New consumption observation ｜ reshaping the market structure, ＂striving for progress＂ in the change of high-end women’s wear

Source: PEACEBIRD Taiping Bird Women’s Dress Weibo

How long has it been since you bought clothes at the mall?

Recently, a topic # I dare not buy clothes in the mall with a monthly salary of 20,000 # rushed to Weibo for hot search. The problem that fewer and fewer people buy clothes in shopping malls and stores has aroused public concern.

People are not only discussing the reasons for this phenomenon, but also wondering, are those high-end clothing stores in shopping malls, especially those women’s clothing brands that have led the trend of the times, still doing well after being closed and closed down?

It is worth noting that recently, a number of high-end fashion apparel groups in China disclosed their 2023 financial reports. From the data point of view, the revenue and net profit of several mainstream brands achieved double growth, and their performance was improving.

At the same time, the slow growth of net profit has also exposed many problems, such as the loss of young consumer groups, serious product homogeneity, high-end mass clothing and accelerated competition, and high-end women’s wear brands have entered a new stage that needs to be transformed urgently.

The pressure of good performance, "hard to hide"

There is basically a fashion group behind the common brand stores that consumers visit in shopping malls.

Domestic mainstream mid-to high-end women’s wear groups, such as Langzi (with LANCY FROM25, LIME FLARE, etc.), Gelisi (with ELLASSAY, Laurèl, etc.), Winner Fashion (with La Koradior, CADIDL, etc.) and Local Fashion (with DAZZLE, DIAMOND DAZZLE, etc.). In addition, there are VGRASS parent company Jinhong Group, JNBY women’s parent company Jiangnan Buyi, and PEACEBIRD women’s parent company Taiping Bird.

Combing the financial report data of these companies in 2023, we will find that "year-on-year growth" is almost the same keyword.

Specifically, in 2023, Langzi’s revenue was 5.145 billion yuan, a year-on-year increase of 24.41%, and its net profit was 225 million yuan, a year-on-year increase of 953.37%; Winner’s fashion revenue was 6.912 billion yuan, a year-on-year increase of 22.1%, and net profit was 838 million yuan, a year-on-year increase of 119.2%; Gelisi’s operating income was 2.915 billion yuan, up 21.73% year on year, and its net profit was 106 million yuan, up 41.7% year on year …

At the same time, the brands under the group also performed well. Among them, the winners, Koradior, NAERSI and NEXY.CO, all earned more than 1 billion yuan, which were 2.387 billion yuan, 1.464 billion yuan and 1.004 billion yuan respectively.

With the improvement of domestic consumption environment and the return of offline passenger flow, high-end women’s brand stores have gradually stepped out of the "cold winter period" and ushered in a small "warm sun". However, it should be noted that behind the growth is the performance under pressure.

Judging from the growth base, the "starting line" of the group’s performance is the "trough period" in 2022, and the profitability of many brands has not returned to the state before the epidemic.

From the business sector, the growth of women’s clothing sector is weak and obvious. In 2023, the most representative of Langzi Co., Ltd., the medical beauty business sector of the group achieved an operating income of 2.127 billion yuan, surpassing the original main business of women’s clothing for the first time.

Source: Langzi shares LANCY Weibo

The demand is more yuan, the scenes are richer, and the exquisite white-collar workers have changed their minds.

In the 1990s, high-end women’s wear brands such as MORELINE, Brother, JNBY and DAZZLE sprouted and developed in the tide of international clothing brands entering China, and attracted the attention of a large number of urban beauties, white-collar workers and exquisite women with their classic collocation and boutique positioning.

As far as mass clothing is concerned, high-end women’s wear is far ahead in terms of brand awareness and market influence, forming a high industry barrier. But in recent years, the business problems of these brands have become more and more obvious.

Internally, many people still have the same impression of the brand, such as slim suits, lightly cooked long skirts and three-dimensional shirts … After the new Chinese style, cool style and BM spice girl style set off wave after wave of fashion trends, this unified and orderly "temperament" will be labeled as "old-fashioned".

