"Once you enter the Panmen, you are as deep as the sea, and you buy them at home one by one", the Pandora myth that was circulated in the peak era now seems to have no new story to tell. Recently, the Beijing Business Daily reporter found that Pandora, located in the main store of Beijing Wangfu Zhonghuan, withdrew its store and replaced it with a high-end jewelry brand Cartier. Pandora, who used to open a store in the city, now many stores are full of doors. "Pandora's famous bead products have been surpassed and many different alternatives to precious metals have emerged. When the product itself loses the core that underpins its high premium, then the gas is the inevitable result. Industry insiders said bluntly.
Closed in large areas
Pandora, who became popular because of the exquisite beads, now seems to have no more pomp and circumstance.
Beijing Business Daily reporter visited the site and found that Pandora, located in the main store in Beijing's Royal Central, has recently withdrawn its store and replaced it with a well-known jewelry brand Cartier. According to the relevant person in charge of the mall, the replacement of Pandora to Cartier is mainly because the mall hopes that the choice of the main store is more in line with the high-end positioning of Wangfu Zhonghuan. The Pandora store on Changyaotian Street in Beijing was converted from a large store to a small counter last year.
In the public comments of Pandora's ChangyangTianjie store, the Beijing Business Daily reporter saw that many consumers commented: "The business of this newly opened Pandora physical store that is very popular in the world is quite bleak..." "Not as popular as before" "Pandora now does not have the feeling of being in the market before."
In fact, Pandora's closure has long been a common phenomenon. Pandora CEO Alexander Lacik previously revealed in a conference call that due to the impact of the epidemic, 70 of the 240 stores in China in 2019 were closed according to regulations, and most of the remaining stores were located in shopping malls, and the passenger flow was "almost zero", he bluntly said that the Chinese business was in a "static" state, and sales showed an "unprecedented" decline.
According to Pandora's official data, in the fourth quarter of 2020, the global average of about 10% of physical stores were temporarily closed due to the epidemic, and Pandora's first quarter 2021 financial report also pointed out that 20%-25% of stores will be closed in the first half of 2021, and 5%-10% of stores will be closed in the second half of the year, which is expected to have a negative impact on organic growth throughout the year by about -6%.
As for the reasons for the large-scale closure of stores, Pandora Group said: "Mainly affected by the COVID-19 epidemic, there are still unstable factors in the epidemic, but the blockade of physical stores has tilted the channel structure to online, which has a positive impact on the conversion of wholesale sales into online sales." However, for the specific reasons for the withdrawal of the Wangfu Zhonghuan store, as of the Beijing Business Daily reporter's release, Pandora has not replied.
"The main reason for Pandora's closure is that the performance cannot keep up, and the mall will maintain a tolerant attitude towards brands with poor sales, but if the brand side cannot make continuous investment in promotion, it will be removed." Yang Fan, vice president of Difan Diamond Company, said.
Zhang Peiying, an expert in the field of fashion, believes that "large-scale store closure is an adjustment of business strategy, pandora, an international brand that has been established for many years, has a high ability to resist risks, and after a series of self-adjustments, there will be certain development in the future." ”
Fist products are out of flavor
A purchaser who has been in the industry for several years told the Beijing Business Daily reporter: "Now no one buys Pandora, the wind of the beads has passed, and everyone likes something else." The Beijing Business Daily reporter searched the circle of friends and found that it had not released Pandora's relevant purchasing information since October 2017. Xiao Wang, a jewelry enthusiast, said bluntly: "Buying Pandora is not worth it." ”
Xiao Li, a former fan of Pandora's beads, also said: "Silver jewelry oxidizes too quickly, it is also troublesome to take care of, and the brand premium is serious, and the price of buying a string can buy a lot of gold and platinum products, in short, the cost performance is too low." ”
According to Pandora's 2020 financial report, from the perspective of product categories, its fist product beads fell the most, reaching 15%, accounting for 1.5 percentage points of total sales fell by 1.5 percentage points to 50.7%. Other new product categories such as bracelets and rings performed relatively well, with a decline of between 8% and 11%.
