news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

text | ren zaoyu

edit | orb

vision | gu xiang

if you ask what is the most powerful domestic beauty brand now, the answer may be surprising.

according to the first half of 2024 financial report of hanshu's parent company, shangmei co., ltd., in the first half of this year, the company's revenue reached 3.502 billion yuan, a year-on-year increase of 120.7%, and its profit reached 412 million yuan, a year-on-year increase of 308%.

the total revenue of hanshu parent company shangmei co., ltd. in the first half of 2024 was 3.502 billion yuan, a year-on-year increase of 120.7% / source: baidu stock exchange

in 2023, shangmei co., ltd. has just created its best performance in the past five years. the annual operating income that year was 4.191 billion yuan. in 2022, the full-year operating income will only reach 2.675 billion yuan.

in other words, shangmei's revenue in the first half of 2024 has already exceeded the full year of 2022, and is quickly "catching up" with the peak within five years.

such achievements have made the fortune of han shu founder lu yixiong, a wealthy businessman in shantou, guangdong, soar. in the 2024 hurun rich list, he ranked 2573rd, tied for third among chinese cosmetics entrepreneurs with fang yuyou, co-founder of proya.

however, such impressive performance is based on the shaky daily cosmetics market.

the national bureau of statistics shows that in the first half of 2024, retail sales of cosmetics consumer goods only increased by 1% year-on-year, and sales in june even fell 14.6% year-on-year.

specifically, the four major global beauty and cosmetics groups, shiseido, estee lauder, procter & gamble and l'oréal, are generally under pressure in the chinese market or the market performance in china's regions. for example, financial report data shows that in fiscal year 2024, estee lauder’s revenue in the asia-pacific market fell by 72.8% year-on-year.

in comparison, the report card of shangmei co., ltd. can be said to be very impressive, not to mention that shangmei co., ltd. two years ago was still in the predicament of falling revenue and profit.

financial report data shows that in the first half of 2024, the revenue generated by the main brand han shu accounted for 83.6% of the group's revenue. the key to shangmei's ability to counterattack and buck the trend is "the increase in revenue generated by han shu, one of the main brands". to be more specific, it is "mainly due to the overall upgrade of the han shu brand, as well as the red waist series and white waist series." the self-operated income of the waist series on e-commerce platforms such as douyin and tmall has increased."

in the first half of 2024, the revenue generated by hanshu accounted for 83.6% of the group’s revenue / source: 2024 interim report of shanghai microelectronics co., ltd.

so, how did han shu do it?

after making 22 short plays in one year, han shu targeted the county ladies

the clue lies in channels and advertising marketing.

for most beauty and daily chemical brands, advertising and marketing are an indispensable part. a very easily observed phenomenon is that in the financial report data of major brands, marketing investment is often much greater than r&d investment - even though most brands are keen to promote their "technological strength" in marketing.

in order to reach the needs of consumers on a larger scale, enhance consumers' brand stickiness, or shape brand mentality, marketing competition among beauty and daily chemical brands is always very fierce. to a certain extent, not marketing means that you have fallen behind.

choosing the right channels and appropriate marketing methods is undoubtedly important for today’s beauty and daily chemical brands. and han shu's "turnaround" started from here.

a collection of some short plays in the video account of han shu’s official flagship store

the "2024 china cosmetics industry development trend report" shows that among the three major online e-commerce platforms of taobao, tmall, douyin and jd.com in 2023, the beauty transaction scale of the first two has declined year-on-year, while douyin's beauty transactions on the contrary, the scale increased by 50.49% year-on-year.

at the same time, short dramas have exploded in popularity, and vertical screens have gradually surpassed horizontal screens.under such a situation, han shu, who was already operating on the douyin platform, entered the field of short drama marketing and chose to cooperate with mcn company to integrate product soft advertising into the plot of the short drama.

for han shu, the advantages of short drama marketing lie not only in the huge traffic and higher reach efficiency of short dramas, but also in the “overlapping target group portraits” of the two.

