Why Do We Need To Design Such A Value Curve?

According to the world clothing and shoe net, recently, there is a very hot business case.

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In a short span of 3 years, a chain store has opened 1800 stores worldwide, opening 80-100 stores a month, with an annual sales volume of nearly 10 billion yuan.

In this era of real economy recession and electricity supplier's surging Internet era, this speed is particularly striking.

With the bright sales support, Ye Guofu, the name creation boss, has been making frequent calls on Ma Yun, severely criticized Ali's platform mode.

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Interestingly, he also wrapped up the front page of the twenty-first Century economic report, making fun of Ma Yun and Wang Jianlin's one hundred million pairs of gamble, saying that Ma Yun could give Ma Yun one hundred million Wang Jianlin's eyeballs as long as he concede defeat.

Every bird will attract two positive and negative people.

People who are interested in fame and fortune are regarded as Xiaomi millet, ZARA+ UNIQLO, and retail innovation under consumption upgrading. People who are not optimistic about it are mocking it as a copycat version of Muji, and plagiarizing their brand designs without sustainability.

In fact, these statements are not entirely true.

Business is like an iceberg. What the public sees is more than a small part of the water, which can not see most of the surface, so it often leads to ineffective conclusions such as "good products" or "very Marketing".

Therefore, if you want to make a reliable business analysis, you must have a scientific way of thinking. Today, business leaders are based on the key elements of the business model. From the angles of positioning, value curve, value chain, profit mode, cost structure, etc., we will anatomize the famous products.

Positioning of No.1 products

First of all, we need to think about the positioning of famous brand products, that is, what kind of people it faces and what value (products and services) do they provide?

The main selling products are small products such as cosmetics, trinkets, snacks, bags, living appliances, small electronic products and so on.

It is not hard to find that the core group targeted by celebrity is "young women in the second tier cities, mainly white collar and college students, and relatively few men". The core position is women, just needs, fast food and small department stores.

This choice alone has great learning.

Living small department stores are a very unique collection.

Just imagine, if you want to buy an umbrella now, or a mouthwash cup, or a pillow, where do you want to buy it? You need to wait on the Internet and not to mention it. The freight may be more expensive than the commodity itself. To buy it in the supermarket, you may have to find it for a long time to buy this item, and the commodity is not personalized enough. The key point is to have a long queue to settle accounts, to buy convenience stores, and finally you find that many small items are not necessarily available in convenience stores, and the price is not cheap.

What famous and excellent products do is to aggregate these long tail products.

So, after work, I bought a cup and went to Shopping Mall on weekends.

It's easy to happen when you go to the name, buy and buy the foundation and so on.

Do you understand this? The business area of the small commodities chosen by name Chuang effectively evaded the Red Sea competition of e-commerce and other retail forms, which is a very unique field.

So you have to say that in business, choice is more important than hard work. If you choose a business with small scale, lack of growth, profit margins and low repeat rate, you will soon hit the ceiling. Although you can be small and beautiful, you have to admit that you can do more with the same strength.

No.2 value curve analysis

We have analyzed the positioning of name creation, and let us look at its value curve.

The so-called value curve, that is to say, what kind of value created by name creation can be understood as: what is the consumer's perception of name creation?

Some people may say: "the famous brand product is not the upgraded version of the 10 yuan store."

But in fact, the value curve of the name creation is very different from that of the general 10 yuan store.

To sum up briefly, Chuang Chuang has the following outstanding features: low price, Japanese import, strong sense of commodity design, beautifully packaged, rich variety of goods, new fast pace, high fashion decoration, location in business center, self-help shopping, etc.

Next, we will analyze the reason why we should design such a value curve.

Low price

In the name of excellent products, 10 yuan of commodities are everywhere, the highest is dozens of pieces, basically can not see more than 100 pieces.

There are two advantages of low price: the first is to reduce competition.

You know, the electricity supplier can sweep the physical retail, the low price is a special key factor, "the more the target product, the more thoroughly the subversive", the low price of the famous brand, the positive PK of the electricity supplier. The second advantage is that it can radiate enough large groups to stimulate sales.

Japan imports, commodity value, high price decoration

But there are drawbacks to low prices. "One cent, one share" is a typical consumer psychology. The low price of famous and creative products is very easy for consumers to produce low quality goods. How can they avoid it?

Ye Guofu, a famous boss, is very clever enough to register her company in Japan. She will write Japanese on the top of the product, and even put the "Japanese import, low quality" as her core selling point directly on the shelf.

