Mecoxlane: Transformers on the frontier of fast fashion

Long time after its founding in 1996, Mecoxlane was a light company selling women's clothing as a mail-order catalog. Since then, the president has changed several times, and the successive "foreign marshals" have without exception let Mecoxlane follow the path of "encircling the city from the countryside". Perhaps it is a cultural barrier. Mecoxlane's products are not acclimatized in the counties, towns and towns that foreigners are looking forward to. The inventory is backlogged year after year, and the customers are shrinking. By the time the board of directors approached Gu Beichun in 2001, they no longer dared to expect too much from this mess. Gu Beichun boldly decided to stop clothing and change to silver jewelry. In less than a year, Mecoxlane miraculously took off.

After accumulating a certain number of customer resources, Gu Beichun decided to return to the women's clothing business. Relying on precise positioning and fashionable and value-for-money products, Mecoxlane has firmly attracted millions of white-collar women aged 20-35, and has gradually extended its product line from the original fashion clothing and fashion accessories to household items, health and beauty, pets supplies, etc. This makes Mecoxlane's "fan" team growing day by day. In addition to the bustling metropolis, the company also has fans in those second- and third-tier cities that are hard to reach in the hands of fashion.

Since 2002, Mecoxlane has grown at an annual growth rate of 50%. In 2009, McCollins began to step into the spotlight. On the one hand, the multi-channel strategy led by Gu Beichun has been fully rolled out. The company has opened more than 200 retail stores in first- and second-tier cities, its own independent e-commerce portal "Maiwang", as well as its original mail-order catalogs and telephone sales. Together, the distribution channels have been enriched and Mecoxlane's weight gain transformation has been realized. On the other hand, cross-industry executive talents have been absorbed into McCawlin's command, which has given him sufficient strength for his next leap.

Gu Beichun does not shy away from saying that the current profit margin of this growing company serving customers with value-for-money products is the highest in the industry. Speaking of "this is a company that has just started with annual sales of more than 1 billion", his emphasis is on the words "just starting", and his face is filled with joy that the infinite future is in sight. As far as the business model is concerned, Gu Beichun said frankly: McCollins couldn't find any competitors. At the same time, he has defined competitors and reference objects for each channel of Mecoxlane, so competition is everywhere, and he promises to be among the best in the market segment of each channel. "Having done this, Mecoxlane will be a very ingenious company. We don't imitate anyone, and we're not afraid of being imitated." Indeed, this immutable and ever-changing company will be as powerful as it is hidden. The Transformers have their own core values that cannot be replicated.

Reengineering the business model

Mecoxlane, who started out with mail-order catalogs, did not forget the core advantage of mail-order catalogs, that is, accurate understanding of customer groups when moving towards multi-channel. According to the customer's habits and preferences, today's Mecoxlane chooses different communication methods such as website, telephone, and text messages. In addition to texting and calling the corresponding customers, it also sends electronic catalogs to customers who are accustomed to the Internet. Customers send printed catalogues. Customer preferences are recorded in the database.

After the website and store channels are developed, if they wish, customers who purchase Mecoxlane products through these two channels will be registered as members. The records include name, phone number, address, purchasing preferences, family members, occupational status, education level, etc. information. After that, all the activities related to Mecoxlane of this member will be reflected in the database, whether it is telephone consultation, ordering, returning goods, visiting stores, or visiting Mainet. In this way, Mecoxlane has laid the foundation for precise one-to-one marketing. Through the macro analysis of all members in the database, Mecoxlane can summarize the user's habits and spending power. In addition to the analysis of cold data, Mecoxlane also warmly invites customers to participate in symposiums to hear their suggestions on its products and services.

Multiple channels not only broaden the channels for customers to contact Mecoxlane and then purchase products, but also play a greater role in economies of scale, because the cost of a single garment can be further reduced, which constitutes the value of Mecoxlane products.

The next step for Mecoxlane is to open more than 2,000 retail stores across the country within two to three years. These stores will help attract customers and give full play to the fashion expertise of Mecoxlane products, so that female customers can understand the product style of Mecoxlane during the fitting process.

