Jul. 29 at 1:24 PM
Some U.S. analysts expect Nike’s China business to recover once its North America operations stabilize, but experts on the ground told CNBC its challenges in the region are deeper, and far different, from what it faces at home. Young Chinese shoppers are increasingly choosing domestic brands over expensive foreign names as part of a larger “China Chic” movement, and consumers are hungry for a localized assortment — not the same product that’s being replicated from Utah to Shanghai. Nike is also working to overhaul its distribution model in China, which critics say has become messy, overly complex and driven by discounts.
“In a way, Nike has just become irrelevant,” said Yaling Jiang, the founder of consumer research firm ApertureChina and an expert on the Chinese consumer. “I don’t think young people can remember what’s the last new thing they’ve done. But if you mention Adidas to them, they will tell you about … their pet clothes, pet jerseys, or their China jackets.”
$NKE