In the era of rational consumption, MINISO is pursuing a kind of universality, whether it is those who no longer blindly pursue high-premium brands, or those who pursue low prices and pay attention to quality, they can find some "small luck" in MINISO.
Wen Wang Yadi Shi Dan.
id | bmr2004
In London's West End, England, there is a long 1The 25-mile stretch of Oxford Street is home to more than 300 shops from around the world. With everything from high-end fashion brands and designer boutiques to high-end fashion chains, traditional British department stores and more, it is one of London's busiest shopping streets, attracting millions of visitors and locals every day.
On the morning of November 10, 2023 local time, a Chinese figure appeared in the world's top business district, and MINISO, covering an area of nearly 3,000 square feet, opened. Following the opening of the MINISO blind box theme store on London's Shaftesbury Avenue at the end of September 2023, it is once again sprinting to the heart of London. Liu Xiaobin, chief marketing officer of MINISO Group, revealed in an exclusive interview with the reporter of "Business School" that he has been upgrading his brand strategy in the past two years, and is expected to open a national *** in the Champs-Elysées in Paris, France in 2024
Since opening its first overseas store in Southeast Asia in 2015, MINISO has spread to 107 countries and regions around the world in eight years. Liu Xiaobin positioned the company's overseas model as the 30 stage, with 10 stage of the "manufacturing type" and 2The "distribution type" of the 0 stage is at 3MINISO at stage 0 emphasizes more branding and localization. After the brand upgrade, MINISO is more "big" and "expensive".
Overseas Chinese in Southeast Asia planted the seeds of going to sea
Singapore became the first stop for MINISO to go overseas, and then it gradually established a network in Southeast Asia. Southeast Asia ushered in a good start, and MINISO used the ability of the best business to quickly stake its ground, expanding from Southeast Asia to other countries and regions around the world.
In 2015, MINISO was established only two years ago, and there is still a lot of room in the domestic market. At that time, MINISO had only 1,100 stores in China, and the market penetration rate was far from reaching the ceiling.
We are not prepared to look outward because the growth of the domestic market has peaked. The reason why I went to sea was completely an attempt. Liu Xiaobin said frankly that due to the proximity of geopolitical culture, Southeast Asia has become the first stop for MINISO to successfully open overseas.
During the 2015 China Import and Export Fair, a group of overseas Chinese from Southeast Asia who came to Guangzhou to travel saw a lot of MINISO stores, and they felt the rich categories and high cost performance of such retail formats, so they took the initiative to extend the business of MINISO in the market of the country where they were located. In this way, in December 2015, they moved the stores and operation model of MINISO to Southeast Asia and became the first batch of overseas first-class merchants. Singapore has also become the first stop for MINISO to go overseas.
Subsequently, MINISO gradually established a network in Southeast Asia. In February 2017, three stores in Indonesia opened at the same time, and all the products on the shelves were sold out in less than 10 minutes. Within a year of entering the Indonesian market, MINISO opened 100 stores.
Now, nearly 7 years have passed, and the number of MINISO stores in Indonesia has reached more than 260. Liu Xiaobin pointed out that MINISO's stores are mainly located in large shopping malls, and the number of shopping centers in Indonesia is about 500. According to this calculation, MINISO has entered more than half of Indonesia's large shopping malls.