Mecoxlane's website was built before Gu Beichun came to the company, but Gu chose to keep his head down, and it wasn't until this year that he led the company to a high-profile outbreak. Among them, the choice of timing is the ingenious part of Mecoxlane. In the context of the booming Internet consumption on C2C platforms, clothing and apparel has become the first category of Internet sales, but there are few B2C clothing sales platforms. According to Pu Sijie, who is in charge of e-commerce, Maiwang currently has more than 1.8 million registered members, 600,000 active members, more than 2 million page views per day, and a turnover of more than 1 million yuan. Last year, Maiwang’s sales accounted for 40% of the company’s total sales. 28%, reaching 223 million, and this year it plans to reach 350 million. At present, there are about 10,000 products on Mai.com, covering all products such as clothing, home furnishing, and beauty. In addition to its own brands, Mai.com also cooperates with many women's clothing and makeup brands, reflecting Mecoxlane's positioning: to create an "online women's department store".

Retail stores and e-commerce enrich Mecoxlane's business model. In Gu Bichun's words, the catalog is like a transportation driver for these two channels compared to Maiwang and retail stores. It effectively transports customers to websites, stores or telephones, where they can place orders directly. At the same time, the increased sales brought about by the expanded customer reach allows providers of value-added products not to be unprofitable because of low prices. Therefore, a spiral upward channel is formed.

In fact, Mecoxlane is not alone in the blue ocean of online marketing. In June of this year, Vanke, which has been focusing on men's clothing, also launched women's clothing products, and promoted its products on a large scale through emails and web portal advertisements. The price of each bra-T 39 yuan is the same as Mecoxlane's value card. . However, in Pusijie's view, there is an essential difference between Mecoxlane and Vanke. This difference is primarily determined by the product.

Fast fashion creates value for money

"Fast fashion" is an imported term that has become well-known with the sweeping of ZARA and H&M in China. It is literally translated from fast-fashion. This is the product positioning of Mecoxlane. Every day when Gu came to his office, he had to pass through a public office area. First up is the design department, where the aisles are lined with pre-made garments, and everyone's clapboards are plastered with inspirational briefs and fabric samples. A separate small room is connected to this area, and the workers inside are busy designing samples. Then there is the department that places orders and asks for quotations, who are responsible for contacting the company's OEM contract factory. In another large open office area are the procurement and quality inspection teams. The aisles that separate them are like a border between Chu, Han and Han, and there are more than twice as many quality inspectors on one side of the line as there are procurement personnel on the other side. This is an embodiment of what Gu Beichun often said, "cheap doesn't mean sacrificing quality". In this regard, Yin Ying has a personal experience. Before she was in charge of public relations, she worked in Mecoxlane for many years in the procurement of accessories. She was always in awe as the quality inspectors smashed the packed cubes on the front, back and diagonal lines to test whether the products would be damaged during transportation. .

The series connection and rapid response between various departments in the office area have formed Mecoxlane's effective internal supply chain, and the long-term cooperation with suppliers is also the essence of shortening the market response time. Mecoxlane pursues "small batches and multi-category", and each type of clothing will not be produced too much, speed up the update speed, and usually launch new products in more than a month. It not only ensures that there is no backlog of inventory, but also ensures that consumers can buy the latest products.

In terms of logistics and distribution, according to Pu Sijie, Mecoxlane's products are uniformly shipped from warehouses in Shanghai, and the distribution is outsourced to different third-party logistics companies. They are all the strongest local logistics companies to ensure service quality. Major large and medium-sized cities can guarantee delivery the next day or at most three days. "Our clothing is small in size and light in weight, and the logistics cost of a single product is low." On the other hand, this is also related to the limitations of self-built logistics.

A considerable number of Mecoxlane's customers are in third- and fourth-tier cities, where the cost of self-built logistics is considerable, and no one can guarantee that the order volume of each second- and third-tier city is enough to cover the cost of establishing warehousing and logistics locally. With fast, another indispensable element is fashion.

