Fast Fashion Clothing Brands Scramble For Celebrity Endorsements To Enter A New Round Of Battlefields.

The battle of celebrity endorsement is penetrating into the fast fashion battlefield.

Sweden's fast fashion H&M has announced that Zhang Yixing, an all-around musician, has become the spokesperson for her brand in Greater China, and is also the first annual spokesperson for H&M brand Greater China.

Through continuous pursuit of market competitiveness and brand influence, H&M will take this opportunity to further promote the development of its business in Greater China based on menswear products with brand sense of design and quality.

It is worth noting that in March last year, H&M also announced the popularity of idols as the brand name of the new generation in China.

Announcing that the celebrity endorser has become the standard of global luxury fashion brand marketing in China, consumers are familiar with this.

H&M's star strategy is not new.

Earlier, H&M invited stars to interpret the special new year series every year, including Yang Mi, Mark, Xun Zhou, Liu Wen, Choi Siwon and other stars who had worked with the brand.

However, from the early stars and supermodels to today's Wang Yuan and Zhang Yixing, H&M seems to have tilted to the flow of resources on the choice of star resources. From advertising face to whether it meets the requirements of brand tonality and visual communication, it turns to whether the advertisement face has its own appeal.

The purpose is very clear, that is, targeting young consumers behind the stars. As of now, micro-blog fans of Wang Yuan and Zhang Yixing have combined more than 100 million.

Although H&M seems to be an adaptation to market trends, it also seems to reflect some anxiety about the density of contacts with celebrities and the choice of stars.

This anxiety is not unique to H&M, but comes from the fast fashion industry.

In September last year, H&M's biggest competitor, Spanish fast fashion Zara announced in micro-blog's official account that China's 90 star Dongyu Zhou and Wu Lei were the brand ambassadors of Greater China, and the same sales were sold in Tmall flagship store in September 27th. The number of fans of Dongyu Zhou and Wu Lei on micro-blog was 28 million 600 thousand and 37 million 750 thousand respectively.

Unlike H&M, which consistently adhered to the star strategy, Zara had never asked a spokesperson in the Chinese market before.

Massimo Dutti, Oysho and other brands of parent company Inditex group also have little habit of hiring spokesmen.

But in 2018, Inditex group made a significant adjustment to the strategy of the Chinese market, introducing star resources to its brands, such as Janine Chang of Massimo Dutti, Li Qin of Oysho, Wang Linkai of Pull&Bear.

The most direct reason for Zara's abrupt change in attitude and H&M's fast pace is the overall slowdown in fast fashion performance, which needs star effect to enhance performance.

In the past year, the global market has generally reached a consensus. The fast fashion of relying on the efficient turnover mode to occupy the dominant position in the market has begun to expose problems under the attack of the more cost conscious electricity providers and the rentals of rents.

According to the latest report released by Inditex group, sales in the 2018 fiscal year increased by 3% to 26 billion 100 million euros, an increase of 4% compared to sales, a further slowdown in sales growth of 9% over the 2017 fiscal year, 56.7% gross profit and net profit rose 12% to 3 billion 400 million euros, the worst growth rate in nearly 5 years.

The Inditex group's share price fell more than 5% on Wednesday after its earnings announcement.

H&M group's sales rose 5% to 210 billion 400 million Swedish kronor last year, or 156 billion 200 million yuan, mainly due to the strong growth of 22% of online channel revenue, accounting for 14.5% of the group's total sales.

During the period, the gross profit of the group rose 21% to 110 billion 900 million kronor compared with the gross profit margin of 52.7%.

The group admits that 2018 is a challenging year. After a difficult first half of the year, there are signs that the pformation of the group is beginning to take effect.

The group focused on upgrading the logistics system in the fourth quarter, which will inevitably lead to cost increases and short-term profit margins, but this will drive long-term profit growth.

In a long period of time, the fast fashion business model made the Zara and other brands become the dark horse breaking the traditional fashion industry rules.

The products with high commercial efficiency and high performance price ratio mean more rich styles, lower prices and quicker updates in the apparel industry to meet the needs of consumers.

The combination of high-end design and low price makes fast fashion invincible in the past 10 years.

Fast fashion to traditional fashion is equivalent to a dimension reduction attack.

Some analysts believe that high frequency and inexpensive fast fashion brands are "efficiency driven".

They are different from the "premium drive" of low frequency and high added value of traditional fashion brands.

Consumers choose fast fashion rather than brand value because of the product itself.

This explains why fast fashion does not need stars for a long time. Why does Zara without star strategy still win the sluggish retail market and open up the distance between H&M and UNIQLO, which are popular with star strategy.