At home, the public is generally fond of Japanese products. In this way, name creation has also laid a good impression on consumers' minds.

In order to strengthen this impression, the official information of the name Chuang is always intended to praise a Japanese designer named Miyake Jun, who is also known as the founder of the concept.

As a matter of fact, the insiders know that most of the products created by the name are produced in China, which is intended to be packaged.

In addition, by creating a designer team and imitating the design of the international brand, the name creates a strong sense of design and beautifully packaged products, which also gives people a sense of quality.

Apart from the strong sense of commodity design, shop decoration is also very important, especially now consumers have a wide choice. If the shop is ugly, there is no desire to stroll.

The strategy of name creation is small storefront and fine decoration. The average area is about 200 square meters, and the decoration cost can be as high as 400 thousand.

Rich category, new fast

The SKU of name creation is around 3000, which ensures the frequency of consumers coming to stores through enough merchandise.

In addition, name creation is also being launched quickly, and almost every week there are new products on the line.

We can try to understand that storefront is a product, goods are content, content is only rich enough and constantly updated, users will be happy to use products (shop), only to retain (repeat purchase).

Located in a shopping center with large traffic volume.

Location selection is extremely important. Location means traffic. Let's take a look at the location strategy of name creation.

In order to reduce costs, the general 10 yuan store will be opened in the street and other unconspicuous places. This is in line with their value chain.

However, instead of saving money, the famous brand creates the best products. Instead, it tries hard to lay out the core area of a second tier city, and usually chooses shopping centers, subway outlets, busy commercial streets and other places where traffic is very high.

Although the rent is high, there are many advantages. First, we can get large traffic to increase sales, and then we can enhance the brand image and save a large amount of marketing expenses.

In fact, this game ZARA and UNIQLO have long been familiar with them. They never spend money on advertising, but spend money on site selection and decoration, because they know that the monopoly of the flow of heights, plus store packaging, is the best advertisement.

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Self help shopping

Next, let's look at the service.

Name creation learning is a big name, highly praised self-service shopping, stores do not set up salesmen, only cashiers and ready to pick up the shelves of the waiter, you only need to serve, they will serve you.

The advantage of doing this is to create a relaxed shopping sense. On the other hand, it saves manpower costs. It is necessary to know that a lot of shopping guide shops can make up 10% of the sales cost.

Well, these are the most prominent points of user perception on the value curve.

Recently, we have always talked about consumption upgrading. In fact, consumption upgrading is essentially an upgrading of consumer attitudes, not just expensive ones.

Consumers are very emotional when judging whether your product is good or not. The design, packaging, store decoration, location, or even imported products will affect consumers' perception.

Consumers will not dig deep into the background of celebrity creation, nor will we study them carefully like we do. They will only feel that this is a Japanese fashion department store, which is cheap and quality, and they can go in without any trouble, which has created a hot name.

Business monk has visited a large number of community forums, and has studied the feedback from people to name creation. It has been found that most of them are relatively reliable. Of course, many consumers feel that some of the products created by the name are very Shanzhai, and are similar to many big brands.

On the quality of goods, electronic products are more than Tucao, and other commodities are better.

On the whole, the value curve of name creation is well suited to people's shopping habits nowadays, which is why it can become popular quickly.

NO.3 value chain analysis

So the problem is, in order to achieve such a value curve, how can we design its supply chain, terminal control, franchise strategy, operation system and brand marketing? This is the value chain we often talk about.

Scale purchase and go to middlemen

The first is how to ensure the quality of goods while low prices.

Knowledgeable people know that the vast majority of high quality Japanese goods and Korean goods we see are actually produced by Chinese foreign trade suppliers. However, domestic companies have poor reputation and high risk of cooperation.

The name Chuang is registered as a Japanese company. In addition to upgrading the brand to the C end, the supply chain also has the advantage of being able to connect to the high quality suppliers and achieve good cooperation with them, which is also the guarantee of the quality of the products.

Specifically, name Chuang finds high-quality manufacturers, directly manufacturers purchase, remove middlemen, and then through large-scale buyout, shortening settlement accounts and other policies, improves bargaining power, suppliers willing to lower prices, provides low-cost support for low price strategy, and at the same time achieves low price and high quality.

Monitoring data, rapid adjustment

The supplier's problem is solved, but how can you ensure that the product you sell is what the consumer needs, and how to ensure that it can be renewed every week to stimulate consumers to frequent the shopping?