Southeast Asia ushered in a good start, and MINISO used the ability of the best business to quickly stake its ground, expanding from the Southeast Asian market to other countries and regions around the world. As of September 30, 2023, the number of MINISO stores in overseas markets reached 2,313, an increase of 286 year-on-year. Among them, there are 1,264 stores in Asian countries other than China, and 654 stores in American countries, accounting for 54% of the total number of overseas stores6% and 283%。
In the first quarter of fiscal year 2024, MINISO's total revenue reached 37900 million yuan, a year-on-year increase of 367%, of which, 13 percent was revenue from overseas markets0 billion yuan, a year-on-year increase of 408%。Revenue from overseas markets accounted for 342%, compared to 332%。
Ye Guofu, Founder, Chairman and CEO of MINISO, said, "With the gradual normalization of offline travel in 2023, we have been able to invest more in the development of the overseas direct sales market, driving the overseas direct business revenue to maintain a year-on-year growth rate of more than 80% for two consecutive quarters. In addition, revenue in the North American market increased by nearly 160% year-on-year in the third quarter, and the business development in emerging markets represented by North America is encouraging. ”
For the operation of overseas markets, MINISO adopts two modes: direct sales and first-class sales. In the direct sales model, MINISO sets up a local subsidiary to operate the business, and the subsidiary needs to ensure its own revenue and profits. The model is to cooperate with local businessmen, and MINISO has set up a "national representative" to coordinate the communication between the headquarters and the businessmen, who only provide the goods to the businessmen, and the businessmen are solely responsible for the local operations.
As of September 30, 2023, MINISO had 202 overseas directly-operated stores, an increase of 71 year-on-year and 26 month-on-month, and 2,111 third-party stores, an increase of 215 year-on-year and 100 month-on-month.
Liu Xiaobin said that the choice of direct sales model will take into account the development potential of the local market, the strategic significance, and the degree of grasp of independent operation. The U.S. retail industry is the most concerned market in the world, from the perspective of global brand building, its value is very high, and it may radiate to the entire Western world, such a market will choose the direct sales model, and the number of stores has exceeded 100.
The management of the flexible ** chain forms a "flywheel effect".
Quantity price, buyout customization, no pressure payment", MINISO relies on this set of **chain party** to enable it to open the market relatively quickly both at home and abroad.
Chinese consumer brands go overseas 1Stage 0 is a "manufacturing type" characterized by traditional ** and commodity OEM, 2The 0 stage is a "distribution type" that emphasizes the advantages of first-chain manufacturing and cost advantages. Today, Liu Xiaobin positions the overseas mode of MINISO as 3Stage 0, more emphasis on branding and localization.
It is understood that MINISO has an average of 100 new products per week, and there are about five or six hundred products a month. Quantity price, buyout customization, no pressure payment", MINISO relies on this set of **chain party** to enable it to open the market relatively quickly both at home and abroad.
Liu Xiaobin pointed out that the cost is controlled through large-scale customized direct procurement, and then the markup rate is reduced by flat circulation, so as to create a product matrix with high quality and low price and diverse SKUs. Up to now, MINISO has cooperated with more than 1,400 first-class merchants in the world, mainly in the Pearl River Delta, Yangtze River Delta and Central China Lake regions. Among them, the top merchants in the Pearl River Delta account for about 50%, mainly covering digital appliances, textiles, toys and gifts, skin care and other categories.
In 2014, MINISO, which was established less than two years ago, began to expand nationwide, opening a number of stores. In November of the same year, at the Asia-Pacific Beauty Exhibition in Hong Kong, Dou Na, the current executive vice president and chief product officer of MINISO, unexpectedly found that there was a company that has been making perfumes for more than 20 years - Guangzhou Xuelei Cosmetics*** hereinafter referred to as "Xuelei"), and she was deeply impressed by the quality of its products and its own design.
As soon as the exhibition ended, Dou Na's team immediately made an appointment to visit the Xuelei factory, and on the day of the inspection, they chose an original design perfume as the first cooperative product. It is reported that in less than two months from the first-class, signing, product proofing, filing and other processes, its cooperative products were shipped in early January 2015.
In the ninth year of cooperation, Xuelei's purchase volume has increased by 300% compared with the first year's cooperation. Xue Lei said that when she met MINISO, the number of domestic stores was almost 200, and she had not yet started to do the international market.
Such a fast "MINISO speed" and the advantages of a large number of orders have enabled the first business to speed up the pace of cooperation with MINISO. In 2015, it began to strive to seize the international market and launched comprehensive strategic cooperation with Singapore, the Philippines, Vietnam and other countries. By reducing costs through scale effects, MINISO has also persuaded many high-quality suppliers to supply big brands.
