O2O Business Docking: Smith Barney "Touches The Net" VS All Customers "Landing"

　　 Metersbonwe (Meters/bonwe, referred to as the United States), is undoubtedly an excellent private apparel enterprise. Since its debut in the streets of Wenzhou in 1995, it has nearly 4000 stores nationwide, with annual sales of 7 billion 500 million yuan and profits of over 1 billion yuan. The company has two brands of "Meters/bonwe" and "ME&CITY", and its comprehensive strength ranks first among the casual brands in the Chinese market.

If mebang is a big Mac in the clothing store, there is also a "growing giant" in the virtual network. VANCL. If Zhou Chengjian, a founder of Smith Barney, is a professional who knows tailors, he has a preemptive advantage in making clothes. Excellent network Founder Chen (micro-blog) was founded and achieved rapid success. In 2010, the sales volume of van customer was up to about 2000000000, and this year's sales figures have been showing explosive growth.

One is a big crocodile under the line, the other is a new upstart on line. However, in 2011, the United States started online e-commerce, the first "touting net". From "from heavy to light" to "light to heavy", there are some vivid intersections between the two outstanding local costume giants.

Behind the same path, there are two giants' mature enterprise development context and the thinking of creating three-dimensional shape under the current complex and complex business form.

　　 Setting up: the "low price and fast fashion" defined by the "virtual operation" VS outsourcing.

In 1998, Zhang Dejiang, who was Secretary of the Zhejiang provincial Party committee, inspected MTS, and thought that the mode of operation was similar to the "virtual operation" that he saw abroad. Thus, Smith Barney became the pronoun of "virtual operation" in the clothing industry.

How does "dummy" operate in the US?

Some people may think that since founder Zhou Chengjian is a tailor, he will start his own factory and develop it step by step. In fact, as a tailor born by a peasant, when the United States was founded, Zhou Chengjian had only more than a million yuan to start up his hands. Limited funds should be publicized and promoted, and factories should be set up and shops opened.

Can we find a way to build leaps and bounds to achieve the leaping development of enterprises?

After inspecting the domestic clothing bases such as Guangdong and Shanghai, Zhou Chengjian found that many domestic clothing enterprises were equipped with advanced equipment, but the products could not find the market, and a large number of machines were idle. "Why not let them work for me if they are so idle?"

Mei Bang apparel has invested part of its funds in establishing long-term cooperative relations with more than 80 garment processing plants in Guangdong and Shanghai. The production capacity is about 10000000 tons of casual wear, which is produced by Mts. Bang Wei. This way is quite similar to Mengniu. Mengniu used to build milk brand by controlling the quality and integrating the existing production and processing resources of the society to produce milk.

"Let the cow run out of the rocket."

　 Zhou Chengjian It is always considered that there is hardly any core technology in clothing industry. "Making clothes is simple, making brands is complex and systematic." He has always taken the reason he realized in his early years as a way of making a big brand.

Design is the soul of clothing brand, and the money saved by the United States in virtual operation is heavily invested in costume design. Zhou Chengjian set up a design center in Shanghai in 1998. A top costume designer Luc was invited from France to be the group design director. In 2001, Smith Barney invited Aaron Kwok to be the image spokesman of the brand. In June 2003, Jay Chou, who was popular in Taiwan, was employed as the spokesman for the new image. In 2011, he invited Lin Chiling to be the spokesman of the image.

In the heavily overloaded garment industry, the United States is also proud to use information technology to transform traditional clothing business processes. The ERP system, the internal management system and the information system of the exclusive store make up the "virtual development" of the three systems. The company has set up a powerful information base for all franchised stores. The headquarters can check the sales performance of each store at any time, and quickly, comprehensively and accurately master various incoming, selling and storing data, conduct business analysis, and make timely business decisions for promotion, distribution and cargo transfer. "The processing period of an order will take 10 days, and now it will only take two or three days." Zhou Chengjian said, "speed is more important than fashion."

In the face of the expansion of sales scale, the United States and costumes inevitably face complex logistics and distribution problems. MaBang still relies on its old ways of "borrowing power" to outsource logistics to logistics companies, but the whole allocation data is controlled by the company itself.

Like ZARA, the United States has firmly occupied the central link of the industrial chain through the integration of various social resources and resources, ensuring the company's profitability and strong competitive advantage.

