Matrix Partners has invested in a number of new domestic brands in the consumer sector, and its investment philosophy is summarized as: looking for “innovators in mature categories” and “definers of new categories”.

"Innovators in mature categories" refers to looking for brands that innovate in the gaps in a large, mature category, such as Jane Eyre in the yogurt category, Zhong Xuegao in the ice cream category, etc. .

"The definer of new categories" defines a new track and creates a new demand, such as self-heating convenience food brand Zihai Pot, baked instant oatmeal brand Wang Baobao, etc. .

In the previous article, we experienced the wave of new domestic products through cases such as the Forbidden City IP cooperation, the White Rabbit collaboration, and the "China Lining" catwalk at the International Fashion Week, which detonated the market.

This article continues the topic of new domestic products, peeking into the turbulence of new consumer fields from the perspective of "innovators of mature categories" and "definers of new categories".

More financing, faster listings, a new growth story for domestic products

In the past year, the new domestic consumption track has been marked by two listing ceremonies, ushering in Come a blowout.

On the evening of November 19, 2020, Yixian E-commerce, the parent company of Chinese beauty brand Perfect Diary, was listed on the New York Stock Exchange in the United States, becoming the first domestic beauty group to be listed on the U.S. stock market. On the first trading day, Yixian E-commerce’s share price soared by over 96% during the session, with its closing market value exceeding US$12.2 billion.

On December 11, 2020, the trendy brand Bubble Mart was listed on the Hong Kong Stock Exchange, with an issue price of HK$38.50 per share. The opening price on the first day of listing soared by 100.26 to HK$77.10, and the closing market value on that day was 953.29. billion Hong Kong dollars.

Some people predict that "2020 will be the beginning of the golden decade for new consumer goods brands", and there is also a golden saying that "all consumer goods are worth doing again."

According to statistics from the public account "New Consumption Daily", as of mid-December 2020, there have been 195 investments and financings in the new consumption field, 28 of which have financing amounts exceeding 100 million yuan, and most of the projects are in subdivided areas. head brand.

This popularity continues.

According to 36Kr, Yuanqi Forest has recently completed a new round of financing. As a star project in the consumer goods track, Yuanqi Forest’s financing is progressing rapidly. The previous round of ongoing financing was valued at approximately US$2 billion. After the completion of this round of financing, Yuanqi Forest’s valuation has reached US$6 billion. This means that in less than a year, the valuation of Yuanqi Forest has skyrocketed by about three times.

On March 25, the domestic beauty brand Betteni was successfully listed on the Shenzhen Stock Exchange, and the “first functional skin care product” was officially born. In this IPO, Bethany’s issue price was 47 yuan, which surged by more than 260 yuan at the opening, with a total market value of more than 70 billion yuan.

Beauty and skin care has always been a popular category for new consumers of domestic products.

According to statistics from the "2020 Investment and Financing Trend Report in the Consumer Sector" released by CBNData Consumer Station, beauty and skin care brands accounted for more than 60% of the consumer products that received three or more rounds of financing last year.

Huaan Securities also mentioned in the "New Consumer Industry 2021 Annual Strategy Report": "Domestic beauty brands have achieved rapid rise with the dividends of social e-commerce, and the sales scale of leading emerging brands has surpassed the international first-line Brand. As domestic products are increasingly sought after by those born in the 1990s and 2000s, the competitive advantages of domestic beauty brands will continue to expand, and more waist brands will have the opportunity to reach higher levels and achieve absolute dominance of domestic brands on this track.

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Perfect Diary: OEM of the same style for big brands, standing on the shoulders of giants

In 2016, he served as vice president of the domestic skin care brand Yunifang Huang Jinfeng left his old employer and founded Yixian E-commerce, the parent company of Perfect Diary, together with Sun Yat-sen University alumni Chen Yuwen and Lu Jianhua. The name of the company was intended to pay tribute to his alma mater.

In 2017, Perfect Diary was launched on Taobao. In the field of beauty e-commerce,

Two years later on Tmall’s Double 11, Perfect Diary surpassed the full-day sales of Double 11 in 2018 in just 28 minutes, becoming the first Tmall cosmetics product to sell over 100 million yuan. Brand.

