Footwear Industry: Daphne Answered The Wrong Question, Will The Whole Industry Copy It?

Did you buy a few pairs of Daphne when you were young?

But in the future, you will never see Daphne's shop on the street or in the mall.

On August 25, Daphne announced in its semi annual report that it would completely withdraw from the physical retail business of medium and high-end brands, close the business sales points of all other brands, and transfer all business to online.

Meibang, Yichun, JeansWest, ESPRIT, Daphne These shoes and clothing brands bearing the memory of a generation of youth are gradually disappearing.

Looking back, I'm afraid Daphne's wrong paper is not the Daphne family's problem, but the shoe industry is experiencing and copying. Daphne is not necessarily a good student, but shoe brands may be copying Daphne's wrong answer.

01 generation shoe king, just did two things right

Mantis finance believes that the first thing Daphne does right is to stand at the right time window. Daphne, formerly known as wing on international, was founded in Hong Kong in 1987. At that time, when both sides of the Strait were open, a large number of Hong Kong and Taiwan enterprises came to the mainland of China to set up enterprises. Yongen international took advantage of this east wind to establish a women's shoes brand in the mainland, which gave a foreign name "Daphne", which was translated as "Daphne".

However, this success has nothing to do with itself. It has only succeeded in catching the "rocket" of the rapid development of China's whole society. With the reform and opening up, foreign investors can invest. With China's accession to the WTO, people begin to have money in their hands and begin to pursue better and more beautiful things.

There is such a joke, three young people make the elevator, one runs in the elevator, one lifts weights in the elevator, and one jumps rope in the elevator. Who took the three of them from the first basement floor to the top floor? Did they run, lift weights or jump rope? Of course not, it was the elevator.

The second thing Daphne does right is to have a clear positioning, which is both fashionable and grounded.

At that time, the mainland was still a fashionable desert. Such a name from the Greek goddess was full of foreign flavor.

"Daphne, no matter who she is in love with today, will find her confidence in every new woman she is in today's play, even if she is touched by her new life." This is Daphne's positioning of her own brand, which conveys the panic and urgency of girls eager to open the door of dreamy, gorgeous and fashion in the era of material shortage.

Daphne asked the spokesperson is the then red combination S.H.E. and singer Liu Ruoying. These spokesmen reveal Daphne's "people friendly" side. S. The three girls in H.E. are beautiful, but the beauty of the girl next door is not aggressive. Liu Ruoying is also known as "civilian Queen".

Daphne's products are in the middle and low-grade line, with "basic" as the main, supplemented by changes in details to do moderate innovation. The advantage is that waste can be minimized from raw materials to production.

In addition, in terms of actual marketing strategy, Daphne started to follow Bailey, the industry's boss, and opened a special counter in the mall. After finding her own position, Daphne gradually withdrew from the shopping mall and focused on the street stores.

In 2005, Daphne's route sank further and turned to the community business district, opening a new brand "shoebox" in communities and supermarkets.

After doing these two things right, Daphne's expansion can be described as rapid until 2012.

By the end of 2008, Daphne had 1815 stores, 616 counters and 418 franchised retail outlets. It also represented Adidas, sofft, born, Arezzo and Nike brands. In 2012, the store expanded to 6881 stores. According to the financial report of that year, Daphne achieved revenue of HK $10.529 billion, and the profit attributable to shareholders was HK $956 million.

Of course, Daphne's support from investment partners is also significant.

On May 25, 2009, the US TPG Group invested 550 million yuan to invest in Daphne. All parties acknowledged that this was a large-scale PE investment in Asia. TPG was one of the largest PE companies in the United States at that time. It became famous in the first World War for its investment in Shenzhen Development Bank. It managed more than $50 billion of capital.

In September 2009, the core platform of Taiwan's qifuri and Baidu Qifu mall was established.

Because the women's shoes business was too busy, Daphne closed all sales outlets of Nike brands in 2009, and gave up the renewal of Adidas sports shoes dealer qualification in mainland China in 2010 to focus on women's shoes channel market.

