△ Add friend and note "inspection" to register Original: Shen Shuaibo This article's creation thanks Vipshop for its strong support; data provided by Vipshop will run through the entire text. Keywords: Rationality, rise of domestic brands, seven dimensions, three-phase superposition, structural change. Brands mentioned: Vipshop, Apple, Dyson, Thermos, Olay, SKII, L'Oréal, Huawei, etc. In the early Warring States period, Qin was exhausted from years of warfare, and the central plains powers were waiting to carve it up, leaving it on the brink of collapse. Duke Ying Quliang of Qin issued a call for talents to help rectify the situation. The world's scholars either scorned it, were unwilling to endure hardship in a poor state, or were reluctant to leave their own regions. Only one person, after months of visiting Qin's prefectures, counties, villages, and borders, understood the gains and losses of past reforms and the problems in people's hearts, and wrote a ten-thousand-character reform proposal. This person was Wei Yang, commonly known as Shang Yang. He later helped Qin lay the foundation for unifying the central plains. In May 1930, Chairman Mao, to oppose the dogmatism then present in the Red Army, wrote the article "Oppose Book Worship," putting forward the famous assertion: "No investigation, no right to speak." He pointed out:

"If you have not investigated a problem, you should stop speaking on it."

"Pay attention to investigation! Oppose blind talk!"

"The victory of China's revolutionary struggle depends on Chinese comrades understanding China's situation." Placed today, these words still resonate powerfully. A strange phenomenon in today's China: those who have never been to a county town or rural area speak daily about consumption downgrading. Those who have never opened a store always want to instruct you on how to do retail. All truths come from investigation and practice; all truths come from deep and focused immersion in the industry. There is no other way. Intelligence is a good thing, but it cannot be based on imagination; the smarter people are, the easier it is for them to fantasize about things that do not exist. Spring Airlines once had a blunder: they pulled a list of customers who flew more than 30 times a year and invited them to a VIP appreciation event. But a China CEO of a Fortune 500 company replied, "I cannot attend an event with people carrying snake bags." The marketing department was shocked and called to ask, only to understand: because the CEO often left earliest and returned latest, he could only fly Spring Airlines, as Spring couldn't get good routes, which actually met his time needs. But flying frequently doesn't mean customers have a good experience or satisfaction. We always think OPPO and VIVO target third- and fourth-tier markets, and no one in first-tier cities buys them. But in fact, according to Vipshop data, OPPO's sales growth in first- and second-tier cities from 2018 vs. 2014 was 3618.44%, and VIVO's was 3056.66%. Meanwhile, the former high-end brand Samsung saw negative growth. We also always feel Huawei phones now target business people. But according to Vipshop data, in Baoshan, a small city on the Yunnan border with a resident population of over 2 million, Huawei phone sales saw huge growth, reaching 14051.43% from 2018 vs. 2014. The three places with the fastest iPhone sales growth were: Chengmai County in Hainan, Huai'an City in Jiangsu, and Heyuan City in Guangdong. Meanwhile, the pace of phone replacement in first-tier markets has significantly slowed, and in first-tier cities, the iPhone X and the new Max are not the bestsellers; the iPhone 8 Plus is. Dyson is no longer the standard for urban elites. Dyson's growth rate is highest in sixth-tier cities, increasing inversely along the 1-2-3-4-5-6 tier order. In the upcoming 2018 year, compared to 2017, Dyson's growth in sixth-tier cities reached 117.5%, with growth over 500% in the past two years. At the same time, growth in first-tier markets has slowed to 20.95%. All cross-sections point to one issue: all self-righteous speculations may be wrong. What is a market? I believe: the sum of all characteristics of a population is called a market. Today, Chinese consumers have completely changed; no theory from the last century can be applied anymore. Consumers have undergone profound changes in all measurement dimensions, and the superposition of multi-dimensional changes makes the final behavior of consumers vastly different. Coupled with China's three-phase overlap of the economic growth rate shift period, the structural adjustment pain period, and the digestion period of previous stimulus policies, this is a huge test for all operators. The seven dimensions are not in order of importance; in different scenarios, the ranking is completely different. Seven dimensions superimposed on three periods: consumers have completely changed.

