Key points of the report:
Market Review
From December 20 to December 31, 2021, the Shanghai Composite Index rose by 0.20%, the Shenzhen Component Index fell by 0.07%, the gem index fell by 3.25%, the Shenwan light industry manufacturing / textile and garment / commercial trade index rose by 4.81% / 2.06% / 1.48% respectively, and the Shenwan food and beverage index fell by 1.06%, Shenwan light industry manufacturing / textile and garment / commercial trade / food and beverage index is + 5.10 / + 2.35 / + 1.77 / – 0.77pct respectively compared with Shanghai and Shenzhen 300 index, ranking 4 / 11 / 13 / 24 among 28 Shenwan industry indexes respectively.
Weekly topic: under the new retail era, offline stores are still irreplaceable
With the full penetration of the Internet into residents’ lifestyle and the gradual improvement of the superimposed logistics distribution system, the online retail platform reduces the search resistance and location resistance, residents transfer some offline consumption to online, and e-commerce accelerates the penetration under the catalysis of the epidemic. The growth rate of traditional offline channels is under pressure, and the development of emerging online channels is bright, but offline physical stores integrating experience, quality service and social attributes are still irreplaceable retail channels for e-commerce. Under the experience economy, offline stores create an immersive shopping scene for consumers. Physical stores provide consumers with physical use experience, buy and pick up goods, on-site shopping guidance and consultation, after-sales maintenance guarantee and other services through vision, smell, touch, hearing and taste, so as to meet consumers’ emotional demands at the same time. Under the quality economy, offline stores attract high-quality consumers. Consumers pay more attention to cost performance when buying online, forcing online stores to gradually lower the premium space of goods, while offline stores represent high-quality consumption. Consumers have a high acceptance of high premium goods, and pay more attention to the availability of goods and enjoy personalized services. Under the social economy, the word-of-mouth communication of offline stores is higher or higher. Consumers have high trust in recommendation sharing from the same circle. Under the background of high online traffic cost, marketing fission or higher cost performance can be achieved through offline stores. Case study: ① fresh retail: the penetration rate of fresh e-commerce is low, and the retail channel is still dominated by offline stores. HEMA Xiansheng skillfully uses the experiential marketing format of offline stores to obtain consumers’ trust in offline product quality, realize low-cost diversion to online, and create a new retail format in which offline experience drives online orders; ② Furniture retail: the core of the home industry is user experience and service, and real experience offline stores are indispensable. Red Star Red Star Macalline Group Corporation Ltd(601828) and Suofeiya Home Collection Co.Ltd(002572) integrate offline stores into life scenes, greatly enhance consumers’ sense of substitution and create a one-stop home experience for consumers; ③ Instant Retailing: consumers pay more attention to the timeliness of distribution, and instant retailing helps the digital transformation of traditional retailers. JD’s real-time retail business launched “hour purchase” on the eve of double 11 this year to build a retail model of “online order, store delivery, hour level and even minute level delivery”. JD’s real-time retail and offline retail stores complement each other, enabling traditional retailers to improve quality and efficiency.
Risk statement
The risk of macroeconomic growth falling short of expectations; Covid-19 epidemic impact; The business condition of the enterprise is lower than the expected risk; Risk of rising raw material prices; Exchange rate fluctuation risk; The competition pattern intensifies.