For example, Givaudan, the perfume merchant of MINISO, is a top European fragrance manufacturer for more than 100 years, and also produces classic perfumes such as Hermes and Chanel; The cumulative sales of MINISO eyebrow pencil have exceeded 100 million, and the first business has cooperated with Dior and Maybelline; The mobile phone charging cable supplier "Lixun" is Apple's first supplier.
In addition to the domestic ** chain, MINISO has also laid out some overseas ** chains. Liu Xiaobin said that overseas local first-class merchants have a better understanding of consumers' aesthetics and use demands, and the products they produce will be more in line with local needs. For example, at present, the proportion of direct procurement from the local ** chain in the U.S. market is not less than 15%, and the perfume and fragrance in the Indonesian market are mainly directly sourced locally, accounting for about 25% of the whole category.
Data for the fiscal year ended June 30, 2023 shows that MINISO launched an average of about 530 SKUs per month across its channels, providing consumers with a broad portfolio of approximately 9,700 core SKUs to choose from, the vast majority of which belong to MINISO's own brands. For MINISO, achieving a dynamic balance between rapid new products and quality assurance is the key to maintaining the advantages of the first chain. It adopts a digital chain management system to ensure the rapid response and flexible management of the channel.
Liu Xiaobin explained that MINISO is also carrying out digital transformation, opening a digital chain intelligent management system, providing real-time sales data of terminals for overseas merchants, based on this, MINISO can dynamically order the global market. For example, the automatic system can ** whether a certain type of single product is lower than the safety stock, at which time node can be stocked in advance, and the full-cycle inventory management can be optimized, so that there will not be too much inventory backlog and waste, and there will be no front-end demand, the back-end can not keep up.
It is understood that MINISO has an internal planner who is responsible for inventory management, monitoring and operation of category goods to ensure that the goal of benign inventory and sell-out is achieved, so the demand data capture for the plan is more accurate. For example, Xuelei also has an internal PMC (Production and Material Control) department, which can do data analysis based on the products it cooperates with. Through the actuarial calculations of both parties, the best business can achieve on-time delivery and ensure that the inventory is in a benign state.
The importance of the chain in the retail industry is self-evident, and effective chain management can not only better control the cost of commodity procurement, inventory and logistics, but also help to adjust the product structure and inventory strategy to better meet consumer needs. MINISO's flexible first-chain management model promotes franchisees to enter a positive cycle, and they are willing to open more new stores while recovering investment costs, and the "flywheel" is turning faster and faster.
"Happy philosophy" in the post-IP era
The difficulty of grasping the super IP is to accurately grasp the preferences of IP fans and understand the cultural core behind the IP, so as to ensure that product planning and design are not limited to a simple image, but integrate it into the function of the entire product.
When MINISO participates in international competition, it has a very rich reserve of IP resources, which is not inferior to local retailers in North America. In Liu Xiaobin's view, in addition to the advantages of the first chain, IP is an important starting point for upgrading its global brand.
In 2016, the collaboration between MINISO and Sanrio's Hello Kitty verified the effectiveness of the IP for the first time. Sanrio's series of IP images are not only loved by Chinese consumers, but also by consumers in Southeast Asia and even Europe and the United States. Liu Xiaobin said that this kind of business success has strengthened the determination of the IP co-branding strategy, so MINISO will cooperate according to the list of the global IP value list in the future.
Over the past seven years, MINISO has successively cooperated with many top IPs around the world, including niche IPs in some vertical fields, as well as animation, film and television, games, sports and other fields. As of June 30, 2023, MINISO has cooperated with more than 80 IP copyright owners and launched more than 2,300 IP co-branded products.
For the empowerment and blessing of IP, Liu Xiaobin refined three key words: good-looking, fun, and easy to use. "Good-looking" refers to high appearance, containing a unified aesthetic concept of life; "Fun" is to give the product more spiritual connotation through IP, which reflects the business philosophy of MINISO - happy philosophy; "Easy to use" refers to relying on the domestic first-class chain to ensure that the products are of high quality and cost-effective.