  • First dimension: Age According to UN data, China's population aged 25-44 peaked around 2013, accounting for about 33% of the national population, and is expected to continue declining. The elderly population will continue to rise; in 2015, the population aged 15-64 accounted for 72%, down 2.5 percentage points from the 2011 peak. Remember this data: China has 228 million post-80s, 174 million post-90s, and 147 million post-2000s. Currently, the full liberalization of the second child has not brought obvious stimulus. All those in the maternal and baby business should note that the market capacity will not expand in the short term. But this stock is still higher than most countries except India. Absolute leading brands can still pick big peaches.
  • Second dimension: Education Since reform and opening up, the total number of people with university degrees in China will not exceed 80 million, only 4-5% of the total population. A cruel fact in big cities today: junior white-collar workers with higher education may not earn as much as those in service industries. In Shanghai's foot bath shops, it's normal for top technicians to earn 18,000-20,000. Courier brothers can earn around 10,000-15,000. But due to their different educational backgrounds, their consumption concepts are fundamentally different. The entertainment programs they like and the stars they like are completely different.
  • In the previous case, we also mentioned the third measurement dimension: Income The income-to-housing-price ratio in first-tier cities has made them less capable of consumption. But on the other hand, due to the property expansion in the past few years, many people have become "millionaires," and this good feeling supports them in consuming certain items: high-end spas, upscale restaurants, small items with low cost-performance, etc. But they can no longer afford big-ticket consumption, such as changing cars. The market for space-occupying consumption upgrade products targeting young people is very small, because most young people with such aesthetics are renting houses. There is no place to put these beautiful but impractical things, but they will give the illusion in reviews that they are selling well. We mentioned earlier that Heyuan City, with the fastest iPhone sales growth, is also the city with the fastest growth in robot vacuum sales over the past five years, reaching 1638%.
  • So in China, housing prices exist as the fourth dimension affecting consumption First-tier cities, whether due to housing prices or gradual maturity, show a rational return of consumption from the results. Vipshop captured all reviews on its platform and found that the frequency of the word "cost-performance" rose from 1.4% in 2016 to 4.5% in 2018. Products like Corning pots, Thermos cups, and down quilts saw sales increase dozens of times during discount events compared to normal days. Silk products, even with average promotion placement, can quickly increase sales when discounts are large. The most important decision keywords for underwear purchases are: comfort + cost-performance. In the past two years, sales of wire-free bras that are healthy, comfortable, and cost-effective have surged, and sales of underwear sets have grown significantly. In beauty, the number of gifts significantly affects whether consumers buy. Sales of affordable alternatives to high-end skincare have increased. For example, sales of Olay's small white bottle, an alternative to SKII's small bulb, have surged. We have been studying Japan across the sea, studying its lost two decades. The mainstream school is that the bubble economy led to Japan's decline, but in Kenichi Ohmae's "The Low Desire Society," it is mentioned: in Japan's lost two decades, bank savings increased by 600 trillion yen, and urban elderly in Japan had an average of 30 million yen in deposits at death, never used. Therefore, Japan's weak domestic demand is because people tend to save rather than consume. This is completely different from China. Chinese people are in a strong wave of consumerism and egoism, meaning if they have money, they will spend it. If they don't have money, they will borrow. The rolling waves of the past forty years have changed Chinese consumption concepts, especially noteworthy: college students born in 1997 will officially graduate and enter society next year. When they have their first disposable income, their different consumption concepts from the previous generation will affect the entire consumer market. And this previous generation does not refer to the post-80s, but those born between 1990-1994. Children born in 1997 don't remember the return of Macau and Hong Kong, don't know the floods that swept China in 1998, and don't remember the frenzy of China's successful Olympic bid. They don't have those most unforgettable shared memories. This generation, whether from poor or rich families, has almost never gone hungry. Most are only children, the apple of the family's eye. Many of them have no obsession with success.
  • Therefore, the consumption concepts of different groups as the fifth dimension deserve close attention We used to joke about selling kidneys to buy Apple phones, but a lot of data shows that many college students are willing to borrow money to buy luxury goods. I once opened a store. Our clerk born in 1997 started working after junior high school, earning about 4,000-5,000, and couldn't save a penny all year, often using various cash loans. But they would buy new phones, go to Haidilao, sing at Haoledi, and not miss a single new movie. Later, employees at Pai Dong Media, especially those born after 1995, were basically living paycheck to paycheck. During Double 11, I paid wages a week early, and surprisingly, they collectively posted on WeChat Moments to "praise" me, which was more effective than any training or sharing I thought was valuable.
  • The sixth dimension, crucial, is consumer confidence Notably, according to the data report provided by Vipshop, consumer confidence in rural markets is very strong. Confidence is not entirely proportional to actual wealth. It is directly related to expectations of one's income, satisfaction with the present, and how much savings are needed for the future. In first-tier cities, insecurity about education and healthcare suppresses much consumption.
  • The seventh dimension is urban generational differences and regional differences This is the unique difference of this vast country. Australia, the US, and Russia have vast territories, but their populations are heavily concentrated, with some countries' capital core areas accounting for over 50% of the population. This makes their market hierarchy and depth not as different as China's. The same applies to small developed countries like South Korea, Japan, and France. But we find that the generational gap between cities is rapidly narrowing. Women in cities of all tiers have converged in consumption views on cosmetics, clothing, maternal and baby products, etc. In addition, consumers have formed brand awareness for high-end brands, cross-border brands, and high-tech products, making it easy for brands to win all. Furthermore, consumers are increasingly familiar with product prices, especially in standard categories. It will become increasingly difficult for middlemen to earn price differences. But there are still many categories with significant generational differences. For example, gold: first-tier cities pursue international brands and designs far more than lower-tier cities. Shanghai's Laomiao Gold and Chenghuang Temple Jewelry have strong dominance over southern cities. But well-known brands in the northern market cannot break through upward. Customers in third-, fourth-, and fifth-tier cities have a narrow awareness of underwear brands, only knowing Urban Revivo, while people in first- and second-tier cities have more widespread awareness. Because first-line underwear brands simply don't open stores below second-tier cities, consumers in fourth- and fifth-tier towns get brand and product education through e-commerce, building awareness of high-end underwear brands and different product types. There are also special categories that almost only exist in certain regional markets. For example, Hunan Province's love for betel nut. The top 10 brands are all on a scale of hundreds of millions. The above seven dimensions are not comprehensive; add dozens of sub-dimensions, and random combinations produce tens of thousands of different consumers. A basic fact: it is impossible to appeal to consumers with a universal approach. Consumers have completely changed. For operators, only by following changes can they survive. Vipshop surveyed thousands of mothers and found: When children are in the fetal stage, 0-3 years old, and over 3 years old, mothers' considerations when purchasing products change.

