The author | Xia Wenqi
On November 30, "Canada Goose Chinese mainland stores are not allowed to return" appeared on Weibo hot search, and its single product price exceeded 10,000 yuan but was pointed out to have quality problems.
Just a few days ago, Canada Goose just caused a heated discussion for false publicity and was fined 340,000 yuan, and it was ridiculed as a "Canada Duck" for flaunting goose down. Even if sales growth in the Chinese market does not make up for the decline in its revenue in the global market.
However, the impression of the past domestic product Bosideng has become the world's first brand in down jacket sales and sales volume in 2020.
Canada Goose was once a market educator in the expensive down jacket industry, cultivating the minds of consumers who buy high-end down jackets.
But now, with the epidemic, Xinjiang cotton, Tokyo Olympic Games events, national self-confidence and sense of identity have been detonated many times, the public began to question the quality of imported high-end brand products is not superior to the domestic, the enthusiasm for domestic brands, national tides has also reached an unprecedented height.
With this high national sentiment outlet, this year's ANTA revenue has surpassed Adi, #Beijing Winter Olympics ANTA replaced Adi as a clothing partner #also on the hot search, Hongxing Erke live broadcast also harvested the "wild consumption" dividend.
Image source: Network
In the down jacket category, Bosideng has also survived the "darkest hour" of diversification failure, and its stock price has risen by more than 700% in the past five years.
Behind the success is its high-end pricing and design trend strategy: at the end of October, the topic "Bosideng 10,000 yuan down jacket" appeared on Weibo hot search, and this "Dengfeng" series focused on "Mount Everest" professional test; previously, the windbreaker down jacket launched by Bosideng and Burberry designers was also promoted on the hot search.
Affordable down jacket track, the duck and duck brand became a dark horse in August with the innovative snow mountain live broadcast, and even surpassed Bosideng in the sales of Douyin Double Eleven, and Bosideng's snow flying is not far behind, and opened kuaishou live broadcast in October.
In the two major battlefields of high-end and affordable down jackets, who will be the ultimate winner?
In fact, Canada Goose, founded in Toronto in 1957, was previously just an outdoor down jacket brand called Snow Goose, with annual sales of less than $3 million in 2000.
In 2001, Dani Reiss, the son of the former president, took over the company and made a major decision: "Due to trademark issues, the renamed "Canada Goose" logo will be used uniformly, and products will only be produced in Canada,"
This was seen as a risky decision and received a lot of criticism. Because at the time, many apparel companies were moving their factories to Asian countries with lower labor costs. But Dani believes that this is the only opportunity to become the only company with the "Made in Canada" label, and binding national brand sentiment will make it more valuable in the hearts of consumers.
In the end, the success of this strategy exceeded everyone's expectations, and Canada Goose also saw the fastest growth in history, and by 2014, full-year sales jumped to about $200 million.
Canada Goose grew at a cavalier growth rate of 34.4% in fiscal years 2016-2020, with revenue in Asia growing from $110 million in fiscal year 2019 to $230 million in fiscal year 2021.
According to Canada Goose's fourth quarter performance report for fiscal 2021, the direct sales channel in the Chinese market rose by 101.4%. It can be seen that China has become its most important source of growth.
Image source: Market capitalization
According to the data provided by the China Garment Association, from 2017 to 2020, the average growth rate of China's down jacket market size is more than 10%. It is estimated that China's down jacket market will reach 163.6 billion yuan in 2022.
In European and American countries, the popularity of down jackets is between 30% and 70%, while the current popularity of down jackets in China is only about 10%, and there is still a lot of room for development in the future.
As revenue in Canada continues to decline, in order to attract Chinese consumers, Canada Goose's marketing strategy has also shifted from national homemade to Chinese elements.
In January 2021, Canada Goose joined hands with young Chinese designer Angela Chen to launch the 2021 Spring and Autumn Co-branded Capsule Series, adding the characteristics of Chinese design.
However, unlike Bosideng's boom, the epidemic still terminated Canada Goose's rapid growth performance, with revenue of $900 million in fiscal 2021, down 5.7% year-on-year.
In the recent punishment letter of Canada Goose, thousands of words about the evaluation of down jackets have caused heated discussion, pointing out that the key to quality lies in indicators such as the percentage of down, the number of pile grams, etc., rather than the specific duck down origin it advertises.
This year's Double Eleven, Bosideng brand omni-channel flow of 2.18 billion yuan, of which online flow increased by more than 45% year-on-year, and also won the second place in the "Double Eleven" Tmall apparel brand sales list.
