ZARA Enters Tmall To Seek Opportunities For E-Commerce Channels

Probably to catch up with the 2014 double eleven, the global clothing giant ZARA officially entered. Tmall 。 This will be the only business channel for the giant outside its own official website. However, in my view, even if there is no "double eleven", Zara will probably join hands with the third party e-commerce platform.

The name of ZARA can hardly be ignored. As the four largest fashion chain in the world, the core of Spanish Inditex group's 9 largest clothing brands, ZARA accounts for nearly 70% of its parent company. Because of its new, fast and small diversity, ZARA has been regarded as a fast fashion company by virtue of its powerful and efficient supply chain. In the past, it has been regarded as the "DELL of clothing industry".

Of course, now it certainly does not want to be associated with the name of DELL.

Inditex has nearly 2000 global stores. As of January this year, there were 457 in China, occupying the top 1/5. Of course, ZARA is also the main force in China. But the embarrassment is that Inditex's sales in China account for only 5% of its total sales.

As you know, China's clothing market is very active. After all, it has a large population and vast territory. However, brand competition is more intense here. Apart from foreign brands, there are more local snakes. That is to say, China with the best market elements is precisely the place where international brands are most scratched.

For example, the channel network, ZARA China has a large number of stores, but the vastness of the characteristics has diluted this advantage. Its sales in China's second tier cities have been successful. But the three or four line market is very bleak. It is said that it has been subsidized by the first-line market. As for the 46 tier market, not to mention it, local brands are hard to effectively cover. Most people in the lower reaches of China do not know who ZARA is.

This is one of the background that ZARA parent company Inditex has tried online channels in the past few years. In order to effectively cover the Chinese market, as early as 2012, ZARA launched online shops in the mainland of China to develop the electricity supplier market and attack small and medium-sized urban consumers without Zara stores. Later, it also planned the electricity business of emerging markets such as Russia.

But, you know, the big brand's official website and its own business channel are often chicken ribs. That year, DELL's own official website was once the largest electronic business platform in the world, but now it is a bit passive, and the electricity supplier system has long been weakened. Apple has been forced to do so, but its official website is an electronic display, and it has been shipped out. Chinese users rarely think of running the official website.

This is because Online retailers Never building a website, calling a call center, finding a few express delivery is so simple, it involves the coordination of the entire supply chain, especially logistics, and of course, follow-up services, that is not blowing.

Many of the big international brands, including ZARA, do not have the capability to build the infrastructure that covers a large market, so that it can be completely transferred. It also worries that the brand, the price system and the quality of service can not be guaranteed.

It is necessary to bow to China's third party e-commerce platform. And now it's really burning. You know, in the last fiscal year, net profit growth of Inditex was less than 1%, which is the worst performance in 5 years. In the first quarter of this year, its revenue grew by 4.3%, but net profit fell 7.3% year-on-year. In the past 3 years, it has maintained double-digit net profit growth.

The announcement was that Citibank lowered its Inditex target price from 130 euros to 120 euros, and lowered its rating from buying to neutral, and ZARA shares fell.

The European market is cold, and the US market is also weak. Coupled with exchange rate losses, Inditex has been very nervous in the past year. It is urgent to bet on China. You see, its competitors, UNIQLO, are crazy about opening stores, and UNIQLO has long been in Tmall.

ZARA Zara.com, a website built in China two years ago, is said to be popular at 10000. To be honest, the tycoons are reluctant to give up the channel system. You know, China has so many stores.

It's really no good not to bow. In fact, before, Zara's goods had already been sold in Tmall and Taobao. In May this year, the monthly sales volume reached about 60000000 yuan. In June, the parent company announced its plan to enter Tmall, saying it was officially settled this autumn.

However, due to the weakness of physical stores, the Chinese market accounts for only 5% of Inditex revenue, accounting for 8% of Zara, which is disproportionate.

Barclays estimated that Zara sales increased 20% annually in the years before joining Tmall. China, the second largest economy in the world, has heard more than the old Americans in terms of purchasing power, and Inditex will continue to weigh it.

