The trend of online shopping is not online shopping. Now, to offline has become the hottest trend in the field of e-commerce in China.
In the 2014 IPO prospectus, Alibaba Group ranked online fashion brand Inman as a success story for the Chinese e-commerce sector.
Its prospectus claims that while Alibaba launched its corporate-consumer platform Lynx in 2008, Inman, which specializes in selling cotton and linen apparel, was one of the first flagship stores to be seated and became Lynx's best-selling women's fashion One of the brands.
Fang Jianhua, founder of Yin Man, has taken a surprising turn since mid-2015. He abandoned the pure online model and went offline to open a physical store, and so far Yin Man has opened 450 stores, mainly Focus on China's small cities.
Last year, Yin Man's online sales increased by about 39%, while the newer and smaller offline business surged 300% with sales of 330 million yuan (about 52 million U.S. dollars) 35%. Fang Jianhua expects the future distribution of online and offline business will reach 40% -60%.
'A lot of people had said that I was going to fail in the offline market,' said Fang Jianhua, chairman of Guangzhou Yinmei Garment Co., the owner of Yin Man. 'But the fact is that unlike the traditional developed retail US, retail in China Industry is a relatively new industry, so there are many opportunities.
Going offline is already a hot trend in the Internet industry in China. Inman is the forerunner.
Yinman found several long-term problems in changing its development strategy.With the increasingly fierce market competition in China's e-commerce market, large enterprises such as UNIQLO, Vero Moda and Gap have launched large-scale online businesses such as Inman Meanwhile, the cost of online advertising tends to go up, and the challenge of scrapping encroachment on the extremely crowded e-commerce sector is also growing.
China is the largest e-commerce market in the world with online sales accounting for the highest percentage of total retail sales in the world, with official data showing that in 2013, 533 million Chinese online shoppers purchased a total of 5.5 trillion yuan (US $ 865.8 billion) ) Of food, clothing and other consumer products, accounting for 15% of the total retail sales of consumer goods, and acquiring new online users has become more and more difficult as the growth rate of new Internet users dropped from 6.2% the previous year to 5.6% last year.
Many analysts expect e-commerce to see rapid growth in the coming years, and operational efficiencies in the industry are on the rise as logistics issues that Chinese retailers have been facing have improved.
Zhao Yingguang, founder of Yan Man's online rival HanDou's e-commerce group, believes that e-commerce is still the dominant trend. 'The big trend is that offline brands will go online, not online brands,' he said.
To be sure, the line between online and offline retailing is increasingly blurred, and companies are recognizing the importance of both hands together.
Millet emerged as a pure online brand in the global smartphone market in 2011 but has opened more than 300 offline stores since 2016. Its founder and chief executive Lei Jun said ignoring offline retail led to the company's 2015 Sales dropped sharply in 2016 and 2016. He attributed Millet's comeback last year to its physical store.
Alibaba and its main competitor, Tencent, are also massively distributing department stores and supermarket chains through acquisitions and shares.
At the same time involved in online and offline retail business can bring the competitive advantage is to reach more consumers, access to better data.
As the days of modest growth have eased, online retailers must work harder to secure new users in smaller cities and to reach older and lower-income people.
In 2015, Fang Jianhua believes cheaper access to physical stores in smaller cities than in online stores means he believes that Inman can compete with pure-play stores through his company's insight into its millions of customers As rivals manage supply chains and stores better, for example, in China's cold northeast 'rust zone', women do not really like Primrose cotton clothes, so companies do not need to open a physical store there.
Yin Man does not charge the franchise fee, will withdraw all unsold stock, unify the online and offline price, and provide the software management system for all the stores.
Initially, there was no brand awareness among Inman's online mall operators, and Yan Yaling, a yoga teacher who wanted to open Yin Man stores in Nanchang, recalled that she had been repeatedly rejected by mall operators, In the end only to find a shop empty shop.
Yan Ya-ling said that although the store is struggling, her stores are often overcrowded because customers can try on clothes and know that the price is the same online and offline. In 2016, she opened her second in Nanchang's busiest mall Home Yin Man stores.
Fang Jianhua said that about 80% of Yinman customers use Tencent Weixin to pay in the store, which pays the way for customers to automatically follow Yinwen's official WeChat account and become a member. These customers are getting new products through WeChat And promotions the latest information, so offline stores have more return passenger flow.
In the second half of 2017, Inman began to attach a radio frequency identification chip to all of its products to bring a variety of product information to the company's Guangzhou headquarters, such as when the product was tried on, when it was sold, or when the product was sold Good information. This information can help Yin Man reduce inventory.
'The problem is not whether fashion brands need to be both online and offline at the same time,' Fang Jianhua pointed out. 'But what size do you want to be in both worlds.'