Image source @ Visual China
Text | At the forefront of entrepreneurship, the author | Li Xiaofeng, Editor | Feng Yu
Entrepreneurs and capital are once again eyeing the jewelry business of Generation Z.
Since last year, many jewelry collection store brands such as BA Jewelry Bureau, ME+ Jewelry Hot Search Station, ACC Super Jewelry, Andy Warehouse have emerged one after another. Among them, some brands have also received the blessing of well-known investment institutions such as Shunwei Capital and Gaozhang Capital.
Different from the previous street jewelry shops, the new jewelry collection store has attracted the attention of more young consumers with its ultra-high cost performance and immersive experience. In a short period of time, these brands have also quickly taken root in the core business districts of first- and second-tier cities, trying to leverage the wallets of Generation Z with small jewelry.
How are the abacuses of practitioners and capital playing?
01 A collection store of jewelry
On Saturday evening, in Beijing's Xinzhongguan Shopping Center, several jewelry collection stores such as Xuanzi, Ajidou and Lannuo were crowded with young consumers.
Photo / Lanno store on Saturday evening
This year, such jewelry collection stores have blossomed in major business districts in first- and second-tier cities. According to the incomplete statistics of "The Forefront of Entrepreneurship", there are at least 4 jewelry collection stores in the Xinzhongguan Shopping Center in Haidian District. In addition, Hopson Hui Mall brings together brands such as BA Jewelry Bureau, Xuanzi, ACC Super Jewelry, etc., Xidan Commercial Circle has UFO and SUK jewelry collection stores, and Sanlitun has also opened NISE.
Some new jewelry collection stores have a large area, such as the STORE area of BA Jewelry Bureau between 160 and 200 square meters; the store area of Onion Warehouse and ACC Super Decoration is also more than 150 square meters.
Their store decoration also generally has a sense of design and recognition, mainly in the novel design of the display cabinet, the color matching is more visual impact and so on. It has been observed that most stores have a full wall of jewelry, which is not only easy to choose, but also a good place for Internet celebrities to punch cards.
The big store model naturally also requires a rich variety of goods. There are many types of goods such as earrings, necklaces, bracelets, headdresses, scarves, hats, etc. in the jewelry collection store. According to public data, each store of BA Jewelry Bureau has nearly 10,000 products and thousands of new products every month; Onion Warehouse and ACC Super Decoration also have 10,000+ SKUs.
These jewelry collection stores are not only popular in first- and second-tier cities, but also have keen practitioners in the sinking market chasing the wind.
In August this year, the post-90s Yang Xuan (pseudonym) opened a jewelry collection store covering an area of less than 30 square meters in Zibo City, Shandong Province. Her store is next to a local university and is located in a developed area of the night economy, and the flow of customers is almost uninterrupted during peak night hours.
The new jewelry collection store has only been popular for more than a year. "Entrepreneurship frontline" observed that many brands such as BA Jewelry Bureau, ME+ Jewelry Hot Search Station, ACC Super Jewelry, Litchi Lychee, Onion Warehouse and so on were established in 2020.
While being sought after by young consumers, jewelry collection stores have also been bet by capital. According to public reports, in April this year, Onion Warehouse completed an angel round of financing of nearly 10 million yuan from Gao Zhang Capital; in early May, ACC Super Jewelry received nearly $100 million in financing from Orchid Asia, Xiaomi Group and Shunwei Capital.
Jewelry collection stores, which have been assisted by capital, are still in the stage of staking land. According to public reports, ACC Super Jewelry is expected to have 500 stores by the end of this year, ME+ Jewelry Hot Search Station also plans to open 500 stores, and BA Jewelry Bureau plans to open more than 150 stores.
Not only that, in the outlet, jewelry manufacturers, franchise brands are also active, they provide businesses with site selection, decoration, marketing, supply and other one-stop services, even if people with no experience can directly open stores - around the jewelry collection store a variety of business formats are also becoming more and more abundant.
Entrepreneurs and capital are trying to pry the wallet of Gen Z with trinkets, can they do it?
02 Trinkets with high profit
Jewelry belongs to FMCG, the elimination rate is high, some users will "monthly throwing", "weekly throwing", and even "daily throwing", so in the eyes of many young women, there is really no need to buy expensive jewelry.
"What I bought before is basically not worn now, and I recently started a new model. So I don't buy too expensive, generally each piece of the highest is about thirty or forty yuan. Post-90s consumer Jingjing said.
This "fast consumption, rapid elimination" psychology of consumers has also become the password to make money for jewelry collection stores. Jewelry collection stores are mainly for the Z era crowd, taking the cheap route, the price of most of the goods is within 100 yuan, and the price of a small number of bags, scarves and hats is more expensive, but most of them are also within 300 or 400 yuan.
In addition, many jewelry collection stores have also launched a membership model, and members can enjoy a 50% discount on the whole venue. "The forefront of entrepreneurship" observed in Hopson Hui that the BA Jewelry Bureau can become a member with the first order of 99 yuan, enjoy a 50% discount on subsequent purchases, ACC can register as a member for free, and the first order can enjoy half-price activities.
Photo / Hopson Hui "ACC Super Decoration" store
Some merchants have accurately grasped the price sensitivity of consumers and launched products with different prices to attract more consumers.
