Baozun E-commerce Revival in China GAP: Opening More Specialized Stores
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发表于 2024-7-9 20:07:37
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On July 8th, the American fast fashion brand GAP opened a new store in Shanghai MixC. This is the 12th new store opened by GAP brand in mainland China in the first half of 2024, and also the 4th new store in the Shanghai region. Other new stores are located in large and medium-sized cities such as Guangzhou, Changsha, Shenyang, Xi'an, and Guiyang.
According to GAP China's information, GAP is expected to open more new stores in the second half of 2024 than in the first half.
The GAP brand's new store, located on the third floor of Shanghai MixC, covers an area of over 500 square meters and sells a full range of products for men, women, and infants and young children. In the first two months, only in Shanghai, GAP brand opened a store in Jing'an Daringcheng in June; In the same month, GAP also opened a new store at Shanghai Hongyi International Plaza; In May, GAP also opened a children's clothing specialty store in Nanfeng City, Hongqiao, Shanghai.
It is worth noting that the children's clothing specialty store is a new offline store model launched by GAP after being acquired by Baozun E-commerce for one year. In February 2023, e-commerce service provider Baozun E-commerce officially completed the acquisition of GAP's Greater China business, which is also an important step in Baozun's e-commerce transformation.
After acquiring GAP, Baozun Group has updated its business composition and formed two main business lines, namely e-commerce business and brand management business. Baozun E-commerce's Q1 2024 financial report stated that its brand management business has two brands, GAP and Hunter. The revenue from brand management business in the first quarter increased by 65.6% year-on-year to 310 million yuan; After adjustment, the operating loss was 29.3 million yuan, which narrowed compared to the same period last year. The reason for the larger increase in revenue is that the operating period of GAP during the same period last year was only 2 months.
Baozun stated at the financial report that the pricing strategy of strict discount control and optimization of supply chain and inventory have enabled GAP to achieve strong sales during the Spring Festival period, and inventory turnover has also improved. In the first quarter, the gross profit margin of brand management business was 53.1%, and the inventory turnover days decreased by 20 to 140 days compared to the same period last year.
Based on the aforementioned information, GAP will flexibly open stores that only sell children's or adult clothing according to the positioning and customer needs of different markets and even shopping malls. The children's clothing specialty store in Nanfeng City, Hongqiao, Shanghai is designed to provide more targeted products and a fun shopping environment for the target customer group.
In December 2023, GAP opened a separate Tmall flagship store specifically for children's clothing, which was later extended offline.
Du Bin, Chairman of Hanbo Commercial Shanghai, a commercial real estate consulting company, told Interface Fashion that children's clothing has always been a strong selling category for the GAP brand. Many brands now open separate counters and large stores for certain sub categories to expand their business models, such as Li Ning's opening of separate stores for the high-end line in 1990.
In addition to opening regular stores, GAP is also trying the pop-up store model in Shanghai, Beijing, and Tianjin to conduct market forecasting and directly obtain consumer feedback. For example, before opening, the Shanghai Hongyi International Plaza store opened in the form of a pop-up store in the mall atrium, and then opened its official store.
On the other hand, pop-up stores have also become a form of market response for GAP testing new series. In the summer of April, GAP opened a summer limited time experience space at its flagship store at 863 Nanjing West Road in Shanghai, and linked it with online marketing activities.
From the site selection and location of the new store, GAP has secured a first floor position in family oriented mid-range shopping malls in multiple cities.
Regarding this, Du Bin stated that although the average vacancy level of offline shopping malls in China has rebounded from the previous high of 30% -40%, the average vacancy rate is still 10% -20%, and the data for first tier cities will be better. In this situation, brands with the financial strength to open chain stores should first have favorable conditions for negotiation, and secondly, the location can also be discussed. Universal fast fashion brands such as GAP and Uniqlo are already mostly located on the first floor of shopping malls that cater to family oriented customers.
Although online channels are the advantage of Baozun E-commerce, in order to become a clothing retail brand, it is an inevitable choice for large-scale brands to advance both online and offline simultaneously. This not only involves a sense of experience, but offline chain stores are also an important asset in cultivating consumer trust.
In the aforementioned Q1 financial report, Baozun stated that Chinese consumers are more sensitive to prices online and value more offline. Although offline purchases are less frequent than online, the average unit price, order volume, and profit margin are still higher than online.
To this end, GAP has increased the proportion of products exclusively available online to balance revenue growth and discount control; On the other hand, offline store products have more streamlined SKUs and more concentrated styles, which helps to shape the brand image.
However, whether online or offline, discounts and discounts are still clearly a normal operation for GAP.
Although GAP has made many operational adjustments based on the Chinese market, such as hiring the new generation celebrity Ouyang Nana as the "brand renewal manager", inviting fashion experts to take fashion photos during the new product series promotion stage, and developing functional products such as sunscreen jackets and cool clothes in response to outdoor trends, GAP still emphasizes its American leisure genes in brand positioning. This inevitably brings a sense of contradiction to consumers.
Looking at the same price range and category, GAP already has too many competitors in the Chinese market, and the American leisure style has also faded. Starting from scratch, GAP must quickly establish its brand positioning in order not to waste this opportunity for rebirth.
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声明:该文观点仅代表作者本人,本文不代表CandyLake.com立场,且不构成建议,请谨慎对待。
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