The overall size of China’s Internet-based retail market in 2016 was more than RMB 5.3 trillion.
People's consumption habits no longer solely depend on physical stores as a result of the development of the Internet, they have identified multiple routes to meet their consumption needs. The change of people's consumption habits has undermined the standing of physical stores. The evolution of a “product-centered” consumption society to a "consumer-leading" consumption society.
The dawning of this new consumption age indicates that the main body of consumption in China market has changed. The generations after 80s, 90s, and 00s have become the main body of consumption. This new main body of consumption is featured by:
1. Huge population.According to the data from National Bureau of Statistics, the population of the generations after 80s, 90s, and 00s is 170 millions, 194 millions, and 140 millions, respectively. The total population of these three age groups is more than 500 millions.These consumers display a new consumption pattern: they prefer less popular brands that highlight distinct individuality and value over traditional famous brands; in the meantime, they are rational and in favor of commodities that meet their requirements rather than high-price ones.
2. The new generation of consumers have increasingly-higher quality requirements on brand products, and consumption experience is one of the important determinants in the selection of brands. The entire retail industrial chain of the society nowadays is disintegrated and its operation efficiency is low.
An ideal new commercial retail should be such that its target consumers would be under the impression that “this store is open for them and their desired products, services and shopping experience are available here”. A consumer would be addicted to the store only after he/she has consumption experience of high satisfaction here for many times.
In an environment with multiple functions and abundant in commodities, the organization of commodity display should take into account consumers' consumption scenarios in order to provide commodities for different consumption scenarios.
A key to understand new business retail is the fact that consumers of this business mode still insist on seeing the physical commodities with their own eyes. Maybe, in addition to the convenience of online shopping, what appease these consumers also include the affective experience during shopping.
One must be cautious of the "post-specialization" of current retail. The phenomenon is the result of the lack of professional retailer because traditional department stores, shopping malls, supermarkets and e-commerce companies have spun off their professional functions and become platforms. Under this background, suppliers have to assume the roles of retailers, giving rise to serious retail structure conflicts, discord within the organization, and poor efficiency. Due to the combined impact of these problems, only low-quality over-priced products are available to customers.
If the concept of "new retail" is a must, then it must focus on the essential reform of the old retail. All existing retailer platforms know nothing other than collecting rents. These platforms are monopolistic and their monopoly may and did give rise to conflicts like the one between Cainiao and SF Express. In light of this, new format of retail will come into being only under the pressure from consumers; the following four formats the the most likely ones:
1. Affection-based retailers : Retailers that make use of consumers' affective binding; IKEA is among such retailers.
2. Club stores: Retailers that have a binding with consumers by delivering services, Costco is among such stores.
3. Vertical E-commerce marketers: Marketers that have a binding with consumers and create reverse marketing channels by virtue of their reverse thinking.
4. Upgraded WeChat businesses: Businesses that are based on the principle of "birds of a feather flock together".
There is no such thing as revolutionary new retail Considering the environment changes and growth and development trends, whoever wins consumers will have a bright future.
For example, MUMUSO, in spite of its fast growth inside China, neither blindly embraces the new retail business mode nor refuse to change. Its success is based on customers' needs and perception. By creating a consumption experience based innovative retail mode in line with customers' wisdom, affection, and sharing. MUMUSO is not a yes-man company.
MUMUSO's impressive achievement of opening up more than 350 stores throughout the world in spite of the depression of the retail industry can be attributed to its "Fashion, Authenticity and Nature" brand image, its in-depth communication with consumers, and its product design, manufacturing, supply chain and services, all of which are down to the smallest details. We strive to deliver optimal cost-performance and home-like experience to our consumers by rigorously selecting excellent materials worldwide and creating a convenient and comfortable shopping environment for our consumers.