Shang Ping Net Sudden Death, Temple Library Performance Pressure, China Luxury Electric Business Nobody Cares.

When he saw the news that Shang Ping net was out of business, Wang Hua still had a very complex feeling. Although he had left the Shang pin net for 5 years, he joined the company in the second year when Shang pin network was founded. At that time, Shang pin net was growing at a rate of 200% per quarter.

At that time, the company was looking forward to a bright future. Instead of thinking about the information of the old club, it was announced that it was not able to continue to provide services for the majority of users because of the poor financing and reorganization. From now on, we will say goodbye to you for a while. The official website and App will be closed. "

Once my colleagues have gone all the way, Wang Hua, who is still leaving the group, has sent messages saying "regrettably", "early in the morning and late in the evening".

For luxury electric business, the closure of Shang pin network is a new member of the long farewell ceremony. From 2014 to now, the peers, such as respected network, product convergence network, Jiapin net, Xiu Xiu net, have already "left first", and the rest can either be integrated into the ecosystem of Ali or transform into "online and offline boutique lifestyle" provider.

From the hustle and bustle to the end of the curtain, the vertical luxury electricity supplier seems to have been unattended.

The long sudden death

In January 8th last year, Shenzhen Herme group announced that it would buy a 90% stake in Shang Ping net and a 100% stake in another subsidiary of Beijing Xin Shang pin Technology Development Co., Ltd., at no more than 400 million yuan price.

In July 8th, Shang pin also announced that due to the recent major financing and restructuring of the company, the shipment and refund of some orders had been delayed since May. However, the company's financing is progressing normally, and the existing business will remain normal.

Only 22 days later, the company issued a notice of suspension.

The sudden death of Shang pin net is widely divergent. Although Wang Hua has already left the company, he has been in the industry, so he knows more about the "old club". Sometimes he will know the company's situation with his old colleagues. In his view, "from the business, its supply chain transformation is too urgent. Most of its business is parallel trade at the very beginning. In 2014, after the pilot of the cross-border electricity retail import business was launched, the company immediately shifted to offshore outsourcing, and business switching was very urgent, coupled with fierce competition, and gradually declined."

When Wang Hua joined the Shang pin network in 2011, it was the time when vertical luxury business was high. According to the group statistics, only half a year ago, the luxury luxury electricity supplier disclosed 12 cases of financing, and the total amount of financing reached US $283 million, reaching the highest level in history. Until 2015, there was still a large influx of funds into the luxury electronics business track.

From the data point of view, the luxury industry shows strong market potential. According to the Mob Research Institute's "2019 luxury industry insight", the scale of China's luxury market in 2019 (excluding overseas consumption) is expected to exceed 200 billion yuan, reaching 213 billion yuan. With the rise of the new generation and the increase of national consumption level, it is expected to exceed 400 billion in 2025.

But the domestic vertical luxury electric providers seem to have failed to enjoy the growth dividend, but further fall into the development dilemma. In the same period, the luxury goods network such as Hohhot, Zun, Zexu, Jiapin and so on has been closed down due to poor business performance. Vip.com has chosen to focus more on "global" and "select genuine products".

Even the first storehouse of luxury goods providers still faces enormous challenges. In the 2019 Q1 unaudited financial report issued in June 13th, the total net revenue increased by 46.5% to 1 billion 175 million yuan, while net profit fell 39% to 15 million 800 thousand yuan compared with the same period last year. The net profit calculated in accordance with GAAP was 19 million 300 thousand yuan, down 44.1% from the same period last year. As of August 1st, the Temple market value was about $400 million.

Since consumer demand is still in existence, why can vertical luxury electric providers not be able to kill the encirclement?

An industry consensus is that the contradiction between the nature of e-commerce and the positioning of luxury brands makes the electricity supplier unable to become the focus of revenue. In China, the electricity supplier almost becomes the pronoun of "low price", often "one word does not match price war"; luxury goods emphasize scarce and noble, and consumers need to enjoy the full experience service of highlighting their identity and wealth. This leads to even the rapid development of online retail industry in China, and the overall penetration of luxury goods is still at a low level. Until 2018, the proportion below the line still accounted for 9.