Of course, no model can achieve absolute victory.

The peak period for the development of this kind of retail giant focusing on market segmentation is to reasonably balance the low price and high quality, but when this balance is broken, it means that the new "destroyer" appears.

With the development of new technology, fast fashion mode will inevitably become the object of reducing dimension.

For example, a group of European fashion business platforms called "Ultra-Fashion" has not yet jumped out of the fast fashion business model, but it has changed the consumer's perception of "high quality and low price", that is, consumers can enjoy the same or similar products at a lower price.

They are more focused on "fast" and are challenging the traditional fast fashion which is known for their immediate response to consumer demand and constantly bringing fresh ideas.

They are shorter from design to shelf, more products updated in fixed time, and are fighting for consumers who are more and more difficult to satisfy.

Boohoo, ASOS and Missguided in the UK are now able to produce goods in 2-4 weeks, Zara and H&M for 5 weeks, while traditional retailers need 6-9 months.

Missguided can launch 1000 new products every month and update the inventory once a day.

ASOS can also complete the product process within 2-8 weeks, with an average listing time of about 6 weeks.

These ultra fast fashion retailers avoid the inherent problems of traditional retailing, namely product shortages and overstock, and the consequent reduction in prices and profit margins.

The supply chain of ultra fast clothing retailers is always agile, able to quickly match inventory supply and changing demand, and strictly control inventory, and achieve a balance between insufficient supply and price reduction.

The preliminary design of the product is to conduct small batch production, test consumer feedback, and replenish goods quickly if successful.

In China, the situation of fast fashion is more complicated.

In addition to the rising domestic apparel brands, fast fashion's current competitors come from another battlefield, thousands of Taobao sellers.

This makes the middle and low end market competition unprecedented fragmentation.

Successfully hatched Zhang Dayi, bugs, Daikin and other net red net red business incubator Hangzhou such as Han Holdings has formally submitted IPO applications on the Nasdaq Stock Exchange, estimated to raise 100 million to 200 million dollars.

Such as Han has 113 signed net red, in the first 9 months of the 2019 fiscal year, GMV realized a total of 2 billion 200 million yuan, earning 856 million yuan, but with a loss of 57 million 500 thousand yuan, and fourth quarter revenue growth of 62% to 385 million yuan.

At present, there are 148 million 400 thousand fans and 91 self operated online stores under the banner of Alibaba. The Taobao China of Alibaba owns 8.56% of its shares.

Zhang Yong, a Alibaba CEO, has raised the concept of "net red economy", which has attracted the attention of the capital and the public about net red. "The younger generation has created new economic phenomena for idols, for the same good people and for the stars, and I think this is unique in the world."

Zhang Dayi, Sydney and other net red Taobao stores have also replaced many fast fashion brands on the list of young consumers.

The sales volume of tens of thousands of pieces within two hours is unimaginable in fast fashion.

Net red shop is new every month. Before the clothes are formally put on the shelves, they will be released half a month in advance, or even earlier.

They estimated the sales volume according to the feedback of fans, and then ordered the factory to solve the most troublesome inventory problem.

Net red stare at the current trend, supervise product design, and realize the products through thousands of Chinese clothing factories behind them. In fact, China has realized the unique fast fashion mode in China.

Like Zara and other fast fashion brands, Taobao's red model in China has also been criticized by copycats.

But the advantage of Taobao's red model compared with fast fashion is the premium of net red personal brand, not just the product itself.

Loyal consumers who follow Taobao behind red often regard net red as their opinion leader, while Zara's consumer loyalty is relatively low.

Alibaba and Jingdong occupy most of the market share of China's electricity supplier market. The infrastructure projects invested by the two companies have extended the development of e-commerce to China's remote areas.

The emergence of net red also made the two platforms firmly control consumers and made the market more fragmented than ever before.

Andrea Fenn, founder of Fireworks, a digital consultancy, said that the choice of consumers in the electricity supplier market is much harder to catch the attractiveness of consumers. This is a blow to fast fashion. Even though it enjoys a reputation all over the world, fashion lovers are very fond of their products, and ASOS, Topshop and New Look have all dropped out of the Chinese market.

This is why fast fashion brands will increasingly feel that they can't catch consumers, and consumers of second tier cities, which are influenced by consumption upgrading and rational consumption, are constantly leaving the fashion market.

Sensitive market players can feel that China's consumption environment is undergoing a drastic change.