According to the nationwide market research conducted by CTR in 2007, the first mention rate of American brand in 157 casual wear brands familiar to consumers aged 14~35 reached 35.6%, far higher than that of other competitors in the industry. In terms of popularity, purchase rate and brand loyalty, Smith Barney is also ahead of its main competitors.

VANCL aims to become "Internet fast fashion brand". The new company, founded in just a few years, was originally a clothing brand rooted in the Internet and sold clothes on the Internet. Van customer's initial sales model was the PPG model that was very popular in those days. At that time, PPG men's shirts had sold tens of thousands of pieces on the Internet in one year, and had a huge impact on the electricity supplier industry. After all, the sales volume of YOUNGOR shirts sold exclusively for shirts was no more than that.

Fan Kai pin's start is also based on men's shirts. Today it has covered five categories, men's wear, women's wear, children's wear, home textiles and shoes, and thousands of varieties. In October 18, 2007, on the website of van guest website, only 10 shirts were sold on the same day, which can help the domestic manufacturers. In the past, fan Kai Cheng also caught the decline of foreign trade business, and a large number of foreign trade enterprises tried to seek opportunities for transformation in China.

After visiting a large number of domestic production and processing enterprises, fan found a large number of international brands. The orders of these international brands went to the top international luxury brands, and then to the rapidly popular market brands. The scale of the manufacturing enterprises was hundreds of millions of yuan or even one billion yuan. This industry, like many other industries that have benefited from reform and opening up for thirty years, is extremely powerful. After seeing such manufacturing and manufacturing level, Fan Cheng pin entered the e-commerce industry of clothing sales.

The strong production and work support support ensures that the product quality of Fan Cheng pin can be protected like the international first-line products. On this basis, everyone sincerely depends on the brand. Founder Chen once thought that VCM was actually a radical brand, because it emphasized quality and fashion style, without exaggeration, steadfast and even honest, so radical.

After having the standard products sold all over the world, all customers need is to give the customer a most affordable price, so that Chinese consumers can enjoy the international products with low price and high quality. For customers who have products, how can customers recognize themselves? Once a full time free shipping campaign has been launched for a half year, fan Kai Cheng has allowed consumers to experience and try on, thirty days of unconditional return, to give consumers enough time and opportunity to experience.

The low price advantage of fan Ke Cheng made it collect wealth at an incredible speed. It is reported that the general clothing brand will take the cost price 6~10 times as the final selling price, and a well-known brand will set the price at about 20 times the cost price. The selling price of fan is only 1.5 times the cost. The price of every customer is 1/6 or even 1/10 of the same brand. Low price, huge advertising, unique e-commerce positioning, so that everyone in the years of rapid growth.

In terms of product price control, Chen said he did not care about anyone else calling him "price butcher". From 49 yuan to a pair of canvas shoes to 79 yuan a pair of jeans, almost the price of Beijing zoo wholesale market. Fan jeans, with its 79 yuan low price rush strategy and sexy models, sold tens of thousands of lines, similar to that of the 20 thousand pairs of canvas shoes sold on a single day. AI research released the "2009~2010 China clothing online shopping Research Report", said that in the independent sales clothing B2C website, the customer ranked first in the market share of 28.4%.

　　 Expansion: stereoscopic interest community VSCPS infinite reproduction

After solving the problem of production, the second difficulty of Smith Barney is sales. If you invest in a shop, you will need to take up a lot of liquidity. Therefore, the United States still takes the advantage of external resources and adopts the more advanced way of store expansion, that is, franchise chain, which solves the problems of high cost of opening a shop and insufficient personnel investment.

At the beginning of the operation, the United States only needs to do some sample shops directly, so as to share risks and achieve win-win with the regional franchisees. According to the level of regional consumption, franchisees pay 50 thousand yuan ~35 million royalties to the US respectively every year, and all franchisees are "duplicated" management.

Since the opening of the first store in May 1995, Smith Barney's franchise has increased exponentially every year. Before its listing in March 2008, the United States has opened stores in all provinces, autonomous regions and municipalities outside China, Taiwan, Hongkong and Macao. It has a deep and extensive marketing network consisting of 2211 Direct stores and franchisees.

After joining the business, the United States provided goods, sales revenue to 25% of the franchisees, the rest of the income to the United States. In this way, the franchisee and the company effectively form a community of interests. The franchisee makes a lot of efforts to sell for profit. In addition to making money, the United States also gets long expected market share and brand marketing channels. From the chart below, we can see that the proportion of Direct stores and franchisees before the 2001~2008 was basically maintained at around 1:8, and the proportion of Direct stores has been relatively low. Franchised stores have made a great contribution to the sales performance of the company.

