MUJI Lost China

Although there has been a lot of research and reporting on the Japanese consumer industry, I still believe that the research and analysis of the whole Japanese consumer and retail sector is in a blank. So this time, we will discuss the misunderstanding and illusion of Japanese brand MUJI, which is the hottest topic recently, to analyze the perspective of domestic perspective.

01

There has been a flood of articles about MUJI products in the market. Therefore, since I write it, I want to restore the hidden truth behind Muji. These conclusions come from the truth I discovered through interdisciplinary and cross role deduction. If you don't talk much, say a conclusion: Muji is a selling company, not a Brand Company.

I used to ask how big coffee looks like Muji in the domestic consumption industry. Now many people in China have an impression of Muji, and even the most discussed view is that Muji is a company with a strong sense of brand design. It is precisely because of such a wrong impression that we will gradually comb the development process of Muji, and take you to see the essence of DNA.

First look at the company name. In fact, the name of the Muji listed company in Japan is not called MUJI, but it is called "good plan". Those who are familiar with Japanese enterprises must know that this is very similar to the new product planning department of Japanese enterprises. In fact, the precursor of Muji is the channel brand Department of Japan's large integrated business.

Why do Xi you want to do channel brand? It has to go back to Japan in 1979. After the second oil crisis in Japan in 1979, the consumer market in the whole country shrank seriously, and consumers began to pay attention to the price and price performance of goods themselves. At the same time, the rise of category killer shops, which rely on the long-term deep bound supply system, has further impacted the prices of the department stores and large integrated business super enterprises that have occupied the top 10 of Japanese retail industry all the year round.

In such an environment, Xi you followed Daie No Brand brand, and started its own brand research and development in 1978.

In 1980, Muji began to enter the market. At first, there were only 40 items (SKU), of which 9 were daily groceries and 31 were food products. It also highlights the concept of "safety", which means "cheap and reasonable". Aiming at the needs of the popular brand premium, the basic functions of a commodity should be built to the extreme.

During the period of -1988 1980, westbound friends constantly transported traffic, channels and marketing resources to Muji, as long as it was the store of West friends, there must be Muji. In theory, as a brand trader, in your cold start stage, if your positioning is high and low, you need to spend a lot of effort in content flow, marketing and channels.

However, there is no need to worry about such problems when born.

02

First, on the channel, Xi you pulled a group of stores and GMS's elder brother to inflow traffic and channel resources to Muji, because its goods are cheap, so they will bring their own traffic volume. At the same time, Xi you also spent a lot of money to invite a Japanese top designer, such as Shen Ze Ren, to give it a platform and put forward a concept of branding, so that all the content story behind is thinking about how to subtract the brand, rather than the "Plus+X" differential upgrade route.

In 1983, Xi you built a brand store for MUJI products in Tokyo's Qingshan mountain. 2 years later, its own brand overfulfilled the Department's KPI. Because in Japan's bubble economy, the idea of subtraction under the state of excess consumption is just cutting off the Japanese national character of Zen, which made the MUJI products break through the sales volume of 14 billion yen. This scene is a relief for the West friend who was trapped in UNIQLO, Da Chuang, Can do and other formats.

So, Xi you decided to set up the Muji division separately. In 1989, Muji was independently split up and renamed the good quality plan. The purpose is to hatch more brands like Muji in the future.

Arguably, after coming out from the belly of Xi you, it is still adhering to the Specialty Retailer of Private Label Apparel: private brand clothing professional retailer, and taking the road of self built channels, which is a great challenge to the Muji, which has previously borrowed heavily from other people's traffic and channels. SPA

But the magic is amazing. In the second years after the split up, the Japanese economy collapsed completely, and the Muji was leaned on the cheap, cost-effective and so naturally tagging labels. It was like Quixote and UNIQLO, lying in the bonuses of the times.

But we all know that if we want to make channel brand, especially the idea of cost-effective, we must have 3 abilities.

1. strong commodity R & D capability to meet common market demands (goods are really good and durable).

2., the ability to lower costs by placing large orders on the upstream (to bargain with suppliers and reduce production costs).

3. solve the strong marketing capability that will result from the large quantity of stock that may result in unsalable sales.

These three abilities are indispensable.

But in addition to second abilities, MUJI products were all short boards. Because traffic and channels are given by Xi you, the specific direction of R & D is also based on sales data of various categories within Xi you, that is to say, it is a department that only makes design and goods. But now we have to build our own channels. This is equivalent to letting the factory director who has become accustomed to the supply chain's flow thinking and coming out to do the brand marketing with the need of divergent thinking, so that there is also the first loss of Muji in 2001.

At that time, the whole company was like selling goods and thinking, but not knowing the market, not knowing the users, not knowing the brand and not knowing the natural defects of the channel.

At this point, Matsui Chusan was in danger and made a radical reform of Muji. It involves: activating the operation capacity of the first line stores, adjusting the location of the stores to cheaper places, but in my view, these reforms are just helping the Muji build up the standard SPA mode, or closer to UNIQLO, which has already played SPA mode 6. But it still does not get rid of its root: Sellers think.