zhan junhao, a well-known strategic positioning expert and founder of fujian huace brand positioning consulting, told salt finance: "han shu has accurately captured the viewing habits and preferences of young consumer groups. the short drama advertisement has successfully attracted people with its unique narrative method and emotional resonance. attention from a large number of young users.”

in the short drama customized by han shu, the protagonist may be the anchor of han shu's live broadcast room, the planner of han shu's advertising, or a loyal user of han shu. han shu tried his best to appear in the short drama scenes in a reasonable and smooth way, in line with the plot, unlike the previous blunt advertisements.

han shu products appeared in the short play together with short play actor jiang shiqi/source: video account@han shu official flagship store

according to data from cicada mama, han shu launched a total of 22 short dramas in 2023, with cumulative views exceeding 7 billion.among these 22 short dramas, 5 "female growth dramas" co-operated with the celebrity "jiang shiqi" are at the forefront of the broadcast volume - jiang qi's main "grass" product category is exactly the beauty category , fans are mostly beauty-loving women under 30 years old.

according to research data from guotai junan,the audience portrait of han shu's official flagship store is mainly young people from small towns, which almost overlaps with the audience of short dramas.

at the same time, it is not difficult to find that most of the products launched by han shu on the douyin platform are box sets priced under 400 yuan. the one he mainly promoted in the short play was the "27 pieces for 399" in the live broadcast room. . compared with international big brands, in the eyes of consumers, korean products that come with lotions and essences all at once are more "cheap and big", which is more in line with the consumption preferences of the groups covered by the short drama.

this information stacks up to form a core group covered by the intersection of beauty brands and short dramas: the "county ladies" who frequently appear in the media.

han shu's hongman waist set box "got 27 pieces for 399" in the live broadcast room

in the eyes of bai yunhu, an expert in the cosmetics and cosmetics industry, this is part of han shu’s strategy.“looking at han shu’s development, its core competitive strategies mainly come from marketing and price.”, he told salt finance.

after combining marketing and price, the conversion of traffic is obviously very rapid. in february 2023, han shu and jiang qiqi collaborated to launch the first customized short drama, and han shu’s sales on the platform that month reached the level of 100 million.

the benefits brought by the short drama are also fully demonstrated in the 2023 financial report data of shangmei co., ltd. financial report data shows that han shu’s gmv through the douyin platform in 2023 will reach approximately 3.34 billion yuan, a year-on-year increase of 374.4%.

han shu's outstanding performance through short dramas was undoubtedly noticed by other brands. proya, marubi, and l'oréal also started customizing short dramas. but when the time came to 2024, han shu slowed down the pace of customizing short plays.

the reason may be that, in han shu's view, the purpose of the skit's exile has been achieved.and the "advertising effect" generated by customized short plays is showing a state of diminishing marginality.feigua data shows that in the first half of 2024, the video sales of "jiang shiqi", which customized short plays for brands, were only one-tenth of those in the same period last year.

what is more critical for han shu is not to continue investing in short dramas, but how to convert the traffic of short dramas into the traffic of his own account, and then exchange the traffic for sales.

this was already reflected when han shu invested heavily in short dramas.

hold the plate and run out

let’s first look at the sales results after slowing down the investment in short dramas.

according to the financial report of shanmei co., ltd. in the first half of 2024, han shu still ranks first among beauty brands in terms of gmv on douyin platform, with gmv reaching 3.44 billion yuan, which has already caught up with the gmv for the whole of 2023.

in other words, when han shu reduced the number of short dramas, han shu's performance did not shrink, but reached another peak.

in this regard, bai yunhu analyzed to yan finance that "low price" is a sharp sword for marketing conversion through online channels, especially traffic platforms such as douyin. through short dramas, consumers can recognize the han shu brand and use "big single products" "take the lead, combine gift box sets, and then use "big purchases and gifts" to let consumers fall into a marketing atmosphere of "more value for money", which ultimately generates conversions and promotes performance growth.

taking the lead in "big single products", combining gift box sets and "big purchases and gifts", consumers can fall into a marketing atmosphere of "more value for money" / source: screenshot of netizen buyer show

in essence, to understand han shu's strong performance, we have to go back to the broader environment.