This "happy philosophy" has also continued overseas, and two of MINISO's three strategic categories in the world are closely related to IP, namely blind boxes and dolls, in addition to fragrances, including perfumes and aromatherapy. In November 2023, ***, which landed on Oxford Street in London, England, will be based on pink, integrating British urban elements into the design, and at the same time, a giant Penpen doll display space has been created in the store. Penpen is the star product of MINISO's own IP "Mini Family" doll family, and plush dolls, keychains and other products derived from the image of Penpen are loved by overseas consumers.
In February 2023, MINISO upgraded its brand positioning to "a lifestyle brand featuring IP design", and enhancing product competitiveness through IP design has become an important strategy for it to build a global brand. Liu Xiaobin said that MINISO regards IP co-branded products as a long-term business.
He explained that MINISO's IP licensing business is a marketing event that is not a short cycle of continuous operation, and it is the production of a variety of products of various IP series in its own business. Because if you want to get an IP license, the cycle from product planning, development, production to launch will take at least three months to half a year, and if you count the business negotiations in the early stage, it will actually take longer. MINISO cooperates with IP on an annual basis, and some even sign contracts of up to 5 or 10 years.
For example, in 2022, MINISO reached a cooperation with Mattel on Barbie's IP licensing and began to design related products. In July 2023, more than 120 products will be launched, covering 12 categories of daily necessities, and combined with the "Barbie" movie hit cycle, they will be launched in China and the United States at the same time. The "Barbie" IP series products were launched for two weeks, the sell-out rate reached 70%, and the performance of the Guangzhou Barbie theme store on the first day of opening increased by 124 compared with the single-day performance of the trial operation9%, and many stores across the country have also announced that popular products are out of stock. It is reported that there will be a new wave of new plans for Barbie's new products in December 2023 and 2024.
In Liu Xiaobin's view, the difficulty of grasping the super IP is still at the user level, accurately grasping the preferences of IP fans, and understanding the cultural core behind the IP, so as to ensure that product planning and design are not limited to a simple image, but integrate it into the function of the entire product, which is the core. IP co-branding and globalization complement each other, and the larger the global market and the more stores MINISO opens, the more conducive to IP licensing cooperation can be strengthened, and the lifestyle brand concept featuring IP design can be strengthened.
According to previous industry association data, the total size of the global trendy toy industry will exceed US$34 billion in 2022 and is expected to approach US$45 billion in 2024, with a compound growth rate of about 14%. In 2020, the size of the blind box market in Asia reached 77US$7.6 billion, accounting for about 32% of the global total; The scale of the blind box industry in the North American market reached 55US$8.9 billion, accounting for 23%; The European blind box market size is 510.3 billion US dollars, accounting for 21%.
Liu Xiaobin said frankly that blind boxes are the first strategic category of MINISO in the world, because this category still has great potential in many overseas markets, and many consumers have not yet formed a strong understanding of the blind box category, but once they experience it, they like it very much, and there is a natural high repurchase rate. Its consumer group has a long purchase cycle, although it is not excluded that some people will eventually come out of the "pit" after entering the "pit", but its entire life cycle is durable enough.
As long as we choose the right IP, it has the ability to attract fans", Liu Xiaobin is not worried about over-reliance on IP. He believes that MINISO has abundant IP resource reserves to ensure that there are new IP and new products every month, and constantly use fresh products to meet consumers' desire to buy.
Brand upgrade, has the product become "more expensive"?
MINISO's overseas pricing can still ensure that it has the best advantage over similar brands in the local market.
On February 24, 2023, MINISO announced the upgrade of its brand strategy, hoping to build a highly global super brand in the next 5-10 years. **Chain and strong IP are the two major bases for realizing its overseas vision, and ** and image store are external manifestations.
