Clothing Brand Second Spring: Target Two Or Three Line City

Beijing, Shanghai, Guangzhou and other domestic first tier cities mature consumer market, is the brand of many brands want to occupy the "geomancy treasure land."

But now this situation is changing. The market of the first tier cities is becoming saturated. More and more brands are starting to compete in the two or three line cities to seize market opportunities and expand their development space.

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In the future, branding will continue to focus on the most competitive markets such as Beijing and Shanghai, but at the same time, it will also consider more room for development.

With the rise of two or three tier cities with the ability to consume and facilitate pportation, it seems that the clothing brand "camping" here is a good choice.

The market of the first tier cities in China is almost saturated, and the two or three line city market has become a new growth point of the garment industry. This is almost an indisputable fact.

On the face of it, the full competition in the clothing industry has made the "fighting" among the brands among the first tier cities tragic.

Therefore, many people think that the brand "war" two or three line city is a must.

In this regard, Xia Hua, President of the Yiwen group, believes that the simple development of the brand to the two or three tier cities is a one-sided business competition.

In her view, in recent years, with the development of economy and the acceleration of urbanization, the emergence of new pportation tools such as high-speed rail and light rail has made the connection between cities and even towns and villages more closely, and it is possible for residents to concentrate on the two or three tier cities.

Xia Hua also believes that the expansion of business is another important reason leading to the two or three line market.

At present, the commercial competition in Beijing, Shanghai and Guangzhou is very fierce. The high price of commercial real estate has led to the high cost of brand operation.

If the profit margins and value-added products of a clothing brand are not high enough, it will be difficult to make profits in the first tier cities.

In this sense, Li Zhixian, a senior analyst at the textile and garment board of Guotai Junan Securities Research Institute, believes that some clothing Brand Company will build one or two stores in the first tier cities. Such shops are just image shops, that is, they do not expect it to make money, but to advertise the brand.

Li Zhixian said: "for such a brand, making money or relying on the two or three line cities, that is, the amount of running."

Li Zhixian also said that in recent years

In addition, expanding domestic demand has greatly promoted the entry of clothing brands into the two or three tier cities, stimulating consumption among the middle and low income groups.

Under the request of "promoting pformation, expanding domestic demand and adjusting structure", the policies have been implemented in depth. Especially, the support of the state for the development of agriculture and rural areas in China will surely arouse the market potential of rural and small towns and bring new development space to the brand.

Chen Guoqiang, deputy director of the Institute of industrial economics of China Garment Association, said in an interview with reporters that China's two or three tier cities and rural markets will gradually expand as a result of the country's policy of encouraging consumption.

At the same time, due to the continuous improvement of the living standard of the domestic residents, especially in the central and western regions, the consumption demand of the residents is accelerating. This provides a direct impetus for the clothing brands to enter the two or three line cities.

According to Chen Guoqiang analysis, today's consumers combine the functionality of clothes with their individual needs.

"Before a piece of clothing for consumers, may be worn on any occasion; now sportswear, outdoor clothing, home furnishing and so on a variety of market segmentation is obvious.

And everyone faces different kinds of clothing, their personalized needs are different.

One of the reflections in the market is more brands to the two or three tier cities. "

Chen Guoqiang said.

Special attention should be paid to the fact that clothing brands enter the two or three tier cities, and it is also a manifestation of enterprises' more conscious use of new channels, new products and new models to develop the market.

For example, the development of the Internet of things has made use of radio frequency identification devices, infrared sensors, global positioning system and other information sensing devices to connect items to the Internet for information exchange and communication, promoting the development of modern logistics and distribution system, and providing a good technical means for clothing brands to enter the two or three tier cities.

There is also a compelled fact that the pressure of life in big cities such as Beijing, Shanghai and Guangzhou has gradually increased. Some young people who are struggling for survival are more and more inclined to escape from the metropolis and look for entrepreneurship and job opportunities in the more livable two or three tier cities.

It also reserved the space for brand development in the two or three tier cities in the future.

Two or three line city market is mature?

Faced with the vast market space of the two or three tier cities, the new round of rapid development of clothing brands seems to be close at hand, but some of the problems behind them have to be squarely faced.

This is a market that is "awakening", but is it a mature market? What problems will the clothing brand face in the face of such a market?

"There is an unavoidable difference between the consumer market of clothing brands and the two or three tier city market."

Said Xia Hua.

For example, consumer purchasing power is relatively weak, brand awareness is not strong.

Although some of the two or three line cities in the Yangtze River Delta region are rich and have high purchasing power, Xia believes that such a special area like the Yangtze River Delta can not be used as a template for grafting to other areas.

The economic development of the Yangtze River Delta region has a higher degree of urbanization and regionalization.

