Li Ning and Ziba Design Want to Build China’s First Truly Global Brand

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A rendering of a Li Ning retail space. This "Beacon" store, designed for first-tier cities in China and set to begin appearing late this year, will showcase a "curated" collection of Li Ning goods; the "A" stores will feature the full product line. | Renderings: Courtesy of Ziba

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Sketches and guidelines for new Li Ning products. The shirts, at far right, designed by Ziba-trained Li Ning staffers for the Chinese national badminton team, will go on sale this fall. | Renderings: Courtesy of Ziba

You may think you've never heard of Li Ning. But assuming you were one of the 4 billion or so people watching the opening ceremony of last year's Beijing Olympics, you've seen him. Remember the guy who lit the Olympic flame? The one who, as if by some superhuman power, levitated more than 100 feet and ran that mesmerizing aerial lap around the Bird's Nest stadium before setting the Olympic cauldron ablaze? That was Li Ning. And if he has his way, you won't be forgetting him again.

Li Ning, the man, is a hero in China -- the gymnast who snagged six medals, including three gold, at the 1984 Los Angeles Olympics and thus helped launch a national surge that reached its height last summer when China won more gold than any other country. (Before Li's Olympic debut, China hadn't appeared at a summer Games since Helsinki in 1952, when it failed to take home a single medal.)

Li Ning, the company, is China's biggest domestic maker of athletic footwear and sports apparel. This year, it's set to rake in over $1 billion from more than 6,300 stores across the country. In the next four years, it plans to add 3,000 more. And to top it off, the company is now undergoing a major overhaul that, with the help of the American consultancy Ziba Design, just might prime it for its ultimate goal: becoming an international name. "We want Li Ning to be a globally recognized brand," says Li, who founded the company in 1990 because he wanted Chinese athletes to be able to wear a Chinese label. "This is our real asset, and building it up is our long-term commitment."

That's where Ziba comes in. Based in Portland, Oregon, the spiritual home of sneakers, Ziba is the 110-person firm behind such innovation milestones as HP's first flat-panel PC monitor and Microsoft's first ergonomic keyboard. And for the past two years, it's been hard at work helping Li Ning remake itself. Everything from the company's product line and store interiors to its visual identity and even its logo are going under the knife. But Ziba is also helping Li Ning learn to think of itself as a global company, which is no small thing for an operation that's been almost exclusively focused on the domestic market. "Defining the problem is more important than solving the problem," says Ziba founder Sohrab Vossoughi. And for Li Ning, "The problem, and goal, was to create a world-class design competency."

In China, the problem is not just Li Ning's, and the current economic downturn has only underscored the urgency of addressing it. To become a true superpower, China knows its manufacturing-based economy needs an upgrade. On the one hand, the country has to continue to fuel domestic consumption that will reduce reliance on exports; on the other, it needs to grow domestic brands that can compete worldwide. So far, the latter effort has yielded little. The Chinese computer giant Lenovo, for example, has struggled to maintain momentum since its much-ballyhooed purchase of IBM's PC division in 2005. And remember TCL? Exactly. (It took over RCA in 2003, but has hardly returned it to its glory days.) True, China's corporate leaders are beginning to understand the value of design in broadening their reach. But the words "Haier appliance" have yet to make Americans swoon.

Li Ning wanted to avoid repeating the mistakes of others by not expanding abroad too hastily. More important, before it could become a global player, it had to reclaim its home turf: In 2002, despite Li Ning's double-digit growth, both Nike and Adidas surpassed the company in Chinese market share. And they've been gaining since. "When that happened," says Zhang Zhiyong, Li Ning's youthful 41-year-old CEO, "we realized that revenue is not the most important thing for a company. It's product and brand innovation -- a design strategy, not just designs."

Or as Ziba creative director Jeremy Kaye tells it: "Li Ning had been the leading Chinese brand for 15, 16 years by essentially competing with itself." But with fierce foreign rivals capturing the prestige, and lower-end brands undercutting them in price, "it couldn't continue by just putting product on the shelves."

Rolling across 25 acres in the outskirts of Beijing, Li Ning's gleaming corporate campus is a manifestation of the company's newfound self-awareness. Completed in 2007, its sleek, low-slung buildings are ringed by red granite walkways evoking running tracks and hexagonal concrete benches that could have been peeled off a giant soccer ball. In the soaring visitor's center, school groups snap photos with life-size cutouts of China's Olympic gymnastics team and Houston Rockets forward (and Yao Ming teammate) Chuck Hayes. There are basketball and badminton courts. An eight-lane swimming pool. An outdoor soccer field. A rock-climbing wall.