As we mentioned before, the SKU of name creation is maintained at around 3000, and what commodity to sell depends on the changing needs of consumers.

The famous designer team will pay attention to the dynamic sales data and network data of the store for a long time.

Not long ago, the merchant noticed that a headphone sales volume on Jingdong was growing rapidly. I did not expect to see a similar headset after a few days in the name of the product. In order to ensure fast and low cost, the imitation of the design was easy to understand.

The important thing is that, because there are 1800 stores in name creation, it is possible to develop a flexible pfer mode. For example, the cups in the A area are not well sold, while the cups in the B area are sold out, and the cups in the A area are immediately pferred to improve the turnover speed.

In the final analysis, we must design our own business models to adapt to the rapidly changing needs.

LP join, fast replication

Let's see again, in the name of 3 years, we can open 1800 stores. Such a high turnover rate of capital must be developed. We want to respond quickly to the needs of consumers, and we need to firmly control the terminals. This leads to the unique policy of joining the name.

Similar to the LP mode, franchisees pay money, but do not participate in day-to-day operation. Store personnel management and daily operation, name creation must be firmly controlled, so that 1800 stores can be made into a network, so as to monitor data and adjust flexibly.

On the franchising policy, franchisees need to pay 150 thousand of the brand usage, 750 thousand of the goods margin, plus decoration fees, store rentals, personnel salaries, water and electricity industry and commerce, etc., and generally invest about 2 million, the threshold can be very high.

In terms of distribution, 38% of the daily turnover (food is 33%) is the income of the franchisee, and the cash is now tied up.

In the background of the winter in the store, the name of the shop was very beautiful, and attracted many investment franchisees with store resources and funds.

Attacking giants and borrowing marketing

Let's take a look at the brand promotion. The early name creation is actually quite low-key. After the data is getting better and better, the boss of the name creation starts to appear frequently in the major financial programs and industry activities, and publicize the idea and mode of name creation.

In order to have more topics, Ye Guofu often refute the mainstream view and attack the electric giant.

Small companies bite big companies to take advantage of marketing. In fact, it is a common practice. In this period, the biggest purpose of name creation marketing is to strengthen the influence on franchisees and make them make decisions.

Starting in 2016, we can clearly feel that the name Chuang has begun to exert its efforts on consumer marketing, frequent media distribution, advertising implants, and celebrity promotion. Its WeChat platform has also surrounded fans around 20 million through the way of sweeping code to send shopping bags. However, in the marketing of C terminals, the name creation is not in place yet, and it is more self selling and outdated.

IT system

We talked about so many top end products design, some people will be very smart to realize that such a rapid expansion speed, management is definitely a big problem. In fact, there is a strong IT system behind the name creation.

From the market research, product development, logistics and distribution, merchandise inventory management, store planning, sales data analysis, marketing planning and other links, we must rely on this IT system for management. For this reason, we are also spending tens of millions on IT.

NO.4 profit analysis

The game of name creation has been approved by consumers, but the price of goods is so low and the cost is very high. Can we make money? In fact, the profit model of Ming Chuang is hidden in mystery.

The first is economies of scale. In every specific category, name creation selects the most likely products to be sold. The products are of high value, good quality and low price, and sales are easy to go up.

Ming Chuang, through large-scale opening shop, pushed the explosive products to scale up. For example, an eyebrow pencil is an explosive product, and it is said that it has sold one hundred million.

Doing business is either low frequency or high price. Since it is a low price, we must try to improve the frequency of purchase and form a good replacement purchase.

Ming Chuang is also very concerned about this.

First of all, SKU keeps at around 3000, and the rich commodity category enhances the probability of customers going to the store. Besides, 2-3 new products are launched every week to maintain frequent updates to stimulate you to frequent fresh visits; besides, the sale itself has the nature of re purchasing products, such as cosmetics and snacks, which will put the goods in the conspicuous position of the door to let them play the role of traffic products.

Finally, another factor is easy to be ignored, that is, price elasticity of demand, and the price elasticity of demand for small department stores is large. When prices are low enough, you may buy more goods that you didn't want to buy. The name may be the lowest price in the shopping center, which can give you enough security and release people's shopping desire, so you can easily buy and buy and think that you have taken advantage of it.

Economies of scale, high frequency consumption, and price elasticity of demand have naturally made the flow of name creation beautiful.

In addition, we must not forget that the brand name and franchisee's franchise cost and goods guarantee money are not too small. Many friends who analyze the names often ignore this point.