But such a city can not represent the development level of the two or three line cities in other parts of the country.

Generally speaking, the purchasing power of consumers in the two or three tier cities is not enough to compare with the first tier cities.

"Two or three tier cities consumers' brand awareness is not strong, especially men's clothing, most men's sensitivity to brands is not high."

Xia Hua said.

In her view, although some men often travel to the first tier cities to buy clothes on business trips, their recognition of brands is not high, and their purchase is accidental.

"If there are no good brands and good department stores in the two or three tier cities, they will always be able to solve their dress problems in the rush of business trips.

The market of the two or three tier cities is in the process of maturity, and it is also a market for the clothing brand to develop in the future.

Chen Guoqiang felt the same way.

He also believes that the domestic consumption capacity of the two or three tier urban residents, especially clothing consumption, is being strengthened.

"State related policies are constantly being adjusted and pushed forward, and the wages and salaries of labourers will be improved. Their health care and employment conditions and living environment will be improved, and their material life will be improved.

In particular, some people who enter the cities from the countryside have provided conditions for them to solve the fundamental problems of life, and they will increase the consumption of clothing. "

In terms of urban development, the two or three line city is similar to the law of the development of the first tier cities, and the latter has also experienced a process from immature to mature.

With the development of urbanization, the two or three tier cities will gradually improve in terms of resources, hardware and regional economic balance, and market development will become increasingly mature.

For brands, in the development of the two or three tier cities, they will not rely on the development of the first tier cities once and for all.

For example, we should adjust the structure of goods, reduce the more fashionable styles, and increase the proportion of conventional goods.

Even so, it does not mean that the brand can adequately control the market.

Xia Hua believes that brands in the two or three tier cities may not be so easy to release the brand characteristics in the first tier cities.

"The release of brand must grasp the rhythm.

If the brand develops in the first tier cities, but has not yet established a good reputation and recognition, I do not propose to develop the two or three line market quickly.

Otherwise, everyone is just beginning to understand your brand in the first-line market, and has not yet formed the desire of the two or three line market, so you release it all, so that the bargaining power of the brand and the position in the consumer's mind will be discounted.

According to Xia Hua, if the brand of Yi Wen group wants to open up a new market, it will conduct a careful investigation in the early stage, such as comparing the similar brands, studying the more advanced hotels in the city, how many concerts the city has held, how people taste and aesthetic standards, how the store level of department stores is.

"If the operation mode of a brand is mature, including its VIP management mode and so on, and it is well done in the first tier market, then entering the two or three tier city is a step that must be taken."

Said Xia Hua.

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Are all brands suitable for entry?

Looking at a market, we should not only see its present but also its future.

The clothing brand will develop the two or three tier cities in the case of the first tier cities, which is the release of the brand rhythm. If the first tier cities fail to make the pition to the two or three line, there will be some problems in the market strategy.

In interview, there is a problem that journalists and respondents must discuss before they talk about the next step, that is, how to define two or three line cities.

Although all the respondents have slightly different discussions on the details, they have reached a consensus that the status of the first tier cities in Beijing, Shanghai and Guangzhou is certain. In addition, they are divided according to different standards. At the same time, the value of the two or three line cities is rising and has considerable potential for development.

Chen Guoqiang said that the division of the 123 line cities is relative. Apart from considering the size of the city, the level of consumer demand and the market level of mass products are also the yardsticks.

Xia Hua believes that the main city of luxury consumption or the main tier of brand development can be called the first-line market, which includes what we call Beijing, Shanghai, Guangzhou and some important provincial capitals.

The two or three tier cities are relatively developed areas around the first tier cities.

Generally speaking, urban population, urban economic development level, residents' income and consumption ability are the factors that the respondents understand the city level.

But there is another factor that Xia Hua stresses, that is, the standard of city department stores, because the development of China's clothing brand can never jump away from department stores alone.

These factors also put forward a thinking for clothing brands: Although the two or three line cities have great potential for development, are all brands able to grab the "cake"?

Xia Hua believes that we should first consider the characteristics of the brand and then look for the relative market.

For example, the NOTTINGHILL (Nuo Dingshan) brand of Yiwen group is very careful when choosing the two or three line city.

Xia Hua said: "like NOTTINGHILL, there is a relatively small number of fashionable brands in the two or three tier cities. I will think about whether this kind of investment is suitable.

It does not mean that the two or three tier cities have great potential for development. They blindly enter the market regardless of the characteristics of the brand.

And the group's high-end brand KevinKelly (Kevin Kelly) now only 13 stores nationwide, may reach 15 by the end of the year, there is no intention to develop to the two or three tier cities.

I must be more saturated in the first tier market, while having a relatively good two or three line market.