Though Muji always promoted itself as a brand, he did not seem to understand the difference between branding and selling. Or Matsui Chusan intends to put the profit growth first in order to make up the stock price of Muji. In the last article, from the perspective of the reconstitution of the Japanese people's freight yard and how to see the new brand in China from 0 to 1, I clearly put forward the difference between selling goods and making brands.

So I think the real success of a Brand Company is that we need to occupy mind share and occupy market share first. But Muji has obviously reversed its order in China.

03

MUJI began to enter China in 2005. Unexpectedly, when I came in, I found that the trademark was snatch by a domestic company called Hainan Nanhua industrial trading company in 2001. MUJI has been robbing, but in the past two years, the lawsuit has been losing.

For those who have made world-class brand goals, trademark registration should be completed in all target countries as early as 1990 when they are ready to go to sea. So MUJI products use "sell goods well, do not worry about not sell out" selling thinking first dig their own pit.

Later, Muji was launched in Shanghai and Beijing flagship stores. The strategy is to fight high in the southeast, like today's famous and excellent products, to reduce the dimension in Southeast Asia, and to cut crag crazily in the mainland of China. Matsui Chusan, the former president of Muji, said: "Muji is a cost-effective brand in Japan because consumers have no idea about commodities, but the position in China should be at the middle and high-end, because Chinese consumers are obsessive about commodities."

Here, we must be curious. Is it not that Muji is a brand in Japan? How to get high in the country.

From the perspective of sellers, you should know that in 2005, shortly after China's accession to the WTO, there was only a brand of Chinese clothing enterprises such as Hai Lan home, Metersbonwe, CABBEEN and Semir in the second tier cities, occupying people's cognition of consumer goods brands. Since Muji had hung up these traditional brands in design tonality, why not comply with the trend of the consumption upgrading of the times, and sell more money to make money easier.

So relying on the platform of the famous Japanese designers, such as Yamamoto Teruji, [original], and so on, the mysterious, low-key, luxurious sense of high quality, the endorsement of "Made In Japan", the early stage of Muji was basically rubbing the domestic clothing brands on the ground (at that time, the domestic clothing brand did not import SPA mode, resulting in a high rate of channel raising). Therefore, in the hearts of Chinese consumers, Muji has always been a representative of "light luxury lifestyle".

But it won't hide for a while. With the increasing transparency of information exchange between China and Japan, more and more consumers have been to Japan, and consumers and entrepreneurs have become aware of Muji's "big bully". It is the same chair as that in Japan. The Japanese shop sells for 10 thousand yen (about 640 yuan), and how it became 20 thousand yen after the arrival of China (equivalent to RMB 1280 yuan).

Why? Why should we allow ourselves who have evolved to the rational consumption stage to give a reason to say that they are elegant and mysterious, so that they are expensive? But the real idea is to reduce consumption, pursue the brand of Buddhism, and pay for branded brands.

At that time, people came out. For example, Ye Guofu, when he created the slogan of "Japanese design + made in China", created the fake mask of Muji.

Ye Guofu was very keen to observe the predicament of Muji. If he had cut prices, he would prove to his Chinese consumers that he had once been a "big bully". This is a devastating blow to a Brand Company. If Muji does not cut prices, his customers will be washed out by China's local brand and rely on the real best price.

Therefore, the early selection of famous brand products is simple and crude, sending a group of buyers to the Muji shop in Japan to shoot the sample and send it to the representative factory directly. The retail price goes straight to 15 yuan.

So we can see that since 2016, the growth rate of single shop business interests of MUJI products has begun to plummet. In 2017, Q3 even grew at a negative pace, accompanied by a sharp decline in the growth rate of Muji's wave of price cuts. To tell you the truth, I have never seen any brand that will depreciate for 11 times in five years. The brand generally discounts it for a long time. From the perspective of investment, the 11 price cuts will basically reduce the price of Muji in China by 2-3 times (P/S times the general brand is greater than the channel brand than the channel).

So when we observe the development process of Muji, we found that its gene is a selling company, not a Brand Company.

04

Finally, let me talk about my understanding of brand. In my opinion, the establishment of brand confidence in the consumer's mind comes from the accumulation of everything that the brand does through the whole value chain. From the early stage of your choice of product concept, to what kind of material you use, how much effort you spend on R & D, what kind of designer to tell, what kind of story to tell, what kind of person to speak, what kind of channel to take, according to what rules, and so on, any detail score here will add to the consumer's trust in your brand.

If you are doing a brand cold start, from 0 to 1, you can rely on 1-2 things to achieve the ultimate goal of selling products. But if your goal is to be a world-class brand, you have to do everything right. If you do something wrong, your consumer mind share will collapse, followed by the collapse of market share.

For example, in Japan, as long as a brand restaurant has suffered serious health problems, the brand will basically disappear on the second day, and the president may turn to the track after he has finished his thanks.