The fall of Nike: How Anta took the throne

Nike, once synonymous with sportswear in China, has seen a significant drop in sales across the country. Domestic brands, such as Anta, have stepped in and dominated the market.

For 37-year-old sales manager Andy Chen, work and family take up a lot of his time, but he does have one hobby—buying shoes. “When I was younger, Nike was always my first choice, but now I prefer domestic brands like Anta, and the quality is just as good,” he says. Chen is part of that generation that grew up watching American TV shows and basketball.

For two decades, Nike was synonymous with sportswear in China, a status built on NBA associations, Western prestige and the rise of middle-class consumption. China became Nike’s largest market outside of North America—at its peak in 2018, the China market accounted for 22% of all the brand’s sales, and in the same year, Nike shoes made up 30% of all shoes sold on Tmall.

Recently, however, as trends have changed, Nike’s sales in China have continued to decline, including a 21% drop in Q2 of 2025. The China market now accounts for only 15% of the brand’s total revenue. Domestic rivals such as Anta and Li-Ning have seized market share, now accounting for 28% of all sneaker sales in China.

“Nike’s situation is an example of a wider trend, but its collapse is more severe than its peers,” says Ashley Dudarenok, founder of consultancy ChoZan. “All foreign consumer brands in China are facing the same structural shifts: the ‘guochao’ [national wave] movement is real, Chinese brands have closed the quality gap and the digital ecosystem is uniquely Chinese,” she says.

Nike’s golden era in China

Nike entered the China market in the 1980s, but it is from the 1990s and especially the 2000s that it began to be dominant. As China’s economy grew and urban incomes rose, Nike came to represent modernity and global culture. The brand’s marketing tapped into a growing desire to engage with the outside world, and especially the NBA’s newfound popularity in China during the era of sports stars such as Michael Jordan, Kobe Bryant, LeBron James and, especially, Shanghai native Yao Ming.

By the 2010s, China had become central to Nike’s global strategy. The company invested heavily in flagship stores in top-tier cities around the country, as well as in digital integration and supply chain optimization.

At its peak, Nike’s Greater China revenue was rising at double-digit rates annually. China was widely described as Nike’s most important growth market outside of the US.

Yet 2020 marked an inflection point. A combination of pandemic disruptions, regulatory tightening in e-commerce and retail, shifting consumer sentiment and geopolitical controversy began to erode the brand’s momentum. Greater China revenue slowed and even reversed in some quarters.

Ivan Su, Senior Equity Analyst and Junhao Yang, Associate Equity Analyst at Morningstar, think that while shifting market trends are a major driver, Nike’s underperformance is also a result of its sluggish response to these changes. “Historically, Nike used to be a trendsetter, but more recently, it has struggled to adapt to evolving demand,” they say.

Domestic brands step up

For years, Chinese sportswear brands were often perceived as budget alternatives to Western ones. Anta and Li-Ning competed primarily on price, having lower margins and limited brand prestige.

From the start of the 2020s, Chinese sportswear brands moved up the value chain, investing more in design, R&D and branding. It was around this time that China’s ‘guochao’ took off—a trend celebrating Chinese identity and pride. Domestic brands throughout the country, including sportswear brands, rode this wave and repositioned themselves as desirable rather than just affordable.

“Local brands have cultivated a powerful set of advantages,” says Dudarenok. “They possess a cultural authenticity that a foreign brand can only imitate, with brand stories often intrinsically woven into China’s national pride,” she says.

Anta’s strategic playbook

Founded in 1991 as a contract manufacturer in Fujian, Anta began as an Original Equipment Manufacturer (OEM), producing items for other brands. Over three decades, it evolved into one of China’s best-known sportswear brands.

The turning point came in 2009, when Anta acquired the China operations of FILA, the Italian sportswear brand. The acquisition allowed Anta to reposition itself as a premium player, rather than a mass-market manufacturer. FILA China was transformed into a high-margin brand tailored specifically to Chinese consumers.

The success of FILA China provided Anta with both capital and credibility. It then expanded into a multi-brand portfolio strategy, acquiring stakes in or rights to brands such as Descente and Arc-teryx in China. This allowed Anta to cover multiple price tiers and consumer segments—from mass athletic wear to high-end outdoor apparel.

Josh Gardner, founder and CEO of digital brand house Kung Fu Data, says Anta’s multi-brand strategy is the key to its success versus Nike. “They own Salomon for winter, FILA for premium fashion-sport, Descente for premium performance, Kolon Sport for outdoor,” he says. “Different brands, different price points, different consumers. Nike has one brand trying to do everything.”

