The original brand has not yet arrived. Someone in the cottage first divides the development of the Chinese cottage into two realms: one is to “produce large amounts of moneyâ€, that is, to produce inferior products, but there will be articles on the logo, such as NCKIA and SUMSUNG; the second is “imitation showâ€. , that is, the production of products in both appearance and function, are the big super imitation show, almost to be real, but the brand is absolutely autonomous. Now, it seems that the Shanzhai people have a new idea, which is to change the object of Shanzhai from "product" to "sales channel."
On the one hand, consumers who have long heard about Starbucks, CK, Coach, etc., are powerful and determined, but because they live in small cities, they can only hope for it; on the Other side, they look forward to the future, suffer a lot of loss, and are reluctant to put down their footing. The big names in the low-tier cities, then, the "shanzhai" has its rationality and inevitability.
Wang Yu dressed in black in the “fake†shop. This set off the red Salvatore Ferragamo (Italian brand) on the feet. “I just bought this month is my birthday. She said lightly.
The place where Wang Yu works and lives is the famous "big city" - Tieling, a prefecture-level city with a population of 3 million and a moderate level of economic development. As a major account manager of a local bank, Wang Yu’s annual income will be around 100,000 yuan.
Wang Yu said that in Tieling, there are not many people who earn income like her. Because there is no life pressure like a big city, it would be normal to spend 4,000 to buy dual-brand shoes or a brand-name package. "I am an office worker and many businessmen are more consuming."
However, the consumption environment of small cities does not seem to satisfy this group. They often need to drive for more than an hour to go shopping in the neighboring and real big city of Shenyang. “Occasionally I will go to some of the 'shanzhai stores' in Tieling to buy it,†said Wang Yu.
The “shanzhai store†mentioned by Wang Yu is actually quite common in many small and medium-sized cities. As counters of first-line brands often do not open here, there are consumers of these brands. As a result, some businesses "help" these brands to sell products to these people.
When you see a counter selling Lancome, Estee Lauder, or a store selling COACH, GUESS at the same time, you don't have to wonder at all. Of course, there is also a very specific one, such as a small store that sells IKEA, ZARA, and Apple products.
"Although these stores are cottages, most of the products they sell are true," said Wang Yu. According to the reporter’s understanding, the purchase channels for these cottages are mostly complex, ranging from big city counters or discount stores to those purchased from Hong Kong and abroad.
“Once we have a seasonal discount here, a customer from the northeast bought 87 T-shirts and 22 trousers at a time. He said to go back and sell it in his shop,†said a salesperson at Ralph Lauren’s store in Beijing Setaolai. "China Economic Weekly", which is a discount store here, is 3 to 50% off all year round and sometimes even lower.
A few months ago, a U.S. blogger uploaded the photo of a copy of the “Apple Store†in a cottage in Kunming and pushed the “channel cottage†into public view. In the photo, the "realistic" level of the cottage's Apple Store is breathtaking. As a result, many netizens launched a series of sun-washing activities: Watson Watts, cottages 7-11...
For brand owners, the emergence of "channels are cottages" is a sorrow and joy. On the one hand, if consumers purchase products from the Shanzhai channel, problems with the products or services will naturally make consumers have a negative impression on their brands; but on the other hand, the Shanzhai stores also study the Chinese brands for these brands. The third-tier cities market offers free materials.
The temptation of the second and third lines “A few days ago the inspections in several provinces and cities in western China had a great impact on me.†Shao Qingfeng, President of Kimberly-Clark China (China) Co., Ltd. said in an interview with China Economic Weekly that their high-end products Western cities like Baoji are very popular. Consumers, like those in big cities, have a strong demand for good products, such as diapers. Many mothers want the best, not the cheap ones.
Shao Qingfeng said that Kimberly-Clark will continue to use force in China's second, third and even fourth- and fifth-tier cities.
Starbucks is also the medium- and low-tier market opportunity. As of 2010, Starbucks has opened a total of 400 stores, of which more than 70% are concentrated in the four cities in the north of Guangzhou Guangshen. But by 2015, Starbucks plans to open 1,100 more stores in China, most of which will open in second and third-tier cities.