That year, a Tmall survey showed that Perfect Diary was the second most popular domestic brand among 00 people, second only to the first place Huawei.

Cosmetics are essentially fast-moving consumer goods, and many domestic beauty brands are increasing the speed of new products to attract the younger generation who pursue freshness.

Yixian e-commerce prospectus shows that Perfect Diary can be launched in 6. Compared with the average inventory turnover days of domestic listed beauty companies in 2019, Yixian completed the concept, development and launch of new products within a month, which is far shorter than the 7 to 18 months it usually takes for international brands. The e-commerce inventory turnover days are only 98 days.

This is inseparable from its strong supply chain integration capabilities.

Perfect Diary’s “light mode” adopts OEM (sticker). brand OEM) and ODM (commissioned design and production). The three major OEMs of Perfect Diary are Cosmax, Yintili, and Shanghai Zhenchen. These three have always cooperated with international brands. Cosmax OEM. Brands include Dior, Lanc?me, and Yves Saint Laurent, Yiteli's OEM brands include Armani, Gucci, and La Mer, and Shanghai Zhenchen's OEM brands include L'Oréal and Estee Lauder.

An article titled "12,000 Words Comprehensive." The article "Interpretation of Perfect Diary" mentioned: "Almost all of the world's strongest cosmetics OEM and ODM factories are rooted in the Yangtze River Delta and the Pearl River Delta. After many years of OEM for big-name cosmetics, they have become very systematic, even if they are Rapidly rising domestic brands can easily stand on the shoulders of giants. ”

In order to better cooperate with OEMs, Perfect Diary has recruited a lot of factory representatives. Just like buyers, they are stationed in various supply places and will immediately arrive as soon as new products or packaging materials are available. Just arrange and combine them, and you can quickly iterate them.

Huang Yigeng, vice president of Yixian E-commerce, shared this example. Perfect Diary once launched a 16-color eyeshadow palette, and several of the sequined colors were particularly popular with consumers. , the company captured this preference through big data technology and launched an independent glitter eyeshadow palette in just a few months.

It uses the shortest path to meet consumer needs and achieve product development and response that exceeds its peers. Speed ??is the "perfect password" for a perfect diary

Hua Xizi: The comprehensive result of the right time, right place, right people and people

Among the new domestic beauty brands. , followed by Perfect Diary is Hua Xizi, who follows the national trend and relies on her appearance to make a name for herself.

Last year on Double Eleven, Perfect Diary and Hua Xizi achieved sales of over 500 million and 400 million respectively. , ranking 11th and 15th in Tmall’s skin care cosmetics and daily personal care products categories

In just three years from 2017 to 2020, Huaxizi completed sales of more than 4 billion. It has become the fastest-growing brand among emerging domestic cosmetics brands.

The founder of Huaxizi is Huamantian, whose real name is Wu Chenglong. He once served as the operations director of Pechoin at Yiwangyichuang. He single-handedly led the development of Pechoin’s e-commerce. From 2015 to 2018, Pechoin ranked first in Tmall’s domestic beauty products Double Eleven transaction volume for four consecutive years.

Huamantian believes that Huaxizi’s rapid growth is a comprehensive result of the right time, location, and people.

First of all, the improvement of the country's comprehensive national strength has enhanced the national pride and cultural confidence of the Chinese people, and the recognition and love of domestic products among young Chinese consumers has been unprecedentedly enhanced. At the same time, they have an increasingly high pursuit of beauty and fashion, so the domestic cosmetics market is ushering in the spring of development. This is the right time.

Secondly, China has the most mature and complete cosmetics industry chain in the world. It is also at the forefront of the world in terms of research and development and technology. At the same time, China has a relatively mature e-commerce and new media ecosystem, which creates huge opportunities for the incubation and development of cosmetics brands. This is a good location.

Thirdly, Huaxizi has a user-centered, professional and ultimate-pursuing team. Currently, there are 100,000 product experience officers working with Huaxizi to create products and services. This is harmony.