Nelson released the 2018 China family smart consumption report, pointed out that the second tier cities tend to rational consumption, the 345 line cities began to enjoy the upgrading of consumption, of which three or four lines of cities are increasingly frantic, and many imported brands which had only been seen in a second tier city had gained a good sales volume in the sinking market.

More and more data prove that, thanks to the popularity of smart phones and the rapid development of electricity providers, the consumption habits of the three or four tier cities are getting closer to a second tier city.

But in view of Zara, H&M and other brand channel strategy, its shops are mainly distributed in the second tier cities.

On the one hand, these stores are facing the risk of consumer loss, on the other hand rents are soaring.

By the end of the 2018 fiscal year, Inditex group has 7490 stores in the world. In the past year, 370 stores have been added, 226 stores have been renovated or expanded, and the group's rental expenditure has increased 1.4% to 2 billion 392 million euros compared with 2 billion 358 million in the 2017 fiscal year.

According to data monitoring, the price of clothes sold by the Zara in the Chinese market has decreased by 10% to 15% over the past two years. This may reflect the growth rate of the group in the Chinese market may not have met expectations, and began to feel the fierce competition of fast fashion competitors and the rise of domestic clothing brands.

Digital pformation is the only way out for fast fashion.

Last year, Zara launched its official website and e-commerce services in 106 countries and regions.

According to group CEO Pablo Isla, over the past 5 years, the group's total investment in online channels has exceeded 7 billion 700 million euros, of which 1 billion 500 million euros has been designated for upgrading technology and logistics.

But we have to admit that the traditional fast fashion has missed the best window period of the electricity supplier.

Until 2010, there were no online stores in Zara. At that time, Gap had opened online stores for 10 years. Until 2014, Zara opened shop online in Tmall. It did not perform well during the double eleven period.

Missing China's electricity supplier bonus period also means that we have missed the training of consumption habits.

The sunken urban consumers, who could have been radiated by the electricity supplier, have developed the habit of shopping in Taobao stores and gradually escalated their consumption.

Morgan Stanley analyst Geoff Ruddell also believes that the further slowdown of the Inditex group's performance last year means that the restructuring measures have not produced much effect, while the slowdown in online retail growth shows that the group's online market competitiveness is not as good as expected.

Whether Zara or H&M, the two fast fashion brands are at the critical stage of digital pformation.

The "efficiency driven" fast fashion mode weighs ahead, and the product itself is not enough to attract consumers.

At this point, the brand asks the star strategy to increase the extra premium for the brand so as to maintain the attractiveness of the brand.

UNIQLO is a counterexample. It is showing the development potential of the fast fashion brand. In many consumers' eyes, UNIQLO is not fast fashion brand relying on quality foundation and high-tech competitive advantage.

In the 2018 fiscal year ending August 31st, the sales of 9983.TYO of the UNIQLO parent company increased by 14.4% to 2 trillion and 130 billion yen, or 131 billion 400 million yuan, and net profit rose 29.8% to 154 billion 811 million yen, or 9 billion 500 million yuan, to close to the 10 billion mark.

Its overseas market sales exceeded Japan's regional sales for the first time.

Among them, the same store sales in the Greater China region continue to grow. The strong online sales performance has accounted for 15% of the total revenue in the Greater China region and recorded double-digit growth.

The same store sales in Southeast Asia and Oceania continued to achieve double-digit growth.

Compared with other fast fashion brands that are in the bottleneck, UNIQLO is making full efforts to expand its global expansion. Its large-scale opening up plan is in sharp contrast to the strategy of Zara and other fast fashion brands.

Ryui Seiso said that UNIQLO is essentially a technology company whose rival is apple rather than Gap.

In 2015, after the launch of HEATTECH heating material by the high-tech group in Dongli, UNIQLO has made high-tech fabrics the core competitiveness, and its products are popular eleven times a year in Tmall.

UNIQLO is updating consumer awareness of "quality" products by providing consumers with first-rate technology clothing at the price of fast fashion products.

Although UNIQLO is also working with stars such as Ni Ni and Chen Kun, it is clear that UNIQLO does not rely on the brand premium provided by the star effect. This may be a wake up call for fast fashion in the recent rush to push new brands and close shop layoffs. After all, it is a product of high quality and low price that can continue to capture consumers, and the "destroyer" of UNIQLO will further threaten the status of Zara.

When consumers' eyes become more and more critical, especially in the Chinese market, the original business model of fast fashion is also being overturned. Though starting to find celebrity endorsements, it can intermittently surprise consumers and stimulate consumption, but in the final analysis, it is still how to give play to the core competitiveness of commodities.