Luxury Electric Business: 16 Billion Of Xiushui Street?

Can all businesses be effective and effective?

This is true in all the words about cake.

You see, the Internet is only selling books at the earliest time, such as Dangdang, and then can sell department stores, such as Taobao, and even 3C, such as Jingdong; also can sell air tickets, such as Ctrip; now, grain can also be sold, such as COFCO I buy; the house has not yet been able to sell, for example, Yi Ju......

In this case, what is wrong with selling luxury goods online?

Yes, everything can be sold online, but that doesn't mean everything is suitable for the electricity supplier.

That's one of them.

Last month, France captured a criminal gang. The 12 members of the crime included 2 former Hermes employees who specializes in counterfeiting Hermes luxury goods.

Subsequently, Hermes CEO announced that it was selling online.

Product 80% is a fake! Actually, this is not an isolated case. Not long ago, SWAROVSKI issued a statement that it did not authorize Jingdong mall, Amazon and any website to sell SWAROVSKI products in China. However, the latter's website had set up luxury channel and sold related products.

Subsequently, LV, GUCCI, PRADA and other luxury manufacturers also issued a similar statement.

According to the survey, the potential of online luxury goods market in 2011 may be as high as 16 billion, so this may be a potential market of 16 billion in Xiushui Street.

So where do these luxury goods come from? Industry analysts believe that overseas purchasing and second-hand goods recycling may be the main source.

Wait a minute! If it really comes from purchasing agents, or even secondhand recycling or tail purchase, it is always genuine. In fact, the amount of this part is very small, which is very incommensurate with the quantity of online shopping that appears on the Internet.

Although Hermes can not represent the status of all luxury websites, it is not necessarily less.

Why does this happen? In fact, the reason is not difficult to understand, the three major reasons can not be ignored.

First, the temptation of high margin.

In a large number of brand promotion and store operation, the gross profit of many luxury goods is still more than 80%, and imitations are much higher than those without these inputs.

A profit of ten times is enough to entice too many businesses to participate in counterfeiting and selling.

This phenomenon exists not only on the Internet, but also in traditional channels.

This temptation is not only in the electronic commerce website, but also in the various links of the electricity supplier. It is difficult to monitor suppliers' frauds. The delivery of the couriers is not uncommon. Some buyers deliberately buy things after they are not shopping.

Second, luxury goods are hard to identify and difficult to identify.

If the core value of luxury goods is brand, LOGO is no longer valuable. I am afraid there is not much objection. The current imitations are a lot of chaos. "High imitation" has become the mainstream of imitation. However, it is difficult for ordinary consumers to identify it, which makes the cost of counterfeiting and selling fake greatly reduced.

Because it is difficult to identify, most luxury goods stores are afraid to directly identify, and some overseas brands require mail to be returned to local identification, and the related costs are often tens of thousands of months.

A high margin product is difficult to identify and identify. The risk of fraud will be greatly reduced, which will greatly stimulate the desire of the counterfeiters.

Finally, we must take into account the "distorted" mentality of Chinese consumers.

On the one hand, Chinese consumers are almost the most enthusiastic consumers in the world. At present, China's luxury consumption has reached 25% of the world, which surpasses Japan, second only to the United States, and a large number of luxuries are purchased by relatively poor ordinary consumers. Here there is a very strange "good face" consumption concept. On the other hand, Chinese consumers are very keen on discounts, hoping to "buy cheap" when they buy expensive luxuries.

This "good face" and "cheap" mentality are intertwined, allowing luxury electric providers to have a gray area in the short term and attract consumers through discount sales.

These factors are intertwined, forming the paradox of the Internet luxury electric business: most of the products on the Internet in Xiushui Street are fake and hard to identify. How can online sales of luxury goods prove true? How to ensure the safety of the express process? If you buy fake products, how do you change them? If you doubt, how do you identify them? Do you believe in a business that is on the decline and may be closed at any time? The power and the external motivation of luxury electric business to become online Xiushui Street is very strong.

In fact, these factors are still not the key to the success of luxury electric business. The more crucial factor is: in the whole industry chain, who controls the controlling power is the core of the game between the most upstream brand manufacturers and channels, whether it is between online channels or traditional distribution channels.

Luxury goods manufacturers themselves have strong pricing power, and there is no incentive to distribute products to ordinary electric providers by risking a huge brand pollution risk. For example, they have set up a manufacturer's channel or self built electricity supplier on the platform electricity supplier.

Therefore, the majority of B2B2C providers and B2C providers are essentially a channel to occupy traditional channels, such as Suning, Gome and Bailian, which are not enough to form bargaining for upstream brands before forming channel monopolies.

It can be said that the existing luxury electric business model is fundamentally unfounded.

Because of this, Xiushui Street on the Internet can not grow to 16 billion, and gradually decline.

Of course, this is not to say that online is impossible.

If a company that controls the upstream can combine with the Internet better, realize the closed system of the whole process, or even create a fast brand like ZARA, it is impossible. However, we can hardly call it "luxury electric business".