"The domestic senior women's clothing brand JEFEN (Ji Fen) has been laying out two or three line cities since 2008.

Xie Feng, design director and chairman of the Brand Company, said that JEFEN is currently opening stores in relatively prosperous southern cities such as Wuxi and Changzhou.

The positioning of the JEFEN brand determines that it has a choice to expand the market downward.

In Xie Feng's view, although international brands such as ZARA and H&M have already "radiated" their own market to China's two or three tier cities, the future performance of these cities needs to be further observed.

Xie Feng told reporters: "the two or three tier cities are not as highly internationalized as Beijing, Shanghai, Guangzhou and other big cities. Their local characteristics are obvious, and some of the influence of the world trend is relatively small, and local residents have their own special interests.

Some international brands may not fully understand the specific situation of China's local cities, and how they will be in the future.

It is precisely the obvious local characteristics of the two or three line cities that also make JEFEN very cautious in its downward development.

Theoretically speaking, the brand is different from the consumers in different markets, and its products should be changed in style and design.

"But the same brand is developing in two or three cities and cities, plus the location of its first tier cities. If its brand positioning and product style are too far away, it will be a blow to the brand."

Xie Feng said.

Chen Guoqiang also agreed with this view.

The demand for products in China's two or three tier cities is more diversified, which puts forward more specific requirements for subdivision of brand products, such as differences in version, style, color preferences, etc.

In view of this, although the two or three line cities have large market space, they do not mean that they are suitable for every brand.

The brand development market involves its development strategy, and it is by no means "big, fast, fast and up".

How can the product be localized? How to balance product differentiation among different cities? Does the local have its own consumer layer? A brand like this should be done.

Expert opinion

Catch the belly of "gourd"

Li Kailuo, director of the Institute of International Industrial Economics

Market structure distribution of "gourd type"

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In the next 20 years, a large number of China's three or four tier cities will become the main battleground for Chinese brands and world brands to compete for hegemony.

Who can become the main prosecution of the "Chinese style gourd market", who will become the upstart in the business ecosystem.

Why is it a "gourd society" instead of a "Pyramid society"?

Because the higher the structure of Pyramid, the smaller the number of the middle class and the rich. The number at the bottom is very large. This is obviously not right for China, which is changing rapidly today.

The shape of the gourd can clearly see that its bottom is a very small number of vulnerable groups. With the change of the gourd curve, most of the middle and lower levels of the gourd will go upward.

Comparing the top of Pyramid with the top of gourd, the number of rich class in gourd is obviously larger than that of Pyramid, which is in line with the characteristics of wealth structure in today's China.

Therefore, corresponding to the wealth structure of Chinese society, the distribution of China's market structure also presents a huge gourd shape.

If the first tier cities located at the top of the gourd lead China's wave of consumption upgrading in the first 20 years, the emergence of many new cities at the bottom of the gourd will inevitably lead to a larger consumption underflow at the time of the arrival of the wheat fashion era.

Focus on mass consumer groups

The success of ZARA and H&M in China stems from its positioning of mass consumer groups.

They are clearly aware of the huge market potential of China's "gourd" social structure.

The "big belly market" of gourd is the largest market, and the dynamic characteristics of the gourd determine the market potential.

Especially in the gourd market, consumers' ideas will become the guiding ideology of supporting business development. The value innovators of Chinese enterprises should aim at most customers and be willing to give up some customers.

Enterprises should focus on differentiation through further segregation.

Whether it is Gome or ZARA or H&M, their success stems from business model innovation.

A successful business model often lies not in the cutting-edge technology, nor in the timing of entering the market. The key is to find valuable business models.

If innovation can not be rooted in value, technological innovators and market pioneers tend to fall into the end of "dressing for others".

The conventional view is that an enterprise can create higher value for customers at higher cost or create a relatively good value at lower cost.

In this way, the strategy is often mistaken for the choice between "differentiation" and "low cost".

Nowadays, when a large number of popular brands combine the two or even more factors to become commercial textbooks, behind the mystical business model is actually how enterprises and brands find their place in the industry value chain and create value for consumers.

The two or three line market is definitely not a simple extension of the first-line market.

In a sense, the two or three line market and the first tier market are completely different concepts, and the barriers between them may not be eliminated for a long time.

For example, the pursuit of personality and fashion is necessary for the brand of the first-line market, but not necessarily for the brand of the two or three tier market.

The first tier market is famous and influential, and it will probably not be accepted or completely unknown in the two or three tier market.

Those brands that are widely advertised in CCTV can be eaten in the two or three tier market.

Therefore, when the first tier market brand sink channels, how to influence the sink is indeed a problem.

To go to CCTV to advertise? This is obviously not the way to do it.

