Net profit is reduced by half, marketing is difficult to cover Wei Weiwei

Wei Mi’s false excitement was once again hit by the earnings report. On May 24th, the company's parent company L Brands released its quarterly report for the 2018 fiscal year, with net income down 49.5% year-on-year. While the performance continues to be sluggish, the topic of Wei Mi Xiu and Wei Mi supermodel on the social platform is not diminished. The product promotion of Wei Mi online and offline is also very lively. The sound of the product itself is mostly quality defects and lack of comfort. good. In the eyes of the industry, Wei Mi's marketing is undoubtedly successful, but the hot topic marketing also hides the problem of insufficient products, and the adjustment and improvement of products is the key to alleviating the downturn.

Performance continues to be sluggish

Compared with the same period of last year, the performance of the company's parent company continued to decline in the first quarter of the 2018 fiscal year. As of May 5, the first quarter of the 2018 fiscal year, the company's operating income fell 26% year-on-year to 155 million US dollars, store comparable sales fell 2% year-on-year, the core brand Wei Mi stores comparable sales fell 5%.

The decline in net income in the first quarter of nearly 50% was not the result of the loss of the Victorian parent company. The state of low performance has been going on for two years. According to the data of the Beijing Business Daily reporter's financial report for the past two years, the net income of the company's parent company has experienced a relatively continuous decline since the third quarter of fiscal 2016. From the third quarter of fiscal 2016 to the third quarter of fiscal 2017, net income fell by 25%, 0.6%, 38%, 45%, and 29%, respectively. In the fourth quarter of fiscal 2017, there was a slight rebound, but in the first quarter of fiscal year 2018, it fell again. The state of net income has fallen sharply.

Regarding the reasons for the continued decline in performance, the Beijing Business Daily reporter has sent a post to the parent company of Wei Mi, but the relevant person in charge of Wei Mi said that due to the time difference, the reply cannot be resumed.

It is reported that as of May 5, 2018, the company's brands have 3,069 stores worldwide. At the end of April last year, the number of stores was 3,080, and 11 stores were opened.

Into the Chinese product frequency on the black list

Despite the continued sluggish performance, the network's popularity has continued unabated. The Beijing Business Daily reporter found that since the "Wei Mi Xiu fall" incident, Wei Mi's topic has been concentrated on the Wei Mi show supermodel, and the rare content of the product is also product defects and discount promotions.

Under the enthusiasm of network voice and brand promotion, it is a product quality problem that is frequently exposed. Beijing Business Daily reporter found in the Wei Mi Tmall flagship store that there are not many consumer evaluations such as "Unsuitable underwear size", "Underwear color loss" and "Fabric hard". Previously, some consumers reported to the Beijing Business Daily that the purchase of the front buckle Wei Mi underwear appeared in the second time when the metal buckle faded. In 2017, a large number of imported garments that were destroyed by Shanghai Entry-Exit Inspection and Quarantine Bureau, a batch of underwear products that Wei Mi sent to the Chinese market were listed on the destruction list because of the excessive formaldehyde detected.

Improving quality is the key

At the same time, Wei Mi's discount promotions have basically never stopped. Beijing Business Daily reporter visited the Victorian Palace in Central, and found that the VIP brand of the VIP brand, which is located on the first floor of the store, has the largest discount and the largest number of consumers. Promotions such as 3 pieces of 138 yuan, 2 pieces of 238 yuan, and buy one get one free are not small. At present, Wei Mi Tmall flagship store also has more related promotions, and there are many discount promotions in foreign channels.

The seemingly hilarious promotion is in fact a follow-up to Wei Mi’s sluggish performance, and Amie Preston, Lenny’s chief investment relations director, has previously said that the brand’s brand category, especially the loss of Vimy’s teenage brand, PINK, has forced the brand to take discount promotion.

For the status quo of Wei Mi, Zhou Ting, Dean of the Guest Research Institute, said that Wei Mi's brand marketing was very successful, but the products failed to keep up. The over-marketing of Wei Mi Xiu also caused a disconnect between the audience and the consumer group. . The direct contact of the underwear with the skin, quality and safety is the most basic premise, but also the top priority of consumers. The quality problems of Wei Mi underwear products will directly affect the consumer's trust in the brand, and will also greatly reduce the brand image.

In the layout of the Chinese market, the negative impact will be greater. Chinese consumers lack loyalty to the brand. If Wei Mi fails to establish brand trust in the early stage of entering the Chinese market, it will lose the relationship between consumers and brands. Tightness, this will be a huge loss for the brand.

Yang Dazhao, a well-known fashion industry investor and CEO of Youyi International, holds similar views. Yang Dazhao also pointed out that although Wei Mi has a strong influence in the Chinese market, it is difficult to shake the position of excellent domestic brands in the hearts of consumers. After the shrinking of the US domestic market, the decline in performance is eager to find new growth points in China. However, when laying out the Chinese market, the products should be adjusted and upgraded to understand the local consumption style and national conditions.

Beijing Business Daily reporter Wang Xiaoran Wei Ru

(Editor: Li Jiajia HN153)