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Arc’teryx Transformed into a Trendy Luxury Product in China

The Arc’teryx brand’s “take-off” in the Chinese market and its contribution to narrowing the losses of its parent company can be attributed to Anta’s strategic “overhaul” techniques.

Anta has always been adept at marketing technical apparel, a skill honed by experience. Having repositioned FILA to cater to China’s “new middle class,” Anta now targets the same demographic with Arc’teryx, aiming to “satisfy men’s pursuit of middle-class status.”

Before Anta’s acquisition of Amer Sports, Arc’teryx had only two stores in China. At that time, Anta’s successful revival of FILA validated its marketing prowess and reinforced its ambition, as stated by its founder, Ding Shizhong: “We don’t want to be China’s Nike; we want to be the world’s Anta.”

Driven by global aspirations, Anta set its sights on Amer Sports, the parent company of Arc’teryx, and in 2019, executed a “David and Goliath” style cross-border acquisition. In March 2019, Anta, together with Fountain Capital and Tencent, formed an investor consortium to acquire all issued shares of Amer Sports. As the largest shareholder, Anta spent over 1.5 billion euros to secure a 57.85% controlling stake.

However, Anta’s total cash and cash equivalents at the end of 2018 were only 9.283 billion yuan, making this acquisition a bold “gamble.”

This acquisition, the largest in the history of China’s sports goods industry, was considered by Ding Shizhong, then Chairman and CEO of Anta Group, as: “The most significant decision I have made since starting the business.”

At the time, Amer Sports was suffering from consecutive years of losses and an imbalanced balance sheet. This also meant that Anta could not afford to fail in replicating FILA’s “resurrection magic” with Arc’teryx.

After taking over Amer Sports, Anta reorganized its business lines, highlighting key brands while divesting “marginal businesses,” reducing distributors, and developing direct sales. As one of the key brands, Arc’teryx embarked on a path of transformation.

Firstly, in terms of brand positioning, the original Arc’teryx was popular within niche professional circles. After the “overhaul,” the brand added a commuter setting, expanding its audience from outdoor sports enthusiasts to urban white-collar workers, increasing brand visibility, and entering the view of ordinary consumers.

To cater to the trendy young people, Anta also added more fashionable elements to Arc’teryx products, making the brand retain its unique characteristics while becoming more popular and youthful.

Secondly, to ensure the synergy of the brand’s new positioning, at the beginning of 2021, Arc’teryx underwent a major change in its senior management. The new CEO, Hasselden, has a background as the CEO of Lululemon, and the new Vice President of Brand Marketing has many years of experience at Adidas.

Lastly, the most important aspect is Arc’teryx’s luxury effect. To leave a high-end brand impression in consumers’ minds, the brand began to collaborate with domestic and international supermodels and uniformly chose celebrities who have had luxury brand endorsements as spokespersons.

Offline, Arc’teryx also established a high-end brand image by opening stores next to luxury brands, becoming neighbors with brands like Hermès, Louis Vuitton, and Cartier.

Through a series of operations, Arc’teryx has successfully transformed, not only growing rapidly in China but also becoming one of the three favorites of the “new middle class” among middle-aged men.

Now, Arc’teryx has more than a hundred stores in China, and Ding Shizhong’s “bold bet” is beginning to show signs of success.

Jack Chan

Pre Editor in Chief of FirmKnow News.

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