Talk About Dominance Rule From UNIQLO Shop

I wonder if you have noticed that UNIQLO stores are opening more and more.

Since the end of 2015, the fast fashion industry has been gradually declining.

Competition is also increasingly fierce.

Even in such a depressed market environment, UNIQLO is still expanding on a large scale.

Last year, UNIQLO opened 77 new stores in the mainland of China.

And the return to UNIQLO is a rising reputation.

According to a survey, UNIQLO's "goodwill", "awareness" and "purchase intention" in China all exceed H&M and other competitive brands.

Among them

The layout of Ryui Masa, founder, looks a little bit interesting. When a store opens in a certain area, sales will rise when the number of stores reaches a certain level.

Ryui Masa summed up this experience as "dominance phenomenon".

In fact, this "dominance phenomenon" is not limited to UNIQLO, Internet Co's user growth strategy, new media marketing strategy and other fields have been applied.

This article elaborates on the thinking model behind it.

Recently read the nine wins and defeats of Ryui Masa, founder of UNIQLO. He mentioned the experience of opening up shop in UNIQLO: in a certain area, shops will be concentrated, and when the number of stores reaches a certain number, sales will rise at an instant.

Ryui Masa summed up this experience as "dominance phenomenon".

If you know more about retail sales, you will find this kind of "dominance advantage" phenomenon.

The strategy is quite common.

At least I know that Starbucks and 7-11 convenience stores adopt this strategy.

7-11 Ayabe Yobun, deputy general manager of China, once mentioned in a speech:

We have been insisting on a policy of opening a shop: setting up shop in a certain area.

Whether in Japan or China, they adhere to the policy of high density and centralized shops.

It has many advantages, but the most important advantage is that it can enhance the popularity of chain brands.

After a customer has been there, we can enhance reputation and recognition through customer's word of mouth.

Let's share with you an example: in Tianjin, we covered 80% of the shops within a radius of 5 km, which greatly improved customer awareness.

In view of the universality of this dominance phenomenon in business operations, reading, learning and marketing, I would like to talk about the important thinking model behind it in detail.

The critical mass derived from physics

As early as 1941, Leo Szilard, a physicist, proposed that

If uranium exceeds a certain mass, chain reaction will occur.

The minimum mass of fissile material needed to maintain chain reaction is called critical mass.

Later physicists discovered that the rate of nuclear reaction would increase exponentially with the combination of more mass than "critical mass". Under certain conditions, a nuclear explosion would occur.

The critical mass model has been widely applied in many fields.

People have invoked the term describing the atomic reaction process to describe Silicon Valley and

The rapid rise.

When knowledge technology is accumulated to a certain critical point, the new technology will explode and expand with the fission reaction.

I once mentioned an example of how ice turns into water in an article, and it is also a very vivid interpretation of critical mass.

In addition to physics, this thinking model has many applications in business.

In addition to the retail strategy of retail chain corporation, we can also find its shadow in the early growth strategy of start-up companies.

As one of the founders of Paypal, Peter Thiel has described the early user acquisition methods of Paypal:

If Paypal wants to succeed, we need to attract at least one million of users.

Considering cost, advertising is not an effective way.

The number of pactions with big banks is also constantly sliding, so we decided to adopt the method of paying people to register.

For new users, we award them $10.

Then he / she recommends a new user with a reward of $10.

This approach has brought us hundreds of thousands of new users, enabling us to achieve exponential growth.

Paypal pioneered Internet Co's early "recommended reward" strategy, and later Airbnb, to the recent new world events, was an imitation of this strategy.

Chain retailers use the "critical mass" phenomenon to open their stores mainly because they can significantly increase visibility and recognition after they have reached more than a critical point, thus achieving a leap in sales.

Internet Co's application of "critical mass" model can solve the phenomenon of "chicken eggs or egg chickens" in many Internet platforms.

Taking drops, for example, there are enough users in the initial stage to attract drivers to sign up for APP, but without a large number of drivers, early users would not place orders on the platform.

The typical solution to the problem of "laying hens or laying hens" is to rapidly increase to "critical mass" through subsidies and other ways, so as to achieve two-way growth.

The same phenomenon exists not only in bilateral markets like drops and Airbnb, but also in companies with strong network effects such as Facebook.

According to the famous American fund manager Tren Griffin, Myspace, founded by programmer Anderson in 2003, was once the largest community website in the United States.

At the peak of 2008, Myspace's monthly active users reached 75 million 900 thousand.