"The brand side will not let go of all channels, and will not give as many empowerment as domestic brands." Wang Hua told reporters that this forced businesses to obtain sources of goods through other channels, such as distributors, agents, buyer companies, etc., suppliers are mixed up, it is difficult to ensure the stability and quality of goods, "quality control is luxury goods providers can not evade the difficult problem, which is determined by the chain of the industry."

Whether for businesses or consumers, luxury electric providers all trust the economy, and "trust" is a luxury. Jiang Ke, vice president of the strategic planning department of the fashion business department of Jingdong mall, has expressed similar views in the interview with blue hole business. "The electricity supplier and luxury brand want to play together, and need to continue to be patient. We must make them feel that they will not lose anything by doing business. They must not move their lifeblood.

For consumers, in order to solve the trust problem, many platforms are increasing the requirements for the qualification of goods. "For example, purchases of European brand goods, there were procurement invoices before, now also need to provide brand name invoice, plus European dealer invoice. So the quality control is relatively much better than before. The former brand invoice is hard to take, and now it is much more relaxed than before. "Wang Hua," he said.

　　 change

The closure of Shang pin network and a vertical luxury electric business does not mean the end of luxury online sales mode. On the contrary, new changes are taking place in this industry.

What the naked eye can see is that the brand side has changed its attitude in recent years. "The investment in online marketing has increased a lot, including online shopping mall." Wang Hua said.

As the volume of China's luxury consumer market is increasing and consumers' shopping behavior is tilting towards the mobile terminal, luxury brands are actively catching the electricity and seeking the correct channels to communicate with Chinese consumers.

On the other hand, with Tmall, Jingdong and other e-commerce giant platforms testing the luxury sector, luxury brands are more willing to cooperate with large traffic platforms. A high-end cosmetics brand manager said: "we do not spread vertical channels, only tmall flagship store."

While the electricity giant also takes advantage of the situation, Tmall has launched a luxury virtual APP - LuxuryPavilion has assembled Longines, real time, La Mer, Guerlain, Burberry, Martha Lahti, Hennessy and other more than 20 brands; Gucci's parent company's open top Group's top international high-end brands Balenciaga, SaintLaurent, Alexander Mcqueen, Pomellato have also entered Jingdong's luxury platform TOPLIFE.

Luxury brands also choose to test the vertical luxury electric providers. By the end of 2018, the Prada group announced cooperation with the temple library and began selling official Prada and MiuMiu two core brand products in the temple library platform in June 2019. This is also the opening of the Prada group in the Chinese market channel for the first time to choose the third party e-commerce platform in China.

But overall, luxury giants are more inclined to control channels and demand traffic support. On the one hand, more and more luxury goods providers choose to build their own platforms. On the other hand, most of the luxury electric providers choose to enter the local giants to complete the online sale.

For vertical luxury electric providers, its traffic can not compare with Taobao, Jingdong and other giants, while luxury users only occupy a small number of consumers. This makes the cost of the rear end customers greatly improved, and huge capital investment makes many luxury electric providers overwhelmed.

As a veteran in the luxury electronics business for 8 years, Wang Hua is also deeply aware of the fierce competition in this industry. "Big players are so few, even though the market share will be somewhat different, but no platform can be regarded as the absolute leader."

According to the statistics installed by the Mob Research Institute in June 2019, even the leading Temple store has only 1 million 333 thousand units installed. As a result, "transformation" has become the most widely used vertical luxury business in recent years.

Wang Hua concluded that there are basically three kinds of transformation of luxury electric business: first, expand the supply chain through cooperation, no longer be confined to traditional luxury goods; two, introduce more new designer brands to solve the problem of profit space and quality control; three, develop offline stores, and realize the overall upgrading of operation, supply chain and experience level.

The transformation of data can also be seen. In the first quarter of the temple treasury's latest financial report, although the growth of traditional luxury goods is not large, cosmetics, sports trends and travel lifestyle products have increased by 4 times over the same period.

"The overall business model of the luxury goods industry has a narrow gap, that is, to match the traffic volume and the category of products, and to see which platform fits well and sells well." Wang Hua said.