"The price of the goods in the store is between a dozen and a hundred yuan, which meets the needs of different groups of people, some are cheaper, and some are more expensive." Yang Xuan said. She observed that most consumers who enter stores buy one or two items. "Even if you don't buy jewelry, you will take a head rope of one or two yuan."
On the Little Red Book, there are also merchants who share the way of business. "10% are high-end models, mainly for high-end consumer groups with quality requirements; 20% are drainage models, which can be used to do activities and attract customers; 70% are popular models, which are in line with the aesthetics of most people and can make profits." Someone shared.
So, is the jewelry collection store that is highly sought after by young people and opened in a pile of people a profitable business?
Public reports show that the unit price of BA Jewelry Bureau can be nearly 130 yuan, and the monthly sales of a single store are nearly one million yuan.
In 2020, ME+'s official data shows that during the Opening of the first store in Chongqing on National Day, the number of customers entering the store in a single day reached 15,000, the sales volume of the first store exceeded 200,000 on the first day, and the 8-day holiday on National Day exceeded 1.1 million.
Jewelry collection stores opened in third-tier cities are also quite optimistic. Yang Xuan told the "forefront of entrepreneurship" that the initial investment cost of this store was less than 100,000, and it has been open for less than 4 months, and it has returned half of the capital. "When the business is good, the monthly net income is about 10,000 yuan, and it is expected that it will be able to return the capital in March and April next year." Compared with the local income level in Zibo, this revenue situation is already good.
Qingqing (pseudonym), a staff member of a small commodity department store, revealed to the "forefront of entrepreneurship" that "in our factory, the price is generally 30% off the market price, and the profit margin is more than 60%. ”
"Like a store of about 100 square meters, the investment in the front futures is 80,000 to 100,000, excluding labor, rent and other costs, the net income of a year is generally between 150,000 and 200,000." Qingqing said.
In addition to the lower discounts, they will also launch a preferential campaign to provide rent and renovation subsidies to customers who receive goods. "The minimum subsidy is 800 yuan per month, which is determined according to the purchase volume, and there are rebates for later replenishment." Qingqing said. She also added that if the upfront turnover is difficult, it is possible to apply for a three-month subsidized rent.
For entrepreneurs, a mature supply chain has made jewelry collection stores a simple business. As jewelry collection stores have become the mecca of Taobao for urban exquisite girls, they seem to have become a money-making tool for merchants.
03 Three mountains
However, the jewelry collection stores that are everywhere do not seem to have a high threshold.
First of all, the product styles of each house are similar, and some jewelry styles can also be searched for similar models on the e-commerce platform, and the price is lower.
Yang Xuan mainly buys goods from Guangzhou, Yiwu and other places. "The style of our products is similar to the style of the chain store, there is not much difference. The difference is that chain brands may have a brand effect, which we don't. ”
Unlike clothing, many young consumers pay more attention to the appearance and style of jewelry than the brand. In the case of serious homogenization of products, the only way to retain consumers is price competition. Therefore, small shops with lower costs may not have an advantage over chain brands.
In addition, although the price of goods in jewelry collection stores is mostly within 100 yuan, for young people who like "moon throwing", their cost performance is still not high enough.
Jingjing sometimes buys a lot of jewelry on Taobao, and the lowest unit price is only two or three yuan, and some of them she has not worn once. "Some of them are bought to make up for the freight, and they don't like it or feel bad." Her jewelry box was neatly lined with dozens of earrings and necklaces, "Don't look at so much, but it adds up to a hundred dollars." ”
When shopping, more and more young people are beginning to be sensitive to price, and they are good at calculation, and they can easily find the most cost-effective goods. Some people may buy one or two jewelry when shopping, but Taobao or the lower price of 1688 may be the occasion for many young people to spend wantonly.
Not only that, the jewelry collection store is also facing suppression from the collection store of the life department store. The latter has a wider variety of goods and can attract more customers.
A staff member in charge of brand franchise in a lifestyle department store said, "Most of the consumers of jewelry are women, the customer base is too single, and it is difficult to do only jewelry now." "Compared with a single jewelry collection store, department stores can cover a wider range of consumer groups."
"Selling only jewelry will limit the purchasing power of many people, and our positioning is that the more complete things are, the more people buy." The staff member said, "You can use a wall as a jewelry display, consumers can try on it, you can punch the clock, and you can also help you accumulate popularity, but other categories are still more on." ”
"The Forefront of Entrepreneurship" observed that Hopson Hui's KKV store has a special jewelry area, as well as an earring wall for consumers to take photos and punch cards. The variety of goods also includes earrings, necklaces, bracelets, brooches, etc., and the price is mostly within 100 yuan.
Photo / KKV jewelry display area
Behind the enthusiastic pursuit of young girls, the jewelry market is also growing rapidly. Ai Media Consulting data shows that in 2021, the scale of China's jewelry consumer demand users is expected to reach 1.05 billion person-times, the market size will reach more than 200 billion yuan, and maintain an annual growth of nearly 20%.
However, when jewelry collection stores successfully conquer the wallets of a new generation of young people, it is necessary to be vigilant that discerning consumers are good at chasing the wind, but their eyes are also easily attracted to the next consumption hotspot. In addition to affordable prices and influencer attributes, jewelry collection stores still need to find the right way to capture the minds of consumers as soon as possible.