It is a must to transfer the interests of the channel and gain the favor of a big market. Inditex CEO Pablo Isla said in September this year that China is of great significance and "Tmall is of great significance to China". In fact, over the past six months, the giant has been constantly rendering information about China's e-commerce platform.

But it's not easy to settle in Tmall. ZARA This is the core advantage of brand and supply chain management. If Tmall didn't have three axes, it would never agree. After all, Tmall has to collect some of its money.

In order to cater for such a big brand like ZARA, Tmall has really spared no expense in the past six months. In April, it announced the strategy of "five strategies". For Tmall, it was mainly about fashion, vertical industry and internationalization. Ma Yun said that to build Tmall into an e-commerce fashion landmark, double eleven things should be done internationally.

Ma Yun said that he had to work hard below. You look at the busy Tmall people in the past half year. By August, it has launched a strengthened version of the fashion strategy, providing the platform business with the overall solution of "brand fashion". By creating a three-dimensional marketing system for fashion media, it will achieve seamless docking between brands and consumers, and create an e-commerce fashion ecosystem.

This is a new feature that distinguishes Tmall from many electronic business platforms. That is to undertake many brands of three-dimensional promotion task. Before long, you can see that Tmall's new trend in autumn and winter in 2014, Tmall will give many brands custom fashion blockbuster, set up special guide shopping, create fashion show, provide consumers with fashion trends and trend of synchronization with the international fashion industry, synchronize with the T brand new products of the whole network, and "watch and buy" services.

Careful people have seen that for two months, Tmall has established cooperation with men's clothing, fashion home, fashion health, food and wine, Baisha jewelry, boutique and so on, and has joined the fashion network and many TV channel boutique columns, such as "China on the tip of the tongue", "where to go to Daddy", "goddess's new clothes", and cross screen presentation.

Prior to that, Tmall even changed money to make a revision of the edition. In order to pull into Burberry, Estee Lauder, ASOS, Muji, ZARA and other international cards, it was really willing to bow. Now, more than 4000 international brands in more than 50 countries have been stationed in Tmall.

This is timely rain for brands like ZARA. You know, the giant has great international influence, but in China, ordinary people do not know much about it. So many people selling clothes, I flat head who cares about you ZARA not ZARA ah. Tmall's plan is to advertise it.

Moreover, if there is no such link, it will be very stressful to expect Tmall to ship simply. You know, the entire Chinese apparel industry is suffering from a stock crisis. In the first half of the year, the stock of clothing listed companies is only about 6000000000 yuan. This means that at least by the end of the year, it will face the price war of digestion and inventory. Without brand promotion, it is still more difficult for ZARA to beat them.

Moreover, the digestion of these stocks is mainly three or four lines or even 46 lines, which is the future focus of ZARA. It's still good in core cities.

As for the impact of UNIQLO, ZARA's pain is probably in my heart.

Of course, there are many platforms for ZARA to choose from, such as Jingdong. However, to say that clothing, Tmall is more cattle. According to Ai Rui's "2014Q2 China online shopping market transaction scale report", Tmall's market share accounted for 57.3%, Q1 grew by nearly 7%, and continued to lead the B2C shopping market. In fact, at present, B2C apparel trade accounts for more than 70%, and new product sales account for more than 60%.

Cooperation with Tmall will not allow ZARA to fall. Tmall and its brothers platform characteristics, very consistent with the ZARA business model, in line with the characteristics of small and diverse. A few days ago, Juhuasuan even launched a special small quantity of multiple platforms. The other side of ZARA will not give up its official website platform. After settling in Tmall, the two sides opened the background, unified shipment and unified price. However, judging from my judgement, ZARA's official website will probably be very exhausting, compared with Tmall.

It is no small matter to miss the Chinese market. According to recent data released by the McKinsey Global Institute, China's online retail sales will reach US $420 billion to $650 billion in 2020, the sum of the US, Japan, Britain, Germany and France.

Before, McKinsey report also said that in the world IGDP, the proportion of Chinese electricity providers was the highest.

Therefore, catching a double eleven is not the reason why ZARA settled in Tmall. This is the inevitable choice.