Core Viewpoint - Decathlon, once celebrated for its affordability in the Chinese market, is now shifting towards a price increase strategy, moving away from its original value proposition of cost-effectiveness [4][19]. Pricing Strategy - From 2022 to 2024, Decathlon's average product price in China is expected to rise from 128 to 196 yuan, marking a 52% increase, with some products seeing price hikes of up to 100% [5][21]. - The introduction of a 69,999 yuan road bike exemplifies this shift towards higher pricing [6][21]. Brand Positioning - Decathlon's unique positioning as a sports goods retailer, originally focused on high cost-performance, is now being challenged as it attempts to transition into a recognized sports brand [20][21]. - The company has historically operated as a dealer of its own brands, with over 90% of its sales coming from private labels, allowing it to maintain lower prices compared to competitors [14][16]. Market Challenges - The company faces significant competition from cheaper alternatives and niche brands that have emerged in the market, making it difficult to maintain its previous pricing advantage [31][33]. - The shift in consumer preferences towards specialized brands has further complicated Decathlon's market position, as it struggles to compete with both low-cost alternatives and high-end brands [32][33]. Strategic Shift - Decathlon's "North Star Strategy" aims to upgrade its brand image from mass-market to high-end, which includes a reduction in the number of private labels and a focus on enhancing customer experience [22][24]. - The company is also attempting to increase the proportion of high-end products in its offerings, with a target of 10%-20% [26][27]. Financial Performance - Since 2021, Decathlon's revenue growth has stagnated, and profit levels have declined, indicating a disconnect between consumer perception and actual purchasing behavior [28][27]. - The company is under pressure to adapt to changing market dynamics, as evidenced by its efforts to understand and cater to the needs of the middle class [27][28]. Conclusion - Decathlon's transition from a budget-friendly retailer to a higher-end brand is fraught with challenges, as it must navigate a competitive landscape that includes both low-cost alternatives and specialized brands [36][44].