Thinking Behind The Bankruptcy Of "Yi Er San"

Another start-up company focusing on "sharing economy" has been shut down. This time, it is the sharing fashion monthly rent platform - "clothing 23".

Recently, yi'er-3 announced that due to business adjustment, new user registration and new member purchase will be stopped, and the service will be closed on August 15, 2021.

At 0:00 on July 13, yiersan will close the single channel for regular service leasing; At 0:00 on July 23, the reservation channel for suitcase return will stop; From 0:00 on August 1, customer service will open the channel to refund the membership fee and deposit; Operation refund will be closed at 0:00 on August 15.

However, since 0:00 on August 15, the operation of yiersan app and related small programs and web pages will be suspended, and the server will be shut down. At that time and after, it will be unable to log in. The relevant information legally collected by yiersan will be deleted in accordance with national laws and regulations.

Frequently favored by the capital, Ali's two participation in investment has also exposed problems such as automatic fee deduction

According to public information, Yi Er San is affiliated to Beijing Shangshi Xiaozhong Technology Co., Ltd., which was established in January 2015, with Liu Mengyuan as its legal representative and a registered capital of 3.98 million yuan. According to the company's information, Liu Mengyuan holds 46.73% of the shares.

Since its establishment, yiersan has obtained 6 rounds of financing with a total amount of more than 80 million US dollars. Investors include Sequoia Capital, Softbank China, Alibaba, IDG capital, Jinshajiang venture capital, etc. In the angel round stage of Yier Er San, Wang Gang, an early investor of Didi, invested in it. Sequoia Capital, IDG capital, Softbank China and Zhenge fund participated in the later rounds of financing.

Among them, Alibaba has participated in the investment twice. In 2017, Yi Er San obtained a US $50 million round C financing, in which Alibaba also participated. The latest round of financing of E-23 stayed in September 2018, when it obtained Alibaba's strategic investment, and the specific amount was not disclosed.

When obtaining the strategic investment from Ali, Yi Er San once said that through strategic cooperation with ALI, it would carry out full platform strategic coordination with LEIYU, Taobao, tmall, Alipay and sesame credit in Ali ecology in the future, including settling in Xianyu, Taobao and Alipay platforms to provide clothing rental services to users; The establishment of leisure fish shops, the sale of second-hand clothing.

As a monthly rental platform for women's fashion, yiersan focuses on the "monthly changing" business for the core users of the first and second tier white-collar women aged 25-35, who have received higher education, love the United States and are willing to accept new things. It provides female users with the service of meeting system, changing clothes for times at the price of 499 yuan per month, and also provides free washing, free postage, free postage, etc Additional service of express delivery to pick up clothes.

In addition, yiersan also invited brands to settle in the platform to provide rental services and sales services, and it also provided users with free washing and freight free services through the self built central intelligent laundry factory.

In fact, it is the vast idle market for white-collar workers in the city. IDG capital has investigated that white-collar women who have worked for 2-3 years in first tier cities have a monthly budget of 1000-1500 yuan for clothes, excluding rent.

It was also around 2015 that platforms such as "neon and feather clothes", "* * school" and "beautiful rent" began to rise, and the concept of "shared fashion" was put forward one after another. However, most of these market players failed to hold on.

Liu Mengyuan, the founder of yiersan, once believed that the advantage of the development of both leasing and leasing business is to use high-frequency consumption of clothing to drive luxury goods of medium and low-frequency consumption“ The user portraits of "renting clothes" and "second-hand luxury goods" of Alibaba leisure fish have a high degree of overlap, and users in the station do not need secondary education. With its back to Ali, yi'er-san can obtain huge Amoy system traffic. Yier'san has also established a store group in the Amoy department, and has realized the connection with the inventory in the app's main station.

According to the data, during the peak period of clothing 23, the number of times goods are transferred horizontally is 20 times. Each user will open the app once every other day, and the opening time is 10 minutes. By the beginning of 2020, the number of registered users of Yier 23 platform has exceeded 22 million, of which the users who have used for more than one year account for 65% of the monthly active users, and more than 20000 clothing SKUs are on the shelves. In May 2019, the platform will turn losses into profits, and realize the overall development of the platform.

However, in the view of industry insiders, the rise of clothing 23 in a short period of time, in addition to capital support, the concept of play marketing is a factor that can not be ignored. For example, in the aspect of content and entertainment marketing, yiersan attracts more users' attention by means of event marketing such as star trial and popular IP. Interviews, customer visits, office tea breaks, meeting with important leaders, attending press conferences, and daily shopping are all common scenes in the advertising of yiersan.

Those who have seen the advertisement of clothing 23 should be very familiar with the following scenes: a working woman rents clothes in clothing 23, and gets promoted all the way by virtue of her high-quality clothing interview and cooperation. Yi Er San uses this "beautiful" workplace atmosphere to strengthen the cognition of urban white-collar workers.

