The waves behind the Yangtze River push the waves ahead, and the waves in front die on the beach. Metabolism cannot be avoided in any industry. What was once so popular will eventually give way to younger generations. In the clothing e-commerce industry, this pattern also exists. Mogujie and Secoo, which led the trend among young people in the past, now seem to be abandoned by a new group of young people. They are eyeing the new generation of fast fashion brands, such as SHEIN.
However, many companies, like Internet celebrities, come and go quickly. The new generation of fast fashion brands also face fierce competition and "iterations" by young people. It is hard to say whether they will be short-lived for a year or built to last. .
The rise of SHEIN
Everyone needs to wear clothes, which means that the clothing industry will never wither. But for individual enterprises, they still have to face the historical law of "change of dynasties". The most popular clothing e-commerce brand at the moment is undoubtedly the popular SHEIN.
SHEIN, whose Chinese name is "Xiyin", is a national cross-border e-commerce giant established in 2008. Perhaps many people still don't know about this company, because it does not operate in the Chinese market, but in markets such as the United States. It is normal for Chinese people not to be familiar with it.
is not well-known, but it does not prevent it from becoming bigger and stronger. In 2020, its revenue reached 70 billion yuan. In May last year, it replaced Amazon as the most downloaded shopping app on iOS and Android platforms in the United States. In fact, it ranks first among iOS shopping apps in 54 countries and regions.
When the company was established, SHEIN mainly purchased goods domestically and then sold them abroad, reaping the first wave of dividends from my country’s cross-border e-commerce. With the rise of social media, when other Internet celebrities have not yet been commercialized, it has completed its primitive accumulation.
As orders increased, the company found that the wholesale model was outdated, and launched the "small order quick return" model, which means that each product will only be produced in 100 pieces at the beginning, and will decide whether to increase production based on market feedback. Considering that the factory was unwilling to accept small orders, SHEIN took the initiative to provide subsidies, never defaulted on payment, and even took the initiative to lend money to the factory.
solves the production side. SHEIN has established a huge supply network, which is not only sensitive to market reactions, but also responds quickly. As of the end of 2021, it has more than 20 million fans on Instagram.
In SHEIN’s recent round of financing, capital tycoons from all walks of life flocked in, including Sequoia China, Tiger Global Management and Pan Pacific. After the financing is completed, SHEIN's valuation may reach US$100 billion, which is the sum of H&M and Zara. It is rumored that the company is also planning to go public. The strong performance of
Houlang and Qianlang
SHEIN has dwarfed many established domestic clothing e-commerce companies. If we go back 10 years, the most popular brands back then were indeed Mogujie and Secoo. By now, I am afraid that the first reaction of many people is: "Mogu Street is still still there?"
The founder of Mogu Street is Chen Qi, who was Taobao employee No. 51. Mogujie was officially launched on Valentine’s Day in 2011 and had 6 million registered users in just 13 months. When Mogujie raised funds in 2015, it also attracted various capital tycoons, such as Hillhouse Capital and IDG Capital. In December 2018, Mogujie was listed in the United States and was known as "the first fashion e-commerce stock".
Times have changed, Mogujie has already passed its peak moment and is in trouble. From fiscal year 2018 to fiscal year 2021, Mogujie’s revenue has continued to decline, with net losses every year.
's business is so bad that it is not surprising that Mogujie's stock price has been below $1 for a long time. In order to avoid delisting, the company merged its shares with 1 share for every 12 shares on March 28 this year.
Secoo, known as the “No. 1 luxury e-commerce stock”, has encountered a similar predicament as Mogujie, with its stock price below US$1 for a long time. Amid the turmoil of rumors about "bankruptcy" and "wage arrears", the company is struggling.
Mogujie and Secoo are just a microcosm of the decline of "Qianlang", a clothing e-commerce company. If we extend the time, a question will arise: How long can the "back wave" who are currently famous for a while stay popular?
Even SHEIN, which is at the top, is currently being questioned by many. For example, intellectual property rights are questioned. Its "design models" are considered to be the dismantling and reorganization of creative elements of big-name designers.In fact, many clothing brands have taken it to court.
There are also health concerns. An investigation by a Canadian magazine in 2021 found that the lead content in toddler jackets purchased from SHEIN was far higher than Canadian standards.
has many celebrities, so it is not surprising that SHEIN is questioned. But if there are too many doubts and SHEIN has no way to eliminate them, it is likely to accumulate into a decline in reputation. Coupled with the changes in companies and the replacement of young people, who knows how far SHEIN can go?
