Is The "Anti Brand" Strategy Ineffective? MUJI Sales In China Are "Cold"

Recently,

The second quarter earnings report released by the parent company's good plan shows that the three performance data of the company's operating income, operating profit and net profit during the period all showed signs of a decline.

According to the regional perspective, the Chinese market has declined for the first time in comparison with the sales, with a drop of 2.2%, which also caused the company's China.

Half a year's performance was sluggish, and revenue dropped slightly by 0.2%.

1 more problems, more difficult to sell after the black list

MUJI's poor performance in the Chinese market is closely related to the brand's reputation and image decline in recent years.

Especially in recent two years, there have been several incidents of "low brush" Chinese consumer sentiment.

In March 15, 2017, Muji was exposed by CCTV 3. 15 evening party. In the Muji shop, some Chinese food labels on Japanese food were labeled with Japanese labels. But when the Chinese label was opened, the real origin of these products was revealed in Tokyo, which is suspected to be from Japan's nuclear radiation area.

In January 29, 2018, according to Xinhua news agency, the first batch of 8 typical cases investigated and dealt with in the special coverage of "problem map", which was reported by the State Bureau of surveying, mapping and geographically information, was published in the "Muji" shop. "The problem map" was listed in the column: there was a problem in the map of the autumn and winter furniture catalogue published by Muji shops in 2017.

According to the investigation, the map has no map number, there is a boundary of the wrong painting country, and the important islands such as Diaoyu Island, Chek tau island and the South China Sea Islands are omitted. Hainan Island and mainland are different colors, and Taiwan island is seriously wrong.

Before March 15, 2018, a number of consumers reported to our newspaper that MUJI products such as cups, cosmetics boxes and so on were not labelling, could not see the place of origin, material and usage, and the children who had broken their cups were scratched.

In addition, there are several MUJI products in the sale of electronic products, in the Chinese market did not carry out maintenance services, "products in a year can only be thrown away", many consumers are disappointed with the lack of after-sales service.

In September 21, 2018, the commodity branch of the Beijing branch of the Haidian Bureau of industry and Commerce carried out the sampling inspection of MUJI products, but failed to get the active cooperation of Muji workers.

In fact, although Muji has been declining in the same stores in the domestic market, it has started to decline since the beginning of this season. But in terms of its growth rate, it has started to decline in the Chinese market since 2017. In 2017 Q2 to 2018 Q2, its quarterly growth rate in the Chinese market was 22.6%, 21.2%, 18.3%, 14.8% and 10.4%, respectively.

The 9 price reduction in 24 years failed to promote growth effectively

Looking back, we can see that Muji has bottlenecks in the Chinese market and may not be related to price factors.

Since October 2014, Muji has launched the "new pricing" strategy in China, and its price reduction frequency has basically reached two times a year.

In the past August, Muji announced its ninth price cut, with an average price reduction of 20%, reaching a maximum of 40%.

However, we can see from the sales growth in recent years that these price reduction strategies have not significantly stimulated sales growth.

In fact, the concept of "anti brand" and "no label" advocated by Muji is contrary to the trend of consumption upgrading in the past two years. The dull, unmarked MUJI products have been dubbed "consumer demotion" by many netizens.

Looking back at the history of Muji, we can see that this "joke" is not entirely without foundation.

"Muji" (MUJI) is a Japanese grocery brand.

The "literal plation" of "MUJI" means "quality goods without trademarks", which reflects the initial setting of this brand. In 80s, Japan's economy declined and consumption was low. People expect more low-priced products in addition to the quality of products.

Against this background, Kinouchi Masao, founder of "Muji" company, put forward the concept of "anti brand (also known as no brand"), and founded the "Muji" company. The propaganda will provide a good product with a simpler packaging, a trademark removed, and an unnecessary design.

This concept greatly caters to the psychological needs of consumers at that time and also makes the MUJI products a great success in business.

But the development path of the brand in China is quite different from that in Japan.

In 2005, after Muji has entered China, it has been regarded as the lifestyle brand of "urban middle class" and "Wen Qing youth". Therefore, when it was sold in Japan, it had the advantage of "value for money" and high cost performance. In Chinese stores, it is hard to see that clothes that are quite different from those of fast fashion brands, and hundreds of thousands of household items are really difficult to link Muji with "affordable" and "low price".

3, the number of stores in China is less than that of famous brands.

The slow development of Muji in the Chinese market is also reflected in its opening rate.

By the end of August, Muji had 235 stores in China, with a net increase of 6 stores, including 8 new outlets and 2 closes.

This expansion is really "turtle speed". We must know that the same is from the fast fashion brand UNIQLO of Japan. The statistics of the first half of 2018 alone have opened 32 new stores in the mainland of China, which still do not contain data for re opening the stores due to upgrading digitalization.

The more notable data contrast comes from its chasing people. The newly opened store data, which has just announced the success of 1 billion yuan financing, shows that the scale of its domestic stores has reached 2000, because the number of specific stores has changed every day, and the average monthly quality of famous products is 1/8.

Cheng Weixiong, general manager of shoes and clothing industry and Shanghai Liang Qi Brand Management Co., Ltd. pointed out that Muji has been positioned as a "high-end brand" in the domestic market for a long time. But in fact, in Japan, it is a "cheap grocery store". The early position is too high, so that Muji can not sink to more opportunities, and the market of small and medium-sized cities that is worth excavating can only stay in the big cities such as North, Guangzhou and Shenzhen.

As we all know, in the context of the double trend of consumption upgrading and new retail, the market of the two or three line cities actually contains great opportunities for a "cheap grocery store" as the main form.

In other words, if we can not get a certain share from it, it often means that development is difficult to sustain.