Daphne Changes Route Investment Variety To Save Losses

In recent times, Daphne has failed to save 827 losses by turning off its stores.

The recent change of route, through the investment of variety shows to save losses, is such a measure wrong?

Nowadays entertainment programs are in an unprecedented hot period. Daphne's investment is good for brand promotion, but it is different from simple advertising.

Fang and trader side, the audience ratings, advertising revenue and program quality together determine whether Daphne's "layman" entertainment path can go a long way.

Investment Reality Show

Recently, Zhejiang satellite TV has launched a new variety show, the bee girl team. This is a women's group music development reality show. Nicky Wu and Nicholas Tse are the two major coaches to train new people. The winners will be given the opportunity to sign their debut.

In addition to the two popular "male gods" to join, the program also attracted the participation of Daphne, a public shoe king. It is worth mentioning that in the video website playback version of the program, in addition to the Daphne brand name, a listed company announcement of Daphne footwear disclosed a closer relationship between Daphne and the show.

The announcement by Daphne said that the cooperation between Duff Nie's Daphne investment and Zhejiang satellite TV and Hyun Feng signed a TV program "bee girl team".

The producers of "bee girl team" are Zhejiang TV, Daphne investment and dazzle front three parties. The parties agree to make the TV program of the bee girl team for broadcast on Zhejiang TV channel.

The announcement shows that Daphne investment and Hyun Feng are responsible for all the production, shooting, publicity and other expenses of the program. The total amount is 180 million yuan, of which Daphne invest 30%, but not more than 54 million yuan. The amount of investment from Hyun Feng is 70% of the total investment, that is 126 million yuan.

The investment in TV program production is Daphne's total investment of not less than 54 million yuan, but according to Daphne's 2015 performance report, the company's equity holders should account for HK $378 million 900 thousand, and the investment of 54 million yuan is indeed a small expenditure for Daphne.

It is also worth mentioning that Chen Yingjie, a partner with Daphne, is inextricably linked to it. The company is indirectly holding more than 30% of intermediate holding company's chairman of the board through the intermediate holding company.

It is understood that Xuan Feng is a cultural media company founded in September 30, 2015. Its main business is designing and producing various kinds of advertisements; literary and artistic creation and performance; performing venues management; enterprise image design, computer graphic design; photography service; technical consultation, technical services, entertainment information in computer professional field; ticket agent for literary and artistic performances.

Losses for the first time in nearly ten years

Daphne, who sells shoes, is a new career in TV programming.

In this way, the interpretations of the people in the industry focus on the diversification and reversal of the decline.

Daphne's latest report shows that turnover in 2015 was HK $8 billion 379 million, a decrease of 19.1% compared to the same period last year, and the loss of company holders should be HK $379 million.

The author then searched Daphne's earnings reports for the past three years, and found that the profits of the company's equity holders had fallen sharply for 65.6% years to 329 million 100 thousand Hong Kong dollars in 2013, down 46.5% to HK $176 million in 2014.

By 2015, the company's equity holders should take profits from positive to loss, which is Daphne's first loss in nearly ten years.

With the loss of net profit, Daphne is a big shop.

Daphne reported that last year, the number of online stores in Daphne group exceeded the total in the first three quarters, reaching 405, and the whole group closed 827 stores altogether.

As of December 31, 2015, Daphne group had 5597 core brand sales outlets, including 5056 direct outlets and 541 franchised stores, accounting for less than 10% of its affiliate stores.

In the early days of Daphne, the proportion of franchisees was about 80%.

It is one of Daphne's strategies to join in and fight for direct camp.

According to the insiders, Daphne's closure of franchised stores in the main business downturn is intended to unify the channels and reduce the cost of circulation, thereby increasing revenues and profits.

However, judging from the current performance of Daphne, the battle for direct closure of a large number of franchisees did not let the performance get warmer.

In fact, the decline of Daphne's performance is related to its own business strategy, but it does not exclude the impact of the slump in women's shoes industry.

In the past 2015, women's shoes enterprises were having a bad time.

The 2015 performance report released on Saturday showed that the company achieved operating income of 1 billion 619 million yuan during the period, down 7.94% compared to the same period last year, and net profit was 24 million 550 thousand yuan, down 31.72% from the same period last year.

As the largest shoe retailer in China, BELLE also issued a profit warning. It is estimated that the net profit of BELLE 2015/16 will be reduced by 35%-45% over the 4 billion 763 million 900 thousand yuan of 2014/15 fiscal year.

Return on investment is still hard to guarantee.

When shoes are becoming more and more difficult to sell, companies are beginning to find another way out.

Regarding the investment in TV program production, Daphne said that through TV programs, it is committed to optimizing, strengthening and diversifying the marketing activities of the company and promoting its brand image to enhance its competitiveness.

The industry also believes that Daphne's move is to make use of hot entertainment programs to improve the company's brand promotion, while diversifying investment, the purpose is to reverse the decline of performance.

Zhang Qing, a clothing industry expert, believes that from an investment perspective, Daphne has straddled a new industry from women's shoes to a new challenge to operations and management.

However, investment in TV program production may be another attempt of Daphne brand promotion. Daphne has promoted through celebrity endorsement. From the perspective of consumer acceptance, the way of celebrity endorsement is obviously better than the promotion of reality TV shows.

Compared with other shoe brands, Daphne seems to be more keen on brand promotion through celebrity endorsements.

Through the good voice of China, gatto passed through the difficult period of renaming, and the products were popular through the program naming. Daphne also wanted to make use of this trend. It is understandable that the reality shows are becoming more and more popular.

It is understood that the "bee maiden team" second stage audience rating is only 0.655%, compared with the first phase 0.748% compared with the decline, in March 12, 2016 at the same time, the provincial TV program ratings ranked only tenth, "happy camp", "beautiful sister", "Na so" ratings were 2.201%, 1.28%, 1.032%, all ranked before the "bee girl team" before.

"For TV programs, ratings directly determine the influence of programs and advertisers' brand publicity benefits."

Insiders said.

Of course, besides the effect of brand promotion, the earnings of TV programs are also coveted by the program production team.

Public information shows that when the "good voice of China" was broadcast in the second quarter, the advertising cost was as high as 1 billion yuan, while the "running brother" was broadcast in the first episode of the third season, and the bidding amount of the fourth season, including naming fees, had been completed by 1 billion 336 million yuan.

At present, the advertising revenue of the bee girl team is unknown, but the program has been named by CHCEDO.

"TV programs are not a big investment.

The competition between the quality and the program at the same time determines the success or failure of the program. Therefore, there is still a lot of uncertainty about whether the investor and the advertiser Daphne can achieve the expectation, and from the current performance, the competition is fierce.

People in the industry are judging.

The author also sent some interview questions to Daphne on program viewing, advertising revenue and other related issues.