Shein store, as part of its marketing strategy, usually opens physical clothing stores in different cities around the world. The goal is to promote new clothing lines, give away coupons and guide consumers so they can know their respective clothing sizes before buying online.
So far the Shein brand has opened 12 stores around the world, known as Pop Up Store. In the United States, the first cities were:
This does not mean that Shein stores will not open again in these cities in case you missed the inauguration of some of these. Since usually the stores close after 2 weeks.
Recently, SHEIN announced that its preferred product line SHEIN Premium has been transformed into an independent brand MOTF, and a new independent website will be launched.In order to support this nascent brand, SHEIN’s official website gave MOTF a big traffic hole.In fact, MOTF has been online as early as June 2020, and now it is taken out of the SHEIN website as an independent station, which is a new attempt.MOTF’s brand introduction clearly stated that this is a more high-end product line made of «higher quality» materials.
This obviously means that MOFT’s products are better than those of the main brand SHEIN.The brand SHEIN is loud enough and already has a huge user base. If you want to make a high-end product line, continue to use the SHEIN Premium brand, isn’t it both labor-saving and efficient?Why start from scratch and launch a new brand MOFT?
This is in line with the brand positioning strategy. Because a brand has only one positioning.Toyota will not launch a «Toyota Preferred Car», but will directly create a high-end brand Lexus, Wal-Mart will not launch a «Walmart Preferred Store», but will directly launch a high-end chain brand Sam’s Club.Procter & Gamble has done the best in this regard, making shampoos and launching multiple brands, one brand with one positioning.Rejoice is for «supple and smooth hair», Pantene is for «nourishing and repairing hair», and Head & Shoulders is for «removing dandruff for hair». SHEIN’s launch of MOFT is really involuntary. It is to get rid of the impression of «cheap» and «low quality» , and to sprint towards high-end brands.SHEIN has always followed the fast fashion route. The so-called «fast fashion» has great characteristics: one is the fast update frequency, and the other is the price is close to the people and the quality is average.
●Low-priced «Pandora»: Branded in genes, it is indelibleFrom a psychological point of view, «low prices» are the common demand of all mankind. In developed countries such as Europe and the United States, consumers have no resistance to «low prices».This is also the most fundamental reason why fast fashion brands such as Zara and H&M are able to grab market share in the hands of a group of veteran clothing tycoons in Europe and the United States.
SHEIN has done more thoroughly than ZaraMost of SHEIN’s clothing items are priced within US$13. On SHEIN’s independent station, $6 and $9 products appear frequently.Even MOTF, which is now known as a «high-quality product», can still see a single product for $9.99.It can be said that the «low price» has been imprinted in the genes of SHEIN before, and it is indelible.What’s more fatal is that as long as you are a newly registered member, you can get a 7-day discount coupon on SHEIN’s independent station, and the discount is as high as 70%.May I ask, which consumer can withstand such a price and such a discount?SHEIN’s customer base is mainly composed of young people aged 18-25. In this age group, young people led by the United States are in the «poorest» age.
On the one hand, influenced by the «independent self-care» culture, most young people in the United States after the age of 18 have difficulty getting funding from their parents. If they want to buy their favorite products, they need to work and earn money by themselves.At the age of 18-25, young people are either studying and can only do odd jobs, or they do not have sufficient vocational skills, and their income is often limited. In this case, young people of this age urgently need low-priced products to meet their daily needs.On the other hand, the US economy has shown signs of weakness in recent years, especially after the outbreak. This also directly affects the disposable funds of young people.In 2020, the daily
annual consumption of American teenagers will be reduced to 2,150 US dollars, breaking the record and becoming the lowest in history. In the period from 2012 to 2020, this figure will be as low as US$2371. (Data source: Piper Sandler)The epidemic has defeated the old fast fashion giants such as Zara and Gap, which are mainly physical stores, and has freed up market space for SHEIN, which is mainly online sales.At the same time, the epidemic has made the American people more and more aware of «the value of money», and the «low-price» fast fashion has hit the spotlight again. Therefore, SHEIN has delivered very good results in 2020.However, «low price» is a Pandora’s box, which can both carry and overturn the boat . Because accompanied by the word «low price», there are often the impression of «inferior quality» and «cheap».Can there be too «high-quality» products within this price? Not too possible.
