"Wal-Mart + KFC": a new retail model of China's shoe industry

Once upon a time, "channel is king" and "decisive terminal" are the familiar "warning words" of shoe marketers, while once popular marketing methods such as joining agents and chain monopolies are "struggling to cope" in the price war, promotion war and advertising war. Channel change, whether or not to change, how will it change? In the face of global competition, should the thinking of footwear retail mode also be internationalized? So people in the industry shouted in unison: the era of strategic marketing and mode victory in the shoe industry has come.

KFC? Wal-Mart?

On January 8, 1998, Shangtang, the first specialty store of Aokang Group to carry out the chain monopoly model, opened, which was the first monopoly store of China's leather shoes industry, which led to the first reform of the marketing mode of China's leather shoes industry. This day is recorded in the annals of the development of China's shoes industry. After that, the Chinese shoe industry store is like "KFC", quickly spread all over the country, so far Aokang has opened more than 3000 stores in the country.

When the time comes to 2008, China's shoe chain monopoly has also quietly gone through 20 years. Similarly, this year will also be a very unusual year for China's shoe industry: with the massive implementation of merger plans for listed financing, the intensification of anti-dumping, and the rise in labor costs for enterprises in the implementation of the new Labor contract Law, the advantage of low-cost manufacturing in China's shoe industry has ceased to exist, and the profit space of retail terminals is getting smaller and smaller. "sales increase, profits decrease!" Many enterprises sigh like this. When the shoe industry comes to a new node again, is it sitting back waiting for death or winning at a turning point?

On March 20, 2008, Aokang Group, China's largest private shoe manufacturer and supplier of leather goods for the Beijing 2008 Olympic Games, held a "Pan-Pearl River Delta Regional Investment Fair" in Dongguan, Guangdong Province. There is no doubt that this invitation Chamber of Commerce is also a signal to the industry: only by innovating and changing the marketing mode can we stand invincible. On the same day, more than 200 agents from the Pearl River Delta region jointly witnessed another change in the marketing model of China's shoe industry led by Aokang Group.

"there are only two kinds of people who are successful in the market: those who are half a step ahead and those who are half a step behind." Talking about the reform of the marketing model, Wang Zhenquan, vice president of Aokang Group, summarized two models: "1x N" model and "zero risk" agent model.

The "1cm N" model means that "1" represents a famous product space or a single-brand flagship store, and "N" represents multiple stores. "figuratively speaking, it is the 'Wal-Mart + KFC' model." Wang Zhenquan's vivid analogy is refreshing. And the "zero risk" agent is to adopt the way of "guaranteed commission + business commission" to ensure that the agent does not bear any risk. The agent is mainly responsible for leasing the store and maintaining the local public relations, while the rest is completed and borne by the enterprise.

Before that, Aokang has tasted the sweetness of the shoe retail supermarket. In 2007, Aokang Group opened the largest shoe store in Heze, Shandong Province, with an operating area of 2300 square meters, and its business has been booming. On February 23 this year, the largest footwear store in Wenzhou-Aokang Dawn Space Shoe Store, with an operating area of more than 1000 square meters, Okang, Kanglong, Beautiful Beauty, Red Firebird, Wanliwei, and Okang leather goods all appeared in the same store, causing a sensation in the industry.

"what we are competing for now is standardized management, terminal control and the ability to integrate resources," Wang said on a number of occasions. In fact, this is the three-step strategy for the transformation of Aokang. The "Wal-Mart + KFC" marketing model is the full integration of resources, taking the "shoe supermarket + chain monopoly" road, which is also in line with Wang Zhentao's business thinking.

Will it lead a new revolution in shoe marketing?

"the rise of the shoe supermarket means that the era of enterprise integration market begins to change to the trend of market integration of enterprises." Wang Zhentao, president of Aokang Group, the planning and marketing master who led the four changes in the marketing of China's shoe industry, is far-sighted in the face of the new situation of the shoe industry. "due to export restrictions, exchange rate depreciation, RMB rise and other factors, 2008 will be a year of domestic sales war in the shoe industry, and the competition in sales channels will be more fierce."

Prior to this, some media wrote that the marketing history of Aokang for more than 10 years was divided into four stages: the first stage was the wholesale system, which belonged to the extensive separation of production and marketing; the second stage was the manufacturer joint venture system; the third stage was the franchise system, which introduced chain monopoly; the fourth stage was the multi-brand management system. In fact, these four stages are also four important stages in the history of the marketing development of the whole Chinese shoe industry.

However, for Aokang, although the "1mm N" compound channel will become an important strategy, it is the chain model that plays a decisive role. Reviewing the marketing history of Aokang in the past 20 years, there is no doubt that the chain monopoly in the third stage plays an important role. Wang Zhentao said.

But in fact, due to the simplification and replicability of the chain monopoly, the success of the Okang chain was quickly replicated by its peers. "almost overnight, all kinds of chain stores were all over the street," industry insiders recalled. Since 2000, some big brands have also transformed from shopping malls to chain monopolies, and some third-and fourth-tier brands have also been launched one after another.

At the same time of the rapid expansion of the shoe industry, it is also faced with such a problem, that is, the serious homogenization of products and the smaller and smaller differences between products and brands, and the increasingly stereotyped sales channels. Many second-and third-tier brand enterprises do not study themselves seriously, rationally and scientifically, so they blindly follow the trend and follow the practices of leading enterprises, resulting in low profitability of second-and third-tier brands, or even losses, and some brands have to withdraw from the market.

"the advantage of chain monopoly no longer exists." Insiders in the shoe industry are so impressed.

Through the survey found that in the past, the general shoes and clothing industry stores can be opened to more than 400 square meters even if the big store, but recently "open a big store" the wind quietly rise. Metersbonwe recently opened a store in Kunming with an area of 1600 square meters and Zara in Beijing with an area of 1700 square meters.

"opening a large 'Wal-Mart' store has higher requirements for financial strength and rich product lines, and generally small enterprises are difficult to follow the trend and have a strong competitive advantage." According to Wang Zhenquan, "multi-brand stores

It can compress the product circulation link as much as possible, and it is easy to build a brand assembly line. "

Therefore, under the intersection of various bottlenecks, transformation is imperative. Some experts said bluntly: the next few years will be a critical period for China's shoe industry, if not smooth transformation, will be mercilessly eliminated by the market.

Internationalization of marketing thinking

When it comes to internationalization, some experts believe that the internationalization of enterprises is not necessarily reflected in the fact that their products go abroad, or that enterprises set up factories abroad, what is more important is that the thinking and mode of enterprise management should keep up with the international development trend.

"the entry of 'KFC' into China has led to the trend of chain monopoly, and the success of 'Wal-Mart' has led to the popularity of large warehousing supermarkets. Although the industries are different, the ideas are the same." Wang Zhentao, who has always been famous for his innovation and leadership in the industry, has once again stood in the position of the leader at the turning point in the development of China's shoe industry.

Before that, Aokang formally acquired the global management right of Italy's Vanlivid, which he said was the first step in a comprehensive acquisition.

Similarly, another shoe brand insiders also said that they are in talks to acquire overseas brands. Many companies in the industry are doing this.

"We are not short of these brands of product technology, because we have production capacity and cost advantages, we need its high-end brand image." Said a person in the shoe company.

"in the future, we plan to acquire more overseas brands and make our 'Wal-Mart' shoe supermarket a processing plant for manufacturing world footwear brands." Wang Zhen Tao Si has a clear train of thought on the future development of China's shoe industry. (Wang Hailong)