Original Wang Yaqi Dianshang Online
Text | Wang Yaqi
Editor | question
The girls have supported a batch of new brands of domestic products in the small red book and live broadcast room.
From Perfect Diary, Huaxizi, Winona, Runbaiyan to Tangduo, these online celebrity beauty cosmetics, which made their fortune online, have the ability to compete with industry giants such as L ‘Oré al and Estee Lauder. Commercial competition is not about temporary gains and losses. How long can consumers who love early adopters keep their enthusiasm? Will the aura of traffic always care for new brands?
There is an important formula in the field of management-customer lifetime value/customer acquisition cost, that is, LTV/CAC. Ideally, both LTV and CAC will develop in the best direction with the increase of brand awareness and the expansion of product sales channels. But it is difficult for most enterprises to do so.
In the early stage, new brands used the marketing methods that young people like to get the most accessible customers, so they need to win over potential consumers. Later, if the product itself remains unchanged, it will become more and more difficult to acquire customers, and the cost of acquiring customers will become higher and higher, while the lifetime value of these new customers will further decline. If you pull it for a longer time, it is difficult to make a move only by relying on the line.
In 2021, these new brands that made a fortune online collectively opened offline stores. Comparatively speaking, having offline sales channels means providing consumers with more experiences and services, and the life cycle of offline brands is often longer.
But for new players, the offline operation rules are not as easy to master as expected. "We have to look at hundreds of brands every year, but the real strength to do offline may be less than 10%."
"The shopping guide equipped in the counter was originally designed for us to cultivate ourselves?"
"Is it necessary for us to participate in the overall activities of 1500-300 in the shopping mall?"
"What is the difference between the two modes of joint venture and leasing? Where does the cost structure of opening an offline store come from? "
These questions raised by new brands when they entered offline have deeply impressed Huan Wang, the head of new domestic beauty products in Yintai Department Store, in the past two years. "Mature brands that started from offline at the beginning, such as L ‘Oré al Group’s brands, are familiar with opening offline stores, and the docking between the two parties is very fast. But new brands are different. They often need us to get involved deeper and give more detailed suggestions. "
On December 25th, Winona opened its first national department store in Hangzhou. On January 14th, the 14th national store of Orange Blossom settled in Wuhan. Further, cutting-edge brands such as Run Baiyan, Dr. Ai Er, and Yilian all revealed their plans to expand their offline business. "E-commerce Online" takes Winona and Tangduo as observation samples, and dissembles in detail several capabilities necessary for the new brand to expand offline.
Site selection depends on passenger flow and customer group attributes
Winona is not without offline experience. She first entered hospitals and pharmacies, and she is equipped with an offline team.
However, this kind of offline expansion is not the same as entering a department store in essence. The former is still the logic of distribution and supply, while the latter is the logic of self-operation by opening its own counter. Winona’s first offline store was located in Hangzhou Yintai Department Store West Lake Store. In 2020, Winona settled in Watsons, and the Huan Wang team who noticed this trend contacted Winona, which coincided with the latter’s intention to develop into department stores. The two sides began to dock in July last year, and they communicated before and after for almost half a year.
"E-commerce Online" understands that there are often several basic processes for a brand to enter a department store and open a counter. First, it delineates the city and selects the region, and then it negotiates the location and decoration design, which also includes the allocation of personnel and goods. Winona is very clear about the site selection, and the city is locked in Hangzhou. Huan Wang told reporters, "On the one hand, it is because Hangzhou’s own environment is relatively open and it has a high degree of acceptance of new brands; On the other hand, Winona’s products focus on sensitive muscles. The consumer groups in Shanghai and Hangzhou are more fashionable, and consumers use makeup frequently. Some Light medical cosmetology have a certain burden on the skin and are more prone to sensitive muscle groups. "
Winona is located in the side hall, close to the entrance of the shopping mall.
In other words, where the consumer groups are, the counters will be opened, which is the core strategy of Winona’s site selection.
The idea of Orange Blossom is generally similar, and it also values the indicators on the consumer side. Tangduo told reporters that Tangduo plans to basically cover the provincial capital cities in 2022.