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NO.5 cost analysis

Analyzing the problem of profit, let's look at its cost structure again.

If you join the calculation, you will find that many risks are passed on to franchisees. The remaining cost is mainly focused on R & D, inventory logistics and company labor costs (not shop staff).

In design and development, although it has its own designer team, many products actually have obvious Shanzhai traces, which also reduce the design cost to some extent.

In addition, terminal stores sell fast and increase the mode of goods, resulting in very short turnover time. It is said that there is only 21 days, which reduces the cost of inventory.

So the whole value chain has been organized, although the name Chuang has opened 1800 stores, but in fact it is not a heavy asset, which is also the reason for its rapid expansion.

NO.6 team analysis

Any business mode will eventually come down to the organizational structure, so we need to talk about "people".

First of all, founder Ye Guofu, he is not the first time to do retail.

In fact, he is the founder of "ah Ya", and it is interesting to mention this "ah Ya". The category and name creation are somewhat similar. They are all the business of young women, but the main shops are in the two or three line cities, and the core mode is also the traditional way to join them.

It's not hard to imagine that Ye Guofu has been doing such a long time of small department store, women's business, watching the change of consumption upgrading and the popularity of the electricity supplier, and the ceiling of the past. He must have thought about it for a long time, and have gone around the world for a long time before he thought about how to create this model.

In fact, the development team of the name creation company is a lot of local employees. In other words, it is a team with many years of practical experience in the small commodity market.

What is even more interesting is that the Zeeman holdings, founded by Ye Guofu and the BBP company of Korea, jointly launched the upgraded version of ah ya, which is exactly the same as the name creation.

NO.7 finally, let's talk about two issues that we all care about.

How long can the name creation mode last?

The birth and development of any company can not be divorced from this era.

The name creation mode can make achievements, but there are many factors behind consumption upgrading, traditional retail development bottlenecks, Internet business squeeze, private capital flows and so on.

For the famous Chuang Chuang, the good reason is that people care more and more about the quality of life, and all kinds of small objects will start to grow.

At the same time, consumers care more about the quality of products, the value of their faces, and more about shopping experience, store environment, service, brand and so on. This is the reason for its rapid rise.

Of course, there are challenges in the name creation mode.

In terms of the sustainability of business, to ensure the long-term health of store sales data, we must ensure consumers' purchase frequency and customer orders. Most of the small commodities are durable goods, and the rate of repeat purchase is very low. The sudden emergence of famous and excellent products has led to the release of consumers' demand in the short term. But how many people can buy and buy after buying and buying, and the categories with high consumption frequency, such as cosmetics and snack drinks, need to resist competition from other brands and other channels. This is not based on low prices.

Taking Wudaokou as an example, we have opened three stores in the 100 meter range, as the center of the universe. There are many colleges and universities around Wudaokou. The population is large, the population is close and the demand is strong. And there is another very very important factor, that is, the large population mobility. In other words, every year, students will have a new wave.

However, places like this are limited. If a certain store has a relatively stable population and is released after the demand is released in the short term, it is worth considering how to ensure that sales can not last for a long time.

Therefore, those who feel that they want to join immediately will pay attention to whether they can make money or analyze their geographical location, radiation crowd, purchasing power, competitive environment and so on.

According to the plan of name creation, by 2020, there are 6000 stores in the world, and the revenue has exceeded 60 billion. If you calculate carefully, you will find that its growth rate is decreasing, and 60 billion means that the annual revenue of each store will reach 10 million, and the daily water flow will reach nearly 28 thousand. This figure is much higher than the average sales of the average daily sales of a single store. It is also the name of Chuang Chuang that puts the perspective of expansion globally. It claims that half of the businesses in the future will be abroad. At the same time, Sai man group is also actively distributing financial related businesses.

Can the name creation mode be duplicated?

In fact, it never replicated in shopping malls.

Because objectively, there will be industrial differences, category differences, group differences, geographical differences and so on.

The inspiration of name creation lies in the selection of business areas, closely following the needs of consumers, and creating a distinctive value curve. From the design of products and supply chain management, a chain is integrated to make design, cost performance and shopping experience in place.

But if you think about it, if you want to do retail, don't you have to think about it? So there's no secret about it.

Finally, let's make a conclusion.

A company, however, is able to make achievements. It must match the business elements reasonably into a unique business system. This system can create differentiated user value and considerable profit return at the same time.

And this is the essence of business.

More interesting reports, please pay attention to the world clothing shoes and hats net.