No. 1th Store Research

Source: Internet
Author: User
Keywords Shop number 1th merchandise nbsp;

1. EXECUTIVE SUMMARY

Liu Majestic and gege created the number 1th shop recently some fire. Store 1th held high the banner of online supermarkets, in Shanghai to provide low-cost and logistics-free fast sales of retail services, and is expanding the business to the country.

The main strategy of store 1th is to use low prices and user experience to change the flow, the current development and the speed of burning money is very fast. No. 1th store in the member marketing, marketing, there are many ideas worthy of reference.

Shopping on the offline supermarket is not a very enjoyable shopping experience for the city, so online supermarkets seem to have good prospects, but so far there has been no very successful case. I think the main reason is that the retail sales of fast-selling products have strong geographical and timeliness factors, through the delivery of parcel post is difficult to ensure a convenient user experience. In order to provide more efficient logistics must be a large number of local storage and distribution centers, so the cost is high and the advantages of the Internet is not obvious.

2. The phenomenon


No. 1th Store CEO Liu Junling (left), Chairman Gege (right)

Shop number 1th is an e-commerce website that holds the banner of online supermarkets. Recently, it has been popular among white-collar workers in Jiangsu, Zhejiang and Shanghai, especially in Shanghai.

2.1 Development Overview

November 2007, former Dell China regional president Liu Junling and Dell Global sourcing Vice President Gege announced their departure. Soon, the two people in Shanghai Zhangjiang High-tech park, "Shanghai Yi-Real E-commerce Co., Ltd." The Signboard, and launched the online supermarket No. 1th Shop (www.yihaodian.com), officially opened the prelude to entrepreneurship.

It is difficult to systematically obtain the internal operation data of Store No. 1th. Comprehensive information on all aspects of the Internet, since July 1, 2008 store line to early January 09, its registered users reached 200,000. May 09 It was "China consumer E-commerce Conference" as "Consumers Trust online mall hundred." July 09, Store 1th monthly turnover of about 3 million, the company currently employs about 100 people, divided into customer service, product department and warehousing logistics three major departments.

According to the Google Trends data, 2009 store 1th, the flow of steady upward trend.

Alexa This October to China's Web site data has a sharp adjustment, so after October data and previous comparability is not high.

From the source of the flow from store 1th, search (Baidu, Google) to guide the flow accounted for more than 30%. Like other business start-ups, it relies heavily on search engines to get traffic. Due to the Shanghai white-collar company has always been a unique, google.cn+google.com brought the flow of even more than Baidu. A store of Google's SEO done quite well, in Google's collection reached 570,000, PageRank value reached 6, and Baidu included in 78,900 about.

The 1th store has a considerable amount of traffic from the CPS (cost per Sale) Alliance and rebate website, such as 51fanli.com. At present, many emerging consumer Web sites have started this kind of cooperation under the inspiration of the successful operation of CPS promotion model.

In addition, we also noticed that many people visit the Jingdong and even Taobao will go to shop No. 1th. This part of the people is likely to be online shopping heavy users, they began to browse Taobao, after jingdong to shop 1th to compare the prices of similar goods.

2.2 Business Philosophy

Gege: "I think the success of E-commerce has three main elements: first is the variety, that is, to have what consumers want, followed by the price, the third is delivery timeliness." "..." and e-commerce competition to the end, in fact, is the background logistics management system competition. ”

"E-commerce in the end must be through warehousing logistics to distribute goods to the hands of consumers, so warehousing logistics is the necessary link of e-commerce." Therefore, in the whole e-commerce industry chain, play a key role is logistics management, a strong logistics management system is not only a large commercial value, but once the threshold of competition is still very high. ”

2.3 Business model

According to the yihaodian.com website "About Us", shop 1th is trying to provide a "new home and shopping lifestyle" for customers.

Store 1th Business category covers food and beverage, beauty care, kitchen cleaning, mother and child toys, home appliances and other five categories, tens of thousands of commodities. That is to say, in addition to fresh, almost all of the household purchase list will be found in the goods can find in it, and almost all goods are cheaper than the retail price of supermarkets. At present, customers in Shanghai can only buy 100 yuan a day to enjoy free door-to-door service.

E-commerce website is profitable, choose to cut the industry is very critical: P's gross profit margin of 8%, home appliances manufacturers gross profit margin in 3%~5%, but the department store's gross profit margin can reach 25%. On the other hand, for any retail e-commerce site, consumers ' life time Value (LTV) is the most critical indicator. Typically, the cost of getting customers through marketing is most likely to happen before he finishes his first purchase. And the profit from the first purchase is often much lower than the cost. Therefore, if the converted customer can not repeat the shopping is a net loss. The relatively limited number of repetitive transactions that consumers typically generate on some vertical consumer sites, such as 3C Digital, is why many of the previous Web sites in the vertical sector are trying to shift to a more flat department store. A rich commodity is the key to increasing the existing customer repeat purchase rate, i.e. LTV.

Shop 1th directly into the user is very easy to repeat the purchase and gross profit margin is also relatively high daily necessities industry, the traditional retail channels in the real estate costs saved by low-cost, free shipping back to consumers. This is a very simple but also contains the real value of services. Therefore, if store 1th can be in the capital operation, system building, warehousing and logistics distribution system with excellent execution, it may be the first to avoid Webvan fate of the online supermarket, to achieve a very high threshold of success.