As an Internet company, van Hsin Cheng has no stores in the sales terminal, but on the Internet there is a huge virtual shop that does not close for 24 hours. This website is the main battleground for everyone to sell. Why the number of customers who founded several years can reach 2 billion yuan, which is far beyond the average online sales enterprise. Here we have to mention the CPS mode that van guest implements in the Internet world.

CPS (abbreviation of English cost per sale) is a business cooperation mode that receives a certain percentage of commission based on successful sales. This mode is actually an online franchise. Internet users in China have hundreds of millions of people. How can they promote their businesses in these groups?

CPS solves the problem of profit sharing between sellers and promoters. There are two kinds of advertising investment in CPS, one is in professional advertising alliance, the other is self built alliance.

(1) professional advertising alliance: the proportion of users to webmasters is 16% (now adjusted to 10%). Van guest strictly chooses ROI as the assessment standard in the media selection, and chooses the survival of the fittest among portals, communities and CPS alliance.

(2) self built alliances: there are three ways to operate the Vancl Alliance (union.vancl.com), which is built by fan Kai Cheng.

The first involves no direct sales. After the registration union account, it can only receive the advertisement code and publish it on its website and blog. The cooperation with the online store and campus agent is actually the sale. The current share ratio of the global alliance is initially 16%, that is, the amount of return received by alliance members per month = the monthly amount of the order can be deduced by 16% members.

If a member of a fan alliance member orders for more than 200 months per month, with an average of 200 yuan per month, monthly sales will be about 40000 yuan, and the income will be 6400 yuan / month. In the long tail form, the volume of transactions completed by the company is estimated to be one million orders of magnitude.

For customers, CPS mode is not as hard to control the final sales as it is for other Internet advertising and outdoor advertising. After the CPS mode has been sold, the Commission is given to the partners. This way has low risk and clear effect. And customers can support 16% of the return rate, from one side reflects the clothing industry's gross profit is quite high. Because of the high rate of return, many small and medium-sized websites are willing to assume CPS mode.

High risk and cooperation with customers. Of course, due to the promotion and publicity of the website's brand and the popularity of its customers, the website announced that the proportion of the commission would be reduced by 6 percentage points to 10% at one time, which also led to the protest of the alliance website.

Van guest's CPS has a strong communication and influence in small and medium-sized Internet websites. It spreads viral advertising to all corners of the Internet in the form of viral transmission. Meanwhile, CPS can monitor the actual transformation of high advertising investment to achieve the effect of covering the market. It can not be said that the 200 million yuan in the year of advertising is really the result of 2 billion yuan invested by the general enterprise. No wonder Chen once proudly stated at a press conference that fans' advertisements had occupied most of the valuable website platforms on the Internet.

This sentence occupies most of the valuable website platform, just like the fact that the customers have already had the real stores or billboards in the streets and lanes. How can this influence not generate huge sales performance?

　　 Besides, there are many ways of marketing on Internet:

(1) website Web Advertising: as an Internet company, all customers initially launched product image publicity on the portals, including Sina, Sohu, Tencent, NetEase, Phoenix and so on. From the results, the initial advertising is of great value to the sales promotion of the enterprise, and of course, the cost is huge. At the same time, customers are more concerned about the professional image of professional products, closely related to the relevant channels of the website, such as promoting men's shirts on financial websites, and promoting new leather shoes, bags and so on in women's entertainment websites.

(2) search engine optimization (SEO): the main purpose is to increase the exposure rate of specific keywords to increase the visibility of the website, making it possible to appear as many business names as possible on Baidu, Google and other search engines, thereby increasing sales opportunities. Many key words in search are Vic, and there are traces of search engine optimization in website code design. This will enable the website to gain more network attention at the beginning.

(3) search engine auction (SEM:SearchEngine Marketing), in the Internet business, in addition to free access to some search opportunities, all customers are also combined with their own enterprise positioning, in the main search sites Baidu, Google have done the promotion of keyword bidding, this point has brought more attention to customers.

(4) product mail marketing: as an Internet company, mail promotion is also one of the most commonly used ways of free.

(5) blog marketing: blog is also one of the publicity platforms in the early stage of the development of customers. Customers take products as the topic and let many bloggers write user experience articles, so as to achieve experiential marketing from users' perspective.

(6) Internet media news promotion: the use of Internet media coverage to enhance brand influence and increase users' trust in products and websites.

