Han Shu returns to the offline Douyin traffic spillover can work

（图片来源：IC photo）

Economic Observer reporter Xie Chuchu At the beginning of 2024, returning to offline development has become a "big event" for the beauty brand Han Shu.

On January 2, Hanshu's parent company, Shangmei Co., Ltd. (02145. HK) (hereinafter referred to as "Shangmei") held a new product launch conference of Hanshu CS (cosmetics franchise store), introducing new products, new policies, new services and other information exclusively available in CS channels, and said that the number of agents who took the initiative to sign up has exceeded 220.

However, the reporter of the Economic Observer found that many people left messages under the advertisements they placed, saying that Han Shu is a brand made by CS channels, and after accumulating customers offline, they turned to develop online, and the online "leeks" could not be cut before they wanted to return to the offline;

In response to these doubts, on January 11, a relevant person from the investor relations department of Shangmei replied to the Economic Observer that Shangmei is an omni-channel company, and the resumption of offline channels is due to the fact that Han Shu has a good sales situation on Douyin, and also hopes that there will be a certain increase in offline. How much can be done offline in 2024? The other party replied: "It's hard to say. ”

In addition, Han Shu introduced that in January 2024, the brand will launch products exclusively for CS channels and recruit 100 agents. After each of these 100 agents invests 200,000 yuan, they can earn a fixed income of 100,000 yuan per month. As for how to calculate the income, the progress of agent recruitment and the confusion of franchise information, the above-mentioned relevant people said, "I don't know much, I need to understand from the business department." As of press time, the other party has not replied.

Recruit new agents

This time to recruit agents, Han Shu did not release official recruitment channels and information. There is a lot of information about "Han Shu joining" on the Internet, and after the reporter contacted it, it was found that most of it was false information.

On January 9, the reporter called Han Shu's official customer service number as an agent for consultation, and the operator did not know about the recruitment of offline agents. After further communication, the person said that the commissioner would follow up with him.

Subsequently, a person claiming to be Han Shu, the head of the Beijing-Tianjin-Hebei, Northeast and Inner Mongolia regions contacted the reporter through WeChat. For the information that "after investing 200,000 yuan, you can earn 100,000 yuan per month", he said that it depends on the regional network resources of the agent.

However, the other party did not have a clear reply to the specific selection criteria and types of agents, and the other party still said that it depends on the regional network resources mastered by the agents.

He said that all agents started with a standard: take 200,000 yuan of goods and pay a deposit of 50,000 yuan. 200,000 yuan of goods do not need to be taken away at one time, can be spread to their own franchise partners on demand, and the agent mainly earns the middle price difference. Directly managed stores can get the goods at a 5.5% discount from the market price.

For this new CS channel, Han Shu will provide exclusive products: Pomegranate Giant Hydration Series, Centella Asiatica Soothing and Moisturizing Series, Licorice Glabra Light Brightening Series, Rhodiola Brightening and Firming Series, the unified feature of these products is "very cost-effective supply price". According to the person in charge of the above-mentioned region, the single product pricing range for exclusive products is 39 yuan to 69 yuan.

Offline earnings cannot be estimated

On January 2, Shangmei mentioned in an advertisement placed by an industry media that "today, after suspending offline business for a year, Han Shu can still 'respond to every call' in the CS channel." At the bottom of the article, a suspected offline franchisee left a message, saying, "The brand made up by the CS channel, the customers cultivated have been harvested online, and this income is less before I think of the offline, is it the online 'cut' that can't move?" "We are 'leeks', who dares to believe in Shangmei?"

Founded in 2002, Han Shu started as a cosmetics franchise store in third- and fourth-tier cities, entered the KA channel (large chain store) in 2008, and then quickly increased sales by increasing investment in TV shopping channels.

In 2010, Han Shu followed the Internet tide to enter e-commerce, and in 2014, Han Shu established a micro-business division. With a performance of 40 days of sales exceeding 100 million yuan, Han Shu was crowned with the title of "No. 1 Micro Business" that year, but because it was questioned as a "pyramid scheme", the Micro Business Division was also canceled. Since 2019, Han Shu has increased the layout of online channels such as Douyin, Xiaohongshu, and live broadcast.

According to Shangmei's 2023 interim report, the company's revenue in the first half of 2023 was 1.587 billion yuan. Among them, the online revenue was 1.291 billion yuan, accounting for about 82% of the overall revenue, and the offline revenue was 268 million yuan, accounting for about 18%.

The above-mentioned investor relations department said that the company has definitely not given up the CS channel, but the offline channel has shrunk more severely in recent years. At present, the proportion of online revenue far exceeds that of offline, and after the resumption of offline in 2024, the absolute sales amount of offline channels may increase, but it is "difficult to say" how much the specific proportion can increase. According to the person, Han Shu's current main offline channel is Watsons.

The price range of Han Shu's offline products is 39 yuan to 69 yuan, focusing on cost performance. Compared with the same type of products, such as the currently popular domestic brand Proya, a cleanser and a bottle of lotion cost a total of 87 yuan, and the price of a single product is relatively low.

Regarding the specific market strategy to compete with other cost-effective brands, Shangmei has not replied as of press time.

Inclined to the omni-channel development of Han Shu

Following the decline in performance in 2022, Shangmei's revenue will resume growth in 2023, increasing from 1.262 billion yuan in the first half of 2022 to 1.587 billion yuan in the first half of 2023, a year-on-year increase of 25.7%.

The revenue growth is mainly driven by Han Shu's Douyin channel sales, and the revenue of other brands under Shangmei, Yiye and Red Elephant is declining.

The above-mentioned person from the investor relations department said that the company will be seriously affected by the epidemic in 2022, so the company's entire focus in 2023 will be more inclined to Han Shu, which is the brand with the highest proportion of revenue, the longest history and the most well-known. At present, Yiye's brand positioning is in a period of adjustment, and the maternal and infant brand Red Elephant has been affected by factors such as changes in the competitive landscape and declining birth rates. At the end of 2023, both brands have new moves, but sales have not yet risen.

According to Shangmei's introduction, the Red Man Waist series has become a popular product of Han Shu since its launch. As of January 2024, the series has sold more than 5.85 million units across all channels, ranking first in Douyin's beauty list.

In the first half of 2023, Shangmei's online revenue growth rate exceeded 30%, but offline channel revenue declined. In the context of the beauty industry's return to offline and the importance of omni-channel, Han Shu's return to offline also means that a new round of offline competition has begun.

Liu Bo, general manager of Guangzhou Maisui Enterprise Management Consulting Co., Ltd., said that Lu Yixiong's strategic positioning of Han Shu is very clear, and the logic is to form a closed loop online and offline, that is, online, to make efforts on Douyin, and offline, to let agents and stores undertake online brand traffic overflow. In the future, most beauty brands will form this kind of play.