the more you sell, the more you lose. proya and others start to invest in short dramas
2024-09-03
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china business news (reporter ma jia)live streaming is declining, short dramas are on the rise, and domestic beauty companies are opening up a new battlefield. according to incomplete statistics from china business news reporters, as of now, more than 10 domestic beauty listed companies have announced their semi-annual reports. proya and shangmei co., ltd. have entered the first echelon. although marubi co., ltd. lags behind, its revenue and net profit are both growing.
reporters found that brands with better performance in the first half of the year invested more in new e-commerce channels such as short drama marketing, while the "report cards" of shuiyang shares and fuerjia, which only rely on traditional e-commerce channels such as live broadcasting, are not very ideal. has a new round of competition among domestic beauty companies begun?
proya and shangmei holdings topped the list and invested heavily in short dramas
in the first half of this year, shanghai jahwa, which had been firmly in the top spot in the domestic beauty industry, gave way to proya, which topped the performance list of domestic beauty companies with "revenue of 5 billion yuan and net profit of 700 million yuan". shangmei co., ltd., which ranked second, also squeezed out a number of competitors and stood out with "revenue of 3.5 billion yuan and a year-on-year growth of more than 120%".
the reporter summarized the financial reports and found that both proya and shangmei co., ltd. spent a large amount of marketing expenses on short dramas. take hanshu, a brand under shangmei co., ltd., for example. hanshu has won the first place in the douyin beauty monthly list for six consecutive times and is known as the "king of short dramas" in the beauty industry. in the first half of the year, shangmei co., ltd.'s sales and distribution expenses were 2.016 billion yuan, a year-on-year increase of 137.1%.
the reporter consulted the relevant person in charge of a domestic mcn company, who said that compared with traditional tv drama placement, brands have more autonomy in short dramas. first, the shooting cycle of short dramas is short and the time to put them on the shelves is fast. after the male and female protagonists finish their lines, the product link will appear at the bottom of the screen, and consumers can buy it at any time; secondly, brands can customize the content of short dramas according to marketing needs and directly integrate the efficacy and brand image of the products into the short dramas. for example, when full-time housewives return to the workplace, beauty products can make them more confident. consumers will also place orders for products driven by the emotions of such scripts.
a relevant person in charge of proya said that hanshu has indeed achieved great success through short drama marketing. it achieved sales of 480 million yuan during the traditional off-season last year, which caused a stir in the industry.
data shows that as of the end of 2023, 12 brands including hansu, proya, and marubi have produced 24 customized short dramas on the douyin platform alone.
are shuiyang shares and fuerjia’s live broadcasts “unable to continue”?
previously, yunifang's parent company shuiyang co., ltd. and fuerjia, which sells "medical beauty masks", have always been the leaders in online channels. in the first half of this year, fuerjia's net profit decreased by 3.71% year-on-year, and shuiyang co., ltd.'s net profit fell by 25.74%.
in its financial report, fulijia stated that the company's online revenue accounted for about 45% of its total revenue. its self-operated online business mainly obtained direct sales income by independently setting up and operating online stores through online sales platforms such as tmall, xiaohongshu, douyin, and wechat.
shuiyang co., ltd. stated that the company increased its expenditure on related expenses such as promoting its main brands and market launch, which affected the company's operating performance in this period.
the reporter saw on the social media platform that the live broadcast rooms of fulijia and shuiyang co., ltd.'s brands were broadcasting all day, but the number of viewers was not large.
data shows that 2019 was a year of explosive growth for the live streaming e-commerce industry. according to data from consulting firm imedia research, just 63 minutes after tmall’s “double 11” event was launched in 2019, the transaction volume driven by taobao live exceeded the transaction volume of the entire day of “double 11” in 2018.
"after paying high marketing fees, the sales of the products did not increase. at the same time, the anchor's slot fee is increasing, and the price of the product has been repeatedly lowered, which is hard for the brands to bear." a person in charge of a domestic beauty brand told reporters at a media communication meeting, "the cooperation between brands and top anchors is likely to become a loss-making business. the more they sell, the more they lose."
bloomage biotech and beitanni are working hard on new raw materials
in the first half of this year, huaxizi bio's operating income decreased by 8.61% year-on-year, and its net profit decreased by 19.51% year-on-year; beitanni's revenue and net profit both increased.
huaxi bio admitted that some of its businesses, such as the functional skin care products business, were in the deep waters of management changes during the reporting period and market expansion was not fully launched, resulting in revenue of 1.381 billion yuan, a year-on-year decrease of 29.74%.
in the first half of this year, bloomage and beitanni have been actively filing new raw materials. bloomage launched a total of 6 new bioactive raw materials in the first half of the year. a relevant person in charge of beitanni also told reporters that beitanni has successfully filed and approved 9 new cosmetic raw materials, including water dragon, lychee grass, short-stemmed fleabane, southern yew seed oil, meconopsis racemosa, and liangwang tea, ranking first in the country in the number of approved new plant raw materials.
"the number of exclusive raw materials and related core technologies owned by a beauty company can also represent the core competitiveness of the company. consumers and investors will 'pay' for this company. raw material innovation may also become the second growth line for domestic beauty companies." an investor left a message on an investment forum.
how can domestic beauty companies break through in the second half of the year?
facing changes in the beauty industry, domestic beauty companies may also be adjusting their management. take shanghai jahwa as an example. after lin xiaohai became the chairman, ceo and general manager of shanghai jahwa, ye wei was hired as a brand marketing consultant for shanghai jahwa in july this year. in august, ye weimin resigned from the position of deputy general manager of shanghai jahwa and became an external consultant.
shanghai jahwa said that most of the newly recruited talents have a marketing background, but it pays more attention to five indicators: a sense of mission to revive the century-old brand, a determination to win, a spirit of being able to get things done, and an ability to learn quickly. the team must have a sense of urgency to get moving, run, and "roll up."
beauty companies are also measuring the value of marketing investment in online channels. proya management has publicly stated that the first two product placement dramas of the traffic influencer jiang shiqi received more than 2 million likes per episode, but now a short drama with more than 100,000 likes is considered very good, and the popularity has obviously declined, and the traffic has been divided by competitors. in addition, according to their understanding, the production cost of a single episode of the short drama in which jiang shiqi participated was between 150,000 and 200,000 yuan, but when the popularity was the highest, it was hyped up to 600,000 to 1 million yuan per episode, and the cost is rising.
research and development is still a key area that beauty companies need to invest heavily in. in the second quarter, the proportion of research and development expenses of yatsen e-commerce increased to 3.7%. huang jinfeng, founder, chairman and ceo of yatsen e-commerce, said: "in the face of the challenges of the overall environment, we will continue to focus on expanding our product portfolio and optimizing our channel portfolio, with the goal of returning to the growth track while balancing profit margins."