As of September 30, 2021, the financial report shows that Bosideng achieved revenue of 5.39 billion yuan in the first half of the year, an increase of 15.6% year-on-year; of which Bosideng's main brand revenue was 3.25 billion yuan, an increase of 19.1% year-on-year. Net profit attributable to shareholders was approximately RMB640 million, up 31.4% year-on-year.
According to the "2021 Top 50 Most Valuable Apparel Brands in the World" released by Brand Finance, one of the five major international brand value assessment authorities, Bosideng was selected for the first time and is the third fastest growing brand, with an increase of up to 39%. In this list, only Bosideng and Moncler are selected for professional down jacket brands.
Previously, in fiscal 2020, Bosideng announced three consecutive years of steady growth in operating income, and this fiscal year hit a record high, achieving a global leader, with the group's revenue of 13.5165 billion yuan and the annual net profit up 42.1%.
In the long run, domestic products are the trend of the times, but the "wild consumption" in the live broadcast room is generally low in price, such as bee flowers, Hongxing Erke, if you do not establish a brand characteristic image, short-term emotions will be forgotten after the short-term sentiment recedes, and Li Ning has become a successful transformation trend brand, lasting growth.
In fact, Canada Goose has been a traditional clothing brand that focuses on outdoor labor protection for decades, step by step by providing clothing for Hollywood blockbusters and stars, to Putin and other political and business celebrities wearing goods, Jeon Ji-hyun and Lee Min-ho wearing it in the snow of Korean dramas kissing...
Successful marketing has made the product explode after 2018, becoming a status indicator, and also planting the idea of "I also want a goose" in the minds of young and middle-aged consumers.
The north side of a few thousand yuan is also a simple style, and in recent years, it has been jointly named with superme and other fashion brands, and has become a "contemporary male college student uniform" after being worn by many rappers and stars. Previously, North side had also released a new sales target of $3 billion by 2021.
In 2018, Moncler also decided to abandon the traditional seasonal fashion collection and instead launch a new limited edition designer co-brand collection every month to cater to younger and more fickle customers, from a pure outdoor down brand to a luxury fashion brand.
However, in 2009, Bosideng hoped to get rid of the dependence on a single down jacket business through the "three modernizations" strategy of branding, four seasons and internationalization, but the strong expansion once made the company face a series of problems such as overcapacity, inventory overstock, aging brand image, and declining revenue.
From 2011 to 2014, Bosideng's net profit plummeted from 1.451 billion yuan to 138 million yuan, and 8,708 offline stores were closed from 2013 to 2017. In 2016, its share price even fell to HK$0.14 at one point.
In 2017, looking at the unlimited scenery of imported high-end down jacket brands, Bosideng refocused on the down jacket business and developed towards expensive and high-end.
In order to establish a high-end brand image, Bosideng has appeared on the show of major fashion weeks, and at Milan Fashion Week in 2020, Kendall Jenner, the supermodel of the Kardashian family, is walking for Bosideng on stage, while Nicole Kidman and Anne Hathaway are sitting offstage, wearing Bosideng down jackets of "Made in China".
At the same time, it launched a Disney co-brand, and cooperated with former LV designers, former design directors of Ralph Lauren and students of Yohji Yamamoto to release designer cooperation models, striving to bring themselves closer to the tide brand.
In China, Bosideng began to sponsor a number of variety shows to invite Yang Mi, Chen Weiting, Xiao Zhan to endorse, earning enough topic and attention.
Down jackets are often complained about as "Michelin tires" because of bloated, but after the arrival of trend stars, Canada Goose and North side have changed from traditional mediocrity to trend symbols. It can be seen that the key to the acceptance of high-priced clothing by consumers is not hard-core quality, but trend identity.
On the Tmall platform, the Bosideng flagship store has a high of 16.98 million fans, much higher than the 4.65 million in the north and 2.04 million fans in Canada Goose.
However, although there are more than 10,000 pieces of the highest selling items in the Bosideng flagship store, they are all basic light and thin models with a price of about 200 yuan; while the highest sales volume in the north is about 3,000 pieces, with an average price of more than 2,000 yuan; Canada Goose is up to 300+ pieces, with an average price of about 10,000 yuan. It can be seen that the impression of Bosideng in the minds of the public is still relatively affordable and close to the people.
In September this year, the average price of down jackets on the Jingdong platform was about 550 yuan, an increase of about 40% over last year.
Coupled with the fact that down jackets are low-frequency consumer goods, it is difficult to achieve "small profits and high sales", and brands such as Bosideng are constantly increasing prices.
On November 26, Rui Jinsong, president of Bosideng Brand Division, said that in terms of price increase, the future will continue to go up, and it should reach more than 2,000 yuan. It is understood that the current main price of Bosideng has reached 1500 yuan -1800 yuan.