Mothers in the pregnancy stage need to be educated and rely on word of mouth;

Mothers with babies 0-3 years old value safety, health, and brand most;

Mothers with children over 3 years old, when the child has passed the dangerous growth period, price will account for more in their considerations, emphasizing cost-performance. Last year, a large number of agricultural product stores used the old man in the picture below as a promotional image, and it worked well initially until it became a joke. But because the Chinese market is huge, many people still fall for it. Image source: Weibo @吴蚊米 This year there is a new trick: I speak for my father. Think carefully, and you'll find it's actually a kind of off-position competition: this rustic, emotional advertising is especially suitable for selling to city people. Because urban advertising doesn't use this approach; in the high-end advertising route, the urban market is already mature and has developed "antibodies," so this differentiated approach can succeed. In the past, the brand world generally believed that too many promotions were bad and damaged the brand. But today, this has become a new normal, and even consumer purchasing behavior has concentrated around promotional seasons. March 8 Women's Day is Vipshop's biggest underwear promotion node, with single-day bra sales close to half a month's sales on normal days. During big promotions, consumers also stock up on skincare products to a certain extent. Another example: Thermos sells tens of thousands on a normal day, but when a discount special appears, it sells over a million at once, showing that consumers are familiar with normal prices and are very savvy; when discounts appear, they immediately snap up, reflecting that consumers understand normal prices thoroughly. Compared to the past, customers choose more cost-effective skincare sets, such as buying a full set of toner, lotion, and essence, or L'Oréal's small beauty box containing many different product samples. At the same time, customers tend to choose more cost-effective large-capacity products, such as a pack of 60 masks. The superposition of multiple dimensional changes, coupled with macro trends, has led Chinese consumers toward fragmentation, rationalization, and stratification. We must understand: Once the consumer structure undergoes irreversible changes,

All past experience may be a burden,

And the new way is actually a new way of thinking. This change seems slow, but it is actually rapid; sailing against the current, if you don't advance, you retreat. Tenth B-end E-commerce Inspection -- "From Products to Scenes" Activity time: December 10-13 Activity locations: Wuhu, Nanjing, Changsha Activity process: Morning of Dec 10: Visit Three Squirrels headquarters + snack store

Afternoon of Dec 10: Visit Nanjing Squirrel small store

Evening of Dec 10: Visit Nanjing Master Gao Beer Workshop

All day Dec 11: Nanjing-Changsha, or free arrangement

Morning of Dec 12: Community group buying exchange salon

Afternoon of Dec 12: Koala Selection Hero League launch event

Evening of Dec 12 to early morning of Dec 13: Field visit to Koala Selection logistics center -- This time is the peak sorting period in the warehouse, allowing direct observation and learning of the back-end operation process of community group buying e-commerce Welcome interested distributor friends to join us to understand and inspect on-site : Organization format

  1. Big shot exchange salon
  2. Company visit
  3. On-site explanation
  4. One-on-one exchange
  5. Actual market case visit Friends who want to participate If interested in a particular day's content, you can register separately Long press this QR code or click "Read Original" to register in one click! Add friend and note your intention -END-