Socks, Two Layers Of Escalation Of Consumption

China is the largest country of socks export.

Less than 30 years of development in Datang Town, the annual production of socks accounted for more than 70% of the country, the global 1/3, so there are "Datang hosiery machine ring, the world a pair of socks" argument. China's foundry factories also provide OEM services for Adidas, PUMA, Okamoto, Decathlon, UNIQLO, Muji and other international brands.

Based on such a perfect industrial cluster, socks have long been a fully competitive market in China. From the price band to material, pattern, design sense, function and specific crowd segmentation, almost all people's consumption characteristics and needs are covered.

Socks for stalls: 5~8 gross / double, 10 yuan / tie, 10 yuan /8 double, 2 yuan / double, 10 yuan /3 double;

Traditional clothing store and underwear store: 5 yuan / double, 6~8 yuan / double, 10 yuan / double;

Home living hall such as MINISOR, MUJI:10 yuan / double, 20 yuan / double;

Sports brand and UNIQLO: 27 yuan / double, 39 yuan / double; 20~30 yuan / double, 60 yuan / double;

New home brands (such as Sakya house, Body.ing, Tutuanna):99 yuan /4 double, 99 yuan /3 double, 20~30 yuan / double;

Socks store (such as Happy Socks, Stance): high-end 100~300 yuan / double, parity 160 yuan /3 double, 80 yuan / double, 120 yuan /3 double.

Different consumption channels correspond to different consumption needs and consumer groups.

　 01, socks, the two step escalation of consumption.

And the upgrading of consumption and crowd segmentation of the socks are even earlier than other consumer goods that are widely concerned today.

As early as 2015, China's per capita consumption of socks was comparable to that of Europe and the United States.

In 2015, the per capita consumption of socks in Japan reached $37.3 per person, while in Europe and the United States, the per capita consumption was $20 per person, while China was 15.1 dollars per person. If a pair of socks is calculated at 5 yuan, the Chinese will replace only 6 pairs of socks each year than in Europe and America.

(taking into account the fact that Japan has to take off shoes in and out of some places, it is extremely embarrassing to show holes in socks. Japan's quality and replacement requirements for socks are much higher than those in China and Europe and America. We use European and American socks per capita consumption as a comparison. )

And the direction of consumption upgrading is faster replacement frequency, or higher single and double price, which are factors that promote industry scale growth (socks demand = quantity * price). When consumers wear socks to wear and stitch and then wear them, they are thrown away when they are worn out. Such changes have led to the low-end brands such as the Antarctic and ruse. Until today, in Taobao, the number of socks sold for hundreds of thousands of pieces per month is concentrated in 1~2 yuan / double. This is the first wave of upgrading of socks consumption - upgrading frequency.

As the largest socks Market in the world, China's market space is undoubtedly huge and diverse.

But when we look for socks that can be named in such a large market, we hear the most Tutuanan, thick wood, boots, Happy Socks and Stance, all of which are from Japan, Europe and the United States.

In 2009, TUTUANNA opened its first store in Shanghai's Jiu Guang Department store. In 2013, its number of domestic shops increased to 73. In 2014, it grew to 160 stores and sales volume was 369 million yuan; up to now, there are more than 400 in the country.

Similarly, Happy Socks opened its first store in Shanghai in November 2016, expanding to 42 in 3 years. Stance also formally entered Tmall in 2016, and opened stores in Shanghai, Qingdao, Changchun, Changsha, Hangzhou, Chongqing, Ji'nan, Nanning, Nanjing, Nanjing and Nanjing, and has opened 17 stores. They harvested the second bonus of socks consumption upgrades - single and double price increases.

The bonus of the second wave is represented by the higher sock shop and the home clothing store.

　 02. New model of socks: Inspiration from stalls to socks stores

In the past, the stalls, to supermarkets, and now to the low-end online market, in the field of socks, businesses basically only one point: low price.

In the first quarter of 19 years, the Datang hosiery industry output value was 4 billion 100 million yuan, and the total profit was 100 million yuan, with a profit margin of 2.44%. Profits are thin.

Online 1 yuan / double socks enterprises cost more than 8 gross / double. Enterprises that are confined to low prices will be eliminated in two or three years. Any fluctuation of enterprises or wind direction can not be accepted.

The direction of many hosiery enterprises from low price competition can be basically divided into three categories: (1) increasing product differentiation, improving product added value; (2) deriving from clothing and other categories; (3) attracting specific groups, special-purpose, and deep tillage.

The difference innovation of socks is mostly Happy Socks.

