How Does Muji Maintain "Middle Myth"?

In the front gate of Beijing, there are many flagship stores, including Japan's largest home chain brand Muji in second of the world's Muji hotels. In the past six months, this company, which represents middle-class life, is constantly in turmoil.

In July 17th, the Beijing municipal market supervision and Administration Bureau announced the "unqualified list of furniture random inspection in 2018". Among them, 6 pieces of MUJI products did not match the nominal material and the actual material.

In July 19th, the situation of Muji release was explained and apologized, indicating that it is willing to provide a replacement service for customers who purchase these 6 furniture. According to statistics, this is the fourth time since 2019, the quality problem of Muji has appeared.

At the same time, Muji is also faced with competitors from China. In recent years, a number of brands such as local brands, excellent products, strict NetEase selection, and millet products have begun to emerge. What is the future of MUJI products?

　　 The myth of selling lifestyle

"My idea is that by 2030, Muji stores will be used in most international cities, and customers will buy and use our products every day." The chairman of Muji group, President of the Muji group, said.

MUJI was founded in 1980 and used to be the private brand of Xi you chain supermarket. It aims to provide limited price products. The brand name is Mujirushi Ryohin, which literally means "no brand quality goods". )

At that time, Japanese consumers attached great importance to the perfection of aesthetics. Products that did not conform to strict standards would often be disposed of. MUJI has gone the other way, playing the slogan "durable", "highly general design" and "the right price". As soon as they enter the market, fans will swarm into groups.

Soon, Muji attracted a large number of enthusiastic followers, whose product line covered food, stationery, luggage and even furniture, and was deeply loved by the middle class.

In 2005, Muji produced the first store in mainland China in Nanjing West Road, Shanghai. Subsequently, MUJI MUJI wind penetrated into every corner of China's middle class. From a table, a stool, a cup of dish, to MUJI Cafe&Meal, MUJI BOOKS, MUJI to Go, restaurant (MUJI Dinner), or even Hotel (MUJI Hotel), sitting on the basis of "fans" beyond imagination.

　　 Chinese brands that are eyeing

MUJI has also been criticized for its rise.

From the price point of view, the price of the same commodity in mainland China is about 2 times that of the Japanese mainland. For example, the same glove box, only 71 yuan in Japan, and 135 yuan in the domestic market.

Under such circumstances, a number of Chinese local brands are gradually rising, and China's "apprentices" of Muji have begun their debut.

In 2013, "famous brand" was established, and as of December 2018, it has 3400 stores worldwide.

In April 2016, the NetEase was strictly elected and directly linked to the big name manufacturers. It was called "parity Muji" since the first day of its existence.

In April 2017, millet was born, relying on Millet ecological chain system, using millet mode to make consumer goods.

In May 2017, Taobao's heart election came out. There are over 2000 SKU (inventory units) and more than 800 standard products on line one year, attracting over 100 million visits.

After feeling the pressure brought by "Chinese apprentices", Muji began to launch the "new pricing" strategy in China in 2014, and the price reduction frequency reached two times a year.

Wang Guoping, a member of the senior advisory group of Lian Shang network, pointed out that domestic enterprises are running too fast, and contrasting with Muji is slow. He believes that any format has a life cycle, unless it is given new connotation to lead the market again.

Marketing expert Lu Shengzhen told China Economic Weekly that Muji has encountered more and more similar brands in China, and competition has further intensified. Imitation and competition of similar shops such as famous brands, quality products and deer island have diverted the flow of MUJI products and customer loyalty. This is also an important reason for its performance to "cool down".

　　 Can Muji continue to be a middle class myth?

Update speed than others, even the quality of problems.

According to media reports, in January 2019, the Hongkong Consumer Council found that Muji hazelnut oatmeal biscuits contained genotoxic and carcinogenic alcohols and acrylamide. In February, Muji part of the batch "natural water" was also detected potential carcinogen bromate exceeded the standard, recalled the product. In April, Muji was once again recalled due to safety hazards due to the use of notebook (M) and stainless steel ruler.

Under the "internal and external troubles", Muji's performance is declining. From the two quarter of fiscal 2018 to the two quarter of fiscal 2019, the quarterly operating income of the Muji parent company's good plan in the Chinese market increased by 22.6%, 21.2%, 18.3%, 14.8% and 10.4%, respectively.

In July 15th, the first quarter results of the 2020 fiscal year announced by the good quality plan showed that the sales of good plan increased by 5% to 112 billion 300 million yen (about 7 billion 100 million yuan) in the 3 months ended May 31, 2019, and net profit dropped 31% to 6 billion 500 million yen (about 400 million yuan), which is the first time since 2014. Meanwhile, the comparable sales decline in the Chinese market has increased to 4.9% during the reporting period.

In the face of fierce competition, Muji has begun to develop and extend its business. In June 2017, MUJI Diner, the world's first Muji restaurant, opened in the flagship store in Huaihailu Road, Shanghai. In 2018, Muji set up two hotels in Shenzhen and Beijing, MUJI Hotel, and Shenzhen's hotel was the first Muji world hotel.

In addition, in response to the Chinese market, Muji also launched the "China needs" series of commodities in March 2019, and also revealed a clear "please" intention. Through the customized adjustment of the product size in China, Muji hopes to make a clear idea of product strength.

In fact, with the rise of more and more similar lifestyle brands, price cuts are not a solution. The company, which has more than 900 stores with an annual income of nearly 26 billion yuan, has reached a crossroads in China.