There Are Six Reasons Behind The Continued Rapid Growth Of UNIQLO China.

The fast selling group of UNIQLO parent company announced its first half financial results in 2019, and its turnover increased by 80 billion 900 million yen in half a year, with a turnover of 1 trillion 267 billion 600 million yen (an increase of 6.8% over the same period), operating profit of 172 billion 900 million yen (up 1.4% over the same period), and net profit of 114 billion yen (9.5% growth over the previous year), a record high.

The sales of overseas business of UNIQLO increased by 72 billion 500 million yen to 580 billion yen (up 14.3% over the same period last year), and the domestic business of UNIQLO was reduced by 2 billion 300 million yen to 491 billion 300 million yen (0.5% lower than last year) due to the warm winter, and GU increased by 11 billion 300 million yen to 117 billion 100 million yen (10.7% growth over the same period).

Among them, UNIQLO overseas business achieved a profit of 88 billion 400 million yen (an increase of 9.6%) over the past six months, with an additional sales of 72 billion 500 million yen. Driven by the strong performance of the Chinese mainland market, the Greater China region has become the main driving force for the growth of overseas performance.

By the end of February, there were 673 stores in mainland China, 28 stores in Hong Kong and Macao, 67 stores in Taiwan, and 768 stores in Greater China.

The first half sales and operating revenue of UNIQLO showed a two digit growth. By the end of August 2019, the sales volume of UNIQLO will reach 500 billion yen in the whole fiscal year, and its operating income will reach 85 billion yen.

In addition, the development of e-commerce in UNIQLO China has been rapid, and the ratio of electricity suppliers has reached 20%.

On April 11th, at the financial press conference held in Tokyo, Mr. Ryui Masa, chairman and CEO of Xun marketing group and Okazaki Ken, chief financial officer, attended the group. Senior executive director of the group and Pan Ning, chief executive of UNIQLO China, summed up the six major reasons for the sustained growth of the Greater China region and the potential for future development.

1. UNIQLO LifeWear suits the success of life brand building

UNIQLO China has become a typical representative of cross industry brand new retail practice and innovation in the past few years. With the help of LifeWear service life brand value construction, product service optimization based on consumer insight and technology upgrading, online and offline digital experience innovation, UNIQLO has been highly recognized and loved by the Chinese market and consumers. It won the first place in many Chinese brands ranking list in 2018. LifeWear's life satisfaction brand concept is deeply rooted in the hearts of the people. At the same time, the media is rated as high quality and high added value daily wear, and the average purchase rate of customers and shops is significantly improved.

CAMPAIGN ASIA-PACIFIC magazine was selected as the "2018 China brand".

For 7 consecutive years, it won the title of cross brand "gold lettered signboard".

In the 4 consecutive year, it won the first prize of "China famous mass brand digital marketing value ranking" selected by Internet Weekly magazine.

2. expansion and evolution of digital marketing of UNIQLO brand

As the first overseas market of UNIQLO, the Greater China region is an area where digital pformation has been carried out earlier and deeper.

The digital pformation of UNIQLO has made more localization attempts here.

In 2014, the management of the Greater China region noticed the trend of China Mobile Internet's rapid development. Both in terms of media delivery, digital content innovation, and brand and consumer communication platform construction, the trend of mobile Internet was changing.

UNIQLO started building digital marketing teams since 2014, and has been operating on media platforms such as WeChat, micro-blog, nice and other social platforms.

By actively spreading new products and launching new activities on social media, it has made great contributions to attracting customers.

Especially in mainland China, marketing activities on social platforms such as WeChat and micro-blog have greatly increased the number of young customers and new customers of potential customers in the future.

For example, through the use of KOL, which has a great impact on the fashion industry and ordinary consumers, the product publicity (i.e. mainstream public opinion leaders = the so-called "influencers"), its fans see the information pmitted on the KOL, buy products, and spontaneously share the information and fashion dress of the two UGC shares, making the marketing effect further improved.

After nearly 5 years of operation, the number of fans of UNIQLO's digital platform has exceeded 100 million, with an average monthly reading of nearly 100 million people.

3. UNIQLO has a reasonable aesthetic consciousness and cost-effective products quality and value, it is difficult to be imitated by other companies.

Practicality + functionality + design sense = the ultimate experience of UNIQLO brand products.

Under the philosophy of LifeWear's life, UNIQLO's brand mission is to create comfortable and quality daily clothes and enrich people's lives.

UNIQLO's pursuit is to provide consumers with high quality, high functionality and fashion design daily necessities, at a price that everyone can afford to make life better.

Product upgrading based on technological innovation has always been the core of UNIQLO's persistence and the best way to achieve quality replication.

The Fleece fleece, which has been popular around the world since the birth of 1999, enables people to buy high-quality and comfortable clothing at a reasonable price. By 2003, the HEATTECH warm underwear series, which has sold more than 1 billion pieces in 15 years, has been redefined in 2003. It has redefined the warm experience in winter. It has become the classic "exploding money", which has changed the general knowledge of people's wear and clothing. The core function product of UNIQLO based on fabric innovation and technology upgrading is becoming an indispensable product in the daily life of Chinese consumers. It has become a classic "exploding money" that changes people's dressing knowledge.

In addition, the integration of cultural creativity and fashion design is the key to the upgrading of UNIQLO products and the added value that is difficult to be imitated for quality.

From Japan's comics, cartoon characters, floating world paintings, the cooperation of global enterprises, the works of international top artists, UNIQLO "UT" has always been a popular commodity among young people.