Catching up with the trend of domestic products, Huaxizi integrates traditional culture with modern fashion. For example, after exploring the intangible cultural heritage culture and craftsmanship of the Miao people, we jointly created a series of makeup called "Miao Impression" inspired by Miao silver jewelry.

In the Huaxizi Tmall flagship store, the best-selling series all have traditional Chinese elements, such as reliefs, concentric locks, Miao silver jewelry, ceramics, etc.

Live broadcast e-commerce promotes the consumption of domestic products

In 2016, mobile live broadcast broke out, and domestic e-commerce live broadcast emerged. After technological iteration, epidemic and other reasons, it has been stimulated by It achieved explosive growth last year.

CNNIC’s 46th China Internet Development Statistics shows that as of June 2020, the number of online live broadcast users in my country reached 562 million, an increase of 2.48 million from March 2020, accounting for 59.8% of the total Internet users. Among them, the number of e-commerce live broadcast users was 309 million, an increase of 44.3 million from March 2020, accounting for 32.9% of the total netizens.

The "China E-commerce Industry Market Forecast and Investment Strategic Planning Analysis Report" by the Qianzhan Industry Research Institute shows that the overall scale of live streaming e-commerce will exceed one trillion in 2020, and it is expected to maintain a high growth trend in the next two years. . As the integration of content platforms and e-commerce transactions continues to deepen, it is expected that the scale of live streaming e-commerce will expand to 2 trillion yuan in 2021, with a penetration rate of 15.

E-commerce live broadcast broadens the conceptual boundaries of the core elements of the original consumption scene: people (consumers), goods (commodities), and fields (scenes), and builds a new model with brand users of the anchor platform as the main participants. ecological closed loop.

Data from the "2020 Domestic Product Consumption Trend Report" released by Suning.com shows that in 2020, live broadcast room purchases and community recommended purchases have become the two new growth points for domestic product consumption. Among them, the consumption of domestic products in the live broadcast room increased by 126.3%, and the consumption recommended by the community increased by 147.2%.

During the severe period of the epidemic, offline business was hampered. Sun Laichun, founder of Lin Qingxuan, led the company’s ALL-IN e-commerce live broadcast. Overall sales still achieved a 20% increase, and the average store performance reached 122.19 in the same period. Offline customers The unit price reached 164.3 during the same period.

On "Double Eleven" in 2020, Adolf, a domestic fragrance care brand, set a record of more than 87 million goods in 10 minutes via live e-commerce, and total online sales exceeded 328 million.

If the e-commerce platform accelerates the process of new consumer products from 0 to 1, then live broadcast e-commerce is to complete the next process from 1 to N, from popular products to continuous popular products, from small to large. Many brands have become the first in the category, gradually accelerating the fission effect of the brand.

New channels: the secret to the success of cutting-edge brands

EO Think Tank once defined new domestic products as: Chinese brands making new creations based on the connotation of traditional Chinese culture Or domestically produced goods that are disseminated using new marketing resources.

One of its main features is the new channel, which means that domestic product brands rely on the new generation of information development technology and use diversified digital platforms and marketing resources to broaden consumers' awareness of the brand through multiple channels. Strengthen the brand's customer acquisition and repurchase capabilities.

It can be said that the rise of domestic brands such as Perfect Diary and Huaxizi is inseparable from the "planting grass" marketing model through online channels.

Yixian E-commerce Stock Book also mentioned that popular traffic platforms such as Xiaohongshu, Bilibili, Douyin, and Kuaishou are "playing an increasingly important role" in influencing consumer shopping. Yixian E-commerce has cooperated with 15,000 KOLs of different reputations, and is currently incubating the company's KOLs.

In 2018, Hua Xizi took the initiative to contact Li Jiaqi to promote a loose powder priced at 159 yuan.

Li Jiaqi compared the affordable Korean loose powders on the market at 49 yuan a piece with the big-name loose powders priced at 200 to 300 yuan, and thought that they should be priced at 99 yuan to enter his live broadcast room.

Huaxizi has entered the mid-to-high-end price range with its products, aiming to become a mid-to-high-end makeup brand.

After studying Hua Xizi, Li Jiaqi brought this loose powder to his live broadcast room and helped it become the category king, creating a sales miracle of 700,000 boxes sold on Double Eleven in 2019.

