Ziyue: Making Terminal Services into an industry chain (in turn)

In the era of channel diversification, brand owners pay more and more attention to terminal investment and have opened specialty stores. However, for brand owners who are mainly engaged in manufacturing and product R & D, the difficulty in opening a store is: opening a shop is a "professional job ", the store image design, the determination of the shop decoration style, and the use of display items directly affect the brand attributes and sales performance of the store.

In the past, brand owners had to communicate with planning companies, design companies, and display item manufacturers one by one to complete the creation of the store. However, the disadvantage of this traditional practice is that the planning, design, and production of specialty stores are completed by three different companies, and they are easy to fight independently to form an "isolated island" for information interconnection ".

In this context, a company called ziyue integrates the above functions to form an industrial chain and provide brand owners with an integrated service for shop opening. In other words, brand owners only need to put forward their own demands and general ideas, and the rest is done by ziyue. In foreign countries, this industry is known as "terminal display" and is already a very mature industry. In China, despite having a market scale of 70 billion yuan, the entire industry market is very scattered, and the market share of leading enterprises in the industry is less than 1%.

Store Integration

In June 2010, a well-known cosmetics brand in China found ziyue, Hangzhou, and put forward a difficult business demand: the brand has been operating in China for several years and has more than 200 specialty stores. As time passes and the market environment changes, the Headquarters proposed a plan to build a second-generation specialty store. Due to the need to boost performance, brand owners hope to complete the production of the second-generation specialty store within two months.

"We inquired from the side that the cosmetic brand was originally opened in a traditional specialty store. They recruited a well-known planning company in China and hired a Japanese design company to design the store. Finally, they made the item at a factory in Guangzhou. Later, they found that there was a problem in the design and factory business connection. The design company's philosophy was so advanced that it was unable to carry out bulk production in China using the technology. In this way, the entire project cannot be further promoted, and it also delays a lot of time ." Jiang Ying, CEO of ziyue company, told the reporter of China business news.

After high-level discussions, ziyue decided to take over the "special" order. As the other party requested to complete the whole process from planning, design to production within two months, ziyue decided to go to the factory for a meeting and discussion by Party A's team, ziyue's Planning Department, design department, and production department, handles problems on site and reduces communication time. In the end, it took only one month from the establishment of the project to the launch of the second-generation specialty store of the cosmetics brand.

"From this case, we can see what kind of company zimoon is. Ziyue focuses on the customer's shop opening needs and provides customers with integrated terminal solutions ." Jiang Ying told reporters.

Founded in 2005, ziyue was originally a foreign trade enterprise that operates acrylic and other special materials. After several transformations, regionalization is a professional service provider that provides customers with market planning, terminal design, and item production. Ziyue has an independent planning company, design company, and production factory. Currently, ziyue has a production base covering an area of Mu in Hangzhou and Suzhou.

Extended value chain

In Jiang Ying's view, ziyue not only helps brand owners to open specialty stores, but also enhances the overall brand image through the terminal image design. How does a trading company that runs acrylic develop the path of terminal integration? In this regard, Jiang Ying said that since its creation, the company has undergone five transformations, and each transformation changes around the customer's needs.

"Some design companies find us and require them to prepare and produce them according to their design drawings. We found that the solutions proposed by design companies are often difficult to implement ." Jiang Ying said, "design companies tend to exaggerate the Aesthetic Perspective and ignore whether the technological level can be achieved ."

Jiang Ying believes that the creation process of traditional specialty stores has various drawbacks. "Many design companies in China do not know very well about the features and production processes of the terminal materials. Many good creative designs cannot be implemented at all, and the commercialization level is very low. Most of them are flashy. In China, prop producers are basically limited to the production and installation of items. The design capability is very weak and the level is low, which cannot effectively meet the high requirements of the brand for the terminal image. At the same time, the lack of standardized module management capabilities cannot meet the rapid replication and standardized management of brand terminals. We can see and seize this space ." Jiang Ying told reporters.

 

At first, ziyue attempted to intervene from the planning period of the store, from planning to design to the final production. Therefore, ziyue has built four internal systems: terminal shopping research and strategy service system (for planning), Development and Design System (for design), and production and supply system (for production) and sales and customer service systems.

Shi zhenrong, founder of Acer Group, put forward the famous "smiling curve" theory when he "recreated Acer" in 1992. According to this theory, the increase in product value is in the early stage of R & D and brand building, while the intermediate production and distribution processes are at the bottom of the value chain. The value chain of a commodity ranges from R & D, production, distribution to the final brand promotion, forming a curve like smiling lips.

"In the context of China's rising labor costs and increasingly meager manufacturing profits, ziyue's terminal integration services have evolved from the original trade to the subsequent processing of items, several transformations indicate that it tries to extend the value chain and grasp the high value-added part of the value chain." Han Mei, a senior retail brand consultant, told reporters.

"From the feedback from the industry, terminal integration services will become the future direction. Professional people do professional things, so that brand owners can put their core competencies in production and production ." Jiang Ying said.

Ziyue focuses its business on cosmetics, Digital Electronics, food and drinks, and jewelry. It has more than 200 customers, including Dior, SK-II, Yuxi, herborist, polaia, Unilever, Samsung Electronics, tongrentang, and Hu qingyu Tang. Among them, polaia has been working with ziyue for five years, and its production of 1000 specialty stores in China comes from ziyue.

Comments from Yiyi International Business Model Research Institute

Scalability can only provide mediocrity

The so-called "isolated islands of information" is formed by different planning companies, design companies, and display item manufacturers, A service provider integrating planning, design, and display of item production seems to have created a new industrial chain model.

Ziyue believes that: "design companies tend to exaggerate the Aesthetic Perspective and ignore whether the technological level can be achieved." As a result, ziyue constructed "intervene from the planning period, from planning to designing to making the last piece of work, it is all done by them." . In our opinion, not to mention whether a high-level design company in China will be as miserable as ziyue said (that is, the process level will be ignored during design), which is only emphasized by ziyue, from the perspective of the existing technology level to plan or design the service concept, this "cutting foot (high level of design) fit (self-production level)" model can only provide mediocre works. On the contrary, if the customer can obtain high-level design from the design company, even if ziyue's technological level does not meet the requirements, is there no other company at home and abroad to choose?

Ziyue's Integrated Innovation exists everywhere in other fields. For example, many printing plants have the planning and design capabilities, but in general, they can only provide some simple and low-value planning and design services, if the customer has high requirements, they also need to find a professional design company. Why has no company engaged in industry chain integration like ziyue so far in the printing industry? One of the key reasons is that such diversified integration, even if it can provide higher customer value, may not have a good input-output ratio. We strongly agree with ziyue's Value of "professional people do professional things". However, ziyue's three majors, planning, design, and production, have clearly put all three of them in a dedicated manner. Comparing the excellent professional companies that focus on planning, design, and production, whether ziyue can truly form a professional advantage is the key to determining the success or failure of its model.

Ziyue: Making Terminal Services into an industry chain (in turn)