BEIJING: Chinese athletic shoemaker Li-Ning knew it couldn't “out-Nike” Nike, especially in the sporting giant's own backyard. So the company is going low-budget edgy in its expansion to the US, using an irreverent YouTube video to play up its heritage while taking a lighthearted dig at the company name shared with its high-profile founder. Li-Ning is among the first Chinese consumer product brands trying to build a following in the US, seeking to grab a slice of its saturated but highly coveted market. As China's economic might increases – it last year overtook Japan as the second-biggest economy after the US – its companies are increasingly confident about expansion overseas. But corporate China has yet to produce a brand with the global name recognition of the likes of Apple, Sony or Google. “It's a process of finding out – while staying true to our heritage, our brand – what side of our DNA is going to resonate with the American consumer,” said Jay Li, general manager for Li-Ning International. “We're still searching, to be perfectly honest with you. And we're not in a hurry.” Americans might remember Li Ning as the final torchbearer during the opening ceremony of the 2008 Beijing Olympics – the former gymnastics gold medalist who “ran” along the opening in the stadium roof while suspended by wires. His namesake company is a top domestic brand in China's lucrative athletic shoe and apparel industry, with more than 7,900 stores across the country. Though it has forecast slumping sales and a one percentage point decline in gross profit margin in 2011, CEO Zhang Zhiyong recently told the Wall Street Journal that Li-Ning plans to invest $10 million in US operations this year. “Our founder Mr. Li Ning has always said his vision was never about building China's Nike, it's about building the world's Li-Ning,” Li said. “You can't be global without having a legitimate claim of market share in the most mature sporting goods market.” There are significant hurdles to overcome: Americans are still smarting from the recession and spending less. Chinese goods are widely regarded as shoddily made, knockoffs or even dangerous. Li-Ning's logo recently underwent a redesign, but many consumers may still see a strong resemblance with the Nike “swoosh.” “The way to fight the perception is to continue rolling out your own world-class products and that perception will go away,” Li said. He would not provide sales figures for the US, where Li-Ning products are sold online and through a few select retailers, but said international operations made up only 2 percent of the company's total revenue. Expansion into the US is “important for them because if they show they have retail presence in the US it helps them not only sell there but it helps them sell in their home market in China and wherever else they go,” said Ben Cavender, associate principal at Shanghai-based China Market Research Group which has studied Li-Ning. “They can say, ‘Look, we really are an international brand.”'