According to a survey conducted by BCG, a business strategy consulting agency, the number of middle-class and affluent consumers in China will increase from 150 million to more than 400 million in the next decade, of which two-thirds will live in small cities. The class is rapidly rising in areas outside China's major cities.
According to statistics, there are 150 cities with more than 1 million people in China, except in the North, Guangzhou, and Shenzhen, and there are only 13 in the United States. With such a huge business opportunity, how can a company not see small and medium-sized cities as the power source for the second wave of expansion?
The big brands who have fallen in love with sensitive people in small cities have already received a surprise.
At the beginning of 2011, L'Oreal, the world's largest cosmetics group, opened its first Lancome counter in the second-tier cities of western China in Yichang International Trade Building.
“At first, I was a bit worried. After all, Lancome is one of our best luxury cosmetics brands.†Guy Paul, president and managing director of L'Oreal (China), told China Economic Weekly. “But now, this counter in Yichang has become a place in China. One of the most important Lancome counters."
Yichang Lancang was sold on the same day and opened at 2 am the following day. It achieved sales of more than 1 million yuan. As of the first half of the year, sales exceeded 12 million yuan. According to the survey, 48% of customers are consumers in Yichang City, 30% are from surrounding counties and cities, and 22% are from other surrounding prefecture-level cities. Subsequently, Estée Lauder, another high-end cosmetics brand, opened a brand counter in Yichang.
“We have also included the market expansion of the second- and third-tier cities and even lower-tier cities,†said Gaipaul.
Starbucks, the brand that bested the concept of “Peasant’s Favoriteâ€, was also successful in Jinan: single-store daily sales record of nearly 3,000 cups of coffee, which can easily squeeze into the national average of Starbucks. The top ten stores with the highest sales.
Although small and medium-sized cities are full of temptations and imaginations for large companies, problems that may be encountered cannot be ignored. For example, Starbucks has tentatively entered second-tier cities such as the Northeast, but the response was flat. For many brands, only a certain number of stores in a city can achieve a reduction in the cost of back-office logistics. The recruitment and training of sales and service personnel, especially managers, will also face challenges.
“Logistics costs are also a big problem. Big cities generally can open many stores, and the more shops the average logistics costs, the lower.†A franchisee told China Economic Weekly, “The company requires that the store decoration be consistent, but After all, the consumer groups in the small cities are limited. We want to create a "briefly version," but the company does not agree that prices cannot be sold high, and profits are too low," he said.
On the one hand, consumers who have long heard about Starbucks, CK, Coach, etc., are powerful and determined, but because they live in small cities, they can only hope for it; on the Other side, they look forward to the future, suffer a lot of loss, and are reluctant to put down their footing. The big names in the low-tier cities, then, the "shanzhai" has its rationality and inevitability.
Wang Yu dressed in black in the “fake†shop. This set off the red Salvatore Ferragamo (Italian brand) on the feet. “I just bought this month is my birthday. She said lightly.
The place where Wang Yu works and lives is the famous "big city" - Tieling, a prefecture-level city with a population of 3 million and a moderate level of economic development. As a major account manager of a local bank, Wang Yu’s annual income will be around 100,000 yuan.
Wang Yu said that in Tieling, there are not many people who earn income like her. Because there is no life pressure like a big city, it would be normal to spend 4,000 to buy dual-brand shoes or a brand-name package. "I am an office worker and many businessmen are more consuming."
However, the consumption environment of small cities does not seem to satisfy this group. They often need to drive for more than an hour to go shopping in the neighboring and real big city of Shenyang. “Occasionally I will go to some of the 'shanzhai stores' in Tieling to buy it,†said Wang Yu.
The “shanzhai store†mentioned by Wang Yu is actually quite common in many small and medium-sized cities. As counters of first-line brands often do not open here, there are consumers of these brands. As a result, some businesses "help" these brands to sell products to these people.
When you see a counter selling Lancome, Estee Lauder, or a store selling COACH, GUESS at the same time, you don't have to wonder at all. Of course, there is also a very specific one, such as a small store that sells IKEA, ZARA, and Apple products.
"Although these stores are cottages, most of the products they sell are true," said Wang Yu. According to the reporter’s understanding, the purchase channels for these cottages are mostly complex, ranging from big city counters or discount stores to those purchased from Hong Kong and abroad.