Happy Socks, founded in 2008, is a star enterprise in the innovation industry of socks. It mainly focuses on creativity, color, art and design, and sells socks to dozens of hundreds and hundreds of prices. But pure imitation does not create the Chinese version of Happy Socks.

Most of the innovative Socks Companies designed in China are unable to raise their prices upward, and they are trapped in hundreds of thousands of new products SKU every year to catch up with the largest number of consumers. But the 2 point is ignored.

(1) competition pattern changes: Happy Socks, as the founder of flower socks, has become a fashion brand. It can compete against many imitators with brand as a barrier, and target consumers can identify "Happy Socks" and "non Happy Socks". And the emerging domestic socks enterprises, in the face of strong imitation power + short sampling period of socks industry, can only deal with a large number of new products and high intensity inventory management each year, and are labeled with low matching labels.

2. Channel model: the high price of Happy Socks is enough to support the store mode under the line. Tens of thousands of offline sales outlets and online channel marketing are also difficult to imitate in the initial stage.

The price is difficult to upgrade. A special socks store with a single pair of 10 yuan ~20 yuan is established. According to the industry practice, the profit and loss balance of 50%~60% is difficult to achieve.

　　 03, socks new mode II: three strong Tutuanna, sakaku house, Body.ing

For most people, it may be hesitant to spend tens or even hundreds of dollars to buy a pair of socks, but socks with lower prices can not support single store profits.

As a result, when Tutuanna was settled in China in 2009, the model of selling pajamas, underwear, household clothes and socks at the same time was developed. Such a shop can be regarded as an upgraded version of "urban beauty" or an extended version of "socks store", and socks are no longer the only main force for store running.

Such a pattern, so that the demands of socks return from design to comfort, and prices drop from hundreds to tens of dollars.

In such a business mode, Tutuanna, Body.ing, and Kaiwu have been developing rapidly, but they inevitably encounter bottlenecks. High end is inevitable, but parity can be bought anywhere.

The 3 brands are consistent in positioning and even price. Socks are generally more than 20, and pajamas are generally over 150. The product features are also skin friendly and home oriented. There is a slight difference in product structure. The income from Tutuanan shop outside 60% is out of socks. The sales of socks sold in Sakya house is over 50%, and Body.ing's household clothes account for a higher proportion.

But these 3 seem to be at a high level. Buying socks, pajamas and underwear has a more professional or lower price brand; the location of "affinity" is unable to attract more customers; and very low passenger flow leads to high gross profit only to smooth the fixed cost. Vicious spiral.

The final result is that even in the second tier cities where high consumption groups gather, the average income of such stores is 130~150 million / year.

The third way is to focus on a more niche market.

Such as sports socks, deodorant socks, antibacterial socks, baby socks, diabetic socks and so on. These demands are neither rigid nor easy to replace, and are not easy to grow. China's per capita consumption of socks is less than 100 yuan / person / year, and only a few people need to deodorant and antiseptic socks. This part of the demand can be satisfied by the whole class socks brand.

　 04. What kind of socks enterprises are we looking for?

In the new mode of stocking sales, the exploration of socks stores and household clothing stores does not seem to be suitable for China's national conditions. The imitation of Tutuanan and Happy Socks makes many hosiery enterprises blind.

In 2018, 28 billion 900 million pairs of socks went out from Datang and sold 1 million orders a day. According to Datang socks production and sales accounted for 60% of the domestic calculation, and 50% exports to calculate, the size of Chinese socks reached 60 billion. In such a market, successful enterprises need to have the following elements:

1) achieve depth: focus on socks, have their own unique product system and supply chain.

Socks themselves are very easy to be covered, and consumption is random. Home markets, clothing stores, shoe shops, jewelry stores, underwear stores, supermarkets, and online can randomly divide some markets. Products that are not differentiated are mostly reduced to distance and price competition. Such differentiation is very difficult, but very core.

2) achieve breadth: product range covers all groups and functions. Men's socks, socks, socks, functional socks, business socks, sports socks, boat socks, stockings, short stockings and so on. In the mass market, we need to seize the share from the extremely scattered socks Market and no longer need to be positioned in a more fractionable market.

3) facing the mass market. Retail prices should not be too high, so as to reach the largest consumer groups.

High price to raise the purchase threshold is also destined to be niche market. And consumption upgrading is not only a better product, a higher price, but also a constant price, better product. In the mass market, the perception of product power is more and more obvious.

4) online and offline. Only a single electricity supplier or offline channels can not form a closed loop in the minds of consumers. In particular, we should pay attention to offline channels, the traditional circulation channels can be used as auxiliary; online shopping outlets with larger traffic volume can set up counters and stores, and the mode can be lighter, and choose less atrium or smaller stores.