At the same time, Anta invested heavily in upgrading its own core brand, positioning itself as a national champion. Sponsorships of Chinese Olympic teams and local sports events reinforced its domestic credibility.

“Anta runs a China-first playbook with global ambitions,” says Dudarenok. “Its marketing says, ‘We are on the same team, and we have the gear to help you win.’ In the current climate, the latter message is proving to be far more powerful,” she says.

This portfolio approach—combining global brand assets with local operational control—created a diversified revenue structure less dependent on one single identity.

The market changes

Nowadays, Chinese consumers no longer assume foreign brands are superior. Over the past decade, domestic manufacturers have improved in product quality, materials science and design capability.

In the 2000s in China, wearing Nike was often about showcasing a connection to the global community. Today, sportswear has become a part of everyday attire. It is no longer a status symbol but a functional lifestyle product.

As the category normalized, price-performance became more important and domestic brands—thanks to localized supply chains and cost structures—were increasingly able to offer similar features at more competitive prices.

Perhaps most critically, Nike’s brand narrative, rooted in global sports icons and Western cultural references appears to resonate less with younger Chinese consumers than previously.

“This has become a less important factor as consumers have become more sophisticated and are starting to look beyond brand origin to focus on product quality and emotional connection,” say Su and Yang.

Domestic brands have also tapped into much deeper integration with domestic e-commerce platforms such as Tmall, JD.com and Douyin—all of which allow for rapid marketing cycles, livestreaming campaigns and real-time consumer feedback loops.

Gardner points out that these domestic platforms are where the majority of Chinese shop. “Nike spent years funnelling Chinese consumers toward Nike.com and the Nike app,” he says. “But that’s not how China works; consumers shop on Tmall, Douyin, WeChat. Nike was playing a game nobody else was playing.”

Domestic brands have the advantage of having the entire supply chain, from initial design to the retail store all being in proximity, enabling faster turnaround and inventory management. Lower logistics costs then allow these domestic brands to compete effectively on pricing without sacrificing profit margins.

Su and Yang say that domestic brands have greater insight into supply chain management in China, due to their experience operating the manufacturing plants. “This expertise allows them to offer products with much better price-to-value,” they say. “For example, local players price their high-performance carbon-plated running shoes at roughly a 50% discount compared to international equivalents, without sacrificing significant functionality or profitability,” they add.

Challenges for Nike

Foreign brands such as Nike face a dilemma in the Chinese market: how to maintain global brand coherence while adapting to local markets?

Nike has attempted China-specific product lines and marketing campaigns, but the competitive environment is less forgiving than a decade ago.

Despite these attempts, Gardner feels that today, Nike lacks China market authenticity. “Cultural authenticity is huge—Anta and Li-Ning don’t have to localize, they ARE local,” he says. “They’re creators within the Guochao movement, embedding Chinese cultural heritage into product design in ways that feel real, not performative.” He compares this to Nike’s Lunar New Year campaigns, which, he says, “always carry a faint whiff of ‘foreigner trying hard’.”

Geopolitics is also an issue Western brands must confront when operating in China. In 2021, Nike was caught up in a controversy involving Xinjiang cotton. Several Western brands, including Nike, had made statements saying they would be not sourcing cotton from China’s Xinjiang region due to perceived concerns over labor. This resulted in calls to boycott the brands across Chinese social media and even in some cases seeing their products removed from local e-commerce platforms. For example, Nike sales on Tmall fell by 59% year-on-year as a result of the boycott.

Similarly, in 2019, a social media post by a senior NBA executive in support of protests in Hong Kong resulted in Nike removing Houston Rocket merchandise from its China stores to avoid backlash.

Issues like these put brands such as Nike in a delicate position. Statements made for Western audiences can quickly become flashpoints in China, meaning brands must walk a tightrope to maintain relevancy on both sides.

Beyond the swoosh

When Andy Chen puts on his new Anta shoes, he doesn’t feel as though he is making a political statement, he simply feels he is choosing a product that fits his tastes and price range.

This quiet shift from aspirations rooted in foreign prestige to confidence in domestic products may be one of the most consequential changes in China’s consumer market over the past decade.

Dudarenok says the era of “easy wins” is over. “To survive and thrive now requires humility, agility, and a radical commitment to localization—foreign brands must abandon global-first mindsets and empower their China teams with real autonomy,” she says.

“They need to rebuild their channel strategies to include wholesale partners, hyper-localize product development with R&D on the ground in China, and become natives in the Chinese digital ecosystem. If a brand is going to charge a premium, it must be justified with tangible value, not just a logo,” concludes Dudarenok.