The Ministry of Commerce reported that China's department store retail industry is picking up and is embracing new retail in various ways.

 

According to the recently released "2017-2018 China Department Store Retail Industry Development Report", the development of department store retail companies in 2017 has improved significantly. Among the 85 department store retail companies surveyed, sales and main business profits increased by 9.10% year-on-year respectively And 2.32%, the growth rate has greatly increased from the previous year.

 

　　 This report, co-authored by the Department of Circulation Industry Development of the Ministry of Commerce, China Department Store Commercial Association, and Hong Kong Feng Group Li & Fung Research Center, analyzes the current status of China's department store retail industry and discusses the industry's transformation.

 

　　 The report believes that new retail species are exploding, and department store retail companies are beginning to develop towards multiple formats. As Internet giants such as Ali and Tencent have joined hands with department store retailers, online and offline integration is accelerating.

 

　　Department store "de-departmentalization"

 

　　In the past two years, there has been a "rebranding tide" in department stores.

 

In March 2017, Rainbow Shopping Center Co., Ltd. decided to change its name to Rainbow Co., Ltd.; in January this year, Liqun was renamed to "Liqun Commercial Group Co., Ltd.". During the same period, Xinhua Department Store, a subsidiary of Wumart Group, was renamed to "Wumei Xinjiekou square".

 

　　The report concludes that behind the “rebranding tide”, the department store’s determination to “de-departmentalize” and transform into a multi-format, comprehensive-service retail enterprise.

 

　　The survey shows that up to 83.5% of the department store enterprises surveyed have entered the retail format other than department stores, among which supermarkets, shopping malls and convenience stores are the most common. Another 41.3% of companies said they plan to set foot in other retail formats in the coming year, among which the shopping mall, convenience store and outlet formats are the most concerned. The small format represented by convenience stores is gradually gaining popularity.

 

Department store opened "buyer shop"

 

　　 In the face of the trend of homogenization of brands, how to play well in differentiated competition? Many department stores try to operate their own models and introduce buyer shops to enhance the personality and gross profit margin of the products.

 

　　Tongzhou Wanda Plaza opened the country's first "Wanda Preferred". Wanda's professional buyers screened fashion, jewelry, shoes, skin care products, food, etc. from all over the world. Bailian Group also opened its first boutique in Shanghai. Through direct overseas purchases, self-owned buyouts, and in-depth cooperation with domestic and foreign designers and brands, it sells more than 150 international fashion and lifestyle brands in the store.

 

　　The survey found that 76.8% of the interviewed department stores have adopted the self-acquisition and self-employment model, but nearly 55.5% of the interviewed department stores have an existing self-acquisition and self-employment ratio of less than 10%.

 

　　 In addition, 32.1% of the department stores surveyed have developed their own brands, an increase of 7.1 percentage points from last year. Among them, more than 61.5% of the companies indicated that they have increased their own brand ratio in the past year.

 

　　In FY2017, the sales of self-operated goods of New World Department Store China Co., Ltd. accounted for 31.8% of revenue. Its own brands include the "LOL Original Life" concept store, "n+Natural Baking", and "Xin Shuo", which specializes in niche clothing.

 

　　Use data to give customers accurate "portraits"

 

　　Digital technology has become a "weapon" for the transformation of department store retail enterprises in the new consumption era.

 

　　 The report pointed out that in the face of the new consumption era, department stores should use data to accurately depict consumer demand and then provide products in a targeted manner. Up to 92.6% of the surveyed companies have collected consumer data. Among them, 96.1% of the surveyed enterprises passed the membership card/membership plan, 42.7% through the store WIFI, and 24.0% through the online commodity purchase history information.

 

　In August 2017, Intime launched the first paid membership card in the department store industry, established a two-way interactive membership network system, and comprehensively collected customer data online and offline. Intime Business recognizes customer needs based on users' shopping records on platforms such as Intime App and Taobao Tmall, thereby providing more personalized product recommendations and services.