Liu Xiaobin said that in 2023, MINISO will accelerate the pace of upgrading the image of the terminal, and the external performance is to open many large stores with independent houses, such as: Beijing Road in Guangzhou, Chunxi Road in Chengdu, Oxford Street in the United Kingdom on Huaihai Middle Road in Shanghai, and Times Square in New York, etc.
Taking Guangzhou *** as an example, the store is the first MINISO in South China, with a total area of nearly 1,000 square meters, and the overall layout of the store is divided into three floors, with nearly 2,800 SKUs, one floor covering blind boxes, digital, food and other categories; The second floor mainly covers daily care, fun, beauty care, cultural and creative and other life categories, and sets up a special IP area; The third floor is the Fragrance Museum.
It is reported that Guangzhou *** will achieve a monthly sales volume of more than 5 million yuan in the summer of 2023, refreshing the past record of MINISO, and the upper limit of monthly sales of a single store in the past was generally 2 million 3 million yuan. New York Times Square*** sales exceeded 550,000 yuan on the first day of opening, with a monthly revenue of nearly 10 million yuan. The world's major models have refreshed the performance milestone, which surprised Liu Xiaobin.
In his opinion, the investment in opening a large number of stores is relatively high, whether it is rent or operating costs, it was originally expected to ensure that there is no loss of money, and the big store model is more to release the signal of brand upgrading. However, in fact, MINISO's cost-effective products and IP features are very popular with consumers, especially young consumers, which is the biggest gain in 2023 and also provides experience for its subsequent overseas expansion.
It is worth noting that while MINISO is "getting bigger", there is also a controversy about "becoming more expensive". Originally sold in China for 29A blind box of 9 yuan may be sold for 10 pounds (about 83 yuan) several times in the UK. On social platforms, many netizens have doubts about the overseas pricing and product categories of MINISO, believing that the categories are different from those in China, and they are also more expensive than those in China.
In China, MINISO has also raised prices for some products. For example, MINISO's fragrance used to retail for $399 yuan, the current retail price of the "Master Fragrance Room" series is 799～89.$9.
Liu Xiaobin pointed out that the "Master" series is an attempt made by MINISO, hoping to turn the aromatherapy category into the brand's "mental signature dish". MINISO and the world's professional perfumers and the three top spice ** merchants set up the "Master Fragrance Room", the internal originally did not have a lot of confidence in the price increase, but later found that with a good product concept, combined with the private domain, the public domain of grass planting and marketing, the establishment of the product mentality, is still very popular.
It is reported that after the establishment of the "Master Fragrance Room", it launched the Master Classic Series, the Master Floral Series, and the Master Star Wish Series of fragrances. In the past year, sales have exceeded 90 million yuan. As for overseas pricing differences, Liu Xiaobin believes that this is one of the manifestations of localization.
He said that overseas expansion also needs to maintain positive profits, and some places may have higher rent, labor and operating costs, and need to set a relatively high unit price multiple. Consumers in each country have different spending power, and pricing needs to be based on local currency conversion, rather than directly converting domestic pricing from RMB to USD or EUR. Overall, overseas pricing can still ensure that it has the best advantage over similar brands in the local market.
MINISO's core customer base has not changed, and it is still positioned as a young, female, and trendy consumer group overseas. It is reported that female consumers account for about 80% in China and 70% or 80% overseas. For MINISO that goes overseas, the difficulty still lies in the grasp of "localization".
Liu Xiaobin said that going overseas must be rooted in the local area to meet the needs and preferences of localized consumers. In the selection, marketing model, product development and other links to take into account the local cultural traditions. For example, Indonesia has one of the largest Muslim populations in the world, with about 90% of the population being Muslims.
In the era of rational consumption, MINISO is pursuing a kind of universality, whether it is no longer blindly pursuing the middle class of high-premium brands, or the salarymen who pursue low prices and pay attention to quality, they can find some "small luck" in MINISO.
This article ** was provided by the interviewee).
*: Business School Magazine, January 2024.