The first idea of site selection is to look at people’s traffic. For example, Wuhan Yintai Creative City has a high average daily traffic and can rank among the top five local shopping centers. The second is the spectator group attribute. According to the relevant person in charge of the Orange Blossom brand, "the core consumer groups of Orange Blossom are concentrated in the age of 15-25, mainly college students and young women who have just entered the workplace. Many colleges and universities such as Wuhan University and Huazhong Normal University have gathered around Yintai Creative City, and the customer groups are highly matched with the core consumer groups of Orange Blossom."
The difference is that Winona and Juduo show different tendencies about who their neighbors are.
Among many department stores in Hangzhou, Winona finally chose West Lake Yintai. An important reason is that the high-end cosmetics brands here are relatively complete, and Winona’s competing products are also here, which means that the consumer groups in this area are relatively accurate and have been verified by competing products; Although the orange flower finally settled on the first floor, its initial point of view was that the first floor of the shopping mall was close to the subway exit, and the BA Jewelry Bureau was next door. "Comparatively speaking, Tangduo doesn’t mind that its neighbors are non-beauty trend brands such as POP MART and Twelve Light Years, which is really different from the past mature offline brand location ideas." Qing Yang, the person in charge of docking orange blossoms in Wuhan Yintai Creative City, said.
Juduo Wuhan Yintai Creative City Branch
The most important thing in "people’s freight yard" is people
For new brands, every step of offline business is a process from 0 to 1.
In the process of docking, Winona spent more time and energy in the counter design. Mature brands have their own templates, which can be basically copied. However, as an offline counter for new brands, except for the brand DNA elements, the overall image should be re-planned. Once the planning is completed, all stores will not be easily changed, so it is very cautious. The reporter learned that Winona found four design companies to compare the schemes respectively, and spent more than two months on image design.
Then there is the selection. It is not a good explosive product sold online, but it will definitely sell well offline. The offline layout is more spatial, and the requirements for the placement of goods are more clear. Huan Wang revealed, "In the initial stage of counters, most brands will display their own star series and explosive products, which is no problem. However, offline stores are located in different areas, and the portraits of consumers in various places are more detailed, which is almost a thousand stores and thousands of faces. For example, the climate in the north is dry and moisturizing products sell better. This requires the brand to make adjustments according to the product matrix and changes in local consumer groups, and constantly adjust with the store operation stage. "
Winona is the first store (counter) under the national line, and the final color scheme is mainly red and white.
The basic requirements for a new brand to open offline stores will come from many aspects: 1. There are at least 30 SKUs, and it is difficult for a single product line to meet the diversified consumption needs of offline customers; 2. A professional offline team, generally at least 10 people, with positions including business, operation, training, marketing and goods management personnel; 3. With stable financial support, offline sales tend to be long-flowing. The annual sales of offline counters are basically in the scale of several million, and the head can also be several hundred million, but overall, there is no online explosive high sales efficiency; 4. The offline experience and service need the brand to be equipped with offline planning.
Huan Wang told reporters that at present, less than 10% of new brands meet these four points at the same time, and a large number of new brands do not have the strength to directly open offline counters. It is worth noting that the determination of location, the design of counters and the choice of goods essentially point to the business field and goods. However, it is actually people who are more important to do offline business. What new brands really need to overcome in developing offline teams, including shopping guides in stores and operating teams operating offline stores.
Shopping guide is very important for offline stores.
Different from online business, in addition to sales volume and GMV, repurchase rate and member recruitment are indicators that new brands need to pay more attention to. The offline business logic is that high customer unit price, high transaction rate and high repurchase rate drive the consumption of members, thus making the business more stable-mature offline brands, such as L ‘Oreal, Estee Lauder, Shiseido and other large beauty groups, have high membership stickiness, and often value the development of new indicators; However, the new brands that started online, with rich online marketing methods, are not short of traffic and innovative ability. What they value more is brand loyalty, that is, the number of members, which puts higher demands on the shopping guide team.
"Offline depends on people to sell goods, and consumers will receive information deeper than online. If the goods are used well, they will have a sense of body on the spot. Making a professional training plan for shopping guides is a part that many brands have neglected in the past. An excellent shopping guide needs a comprehensive understanding of the brand and a targeted product recommendation ability for different consumers. "
In addition, the change of thinking of the operation team is also very important. Huan Wang, for example, has different publicity rhythms. Apart from double 11 and 618, Shuang Dan is also an important activity node for department stores. With different preferential schemes, online products are more explosive strategies, and the strength of single product discount will be strongly linked to sales volume. However, the promotion effect of a single brand under the line is limited, and the promotion effect is better because of the full reduction of activities in the mall as a whole. There is also the requirement of efficient inventory management, which needs digital management to avoid the situation that there is too much backlog of offline goods, or customers with too little goods can’t get the goods at home.