Previously, according to the research report of Guojin Securities, in 2018, the price increase of the main brand of Bosideng was as high as 30% to 40%. From 2017 to 2018, the proportion of Bosideng's products of 1000-1800 yuan increased from 47.6% to 63.8%; products above 1800 yuan increased from 4.8% to 24.1%, while the proportion of products below 1000 yuan decreased from 47.5% to 12.5%.
High prices are trendy, although the marketing cost is high, but the profit is higher.
According to Bosideng's financial report data, in the 2020/2021 fiscal year, distribution expenses including advertising expenses, depreciation of right-of-use assets, contingent rent and sales of employee expenses were about 4.807 billion yuan, an increase of 12.4% year-on-year.
Bosideng's overall gross margin rose from 46.4% in fiscal 2017 to 58.6% in fiscal 2021, narrowing the gap with Canada Goose.
However, the amount of discussion of Bosideng's more than 10,000 notes in the Little Red Book is lower than the number of notes of Canada Goose's more than 30,000 and the number of notes on the north side of more than 80,000, which shows that Bosideng lacks the circle of explosions on social media, and its young trend needs to continue to be deeply cultivated.
In addition to high-end, Bosideng has also completed the layout of the low-end product line with the matrix brand snow flying and ice clean.
On October 15 this year, the Snow Fly brand flagship store opened a live broadcast in Kuaishou, cooperated with the official service provider Carmela to implement all-inclusive operation, using the previous test high sales to live sell goods, the first month GMV exceeded 6.8 million, and in the Kuaishou e-commerce 116 quality shopping festival, it became the second place in the women's clothing brand self-broadcast ranking.
At the same time as entering the live broadcast room, Bosideng is also increasing its own stores, closing a large number of offline stores and dealer online stores.
At the end of September 2021, the total number of retail outlets in the down jacket business decreased by 149 to 4,001 compared with the end of last year, including brands such as Bosideng, Snow In the Fly, and Bingjie. At the same time, its self-operated retail outlets increased by 2 to 1809, and the number of retail outlets operated by third-party dealers decreased by 151 to 2192.
What is special is that the flagship store and offline store of the Snow Fly brand are actually mainly men's clothing, but in the clothing category in the short video live e-commerce platform, women have stronger purchasing power, "they will not only buy for themselves, but also buy for children, lovers and the elderly according to their needs." ”
According to the characteristics of the high proportion of women in the platform user portraits, 40% of the release plan of Snow In flight is for women, tapping its consumption potential, and finally this investment strategy has achieved an input-output ratio of more than 4 times, and the follow-up Snow Fly has also added a lot of women's explosive products in the selection of products.
The biggest threat is that another affordable down jacket brand, Duck Duck, became popular on Douyin Snow Mountain Live this year, rising by 300,000 fans overnight.
Compared with the previous elaborately arranged indoor live broadcast room, the planning of duck and duck has instantly attracted the attention of consumers. "We are now in the Tibetan snow mountain at an altitude of 5,000 meters, minus 9 degrees Celsius, and the live broadcast here is to show everyone the quality of our duck and duck down jackets, whether it is resistant to wind or not, whether it is warm or not."
In addition, Duck Duck achieved excellent sales through the construction of the Douyin live broadcast room matrix and the live streaming of celebrity Internet celebrities, and accumulated more than 75 million GMV on the Douyin platform in August. It also ranked first in the 818 Douyin clothing list. In September, Duck Duck's sales on the JD platform were 7 million, which also surpassed Bosideng.
On the Douyin platform, there are more than ten officially authorized live broadcast rooms of Duck and Duck, and the scale of online store distribution is gradually expanding, with no less than 10 stores on the Jingdong platform alone.
On October 15, the national duck and duck brand and the most expensive marketing company "Hua & Hua" held a strategic cooperation signing ceremony to jointly create a super symbol. "You love me, I love you, Honey Snow Ice City Sweet Honey", "Calcium in the blue bottle, delicious calcium", "Taking pictures and shouting loudly Tian Qi" are all successful marketing cases of Hua & Hua Company.com.
Duck duck, a classic brand that first grew up from the Zhiqing Society, once as a diplomatic gift, had a glorious history, but now it is considered obsolete, attracting young people through joint models such as Pokémon.
In November, Snow Zhongfei also launched the Chinese Aerospace Culture Joint Series, paying tribute to the ingenuity of Chinese astronauts, and also rubbed up the concept of "meta-universe", committed to fashion and rejuvenation.
It can be seen that affordable domestic products also need new stories and marketing to be seen by young consumers.