“Once we have a seasonal discount here, a customer from the northeast bought 87 T-shirts and 22 trousers at a time. He said to go back and sell it in his shop,†said a salesperson at Ralph Lauren’s store in Beijing Setaolai. "China Economic Weekly", which is a discount store here, is 3 to 50% off all year round and sometimes even lower.
A few months ago, a U.S. blogger uploaded the photo of a copy of the “Apple Store†in a cottage in Kunming and pushed the “channel cottage†into public view. In the photo, the "realistic" level of the cottage's Apple Store is breathtaking. As a result, many netizens launched a series of sun-washing activities: Watson Watts, cottages 7-11...
For brand owners, the emergence of "channels are cottages" is a sorrow and joy. On the one hand, if consumers purchase products from the Shanzhai channel, problems with the products or services will naturally make consumers have a negative impression on their brands; but on the other hand, the Shanzhai stores also study the Chinese brands for these brands. The third-tier cities market offers free materials.
The temptation of the second and third lines “A few days ago the inspections in several provinces and cities in western China had a great impact on me.†Shao Qingfeng, President of Kimberly-Clark China (China) Co., Ltd. said in an interview with China Economic Weekly that their high-end products Western cities like Baoji are very popular. Consumers, like those in big cities, have a strong demand for good products, such as diapers. Many mothers want the best, not the cheap ones.
Shao Qingfeng said that Kimberly-Clark will continue to use force in China's second, third and even fourth- and fifth-tier cities.
Starbucks is also the medium- and low-tier market opportunity. As of 2010, Starbucks has opened a total of 400 stores, of which more than 70% are concentrated in the four cities in the north of Guangzhou Guangshen. But by 2015, Starbucks plans to open 1,100 more stores in China, most of which will open in second and third-tier cities.
According to a survey conducted by BCG, a business strategy consulting agency, the number of middle-class and affluent consumers in China will increase from 150 million to more than 400 million in the next decade, of which two-thirds will live in small cities. The class is rapidly rising in areas outside China's major cities.
According to statistics, there are 150 cities with more than 1 million people in China, except in the North, Guangzhou, and Shenzhen, and there are only 13 in the United States. With such a huge business opportunity, how can a company not see small and medium-sized cities as the power source for the second wave of expansion?
The big brands who have fallen in love with sensitive people in small cities have already received a surprise.
At the beginning of 2011, L'Oreal, the world's largest cosmetics group, opened its first Lancome counter in the second-tier cities of western China in Yichang International Trade Building.
“At first, I was a bit worried. After all, Lancome is one of our best luxury cosmetics brands.†Guy Paul, president and managing director of L'Oreal (China), told China Economic Weekly. “But now, this counter in Yichang has become a place in China. One of the most important Lancome counters."
Yichang Lancang was sold on the same day and opened at 2 am the following day. It achieved sales of more than 1 million yuan. As of the first half of the year, sales exceeded 12 million yuan. According to the survey, 48% of customers are consumers in Yichang City, 30% are from surrounding counties and cities, and 22% are from other surrounding prefecture-level cities. Subsequently, Estée Lauder, another high-end cosmetics brand, opened a brand counter in Yichang.
“We have also included the market expansion of the second- and third-tier cities and even lower-tier cities,†said Gaipaul.
Starbucks, the brand that bested the concept of “Peasant’s Favoriteâ€, was also successful in Jinan: single-store daily sales record of nearly 3,000 cups of coffee, which can easily squeeze into the national average of Starbucks. The top ten stores with the highest sales.
Although small and medium-sized cities are full of temptations and imaginations for large companies, problems that may be encountered cannot be ignored. For example, Starbucks has tentatively entered second-tier cities such as the Northeast, but the response was flat. For many brands, only a certain number of stores in a city can achieve a reduction in the cost of back-office logistics. The recruitment and training of sales and service personnel, especially managers, will also face challenges.
“Logistics costs are also a big problem. Big cities generally can open many stores, and the more shops the average logistics costs, the lower.†A franchisee told China Economic Weekly, “The company requires that the store decoration be consistent, but After all, the consumer groups in the small cities are limited. We want to create a "briefly version," but the company does not agree that prices cannot be sold high, and profits are too low," he said.
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