But after 2009, Myspace was overtaken by Facebook, which made the miracle of growth after Facebook.

The failure of Myspace is largely due to premature commercialization.

In 2005, when Myspace was bought by news group, it began to commercialize. Until 2009, advertising revenue reached $470 million.

And Zuckerberg has better patience, claiming that Facebook is a cleaner communication tool.

After the social network crossed the critical point of user numbers and built enough moat, Facebook began its commercialization tour.

From critical mass to detonation point

Along with retailers' "dominance dominance", I think you will easily find the significance of the critical mass model to marketing.

Malcolm Gladwell's famous "tipping point" is undoubtedly a further exposition of this model.

Malcolm thinks there is a "tipping point" (or critical point) in social media communication, so long as you find that point and touch lightly, the world will move.

The outbreak of an epidemic requires 3 conditions: the environment in which people pmit infectious agents, the infection itself, and the role of infectious agents.

Similarly, Malcolm's method of detonating products is attributed to three modes: the rules of individual characters, the factors of adhesion and the law of environmental power.

The biggest difference between information dissemination on social media and information dissemination on TV and video sites is that the former is recommended by 1 to 1 users, while the latter is one-way information pmission from 1 to N.

As long as the number of the latter is large enough, it is natural to have the nature of mass communication, but the former must reach the critical point to detonate mass communication.

The dissemination of social media, if we want to reach the critical point, the requirements for the information itself, and the design of the communication mechanism are very strict.

Although there are "viscous" and "tipping point" and other books, trying to summarize the key elements of detonating social media communication (the first book focuses on the summary of the characteristics of the information itself, and the second book focuses on the summary of the communication mechanism), but never heard anyone who actually realized the planned social media detonation according to the theory in the book.

The reason is not that the "critical mass" model has failed, but because of the diversity and complexity of public interest, it is unrealistic to plan to achieve mass detonation of social media.

A feasible direction is what I mentioned in an article focusing on the spread of vertical populations or communities.

Vertical populations / communities often have consistency and interest preferences, and are more likely to find information that they are generally interested in.

The "critical number" needed to detonate the vertical population is far less than detonating the general public population.

Vertical crowd opinion leaders (KOL) are very obvious and easy to discriminate.

There are highly efficient directional communication methods and paths among vertical populations (WeChat / QQ group, community forum, micro-blog...)

)

Based on my own experience, it is very feasible to detonate the vertical population in a planned way.

In addition, in traditional marketing, we often refer to a saying that "marketing is thorough", in essence, is the critical mass model.

This model is a very basic and important thinking model in marketing. Unfortunately, many people often neglect it.

From critical mass to reading learning

"Critical mass" or "dominance dominance phenomenon" can also be widely applied to our usual reading and learning.

For example, a very interesting argument: how many books should a person read in a year?

It was first announced that he could read a book a day and stick to it every day.

This has caused many people's guilt, and many people have refuted this practice.

They think that the amount of reading is not important, and what is important is "understanding the content of books".

It's a good habit to digest the contents of the book and improve your cognition, even if you read a few months.

According to my personal experience of long term reading and learning, these two viewpoints are all phenomena without understanding the "critical mass" model.

We often say that the ultimate goal of reading or learning is "cognitive upgrading".

Cognitive upgrading is often a phenomenon of dominance. If there is not enough extensive reading and experience stimulation, it is difficult to form an effective ruling advantage.

Therefore, if we want to keep improving, we should not only understand every book thoroughly, but also reach the "critical number" in quantity.

Based on this, the best way to read is not to calculate how many books we read, but to calculate how many vertical domains or key problems we have achieved.

So I tend to think that reading 10 books in different fields in one year is inefficient. A more efficient way is to select 3-4 books in every vertical field, so as to ensure that we can achieve "critical quality" in these areas and achieve cognitive upgrading.

I think the ability to find answers to complex problems is probably the most useful occupation and business skill.

In the past experience of finding answers, I found that two models of thinking are very important. One is the "Bayesian model" mentioned in the previous article. It tells us that the first prerequisite for finding answers is that we need to focus on small ones and constantly update our understanding.

Another thinking model is "critical mass", which tells us that only when there is enough meaningful experience and thinking in one field, will the answer emerge.

Finally, you see, from UNIQLO's opening up strategy to the principles behind the nuclear reaction and Internet Co's user growth strategy, to the strategy of new media marketing and the way to find answers to complex questions, all start with a simple thinking model.

What an interesting connection it is.