Liu Mengyuan once predicted: "in the future, there will be an" inflection point "in the new leasing market. Mass consumers will think that new leasing is a more fashionable and cool way. This can be seen from the fact that the second-hand, leasing and other recycling business models continue to be favored by the capital.". But Yi Er San had not yet waited for the "turning point" to arrive, he had already fallen.

It is reported that 75% of the income of the clothing 23 platform comes from membership fees, and the rest comes from users' income from clothing purchase. After being treated coldly by the capital, Yi Er San exposed problems one after another.

In October 2018, some media revealed that yi-23 unilaterally modified the content of the agreement without informing users in advance, so that the promise of "seamless connection of monthly trunks" and "member privileges" promised by the platform could not be fulfilled. At that time, Yi Er San gave a response, saying that the cost of the old rules was too high to make profits, and would be implemented in accordance with the new rules in the future. In November 2018, Yi Er San was subject to administrative punishment by Beijing Dongcheng District market supervision and Administration Bureau for unilaterally modifying the contents of the agreement to infringe consumers.

In the three years from 2019 to 2021, a number of consumer complaint websites have exposed such problems as "automatic fee deduction", "member automatic renewal" and "after-sales refund difficulty".

In the ebb of the sharing economy, the most important thing is to have hematopoietic capacity

"Shared Wardrobe" business is not new. It has existed for a long time. The rise of the sharing economy has educated the market ahead of time and improved the acceptance of leasing business by users. For young consumers who are willing to pursue new things, renting clothes to satisfy their love of beauty is indeed worth trying. For market players, once this business model is recognized by the market and capital, the future is unimaginable. Various factors make the "shared Wardrobe" business start to heat up.

In 2014, with the establishment of the * * faction, China's Internet shared wardrobe business began to open. According to public data, 12 shared wardrobe projects were established in 2015. However, in 2016, magic wardrobe, Aimei, mocha box and other platforms stopped operation, and the shared wardrobe industry entered the shuffle period.

In March 2017, Doraemon received US $12 million in financing. In September 2017, yiersan obtained $50 million financing from Alibaba leading investment, which is an investment in the shared wardrobe industry. In October 2018, the group received $30 million in financing. The highlight moment of shared wardrobe also stayed in 2018, and then there was little financing news from the industry.

Li Jun, a retail industry activist, said that the most active period of shared wardrobe is when the sharing economy is in full swing. With the recession of sharing economy, shared wardrobe projects are no longer favored by capital, and many surviving enterprises are also under pressure in terms of operation. In addition, high cost and slow return to cost are the characteristics of shared wardrobe. The withdrawal of yiersan indicates that this mode is not tenable. As a kind of subscription consumption, although there is demand in the market, the customer demand scenario is fragmented, which can not improve user stickiness. Without customers, businesses naturally lose business.

According to Li Ling, a consultant of lianshang.com, the essence of clothing 23 business is clothing leasing, which obtains capital investment through the concept of "sharing". There are leasing businesses in the clothing industry, but most of them are small businesses with less demand for wedding dresses and gowns and more expensive supporting services.

"If it had said so, would it have invested? Will there be business? Just use a "share" to cheat money? So we must understand the essence, whether it is investment or entrepreneurship. " Li Ling thinks.

Zhang Shule, an Internet commentator, said that the sharing platform for renting clothes has not changed its business model, focusing on member leasing. In addition to the normal clothing leasing, more clothing leasing will occur in the vertical leasing of special scenes, such as performance clothing, wedding or celebration clothing, license clothing and so on. On the whole, the market demand of the sharing and renting platform is not strong, fragmented and lacks user stickiness. Most users choose to rent in order to solve a temporary demand, so it is difficult to form repeat customers.

In addition, selling clothing at low prices may affect the frequency of renting clothes. Second hand clothing has always emphasized cooperation with laundry companies, and the recovered garments will be professionally cleaned. However, other original influences such as hygiene and depreciation may result in a small trading volume of second-hand clothing.

For the future development of shared wardrobes, Zhang Shule gives suggestions that the sharing and renting clothes can directly collect the fragmentation demand online in the future, and carry out large-scale and clothing scheduling according to the needs of users in the region and even the whole country, and achieve the interaction with users by express delivery. At the same time, for those large-scale leasing needs, we should form a solution and seek from the b-end.

It is worth mentioning that before the collapse of yi-23, the ofo in the sharing economy came into the public view again because "the deposit is still not refunded after being interviewed by the regulatory authorities", while tens of millions of users are still waiting for the deposit to be returned.

To a certain extent, sharing economy can effectively reduce the threshold of entrepreneurship and innovation, realize the full utilization of idle resources, and form a new growth point. However, with the help of capital outlets, the field of sharing economy is also a piece of chicken feather. Not many of them survived and got through, but many fell on the eve of dawn.

However, for any business innovation or business model, the ability of self-development has always been the top priority and the magic weapon to win in the future.