It is too time-consuming and financial to improve the image by shops. I am afraid that we can not wait until the image is done.

Once the channel is sinking, the brand strategy must be greatly adjusted.

If a brand does not only make the first line market but also the two or three line market, its chances of success are negligible.

The general situation is that the two or three tier market has not yet been seized, and the first-line market has been lost.

Multi brand strategy is the inevitable choice, but it is very risky because the product development system, channel and promotion for the two or three line brand are different, and almost have to start a new business. This is also the main reason why many enterprises dare not act rashly.

Some people think that we can take two brands and a set of people's practices, but the result is always getting more and more chaotic. The two or three line is not done well, but it also brings a thread.

There are many successful examples of multi brand strategy, but to really do it, we really test the brand planning ability, operation ability and promotion ability of enterprises.

Of course, it is another matter to concentrate on the two or three tier market.

Take Fujian Leiro as an example. At this stage, it rarely expands in the first tier cities such as Shanghai. Instead, it turns to a large population in Henan and Sichuan provinces. According to the market research report compiled by Frost&Sullivan (Sullivan), in the past two years, Lirun ranks the top in China's second and third tier cities in terms of retail sales; Lirun's counties outside China's first tier cities, such as Shaanxi's Shenmu county, can receive 3 million yuan, and Yiling's prefecture level cities can reach 8 million to 10 million yuan, and the amount of repayment is several times higher than that of Shanghai.

Local association's line of sight

Where there are people, there will be markets.

China's two or three line cities occupy the largest proportion of the population in China, and the consumption power of the market can not be ignored.

This can be seen from the trend of China's real estate market.

Judging from the clothing industry, the competition in the first tier cities is very fierce. Especially with the influx of international brands and the infiltration of the next tier market, the challenges facing domestic brands to enter the first tier cities, especially the first tier cities, are very great.

If the clothing brand wants to do well in the two or three line market, the style and price of the product must be consistent with the target market.

If the products of the first line market are sold directly to the two or three line market, the result will not be very good.

Therefore, before entering the two or three line market, we must make adequate market research.

- Shen Moli, Deputy Secretary General of Zhejiang Garment Industry Association

At present, the domestic clothing market is mature and occupied by high-end brands.

Let's take a look at the second tier market. Although it is the largest market in terms of population and quantity, the market potential is huge, but its disadvantages are as obvious as its distribution is relatively loose.

In contrast, the consumption potential of the three line or three line market, including the rural market, is rising. The income of consumers in these markets has increased a lot, and they will play a great role in the pformation of China's clothing market in the future.

In the future, the middle and low end market still needs to have a brand to occupy. Therefore, the growth point of the next ten years is undoubtedly related to the development level of the low and middle end market.

The consumption pattern of the two or three tier cities has shown a trend of change. In the past, whether big cities or small towns, people like to blindly pursue some big brands and high priced clothing. Now this situation is changing gradually. People begin to pay attention to the styles and fabrics of clothing, and are willing to spend more time to understand the connotation of clothing.

When people's consumption begins to become rational and consumer psychology begins to mature, the requirements for enterprises will be higher and higher.

Ye Liang, Secretary General of Anhui clothing trade association

The two or three line market is not only the largest market for the garment industry, but also for China's economy as a whole.

Now, the economy of the two or three tier cities is developing continuously, and the consumption capacity is constantly improving. The demand for brands is also increasing.

For clothing brands, if we can seize this huge potential market, the space is huge.

In fact, Henan belongs to the two or three line market.

In recent years, the garment industry in Henan has made rapid progress. One of the great factors is that Henan is the most populous province in the country with strong consumption power from the two or three line cities.

For clothing enterprises, there are two points to note: first, brands are not necessarily aimed at the first tier cities.

Some enterprises believe that making brands is to aim at such large cities as Beijing and Shanghai. In fact, the competition among these tier cities has been very intense, leaving them limited space.

Second, the two or three line market is not equal to low quality.

If a company believes that the two or three line market can reduce the requirements of product quality and so on, then they can only be defeated.

Li Gang, executive vice president of Henan clothing association

For the two or three line market, it should be long-term.

Now, the country is speeding up the process of urbanization, and the "half hour, one hour, two hour economic circle" is rapidly forming. At the same time, the income of farmers is also increasing. All this indicates the huge consumption potential of the two or three line market.

In fact, a provincial capital city like Chengdu has no big difference in spending power with large cities like Shanghai and Beijing.

Therefore, the so-called "two or three line" market should refer to the regional cities and the downwards county-level cities.

Judging from the current situation, the consumption capacity of the two or three line market is already available, but the consumption consciousness needs to be improved.

Yang Shuqiong, executive vice president and Secretary General of Sichuan apparel (apparel) Industry Association