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　　 Strategic adjustment: the United States "touch net" VS all customers "landing"

At the sixth annual meeting of China's Internet retailers, Zhang Zhiqiang, President of SPAR, China's largest retailer and largest retailer in the world, and the world's top 100 retailer, explained why the real businesses need to do e-commerce because the customers are there.

With the popularity of the Internet, people who are accustomed to reading, communicating, acquiring information and buying goods on the Internet are getting bigger and bigger. If the entity retailers do not enter the field of electronic commerce, they will probably be eliminated. The following is a picture of the growth of China's e-commerce market:

In 2010, the United States decided to enter the field of electronic commerce. In December 18th, the "Bon buy network" of American state clothing was quietly launched on trial. In January 3, 2011, the daily sales volume of the State Grid exceeded 300 thousand yuan, and the daily trading volume exceeded 1000 orders, with an average value of more than 300 yuan per sheet. BNN has once been a key project in the United States. The group's goal is to achieve 100 billion yuan in e-commerce by 2020. In addition to its pursuit of scale, Zhou Chengjian hopes to realize the vertical integration of American Apparel business through the "state purchase network" platform. However, after six months, the United States announced that it did not want the State Grid to go on like the high speed rail, and collapsed in a series of accidents. Based on this consideration, the United States has revised its strategy: "test delivery is not launched on a large scale, but gradually revised with the increase of traffic volume."

Zhou Chengjian thinks the cost of online is higher than that of offline. Even though retailers face the pressure of land cost, e-commerce seems to be the lightest asset and the lowest cost, but at present, no Internet e-commerce enterprise is making money. The cost of electronic commerce comes from two aspects: first, the cost of obtaining the number of consumers, that is, advertising fees, has been increased by at least five times in the past three years, and the advertised fees raised by e-commerce are at least five times.

America wants to pursue quality rather than material pursuit. Of course, this also requires changes in the overall online shopping environment. At this stage, the most important thing is not to increase the volume of online shopping, but to consider how to combine the characteristics and advantages of enterprises to meet the needs of consumers.

At present, it can be seen from the composition of the stores in mebaron that the investment of mebang in large stores is increasing. Thousands of square meters of large direct flagship stores have been built. "From heavy to light" is only a strategic supplement.

Of course there is something else. Zhou Chengjian disclosed: "in 2009, the company bought a lot of commercial real estate, valued at about 10 billion, now almost doubled." He laughs, "this is much easier than making tailors and making money in retail business, and doing business in real estate deals with 5 people to solve the problem, and now 10 thousand people, busy all year long, make ten billion profits." He believes that China's commercial real estate everywhere is the biggest risk, and the rising cost of land has become a serious burden on the real estate industry and retailers. The United States buys land to better control its cost and develop its brand.

In contrast to the "touch net" of the US state, it is everyone who has been relying on the rapid expansion of the network.

At the 2011 China retail industry leaders summit, Wei Zhe, former Alibaba president, said: "the important trend of the Internet in the future is the combination of online and offline. Two years ago, 9 of Taobao's ten major clothing brands had no physical stores; up to now, 8 of the ten major clothing brands have opened physical stores. Traditional enterprises should consider how to integrate and how to make trade-offs when they intervene in e-commerce. The online and offline brands should be unified. If suning.com keeps Suning, it is a good practice; the customer and membership system should be unified; the supply chain and logistics system should be unified; the sourcing resources for suppliers should be unified; the online and offline businesses should distinguish between incentive mechanism and marketing promotion.

The advertising under the passenger line has appeared on the roadside in the second tier city of China in 2010. The enterprise that has been born on the Internet has been attacking the offline market and implementing a "soft landing".

Even if customers announce that they are going to set up physical stores in major cities in China, from online to offline, what is the purpose of opening a physical store?

　　 But this process does not mean that everyone will be very successful.

Compared with traditional enterprises, it is because of the no shop sales of electronic business, it can be described as "light load to go to battle array". Once the physical storefront is opened, rent and operating costs become an important issue. Under the attack line, the market will not necessarily bring about the same scale sales growth. If an electric business enterprise opens a physical store, its original low cost and low price advantage will be lost. How can we win the development market online? It depends on the operation of this product.

Although the fund is strong, the cost of setting up a physical store is still too high. The profit rate of a single piece of clothing is almost the same as that of a single department store. However, the operation of a physical store requires planning, design, decoration and labor in the early stage. These are all very large expenditures. For all customers, the profit of opening a store will be much lower than that of the open shop.