4. success of expansion strategy of UNIQLO stores

UNIQLO's current stores are mainly concentrated in the first tier cities with strong purchasing power and strong pmission power (north to Guangzhou Shenzhen), which account for about 30% of the number of stores in mainland China. Meanwhile, UNIQLO has adopted a positive store expansion strategy in two or three tier cities, and has grown together with two or three cities with high growth potential.

UNIQLO opens 80-100 new stores in China every year. The number of stores in the Greater China region is expected to exceed 1000 in 2021.

In addition to ensuring the growth of new stores, UNIQLO is also concerned about how to manage every store carefully to increase profits and ensure that stores are in a steady state of profitability.

5. UNIQLO digital retail experience Innovation: to open up online and offline inventory of goods, deepen the expansion of e-commerce business

In 2017, Liu Jing, chairman of fast selling group (UNIQLO parent company), put forward a "bright plan" at the shareholders' meeting, announcing the pformation of UNIQLO to "digital consumer retail companies", that is, importing digitalization from design, production, manufacture, sale to full staff through cooperation with technology companies.

China as the representative of Greater China as the first overseas market of UNIQLO, the electricity business is very developed. In the first half of the year, the proportion of Chinese electricity supplier sales was about 20%, an increase of 30% over the same period last year, and the planned sales accounted for more than 30% in the fiscal year August 2021.

Faced with the changing technology and consumer demand in the digital age, UNIQLO China enables consumers to have a better retail service experience through more digital means.

In November 2018, UNIQLO launched its flagship flagship store to open up online and offline commodity information, inventory, service and purchase, and integrate offline stores and online stores.

Offline stores as well as e-commerce warehouses, better solve online shopping pain points: online and offline access, UNIQLO stores will have the function of the electricity supplier warehouse, store orders at the same time, effectively carry out business to ensure that customers purchase products can be delivered quickly; in addition, consumers buy goods, store direct delivery can be delivered 1 hours after the order.

While the spot picking service provides convenience to consumers during the Chinese new year or business trip.

Store personalized value-added service, so that consumers can not change the size and color of the product when they try to try the goods on the spot. They can also modify the trousers length free of charge.

Online entrance diversity, service experience richer: online, UNIQLO continues to optimize content, palm flagship store launched the "heart to ride" function to provide consumers with different occasions of clothing recommendation, to solve the problem of consumers do not know how to match; "heart to send" function can choose to give clothes to friends around, so that the flagship store has social networking + e-commerce attributes.

6. strong teamwork and overall operation of UNIQLO

In order to survive in the fiercely competitive Chinese market, UNIQLO established a strong team management system with a sense of mission.

Strengthen the training and mechanism of business personnel, UNIQLO management through daily communication to each employee clearly communicate business policy, implement a sound staff education.

Not only on the local side, but also with global company headquarters, a strong cooperation system has been established to learn from each other's successful cases. Through the practice of team cooperation, the business development of Greater China has been successfully carried out.

4 major topics of future in UNIQLO

First, "train operator talents".

Not only in the Greater China region, but also in the future, we will continue to train managers who can be active in the future global stage.

Second, "develop young customers", especially in recent years, young people using digital means actively marketing mode has been successful.

It will also strengthen children's products.

Because China has abolished the one-child policy, it has great potential.

UNIQLO aims to become the first in the children's products industry.

Third, "expand the two or three line city business".

By expanding the scale of local branches to strengthen marketing, and enhance the popularity of UNIQLO.

In the report issued by the China clothing association, the domestic market of clothing in China in 2018 was 308 million yuan, about 50 trillion yen (the size of the Japanese clothing market is about 1 billion yen).

And it is growing at an annual rate of 7.3%.

Fourth, "achieve 20% of the operating profit margin".

Consciously implement pactions that do not depend on discounts, reduce funds and implement low-cost operations.

In addition, through the use of RFID (non-contact electronic tags) and other digital tools, greatly improving the efficiency of store operation, by preventing store shortage, to improve revenue.

Ryui Masa: China's clothing market will not slow down

In view of the slowdown in the Chinese market in the alleys and alleys, Ryui Masa explained, "I don't think that clothing consumption will slow down. China has 50 trillion yen demand for clothing every year, and we only reach 1000 stores. This is a large market with 1 billion 300 million people.

People's living standards will continue to improve, and the middle class will grow into a class with real purchasing power.

The Greater China region is not only in terms of production, but I think it will also become the largest market in the world.

He said, "in the future, we will speed up the opening of stores in the two or three tier cities, because every city has millions of people and many middle class". He repeatedly stressed: "China's clothing market will never slow down."

About strengthening the two or three tier cities in the future, Pan Ning said, "at present, it is advancing."

For example, sales in Shanghai stores and downtown stores in the far southwest are almost the same.

UNIQLO will carefully manage every store and will improve the performance of all stores at any time.

For large domestic developers, we are regarded as the first brand tenants. We hope to undertake the largest scale and best location of the branch offices. We are preparing to set up a branch store and hope to enrich the network of the national branches.

He emphasized that "UNIQLO started to focus on the business of electronic commerce very early. While trying new things, we used O2O to integrate physical stores with virtual stores, and took measures to link them to attract customers to increase sales.

In 2018, double 11, UNIQLO exceeded 35 yuan in 100 million seconds (about 1 billion 700 million yen), UNIQLO's clothing retail sales ranked first in the country, and sales in Tmall shops ranked the top five.

UNIQLO is confident of the great potential for growth in the future.

Author: Pan Shuaini