a consumption trend that must be mentioned is: consumption downgrade. when 1l bottles of drinks become more and more popular, when the internet meme "it's not that xx can't be bought, but that xx is more cost-effective" becomes more and more popular, and when luxury goods and high-end beauty and skin care products frequently encounter a cold shoulder in the chinese market, the cost-effectiveness its importance in contemporary times has become increasingly prominent.

today, "having both and wanting both" is no longer a shameful consumption concept, but a pragmatic consumption trend. and han shu is exactly a brand that can satisfy “both wants and needs”——compared with international big brands, han shu is more "super value"; compared with white brands, han shu has more brand effect.

taking the cost-effective route is han shu’s key strategy to stand out in the era of consumption downgrade.

for example, in terms of products, unlike many brands that promote “large single products”, han shu mainly promotes “buy one, get many free” “box products” such as red waist and white waist. this also gives han shu a price advantage to explore the vast sinking market.

therefore, short play marketing should be understood as a short-term behavior - han shu needs short plays to reach deeper markets and spread the word "han shu" to a wider consumer group. when the short drama can no longer cover more consumer groups, what han shu needs to do is to hold on to this plate.

in 2023, when short dramas are launched, han shu has already focused on "balancing" the traffic brought by short dramas, avoiding excessive dependence on the short drama category or a certain short drama account, so as to "live broadcast until the sun never sets" "time" to undertake short drama traffic.

at that time, han shu's live broadcast room was rotating almost 24 hours a day, and he tried his best to convert short drama traffic into brand traffic through long-term and high-frequency live broadcasts.

at nearly three o'clock in the morning, han shu's live broadcast room is still broadcasting/source: internet screenshot

"han shu made full use of the social attributes of the douyin platform to strengthen interaction and communication with users, further consolidating user stickiness and brand loyalty." in view of han shu's sales strength that has not decreased but increased after "getting rid of the short drama", zhan junhao so rated.

but achieving this step was still not enough for han shu. because traffic, low prices and long-lasting and stable sales are obviously not equal.

"the strategy of 'traffic for sales' must be a double-edged sword and unsustainable," bai yunhu believes. "traffic is constantly transforming and migrating. nowadays, most domestic brands are kidnapped by traffic, and the head-focus effect obviously, small and medium-sized brands are in trouble with traffic; once a brand with strong financial strength increases its traffic, the gmv ranking will change. "

a simple example is that in the past period of time, white-label beauty brands have also achieved a rise on the douyin channel. according to feigua data, among the 20 beauty brands with the largest growth in beauty gmv on the douyin channel in 2023, 8 are white brands.

however, the "survival" time of these brands is extremely short. they spend money on investment within two or three months and rely on celebrities or strong ip anchors to quickly promote products and accurately harvest. it can take anywhere from a few months to a year before disappearing from consumers’ internet horizons.

although han shu's strategy is similar to that of white card, he certainly does not want to be as "flash-in-the-pan" as white card. therefore, reducing dependence on traffic and building a brand for the long term should be issues that han shu needs to face after its rapid growth.

domestic products such as proya and mao geping also started by relying on marketing. the concept of "morning c and late a" and the founder's ip have given the brand a taste of the sweetness, but to maintain their success, they rely on more than just "traffic." in comparison, the two can remind consumers of more "utility" keywords, while han shu still seems to only have keywords such as "low price" or "gift" at present.

at present, han shu’s products are still linked to keywords such as “low price” and “gift”/source: internet screenshot

in addition to marketing and price, what can consumers remember? this is not only something that hanshu needs to consider, but also something that the entire shangmei group needs to consider - after all, there are many brands in the group, but only hanshu is out. a brand.

"once there are changes in channels and transfers of consumer users, the hanshu brand alone will be very risky, just like the development environment that shanmei shares will face in the market around 2022." bai yunhu reminded.

to solve the "common problem" of uneven development of a multi-brand matrix, bai yunhu believes that there is no way out. "you can refer to the 'mergers and acquisitions' path of big-name international companies." in particular, shanmei co., ltd. is already a listed company and meets this condition.

in any case, if they want to stand firm, han shu or shanmei shares need to solidly find new growth points other than traffic before the market rotation.