Which is more fragrant, joint venture or lease?
For a new brand that started online, the offline business needs to be properly planned and arranged, and it can’t be decided by slapping the head.
It is planned to open a perfect diary of 600 offline stores by 2022. Today, there are more than 280 stores, but the pace is too fast, and one-third of the stores are repeatedly closed, opened and closed; Hua Xizi, who is cautiously exploring on the edge of expanding offline business, has already revealed the plan to open a shop under the cable, but today she is still testing the water frequently through one offline flash after another. Rapid expansion, or cautious wait and see, are different choices, but also suitable for brands at different stages of development.
At present, the ways for new beauty brands to carry out offline business are also diversified: entering CS channels such as Sephora; Settle in beauty collection stores such as colorists and plum blossoms; Flash-flash at multi-business points in the center of the shopping mall; Open offline stores or counters. The first two are traditional distribution logic, which has the advantages of lower cost and can quickly test the acceptance of offline customers for brands. The disadvantage is that there is almost no service and experience, and the display and publicity effect of brand concept is also weak. The latter two are more direct in shaping the brand mind, but the disadvantage is that the brand needs to have a stable cost investment.
The cost of opening an offline counter mainly comes from decoration and design fees, staffing fees, shopping malls or rental fees, utilities and so on. Among them, the cost of each brand in decoration design is different, and the cost per square meter ranges from 5000-50000 yuan; Staffing costs are basically 8% of sales; The level of shopping malls or rental fees depends on the different modes of cooperation-in the joint venture mode, the main business is shopping malls, and there is no extra rent, but all sales will be sampled; Under the leasing mode, the brand needs to apply for a business license separately, and the shopping mall does not take any points, but only collects rent.
Comparatively speaking, the joint venture will have an account period, and the cooperation with the mall will be deeper. Winona adopts the joint venture model. Leasing has no accounting period, which makes it easier for brands to control costs, manage profits and liquidity. The perfect diary that opened more than 280 stores and the orange flower that just opened the 14th store all adopt the leasing mode. What needs to be paid attention to is that there will be great differences in rents and pumping points in different regions, different shopping malls and different locations in shopping malls. According to an industry insider, in Zhejiang, for example, the monthly rent per square meter fluctuates between 100-1000 yuan, and the percentage of sampling points ranges from 10% to 20%.
In the past two years, new brands that have grown up online have dug up the first bucket of gold on the e-commerce platform, occupying the eyes of capital and market. But how to grow from a new brand to a mature brand, and to whom should this baton be handed over?
Li Hao, managing director of Light Source Capital, said in an interview with the media that the competition of consumer brands in China is in a changing stage from the incremental market competition environment to the stock market competition environment. In the incremental market, the core strategy is to improve market penetration, the growth efficiency is greater than the profit efficiency, the explosive product strategy is greater than the brand strategy, the sales capacity is greater than the supply chain capacity, and the single channel strategy can be established; However, in the stock market, the core strategy is to enhance product strength, profit efficiency is greater than growth efficiency, brand strategy is greater than explosive product strategy, supply chain capacity is greater than sales capacity, and omni-channel strategy is necessary.
"Between department stores and brands, it is no longer a simple relationship between Party A and Party B, sales drawing or rent delivery. We are still growing with each other to help brands expand their business scale. " Behind the offline layout of many new brands is the traditional department store industry and the new brands transformed offline, standing at a meeting point. The running-in place of both parties is scattered in the details of each link, which is an all-round adjustment from personnel allocation, product structure and operational thinking. Qingyang revealed that they are also constantly adjusting the way of cooperation with brands, and creating samples and running models through joint brands.
From a better understanding point of view, this is like a change of identity-the brand docking team in the department store industry, Huan Wang and Qingyang are changing from a simple docking role, and now they need stronger operational capabilities, more and more like Tmall’s second child. From offline to online, and back to offline, the growth of the brand has a different trajectory, but the same is still the logic of doing business: good products, consumer service thinking, and operational ability to keep pace with the times are still the core competitiveness of the brand.
Original title: "online celebrity Beauty, Group Battle Store"
