Road of fun, from the "village in the city"

Figure: founder and CEO of Cost-effective Huang Tian Choi

Text: investment circles Wang Hui

In 2012, Huang Tiancai, then 27, chose the sex toy industry in China as a third venture. In his view, the choice of entrepreneurship, should start from the weakest part of the Internet giant, but in the sex industry, there is not a giant.

In that crazy era of "1000 regiment wars", Huang Tiancai had also set foot in the group purchase industry. With the experience of making group purchase, at the beginning of this venture, he chose to cut through the shopping guide, and chose a well-known "cost performance" as a starting point.

Road of fun, from the "village in the city"

In 2012, Huang Tiancai, the second pioneer, was busy with an O2O project called "Province and Province" and the project development was in a dilemma. Because the plate shop is too large, inadequate funding chain, a large number of employees to see the company's dilemma have chosen to resign. Due to the lack of funds, leaving a handful of people left, Huang Tiancai also failed to pay ... Despite his efforts to deal with, the "provincial" project eventually failed.

After the project was completed, Huang Tiancai had to move the company out of the bustling Xiamen World Trade Center in Xiamen and rented a private residence for use in the office and daily life of his staff in the nearby "Village in the City." He himself also moved out of the apartment he was renting at the time and lived in the "village in the city" that he had never been in before.

The life of the village is monotonous and repetitive, while Huang Tiancai spares no time in the village. There are many different kinds of people mixed in the village: workers, security guards, maintenance staff, shopkeepers and supermarket employees. Compared to the World Trade Center, Huang Tiancai saw a different world.

In those narrow, damp alleyways, you can always see several shops with ambiguous red lights, half-covered doors, and flashing signboards at the door, saying "adult products". The beginning of Huang Tian Choi do not mind, did not expect, so slightly ambiguous shops almost ten steps, throughout the city village.

"Here's the demand for adult products so big?" Huang Tian Choi began to think. After a period of exploration, he found that although the adult store in the village was small in scale and the merchandise was quite complete, everything from condoms to various kinds of vibrating equipment was available. However, there were also fatal flaws: high prices and poor quality were mostly "three No product ", even if" Durex "" sixth sense "such a brand, mostly fake and shoddy. Bad industry status has made Huang Tiancai saw the opportunity to start a business, so the price APP came into being.

After doing some shopping for erotic products, Huang Tiancai started to lead the team to make a gradual transition and gradually set foot in the APP of its own mall, then launched the concept of community. In his view, as Taobao, Jingdong and other platforms, as sex toys seller will not provide a distinctive service, but these platforms are flooded with low-level price war and the uneven quality of goods. This seems to explain the "price" from the shopping guide to change the logic of its own mall. "In the future, we will not consider returning to the above platform." Huang Tiancai said in an interview with the "investment community."

The current "cost-effective" APP has covered thousands of SKU products in six categories, including family planning products, flirting and fun, lingerie, men's equipment, women's equipment, and so on.

After 60 "uncle" Chun Shui Tang and 90 "performers" Ma Jia

When talking about competitors, Huang Tian Choi said that Chun Shui Tang is 60-70 after doing sex toys industry, "They are the people of the previous era." He said, "Chun Shuntang business model is the village of adult stores, Despite more than 10 years of development, it has also become known for its high unit prices to make up for its dwindling sales, and now it has not even sold the top 3 in sales.

However, the influence of the 90-year-old girl, Ma Jiajia, should not be underestimated. However, in the view of Huang Tiancai, Ma Jiajia plays more of a "performer" role; and as a performance-to-value APP, By".

"Ma Jiajia is the uncle who obscene out of the Barbie doll, only suitable for viewing." Huang Tian Choi said, "her promotion of the role of the industry is very limited .Consumer buying or not she did not mind, she wanted to show more, exposure Create a personal brand, and sex toys purchase takes place elsewhere. "

Huang Tiancai disclosed that the cost of the current number of users is about 8 million, of which 80 to 88 were born mainly to buy the crowd, repeat the purchase cycle of 27 days, women shopping frequency is higher than men, the customer unit price of 130-150 yuan.

Relative to 60 after Chun Shui Tang team and 90 after the horse Jia Jia, Huang Tian Choi said: "Our team mainly after 80 as the main force, we are the mainstream crowd in the mainstream market."

However, for the price war launched by the e-commerce supplier, Huang Tiancai said he hopes to build the 69 Adult Shopping Festival into a representative festival for the sex toy industry. However, he does not wish to see the price war as the norm in the industry and will not choose to deliberately Pressure on the vicious price competition. "The so-called price war is more about building a user experience that will drive the industry as a whole," he said.

Price from the data show that only June 9 the same day, the APP Mall orders reached 10,000, sales exceeded 2.8 million. Among them, only the choice of "cash on delivery" user orders increased by 5 times daily. The most popular product is sexy lingerie, and family planning products to follow a weak gap. Guangdong is the largest purchaser of provinces, followed by Jiangsu and Shandong.

Investors how to treat this industry

Data from the investment community show that in the past few years, platform-based e-commerce providers have been unable to obtain financing. However, along with Vipshop and Jumeirah-U.K. etc., they are gaining prominence in capital markets and vertical e-commerce businesses are getting increasingly risky investments Favor.

Appears in the Huang Tian Choi, sex toys is expected to be listed on the e-commerce sub-categories of listed companies. From last year to this year, mainstream investment institutions are beginning to learn more about the industry. Taking "price / performance ratio" as an example, its 10 million angel investment completed in May 2013 is the second company to receive financing in the sex toy industry.

Last year, the online market for sex toys was about 15 billion yuan, and this year's forecast could reach about 25 billion. Huang Tiancai said: "This industry has full potential, but also has the ability to develop to hundreds of billions of markets, and will, like cosmetics, become accepted by people with high daily needs."

After 80 has become the main force of social spending, this group is not too taboo to talk about sex toys, which is the main reason for the rapid growth of adult products market in recent years. However, there is still a big gap between the market size of about 30 billion yuan each year in China and the market in Europe and the United States.

The next 5-10 years, when 90, 00 after becoming the mainstream consumer groups in the community, the industry will usher in a big outbreak. "Because people in this age group are closer to Europe and the United States," Huang said. It is estimated that the total online sales of sex toys market will reach 50 billion yuan after three years.

For users, using "price / performance ratio" is more than just buying things. "Price / performance ratio" can also recommend some more suitable products for him or her and give them exercise and healthy lifestyle.

In the past, investment institutions have invested in the sex toy industry and do not seem willing to make it public. This phenomenon may not appear again in the future. In fact, in recent days, several financing options have been announced in high profile in the media.

However, despite the investment, but in the financing process cost APP still took some twists and turns. In 2013, Huang Tiancai won the investment intention. After many conversations, investors still have doubts about the interest industry. He was a cruel, the investors about the original he chose the fun industry in the "village in the city."

Investors were amazed at Huang Tiancai move, but inadvertently saw a bank employee driving a Honda car, dodging from the signs of adult products quickly came out, still clutching a bulging black plastic bag. This scenario allows investors to truly realize that huge business opportunities are hidden in this noisy environment.

Huang Tien Choi revealed that "the cost" is not much financial pressure, the next step will be launched Q & A community, Daren recommended services, and gradually developed into a comprehensive gender platform.

Turning to the future, Huang Tiancai pointed out that "the price" hopes to develop into a personalized, vertical e-commerce platform after serving 80s and 90s instead of being confined to the fun industry. (Wang Hui)