In a 2012 blog post entitled "prosperous Chinese women's shoes market", a blogger wrote: China's medium and high-end women's shoes business network covers all major cities in China, among which Belle controls two-thirds of the channel resources. Daphne and Saturday are two strong competitors, accounting for 10% of the market share, while 71% of Chinese consumers buy shoes in department stores.

If 2012 is really the end of the world, Daphne will be one of the most successful women's shoes brands in the Chinese market.

However, in 2013, the situation turned into a downward trend, and Daphne's revenue and shareholders' share of profits fell year-on-year.

From 2015 to 2019, Daphne's losses have expanded year by year, with losses of HK $380 million, HK $838 million, HK $742 million, HK $994 million and HK $1.07 billion, respectively.

Daphne has also opened a wave of shop closures.

At the end of 2018, there were only 2648 outlets left. By the end of 2019, there are only 360 outlets left for core brands. In the middle of 2020, Daphne announced that none of its offline stores would stay.

02 online or offline, independent brand or agent, what can Daphne leave for the industry?

Why did Daphne, a shoe king of the generation, come down here? Old style, overstocked inventory, blind expansion and poor management are all the internal causes of Daphne. Apart from these old sayings, "mantis finance" believes that Daphne has made two wrong decisions in the past 30 years, and since then has taken a wrong step.

1. Miss online e-commerce, return to the line, Daphne will do the right?

Many people may think that Daphne can't sell well because it doesn't do e-commerce?

In fact, this is the wrong understanding.

As early as 2006, Daphne has been trying e-commerce business. Taobao has only been established for three years at this time, just surpassing eBay. Jingdong Mall will not be established until June next year. At that time, Jingdong was busy participating in the "online banking Cup" 2006 super e-commerce selection activity jointly sponsored by the third-party electronic payment company online banking online and China computer daily, and won the title of "the most popular IT product online business" of that year.

In 2010, Taobao was busy putting it on the shelves to get a better deal. Jingdong is busy making home appliances, replacing old ones with new ones, and playing Dangdang with books on the shelves. At that time, baidu was on the occasion of its 10th anniversary. Li Keqiang personally inspected Baidu, and Li Yanhong released three major visions for the next ten years at the 10th anniversary celebration.

Standing in the situation at that time, who is right and wrong to choose? Who can predict?

Daphne decided to invest in e-commerce platform "Yaodian 100" with Baidu in 2010.

At that time, it was cool to be an e-commerce company. Daphne's old rival Bailey is doing e-commerce by herself. In 2009, Baili established its own e-commerce platform, taoxiu.com. In 2011, we also established a shoe B2C platform called yougou.com, and transplanted Taoxiu's resources to yougou.com.

According to incomplete statistics, there are still five or six online e-commerce platforms around 2010. Everyone wants to control the e-commerce channel by themselves. No one expected that Ma Yun would eventually become everyone's "father".

The lineup of Yaodian 100 looks very strong. In August 2009, it obtained $40 million of investment in round a of Qiming venture capital; in May 2010, it obtained investment of 60 million yuan in round B of Baidu / Daphne; in August 2011, it obtained an investment of 10 million yuan in round C of Intel.

Baidu, Intel, are industry leaders, can't it become another Amazon? Daphne in this atmosphere, stand up for point 100. By the end of 2011, Daphne closed its advantageous distribution channels such as Jingdong, letao and haolemai.

But Yaodian 100 did not make Amazon. After only half a year, it stopped operating in July 2012. Daphne doesn't think the online channel is very important, because 2012 is the peak time for Daphne to open offline stores.

Since then, when e-commerce flourished and became the best channel to attack cities and cities, to gain popularity and to clear inventory, Daphne could not go back.

Eight years later, in 2020, Daphne chooses all in online. Can it still make up for the lost sheep?

At present, there are two main online ways: self run online stores, or find anchors to bring goods.