Wendy, a seller of independent clothing stations in Shenzhen, has been in the field of independent stations for many years, and has witnessed how SHEIN has stepped onto the current «Kangzhuang Avenue» step by step.Wendy’s selection is in the same selection pool as SHEIN.»The quality of SHEIN’s clothes is indeed not as good as that of the outside world. It can only be said that it is among the lower-priced products, which are more popular.» According to Wendy, SHEIN’s product cost may be more expensive than theirs. It’s about 5 yuan cheaper, which is equivalent to less than 1 US dollar.However, SHEIN can see single products for $6 and $9 everywhere. At such a price, can there be good product quality? If you want to eat the fast fashion dividend, you will inevitably face the doubts that fast fashion must face.Many British and American media, led by the «Daily Telegraph», have reported that SHEIN’s products use a large number of chemical fibers and nylon fabrics. This is an «original sin» for Europe and the United States that pay attention to «environmental protection » .There are also posts on a domestic red book that overseas consumers complain about the poor quality of kitchen utensils purchased on SHEIN (SHEIN has a full range of products).Relying on a complete supply chain and a large order volume, SHEIN has reduced the cost to the extreme and is also fully prepared for its «low price». But even so, it is very difficult for SHEIN to achieve the ultimate product quality at a «low price».The more fatal problem is that in addition to «low prices», another attribute of fast fashion also forces SHEIN to further reduce costs, thereby further affecting the quality of products.
The other side of «Only quick not to break»: quick to self-injuryThere are two characteristics of fast fashion, one is that the price is close to the people mentioned above, and the other is the frequency of product updates.As a fast fashion brand going overseas, how fast can SHEIN go? According to its official information, in 2020, SHEIN can reach the level of 1,000 new pieces per day, and within 1-2 months, it will be able to surpass the number of SKUs of Zara throughout the year.The extreme speed of new updates and huge amount of new updates make SHEIN a great success and be loved by consumers. It also lays the foundation for gaining a large number of fans on social media.Supporting SHEIN’s rapid development is China’s complete, efficient and huge supply chain. In order to build this supply chain, SHEIN even has an impact on the entire fast fashion independent station industry.“SHEIN’s order volume is too large, and the domestic factories’ production capacity is insufficient. A large number of factories have been incorporated into its supply chain system , which has had a great impact on us.” Lily, a seller of independent Guangzhou women’s clothing station, told the «Blue Ocean Egainnews» «.com» reported that they are looking for other factories that have not yet been included in the SHEIN supplier system.According to Lily, before they found the factory to get the goods, it usually takes only 5 days to get the goods. But now they are in a selection pool with SHEIN, and the factory schedules them only after 29 days to start production .In order to cope with this situation, Lily can only order in advance, such as ordering goods for April in March. But this is also problematic, because in the style of fast fashion women’s clothing, they are very similar to SHEIN, resulting in its independent station’s new response speed can not keep up.
SHEIN has been selling the style for a month, and they just got this style.»This forces us to sell false inventory in advance , and it also seriously affects the consumer experience.» Lily said, the so-called «sell false inventory» refers to the product on the website before the goods arrive. Hang out and let consumers place orders in advance. When the goods arrive, they will be shipped to consumers.Often consumers can only receive the product more than one month after placing an order. Therefore, consumers rate Lily and their websites low.Wendy, who is also in the same selection pool as SHEIN and has a similar style, chose another way: to build his own boutique brand and build his own style.»From another perspective, the strength of SHEIN also forces us to evolve, and we have to sharpen our heads to improve the differentiation from their home.» Wendy said jokingly. To some extent, SHEIN is improving the competitiveness of its competitors. Level up , improve the difficulty of «killing monsters and upgrading».This in turn has affected SHEIN’s footsteps. If it is not possible to maintain high-frequency new and large-scale purchases of products, then these fast fashion independent stations with similar styles that follow SHEIN will soon become SHEIN’s substitutes.SHEIN obviously also understands this truth, so before finding a new way out, he can only continuously hone his «fast sword», getting faster and heavier.
●The faster the heavier, the harder to returnLily bluntly stated that their independent station’s one-year sales cannot keep up with SHEIN’s one-day sales . Correspondingly, to support such a huge sales, SHEIN also needs a very large inventory.»Making clothes is really doing physical work. There is one thing I still remember.» Lily said that in 2020, they returned 30,000 pieces of goods to the factory, worth about 1 million. This return directly caused the factory to no longer cooperate with Lily.On the day of the return, there was a power outage in the park where Lily’s warehouse was located, and the supplier’s factory was also in this park. As a result, the goods have to be moved from upstairs to downstairs, and then upstairs when they reach the factory.Of course, the burden of carrying clothes fell on the shoulders of the boys. In the second week, three boys were afraid and resigned directly.Although this story is a bit funny, it also reflects the size of Lily’s company. Once a return occurs, it is 30,000 pieces , worth millions. The scary thing is that, according to Lily, their company’s capacity in one year cannot reach the capacity of SHEIN in one day.Lily’s products are unsalable and can still be returned. But if SHEIN’s products are unsalable, where should the returned products go? Which factory is willing to return the goods? How many factories can afford SHEIN’s return?In order to avoid