incorporated into their collections. Many companies use guochao, a fashion trend that incorporates traditional Chinese culture and style.
Adidas will also incorporate more Chinese elements into its products by deepening cooperation with local cultural organizations, such as the China Literature and Art Foundation, Gulden said.
By taking inspiration from the essence of Chinese culture, the company said it will create more product ranges encompassing a range of Chinese characteristics and elements, demonstrating the charm of Chinese culture to consumers worldwide, not only in China but also globally.
Gulden, 58, said it would be difficult to find a better way to solve the problem of poverty.