As a rival, Mcglaughlin warned him that "online shops and physical stores are very different in terms of commodities and business philosophy. If they rush in, they will pay a heavy price." Fan believes that there is no need to be nervous: "we have never forgotten our advantages online."

Van guest obviously knows this. Van guest designed a perfect route for the opening of the final store: first, to open an experiential shop in Beijing. If the experience store is successful, copy the experience store experience to Shanghai and Guangzhou. The experience store is running mature, increasing the sales function of the experiential shop, becoming a real store for everyone, and replicating experience to more stores.

The cost accounting and the operator of the entity store have also been confirmed, but the information of the customer entity store has not yet been released. We need to wait and see. "Touch net" and "landing" may be regarded as the two giants' bluffing and fun making episodes.

　　 Comments: customer experience determines the direction of enterprises.

In the process of enterprise development, both apparel companies in the United States and the world have chosen to grasp and put down some of their main energy in the core stage. However, even in the same industry, the United States and the world have achieved the same result by maximizing control and utilization of their core ways.

In terms of product design, the United States employs a powerful product design team made up of 133 designers and craft experts.

The United States has maintained a high degree of integration with the development of information technology and the development of enterprises. The use of information technology and the formulation and implementation of information strategy are deeply integrated with the company's business. The whole supply chain across the casual wear retailing industry has been established. Van guest is also a high-tech Internet company, and its application in technology is perfect.

From the following table, we can see the direction of enterprises' attention in the world. The major enterprises in the world regard design planning and sales as the most important business concerns.

The United States really has only four parts in its own hands: Commodity planning, product design, some raw materials procurement and a small number of Direct stores. These links determine the products that the United States can provide to customers and the real feelings for customers.

As a customer of e-commerce business, the design and production of the website, the response of network speed, the promotion of products and the distribution of logistics are the most concerned directions, especially in recent years. The competition among e-commerce enterprises is concentrated on the capacity of warehousing and logistics. Many large e-commerce enterprises are building logistics themselves, so as to ensure that the orders have been delivered to customers in time, and even provide more in-depth services to customers. It is this kind of concern that makes the business mode of such products as domestic customers, Jingdong mall, and excellence in China gradually become asset intensive. Wang Hanhua, President of Amazon China, believes that e-commerce is different from other Internet industries. In the final analysis, it is still a business. If it's business, there must be a process of exchanging goods. E-commerce has never said that a fixed company is a "light" company. It is a process of completing business with the modern Internet. It has many advantages, convenient, effective or lower cost, but it does not mean that it is completely a "light" company, not to do such inputs as warehouses and entities.

Therefore, all customers in the whole country have achieved strategic coverage for several major regional storage centers in North China, Southern China, East China, central China and southwest China. There are eight warehouses in Beijing, Shanghai, Guangzhou, Wuhan, Xi'an, Chengdu, Ji'nan, Shenyang and so on. In the future, we will consider building warehouses in Xiamen, Changsha and other places. It is expected that in 2012, nearly 30 warehouses will be built nationwide, with a total area of 500 thousand square meters. When the storage center is built, it will provide more convenient online shopping services for consumers in the surrounding area and enjoy 24 hours of whole territory distribution service.

With the increase in the number of customers landing area, the explosive force of online shopping in the two or three tier cities will be triggered, and its self built logistics subsidiaries like Feng Da have been able to cover all the provincial capital cities, and users can experience more convenient services such as Feng Da's open trial fitting, on-site cash refund, POS card swiping and other special services, as well as the sincere service attitude and perfect user experience of the couriers.

With the full overlap of online business and offline business, we may see that both sides are more competitive and advocacy in the process of customer experience and brand marketing, just like the T-shirt war between the United States and the world in the summer of 2011. It is just the two most powerful online and offline confrontation. Jay Chou, the most successful clothing brand spokesperson in the history of the United States, has been playing a new generation of youth idol such as Han Han, Wang Luodan and Huang Xiaoming. The United States sells Transformers's logo T-shirts authorized by customers, and customers respond to thousands of different personas. Two products, promotion and positioning have their own advantages. Online sales have become the main way to promote the profits of the T-shirts, which are not profitable and rely mainly on the winning of printing. Of course, in the storefront experience, the service and image of the United States are more popular. Whether customers are shopping or ordering online, whether customers are satisfied or not depends on their votes. Customer experience determines the direction and motivation of enterprises.