Taobao, Jingdong and pinduoduo are the main positions of franchised stores on self operated line. Because Jingdong page does not show sales, "mantis finance" compared the sales of Taobao and pinduoduo. Obviously, Daphne's sales on pinduoduo are an order of magnitude higher than those on Taobao. Of course, the price is also half cheaper.

If Daphne can adhere to the quality that is still good at present, put down her posture and focus on pinduoduo, she may not be able to break into a world in the love of "cost performance" pinduoduo.

The second way is to find the anchor to bring goods. Another big women's shoes brand "Saturday" has become the pronoun of "online Red economy" at the end of 2019 and early 2020, and it is Li Ziqi who brings salt to it. According to the record of investor relations activities released on Saturday at the end of May this year, there are about 100 people who have signed contracts, including about 30 people who bring goods through live broadcast, and dozens of short video talents who are engaged in emotional live broadcast. Saturday's performance in the capital market was shocking, with a rise and fall of 414.45% in the past year.

So Daphne can learn from "Saturday", who once worked together. If Daphne carries out such a low price strategy as pinduoshang in the end, with the blessing of the original brand image, "buy it" consumers may also be many.

2. Give up agency, independent brand frustrated, Daphne how to continue this class

Daphne's another wrong decision, so that Daphne almost no turning over the capital, that is, Daphne in order to concentrate on the development of women's shoes brand, give up the agency of ADI, Nike.

Who is China's largest clothing company by market value? Anta, a sports brand, has a market value of HK $220 billion as of August 28. There are three Chinese listed companies that serve ADI and Nike alone, including OEM Shenzhou International, channel provider taobo and Baosheng.

Ten years after Daphne gave up being a distributor for ADI and Nike, the sportswear market has become the largest market in China. As can be seen from the Research Report on China's apparel market, the growth of China's sportswear market is a steep straight line from 2014 to 2018.

Among the top ten brands with the highest share of China's clothing market in 2018, 6 are sports brands.

Sports brands are soaring, women's clothing brands are collapsing thousands of miles.

Belle expanded blindly and delisted from Hong Kong stock market in 2017. Rashabel blindly expanded and lost money year after year, and the decline was irretrievable.

However, although Belle has declined, it has maintained the channel line for ADI and Nike. Now its taobo market value is HK $60 billion, which is higher than the HK $53.1 billion delisted from the Hong Kong stock market in 2017. As of August 28, 2020, the total market value of Daphne is only HK $311.7 million.

Daphne gave up the management rights of ADI and Nike, and gave up a money tree.

Whether to be an agent or an independent brand? This is the myth of the whole industry.

As we all know, Anta's real growth depends on the acquisition of FILA's agent from belle. When Anta bought FILA from Belle in 2009, there were less than 50 stores in FILA, and it has always been a loss. After Anta took over, it positioned FILA as "fashion sport" and took the middle and high-end route. In 2014, FILA turned loss into profit, and Anta began to maintain double-digit growth. In 2015, Anta's revenue exceeded the threshold of 10 billion yuan, reaching the highest performance of domestic sporting goods companies. According to the 2020 interim report, FILA accounts for nearly half of Anta's 14.7 billion revenue.

It doesn't mean to be a good agent. But with a good agency brand, it will certainly be able to provide help for its diversified development.

This is why Anta is still on the way to "buy, buy and buy". It has successively acquired Japanese ski brand Descente, British city walking brand sprandi, Korean high-end outdoor mountaineering brand Kolon sport, and Finnish high-end sports brand group Amer sports.

In addition, Tebu and Hailan's family are also following Anta's path, with Tebu acquiring gasway and Hailan house acquiring British style.

03 end

It's always easy to look back on history now. After all the dust has settled down, we can always find some "inevitable" reasons for failure. However, no one could see the situation clearly at that time.

Daphne's transition from offline may be its new beginning. After all, as long as you are still in the field and you still have chips in your hands, everything is possible.