As early as 2018, signs of downhill pandora beads have been revealed. According to Pandora's first quarter 2018 financial report, Pandora's most famous beaded product grew by only 2% in the first quarter of that year.
Industry insiders pointed out: "Pandora's model innovation once made the brand famous at home and abroad. Buying a bracelet can be paired with multiple beads, and the beads can be purchased separately, which greatly increases the repurchase rate. But it is difficult to benefit from one model all the time. In addition, although the unit price of Pandora's products is not high, the cost of making up enough for a bracelet is basically in the range of 3000-5000 yuan, then on the basis of this price, consumers can actually choose a lot of brand space. ”
Zhang Peiying said: "Pandora's star products may consider more about the brand perspective, but whether they can be successfully converted into sales also depends on whether the product can meet the needs of most people. However, Pandora's bead form is single, in fact, can not continue to meet the needs of Chinese consumers, or should be the brand and the market to form a perfect combination to produce a sustained driving force. ”
Yang Fan said bluntly: "Pandora's famous bead products have been surpassed and many different precious metal substitutes have emerged, such as bracelets with gold beads. Compared with Pandora, who has a high premium but does not take the precious metal route, many domestic jewelry brands have achieved perfect transcendence in products. When the product itself loses the core that underpins its high premium, then the gas is the inevitable result. ”
The Chinese market is not satisfied
Pandora pointed out in the latest earnings report that thanks to the us economic stimulus program, the company's sales in the United States increased by 64% in the first quarter of 2021.
However, for the Chinese market, Pandora said: "Compared with 2019, the Chinese market is expected to continue to drag down the Group's performance. ”
According to public data, from 2014 to 2019, the market size of China's jewelry industry increased from 567.4 billion yuan to 750.3 billion yuan, and it is expected that by 2025, the market size of China's jewelry industry will be about 944.5 billion yuan. In fact, the Chinese market is still an excellent soil for the development of the fashion jewelry industry.
However, such soil still seems to be difficult to breed a new story of Pandora.
According to Pandora's first quarter 2021 financial report, although Pandora's revenue in China increased by 35% year-on-year, this accounted for only 6% of its global sales.
As a result, Pandora's management was not satisfied with the performance in the first quarter, noting that it would reposition its operations in China. "Pandora's core problem in China is that it is seen as a mainstream jewelry brand. Therefore, we must change the perception of Chinese consumers and focus on the brand advantage of Pandora fashion jewelry. ”
"Now Pandora's positioning is more inclined to fast fashion brands, but fast fashion does not create fashion, and there are almost no unique styles that belong to the brand creation. Pandora is sometimes more like a collector of information, lack of original design, but also become an important factor restricting the development of pandora and other jewelry brands, and with fashion jewelry as the positioning, the price at this stage is not competitive. Dong Xinrui, an expert and investor in the Beijing Intellectual Property Library, said.
"If you simply claim to be the mainstream of fashion jewelry, but are surpassed by domestic jewelry competitors in terms of material and quality control, it is not simply relying on brand promotion to turn the situation around." Yang Fan said bluntly.
In addition, according to industry insiders, Pandora's early expansion in China was too fast to make its market reach a short-term saturation in advance, in the first quarter of 2017, a total of 58 new stores were added around the world, of which 19 were opened in China, and sales in the Chinese market also soared by 125% to $62.54 million.
"Chinese consumers have previously invested in jewelry when buying jewelry, which is a major factor to consider. Therefore, the development of fashion beads that do not maintain value will encounter difficulties. But now with the change of consumption habits, the matching attributes of jewelry have gradually become important. If Pandora can reasonably adjust product design, pricing, and master the various models of online marketing in the Chinese market, there will still be new developments in China in the future. Zhang Peiying thinks.
Beijing Business Daily reporter Zhao Shu commented on Lin Yuwei