October of 2014, the State Council issued the “Guiding Opinions on Speeding up the Development of Sports Industry and Promoting Sports Consumption” (herein to refer to as the Opinions). By end of 2025, the market size will achieve five trillion RMB. The article will make analysis on the following three issues. The first is how to develop and allocate industrial resources. The second is whether sports products and services can meet the public needs. The third is the supporting policies for the benefit of industrial development.
Sports Competition Industry Is the Core of the Industrial Chain
Many insiders take positive hope on the industry because they strongly believe in the continuously increase of competitions and advertising contributions of sports events like CBA and Chinese Super League these years.
Within the pyramid of sports industry, sports competition and performance industry is treated on the top and leading the industry.
According to Chinese Super League Valuation Report, Chinese Super League earned 400 million Yuan during 2014 which is the best year ever. Each club earned around 10 million, 75% higher than last year which was 5.7 million.
As a sports competition operation company, Oceans signed with three clubs of Chinese Super League, two clubs of League One. Zhu Xiaodong, the CEO, declared that clubs can gain professional knowledge on business development and methods to boost attendants. Strategic cooperation always takes five years on average instead of only consulting. By deeply exploring value of competitions, sports operation companies can also have more opportunities.
Meanwhile, some unpopular projects have some opportunities, too. China Table Tennis Association goes public on Beijing Sports Industry Resource Exchange in 2015. Even though the competition level is high enough, to selling better still requires customer satisfaction.
Currently, the business value of competition is not completely developed yet, and the reason is that the marketization level of resources and contents of the value chain such as competition, sports stars and broadcasting rights is still low.
Mass Fitness Industry Is the Treasure to be Digged for
During the marketization, independent property rights events are stimulated due to sports resources allocation and rights.
In the recently two years, Wukesong Indoor Stadium brings up the concept of four season sports. Three-to-three basketball in summer, Five-people basketball in spring and autumn, and Snow World in winter are all popular. The responsible person of the stadium said currently is not in broken even yet, however, through these activities we can attract advertising contributions which is the common method to make a profit and takes 80% of the whole revenue.
Coincidently, Wisdom Group take the project called four season run. It is hold in eight cities in China. Single running is accumulating business value. The value will be even bigger if it is nationwide. Famous analyst Yang Renwen said that Wisdom is familiar and professional with advertising contribution and they want more customers which is their main purpose. Iyuesai has over 200,000 active users and there will be a new story to be told once the users are large enough.
Sporting Goods Industry Is Facing New Challenges
In the components of value added of sports industry in 2008, sports good, shoes and cloth take 80%, the share is over 75% in 2010. Refers to the US, sports goods only take one third. Traditional industry will face new challenges during transformation.
Zhang Tao, Vice CEO of ANT thinks more and more people will join sports with the background of national sports strategy, sales volume will also increase as a result. ANTA is building brand. By cooperating with national teams, the ANTA brand will be strengthened, and consumers will thinks about ANTA once they think about Chinese sports.
Some companies think the opportunities are coming to them. One of the time-honored brand Feige Bicycle works with Letv sports to develop super bicycle, except original beauty of machine, it also provides social network, riding data, intelligent control and prevention of burglary. CEO of Feige said that sports industry need internet thinking as well, the concept of internet+ pushes the cooperation of Feige and Letv sports. The product is cutting-edgy. He believes it will be very popular.
Due to the development of internet, big data, and intellectual technology, traditional manufactures who can build up a new platform first will win the market.
( Source：People's Daily )
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