Externally, fast fashion brands represented by Uniqlo, ZARA, UR and Hot Air have diverted consumers with their high cost performance, high innovation rate and fashionable style. In order to withdraw funds, Chanel and Dior high-end international clothing brands that began to sell at a discount, as well as mass clothing brands that have turned to high-end products, are dividing their market share.

The reason is that the market has changed and the audience has changed.

Xu Lizhao, head of the Shopex market, pointed out that as the core consumer group of high-end women’s wear, elite women have more diverse roles in the workplace, and their demand for clothing is more diverse, and they are considerate and comfortable while being fashionable and casual. Some younger elite women want to make professional clothes more sweet and romantic.

In addition, outdoor sports and tourism and fitness fever have driven clothing to "grow into a new scene", and clothing brands such as Archaeopteryx, Disante, Beifang, Angpao, lululemon and Jiaoxia Outdoor have led the new trend and become the "bright spot" of the whole high-end clothing industry.

From the perspective of the consumer market, he said that in the era of "the ratio of heart to price is greater than cost performance", "emotional value" has become a hot spot to promote women’s consumption, such as the popularity of "dopamine wearing". Focusing on the demand of female groups for "emotional value", clothing brands are also actively solving problems.

Let young people fall in love with "class flavor" and find a breakthrough from diversification.

When any brand develops to a certain stage, it needs to make corresponding adjustments in product design, marketing strategy and service characteristics according to market changes, even high-end women’s wear with sufficient resources is not included.

Recently, in Little Red Book, Brother, a high-end Taiwan, China women’s clothing brand, became popular. A brand that was once labeled as "wearing within the system" made many young people lament that it was "both earthy and expensive".

The reason for turning red is very simple. The combination of "full of class flavor" forced young women who entered the workplace to buy a set, and later found that brother had good quality and service. Looking back at the popularity of my brother, it is not just that consumers are "old".

The younger brother who started off the line set up the live broadcast matrix such as Tik Tok live broadcast room, video number live broadcast room, Taobao live broadcast room and Aauto Quicker live broadcast room very early, which strengthened the ability of online operation and sales. At the same time, in terms of products, Brother has obvious cultural characteristics and collocation style, which meets the requirements of consumers for the tonality of high-end brands. The brand has a good reputation and customers are willing to pay for the high premium.

"Most mid-to-high-end women’s wear brands mainly sell offline stores, and the target consumers usually need to try them on and feel the material and design." Xu Lizhao said that brands need to provide better customer service and deepen emotional communication.

At the same time, he also pointed out that WeChat applet mall, short video official account, Tik Tok account and Xiaohongshu account have become the necessary infrastructure for middle and high-end clothing brands to face consumers, and brands have more channels and contacts to carry out DTC business in order to obtain more direct decision-making data for consumers.

In addition to brothers, high-end women’s fashion groups have also undergone brand transformation.

Gelisi began to expand its categories, and made great efforts to develop luxury brands, forming a brand matrix with many attributes such as fashion, trendy brand, luxury and online celebrity. Similarly, Winner Fashion said that it will start to prepare a new brand in 2024, which will "meet the cross-scene clothing needs of high-net-worth people for sports, leisure and business commuting".

In addition, at the marketing level, Xu Lizhao introduced that some brands began to directly compare with international luxury brands, dig deep into brand-specific DNA, and penetrate brand stories into all dimensions from products, visual communication, marketing and retail terminals.

For example, he said that when Hermes Orange and Tiffany Blue became classic cases in the luxury goods industry, the high-end women’s brand Koradior took rose red as the brand’s exclusive color, and then cooperated with innovative roses to meet the design, inviting sweet stars from Europe and America to speak. This marketing method has made it a hot and well-recognized high-end women’s clothing brand in China.

"The top high-end women’s wear brands still have some room for market growth. Brands need to keep up with market changes, gain insight into the needs of target customers, and conduct flexible product design to meet the diversified product needs of women in different roles in different scenarios. " Xu Lizhao concluded. (Text/Ji Xiaoling)