unsalable products, SHEIN can only continue to study the hot-selling elements of major foreign websites, continuously develop new products, and at the same time continuously optimize the supply chain and improve the response speed of the entire supply chain.In order to avoid returns, SHEIN also has a very strict rating system for suppliers.At present, SHEIN’s suppliers are divided into five levels: S, A, B, C, and D. The S level is the best level, and the D level is the most inferior level.And every quarter, 30% of the suppliers ranked at the bottom of D-level will be eliminated by SHEIN.The assessment indicators are mainly in two aspects. The first aspect is the purchase amount, which accounts for 60% of the assessment score; the second aspect is the KPI score, which accounts for 40% of the assessment score.The KPI assessment scores are mainly determined by four aspects: the timely rate of urgent procurement and delivery, the timely rate of stocking and delivery, the rate of defective products, and the success rate of new products.In addition, SHEIN also has some rigid indicators for suppliers. For example, a swimsuit supplier reported that starting from 2020, SHEIN requires suppliers to supply clothing with no more than 3 threads per piece and no more than 3 cm per thread. . The error of clothes size is only allowed within 2 cm. (Data source: LatePost)Strict supplier management system puts a tight curse on suppliers.Correspondingly, SHEIN should give suppliers enough sweetness. For example, SHEIN never defaults on supplier payments, never extends the supplier’s account period, and must maintain a good reputation among suppliers.Otherwise, Global Tesco is a lesson from the past.Conversely, strict compliance with the agreements with suppliers also greatly suppressed SHEIN’s financial flexibility.Even so, SHEIN is still in a «supplier shortage» dilemma. According to people familiar with the matter, there will be a cross-border e-commerce apparel supply chain summit in Guangzhou from June 2nd to June 3rd, which was organized in cooperation with SHEIN.The summit has a very important purpose, which is to hold a selection conference for SHEIN.Largely distributed goods, large quantities of new products.SHEIN is being driven by the wave of «fast fashion», and is involuntarily running forward. If it does not change, it will only accelerate to hit the south wall.
Change, start from getting rid of «low price»It seems to be trapped in a magical cycle. All brands that started with «low prices» must finally achieve transformation by getting rid of the impression of «low prices».As strong as Xiaomi, it also had to separate Redmi from Xiaomi, allowing Redmi to continue to shoulder the role of «cost-effective», and the Xiaomi brand gradually moved towards the route of high-end models.SHEIN is currently doing a similar thing. Let MOTF try out higher-priced products first. Once it succeeds, SHEIN may focus on high-end clothing brands.From the prices of MOTF products that are currently online, we can feel the price gap between MOTF and SHEIN’s mainline products.Except for a drainage model of US$9.99, the lowest price of other products is US$39.99, and the highest price can reach US$99.99. It is equivalent to about 260 yuan to 650 yuan.The current price has begun to have the potential of «light luxury».For MOTF, after SHEIN has released at least two investment plans at the beginning of the year, it has once again released a separate investment plan for MOTF.In this investment plan, there is a piece of information that is placed at the finale: factory entry requirements, domestic second-tier or above brand clothing has been made, the region and scale are not limited, but the quality is limited.This is to tell everyone plainly that MOTF must take the quality route.SHEIN intends to start with quality, create a product moat, and open the gap with other fast fashion independent stations. Even if the low-price segment is grabbed by other competitors and MOTF is there, SHEIN can retreat calmly.
Get rid of the design dilemma?It is worth noting that, alongside MOTF products, there is an entrance that can directly enter the SHEIN X interface.SHEIN X is a designer incubation program launched by SHEIN in 2021.The aim is to provide young and budding designers with a stage to showcase their products, and also hope that this plan will reach a good cooperative relationship with these potential designers.
SHEIN has been facing the dilemma that all fast fashion brands have faced before-the design dilemma. On the one hand, the Western media treats fast fashion brands like Zara as if they are skeptical of whether SHEIN’s design is suspected of plagiarism or copying, believing that the “design” they are doing is to dismantle and reorganize the creative elements of big-name designers; On the other hand, SHEIN itself is the «target of plagiarism» of domestic competitors.Shenzhen fast fashion independent station seller Anne bluntly said that, in addition to a few big brands such as SHEIN, small brands like them are still «unworthy» to have designers.All clothing design patterns are modified from the products of these brands of SHEIN, changing the pattern and the elements. Especially for swimwear, the fabrics are so few, SHEIN can provide sufficient reference for the industry.As for whether the defendant will infringe, it depends on whether the other party can find their own products. But Anne wasn’t too worried.»Whether their products are truly original is still in doubt, and we are not even afraid.»However, if the products in the SHEIN X plan are really implemented, then sellers such as Anne will face a much greater risk of infringement, and they will be able to avoid the «verbal criticism» of the Western media as much as possible.A SHEIN X can differentiate from other competitors and enhance SHEIN’s brand defense.Get rid of the «low quality and low price» in one hand, and grasp the design initiative and intellectual property rights in the other. At the same time, these two aspects have made efforts to give SHEIN a moat, but it can also save SHEIN from a fully-wound state, from being «pushed by fashion» to guiding the fashion trend.For the crisis-ridden SHEIN, these two actions are critical and urgent. Of course, in order to transform, SHEIN is not only doing these two efforts, and the space is limited, so this article will not go into details.