2.4 Products, services and operations

2.4.1 Affiliate Marketing

Store 1th is very focused on membership marketing, which is consistent with its focus on customer LTV. Store 1th has a unified integration system and system, most commodities have points, different products, different points, different levels of members enjoy the points are not the same. Members can earn points by shopping and participating in community interactions. Points can be directly used to pay for the purchase of goods.

Members were also encouraged to organize the shopping unions spontaneously, and the proportion of union members ' returns was related to the turnover of the entire trade union.

2.4.2 Payment and distribution

Shop 1th currently supports five payment methods:

"Rebate Payment (integral)

"Cod (Cash)

"Online Banking payments

"Bank transfers

"Post Office payment No. 1th stores currently support 1th stores to support ordinary Express and EMS two kinds of distribution methods. For Shanghai area orders, where shopping full 100 yuan, the weight of 10kg free postage.

2.4.3 Service Mall

Shop 1th recently launched the "Service Mall" to provide online payment, recharge, credit card repayment, free access to experience loaded goods, coupons, credit card points redemption gifts, credit card holders special offers, as well as gift cards, tickets, movie tickets sales and other services. This service has a certain appeal to local consumption in Shanghai, but extending to other places involves a lot of business expansion and system integration, and is likely to encounter considerable bottlenecks.

2.4.4 Low Price competition

At present, 1th stores in the sale of goods, household fast, beauty care and maternal and child products are the largest sales of the three categories. Because these goods purchase quantity is big, repeat buys many times, people to the price sensitivity degree is also relatively high. Shop 1th Daily offers two of 50 percent products in a limited period of time to buy, quite a "kill every day" means. And the price of all the goods at the end of the description of the following sentence:

2.4.5 Warehousing and Logistics

The experience of founder Gege and Liu Junling as head of global sourcing and supply chains at Dell and Amazon is one reason for anticipation of supply chain management in store 1th.

At present, No. 1th store in Qingpu, Shanghai, has a 6,000 square meters warehouse. The whole supply chain management system is developed independently. In order to solve the problem of supply and marketing of commodities, store 1th inventory management system real-time monitoring of the shortage rate, when the commodity inventory below the critical point, the system will automatically under the single replenishment. In order to facilitate the turnover of goods, the position of each commercial frame in the storehouse is determined according to the analysis of customer purchase behavior. Another challenge for the retail industry is distribution, the number 1th per single average of 20 items, is the average 8~10 times of online shopping. This is a challenge for packaging and delivery speed.

As an online supermarket, shop 1th already has 6 large categories, more than 150 small categories, more than 20,000 kinds of goods. With the increase of sales and product variety, inventory management and distribution of supply chain management system requirements will become more and more stringent. It will be an important test of the survival of shop 1th to survive this hurdle.

Store 1th plans to open the warehouse to Beijing in the near future and expand its business nationwide.

2.5 Profit Model

Like the offline supermarket, the profit of shop 1th can be divided into front margin and background margin. Front of the margin from the goods in and out of the difference, and the main profit margin by manufacturers back point, shelves, promotional costs. Shop No. 1th was set up at the beginning, the purchase from the supplier is very difficult, the other party's conditions are very harsh. With the expansion of the size of the purchase more and more easy, get the purchase cost, return points are improving. But in comparison with giants like Wal-Mart and Carrefour, shop number 1th is still small, which means that the supplier's return to shop 1th is unlikely to be better than Carrefour for a long time.

Another profitable point for store 1th is to provide marketing services to vendors, advertising and promotional costs. This is the online supermarket 1th store at the same time as an information media special value.

3. Analysis

Although the business is "the general trend", but whether shop 1th can survive on the shore is still full of variables. Here the so-called "ashore" refers to the number 1th stores can achieve a critical mass, so as to achieve a healthy balance of financial situation. After all, it depends not only on its capital adequacy and executive power, but also on whether the Chinese can accept purchases of fast-selling goods online before it goes ashore. Of course, another kind of ashore is to be acquired.

I personally think that online supermarkets have the opportunity, because go to supermarket shopping is not the city people enjoy the shopping experience. If the online supermarket in the price and service is sufficient competitiveness, supermarket shopping should not be difficult to give up the habit. But there have been no very successful cases in this area. I personally think that the problem in the retail sales of fast products have strong geographical and timeliness factors, through the delivery of parcel post is difficult to ensure a convenient user experience. and to provide fast logistics delivery must be a large number of places to establish warehousing and distribution centers, so expensive and the advantages of the Internet is not obvious.

On the contrary, already wired storage distribution channel chain supermarkets are likely to directly through the retail platform such as Taobao to enter the market more effectively, rather than as the 1th shop alone to bear the initial site construction and a large number of storage and logistics construction of the double huge investment?

References

Http://b2b.toocle.com/detail--4742692.html

Http://b2b.toocle.com/detail--4908575.html

Http://www.yihaodian.com

http://www.yihaodian.com/static/help/help.jsp

http://www.yihaodian.net.cn/

http://www.yihaodian.com/static/media-report20091028.jsp
















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