Different from mature markets in Europe and America, in those mature markets, consumers can buy clothing at any price and style they want, including designer brands, casual wear and basic styles. However, China does not have such a continuous product supply, but presents a state of two big and middle small. One of the big ones is the big international brands with many advertisements in the first-tier cities and the big domestic brands that are so expensive that people can't figure it out. Between these two big heads are the relatively well-competed, plentiful casual casual basics, and the almost blank fashion.

Gu Bichun explained that the reason for this phenomenon is related to the single model of department stores in China. Unlike the European and American markets, Chinese department stores are not retailers, but more like commercial real estate companies. They don't know what's popular this year, only which store brand contributes the most sales. The usual method of department stores is to give the merchants a share of the turnover after three months, which seriously affects the cash flow of the brand owners, so the brand owners delay the payment to the suppliers, and the suppliers delay the payment to their next-level suppliers. Such a vicious circle. Therefore, when doing domestic trade, the cost and risk of delaying payment should be taken into account. A piece of clothing may cost 50 yuan for foreign trade, and 65 yuan for domestic trade. So the clothes in department stores have become rare.

Gu Beichun realizes that in such a far immature market, a woman in her mid-30s who has fashion needs but can't afford big names can't easily find clothes she likes in a city or town. He researched in a small city and saw the red doors of sporting goods brands everywhere on the pedestrian street, laughing that it was the street of the fire brigade. When he saw a family of three wearing a full set of sports clothes shopping, he thought that with the enlightenment of fashion, people would distinguish the three concepts of sports, leisure and fashion.

Compete, but differentiate

So what is fashion?

Gu Beichun admits that in the retail store, Mecoxlane is staring at ONLY and VERO MODA. This can even be seen in the name of a sub-brand launched by Mecoxlane

, EURO MODA. In addition, this year, Mecoxlane introduced the RAMPAGE fashion women's clothing brand born in the United States, covering mature women with sexy styles and prices higher than EURO MODA.

Compared with ONLY and VERO MODA, Gu is convinced that Mecoxlane's EURO MODA has differentiated competitiveness. "The competition is fashion, but the price is differentiated." It is understood that the price of EURO MODA is roughly one-third of the first two, and the target customers are similar in big cities, but this price makes Mecoxlane's EURO MODA It has obvious advantages in inland small and medium-sized cities. This is exactly what Gu Beichun is optimistic about. In his words, "the city cannot go down, the rural cannot enter the city, and can only surround the city." The former refers to brands like ONLY and VERO MODA, while the latter It refers to some brands that are active in cities and towns but have few traces in first-tier cities. It is out of this consideration that Gu Beichun firmly grasped the two elements of low price and fashion when positioning the Mecoxlane brand.

Another brand that Gu Beichun often compares to is Metersbonwe. In fact, Wang Hongzheng, senior vice president and general manager of retail sales at Mecoxlane, was recruited from Smith Barney. Before joining Mecoxlane, Wang Hongzheng was the deputy general manager of Smith Barney Apparel and general manager of the ME&CITY brand. Gu hopes that Wang will help him improve the profitability of existing stores, and more importantly, build a franchise-based store chain in Mecoxlane's second- and third-tier cities.

Mecolan does not fully compete with Smith Barney in terms of products. Despite the similar pricing, Smith Barney's product target customers are mostly male and Mecoxlane is female, the former is 18-25 years old, and the latter is 22-40 years old. Hence the differentiation.

Whereas in the field of e-commerce, where a large number of advertisements are placed, the product focuses on basic models, and Mecoxlane does not regard it as a competitor. In terms of strategy, Mecoxlane's planned efforts in the field of e-commerce also reflect differentiation: it is supported by rich and value-added products, bringing advertising high-yield returns. Build brand influence.

With the help of "fast" and "fashion", Gu Beichun has made Mecoxun into a Transformer, but we will wait and see how far this Transformer will go next.

The arrival of Gu Beichun brings Mecoxlane back to life.

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