How far can Watsons fall into the "elderly crisis"?

@新 新 新

Author | Anqi

Edit | Monthly

In the first half of this year, the total retail sales of Chinese cosmetics declined for the first time in ten years.

The retail data of social consumer goods recently released by the National Bureau of Statistics shows that in the first half of the year, the total retail sales of cosmetics were 190.5 billion yuan, a year-on-year decrease of 2.5%, and the decrease of -0.7%of the total retail sales of social consumer goods.

Under the double pinch of the economic downturn and the epidemic, Watsons, as an offline beauty real shop, not only did not lose, but also made profit.

On August 4, the Watsons's parent company Yangtze River Hutchison Industrial (0001.HK) released the unveiled financial report in the first half of 2022, showing that the revenue of Watsons's Chinese market revenue was HK $ 9.685 billion (approximately RMB 8.334 billion), a decrease of 17% year -on -year decreased by 17% ; The overall remains profitable. The profit of HK $ 623 million (approximately RMB 536 million) in the first half of the year's interest tax tax was reduced by 60%year -on -year. It was one of the few retailers with no losses in the first half of the year.

Many people say that this is the phenomenon of the Watson's economy recovery, which is completely attributed to Watsons to transform into the new retail model of "O+O". But is this really the case?

01 Watsons is sad, and has it been closed?

Since 2016, Watsons, which has been singing all the way, can't sell it a little. At that time, Watsons's operating income in China was HK $ 20.914 billion, and his performance fell for the first time. EBITDA, which is used to measure the capacity of cash flow to generate cash flow, is also a decrease of 4.21%.

Since 2017, Watsons has actively promoted the digital layout, innovatively proposed a new O+O retail model of "online combination and offline", seamlessly combining physical stores and online platforms, bringing consumers to enjoy services at any time at any time. And high -quality shopping experience.

Beginning in 2016, Watsons has expanded its stores crazy. So far, a total of 4000+ Watsons offline stores worldwide. In the first half of 2022, it was severely cracked down by the epidemic in East China. Watsons had been suspended from 590 stores, and the sales of stores decreased by 17.6%year -on -year.

As a result, Watsons adjusted to the "carefully opened shop" strategy. Since last year, Watsons has deeply sinking the market and followed the KFC Dessert Station to open a 10 -square -meter super shop. In the first half of 2022, the store was slightly closed. Watsons has shifted its focus from the rapid expansion of chain stores to upgrade of consumers' services.

Speaking of services, Watsons's enthusiastic sales services have to be mentioned. "Fores and worm -style sales" once became the black words of Watsons on the Internet, and Watsons also lost a lot of post -95 markets because of excessive service.

Therefore, the O+O retail model came into being at this time. BA (shopping guide) transformed consumers into private domain traffic through WeChat and membership. It can be delivered for 30 minutes, fast and convenient.

I have to say that the digital transformation of Watsons has greatly improved the retail efficiency. The entire "O+O" user consumption is 2.7 times that of pure offline users. The Cumulative number of users in the corporate WeChat BA has more than 40 million users. The Watsons Mini Program page is also newly revised. It is replaced with pages such as work, life, festivals, and can also make an appointment for store SPA or product trial service. From the data point of view, the digital reform has achieved remarkable results.

After this series of actions, Watsons seemed to have been in trouble, but a series of reforms did not seem to really leverage consumers' shopping desire.

The Watson's 2021 financial report shows that only 8%of the EBIT profit margin in China, and the profit of the first half of 2022 decreased by 60%year -on -year. Although the basic disk was kept, the profit decreased very seriously year -on -year. In the long run, it is difficult to say that it will not lose money. Whether the O whether O+O retail model has sustainable development, whether it really impresses consumers, is still to be observed.

02 Is it barely behind the profit, is it drinking thirst?

Although Watsons is still on the first or negative floor of the large shopping mall, few people have already visited it. Many stores are still more BA than customers. It can be seen that the O+O retail model is just a game on Watsons online. carnival.

The original intention of the O+O mode is to form a digital new retail method combined with online and offline. The BA in the store adds users through the corporate WeChat, promotes small programs and online purchase ports, and promotes online store appointment services and sample collection activities online. This model seems to form a closed -loop sales, but the offline store has already become a storage stored warehouse.

In order to create an online mall, Watsons issued a large number of coupons and activities. Naturally, users will not let go of wool wool and buy online. Received. In this way, there is no one to ask for an offline store.

But the price advantage has never been used as a long -term battle for Watsons.

According to reports, Watson's previous entry fee was as high as 20%, the gross profit margin at the front desk was 30%, and the gross profit margin of skin care products was 40%. Watsons wants to fight for a long time by relying on the price advantage, and can only start with reducing its own profits, and this is full of the concept of Evergreen's urgent want to reduce costs and increase efficiency.

Watsons, who has lost the price advantage, can only become "emergency stores" in the minds of consumers: Many consumers say that they will only remember to buy Watsons when they forget to bring things when they are traveling, otherwise they would rather squat at home to live broadcast and enjoy welfare welfare at home and enjoy welfare welfare price.

Secondly, the online BA frequently sends the news of welfare prices, which makes people can't help but want to be black. The offline BA professional is not enough. In the final analysis, this O+O model still has not fundamentally changed Watsons to serve consumers, and applying a new model to take the old routine, still not long. According to Watsons's official website, Watsons now already have 63 million members, and Watsons also seizures the members: green cards, black cards, equity cards, fan cards, etc. Essence Is it useful or single? The membership system is too complicated, and it will only cause trouble for consumers. In addition, not all consumers have time to squat to buy welfare and calculate the welfare price one by one. If Watsons do welfare activities like Double Eleven every month, I am afraid that many members will be tired.

As consumers are becoming more and more sober for shopping, the stores must be better quality and brand. If you can't understand where consumers just need, they will only use digital channels to transform customers, and they are destined to go long.

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