The beauty insight report released by Xiaohongshu shows that 36% of users obtain beauty information through social media, and 70% of beauty users will be "growed" after using social platforms.

On the Xiaohongshu platform, there are more than 30 million KOC. Brands influence users' consumption behavior by influencing KOC to establish word-of-mouth in the community. Users share their consumption experiences, which in turn affects the brand and other users, forming a positive cycle. This shows that brand content marketing will gradually move from KOL creation to consumer mass creation.

Beauty brands are using new channels and new platforms as the main way to reach target users, and building user trust through "word-of-mouth mass creation" has become a key factor in the rise of beauty brands, especially new brands. ring.

Overtaking on a curve, two micro-blogs and one flicker to separate the crowd

It is worth noting that starting from October last year, Huaxizi began to carry out offline media placement , Huaxizi spokesperson Du Juan and Miao impression promotion ambassador Aduo can be seen everywhere on the elevator screens of office buildings and apartments.

During last year’s Double 11, Perfect Diary also used offline media platforms to build a brand moat. Advertisements for Perfect Diary endorsed by Zhou Xun flooded the elevator screen.

The popularity of Yuanqi Forest is also due to high-frequency and efficient advertising, which frequently appears in variety shows and Focus elevator advertisements.

Wang Xing, CEO of Kantar China and Global President of BrandZ, mentioned an important point at the 2020 BrandZ Top 100 Most Valuable Chinese Brands conference held last year.

She said that for advertisers and brands, efficiently combining online and offline, content-based and scenario-based, and detonating the brand through "double micro, one shake and one focus" will become the key to future communication. The most effective paradigm.

Brands in daily life scenes represented by Focus Media are widely detonated, and social media brands represented by Weibo, WeChat, and Douyin are deeply planted. The interaction and excitement between the two are The post-epidemic era will be the core position to help brands achieve strong recovery and growth.

Isopu’s research shows that among the TOP10 popular, highly recognizable, and mind-occupying advertising slogans in 2020, 47% of consumer awareness channels come from TV advertising, 56% from Internet media, and 83% from Elevator media. 83 Popular advertising slogans are made by "Elevators". If we compare last year's data, 54 came from Internet media, 50 came from TV advertising, and 81 came from elevator media.

The view of "double micro, one shake, one focus" also appeared in Wu Xiaobo's 2020 end-of-year show. He mentioned: "Today, any brand that does not appear in the scene has nothing to do with you. This scene may be an elevator, it may be a high-speed rail, it may be social, just like two micro-blogs, one trembling and one focusing, centralized detonation in public scenes, Then keep it in the private domain. Only the brand that appears in the scene can make you take a second look is called a brand that is relevant to you. ”

For advertisers and brands, online is the key. Efficiently combining with offline, content-based and scene-based, detonating the brand through "double micro, one shake and one focus" will become the most effective paradigm for future communication.

The "2020 China Consumer Brand Development Report" released by Alibaba Research Institute summarizes the secrets of the success of emerging brands into the following five points:

1. Abandon complex physical channels and actively embrace e-commerce. commercial channels to maximize the role of emerging channels in brand building;

2. Make full use of diversified digital platform marketing resources;

3. Grasp the changing consumer demand and target market segments Implement product innovation and combination, and quickly iterate;

4. Focus on direct communication and service to consumer groups;

5. Brand visualization.

In the past year, new consumption of domestic products has shown an explosive trend, including "the first domestic beauty brand" Perfect Diary, "the first trendy toy brand" Bubble Mart, and the tile-shaped Zhong Xue Gao, as well as Huaxizi, which takes advantage of the "right time, location, and harmony", Yuanqi Forest and Wangbaobao, which specialize in health brands, have broken the oligopoly market structure in various sub-categories.

The thinking and model of "innovators of mature categories" and "definers of new categories" to achieve "superiority in corners" in competition have become traceable. What can be expected is that the future will There will be more new consumer brands becoming the next “Perfect Diary”, and there will also be more cutting-edge Internet celebrities becoming mature brands that seize the minds of consumers.