Business of Sport: ASICS tread own path to get ahead

Denzil Pinto 09:18 28/03/2017
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Gael force: French tennis star Monfils is one of ASICS’ most visible ambassadors.

Given their pledge is to always “bring harmony to the body and soul”, of their customers, ASICS certainly stayed true to their words when they opened their new subsidiary in the UAE earlier this month.

There was a distinct atmosphere, helped by the sound of catchy music, as more than 120 guests got a close look at their new Dubai Design District showroom.

For the Japanese sports manufacturer, it was no ordinary occasion. This was something big and just the start of ASICS pushing themselves ahead of their competitors in their bid of claiming a bigger slice of the market in the Middle East.

Since founder Kihachiro Onitsuka first started making basketball shoes in 1949, ASICS have come a long way and are now not only one of the most famous names globally but considered among the best running brands. The company already find themselves in a strong position in the UAE.

At any major shopping mall in the country, you’re most likely to find one of their branded stores, while local retailers like Modell’s, Go Sport, Foot Locker and Stadium, present more opportunities for consumers to purchase merchandise.

With major rivals continuing to push in such a competitive market, ASICS have decided to go alone and take matters into their own hands by replacing distributor Falaknaz, who had played a role in their success since 2003.

It means ASICS will now take charge of their own distribution, sales and marketing plans in bringing more success to their business, which already has more than 100 stores across the region.

It might well be more expensive than working with a distributor but the advantages are huge, giving them further room to expand their footprint in the region, while reinforcing their premium positioning.

They plan to increase their marketing investment, using up to 20 per cent of their budget, while also developing direct relationships with key retailers.

It’s part of their vision in not only bringing innovative products to the the market but offering consumers a “premium and unique retail experience.”

For Alistair Cameron, CEO of ASICS Europe, Middle East and Africa (EMEA), this step is a “new beginning”. “We are a $3.5 billion company and are big in America, Europe and Asia,” he said.

“With this in mind, it’s really important that we can articulate the benefits of the ASICS brand. Although we have been in the region for some time, our brand positioning globally as the No1 running brand hasn’t yet been discovered to its full extent in this region.

“Our distributor has done a really good job and helped us establish ourselves. But for us, for them to significantly invest at a level on what we want, is a tall order, and so that’s why we have come in and done it ourselves.”

While financial figures for 2016 are yet to be released, the move comes after profits for 2015 fell by approximately $80 million, more than 50 per cent than 2014. It was the first time since 2011 they saw such a decline.

With that now in the past, they are looking to the future and Cameron remains optimistic this region can become as valuable as Europe, Asia and America. “The UAE and Saudi Arabia will be the big markets for us,” he said.

“To maximise our opportunity, we will continue using premium retailers like GO Sport. But we will also be driving a much stronger premium level of presentation of all our products, including accessories, which will involve a lot of technical training.”

To ensure that consumers purchase products that are best suited to their needs, they plan to introduce more of their ASICS Foot ID systems in partner stores which have been rolled out in the US and Europe.

The high-tech shoe selection service combines static and dynamic measurement and analyses your movements to determine the right shoe for you.

With that now in place in certain countries, as well as the high volume of sales and the fine detail to research put in by scientists in Kobe, Japan, it’s easy to see why their footwear still remains their biggest seller with 346,080 million Japanese Yen ($311m) in net sales in 2014.

“In terms of running, we are the No1 global running brand,” declares Cameron. “At most businesses, there will be big volume for the lowest priced products but at ASICS it’s the other way round.

Our most expensive products does the volume for us and that’s because our science and technology is far superior than anyone else.

“Here in his region, while we want to extend our business to more branded stores, there will be more need for sales staff to be trained and well-equipped to sell and handle technical products.”

Their cause of hopefully seeing positive results in the future is helped given the importance of health and fitness. In the UAE, the facilities are second to none while Dubai and Abu Dhabi’s sporting calendar is packed with countless events throughout the season.

“With the world moving, there’s a switch in society and we’re seeing that health and movement is becoming important for people,” adds Cameron.

“Particularly, if you take Saudi Arabia, where there are high obesity levels, there are a lot of initiatives for authorities to invest in gyms and get people moving. It’s a major territory to grow.”

While sales is key to growth, so too is sponsorship and their multiyear partnership with athletics governing body IAAF is another indication of how they’re reaching out to global audiences.

The deal, which saw them replace adidas, who ended their agreement three years early, will not just see their logo on display around the stadium but will also see all IAAF officials kitted in ASICS apparel in all of the World Athletics Series meets as well as the 2017 and 2019 World Athletics Championships in London and Doha, respectively.

“If you take London, there will be 80,000 spectators every day over a 10-day period,” said Cameron. “After London it will be held in Doha in 2019 and that is a massive investment for us in this region and for us it will be how we can maximise that opportunity.”

Despite being the top-ranked brand for runners, that hasn’t stop them from exploring other sports. On their books are players in tennis, triathlon and volleyball as well as interest in cricket and rugby.

World No11 Gael Monfils of France, 2011 US Open champion Samantha Stosur of Australia, and British world No11 Johanna Konta are among their tennis ambassadors.

Rio Olympic gold medallist and two-time world triathlon champion Gwen Jorgensen of USA also put pen to paper. Ambassadors are paramount to the company.

They visit Kobe to ensure their apparel is up to their exact standard, while giving ASICS crucial feedback that allows them to enhance their products. And it isn’t just their results that attract ASICS. “We are really careful that they fit the brand,” said Cameron.

“It’s really difficult in today’s world to find a personality who is humble and would want to work with you and be inspired by what you do. “Gael has really helped us by helping testing products and everyone’s a great ambassador.

“We’re always on the lookout and it’s a competitive game.”

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