What are the distinct trends in new retail?

New retail requires deep integration of online and offline logistics

In new retail, companies rely on the Internet and use big data, artificial intelligence and other technical means to control the production, circulation and production of goods. The sales process will be upgraded and transformed, and online services, offline experiences and modern logistics will be deeply integrated. New retail is driven by big data and transforms the retail industry through the development of new technologies and the upgrade of user experience.

The characteristics of new retail operations include channel integration, operation digitization, store intelligence, product socialization, product intelligence, etc. In the new retail scenario, multi-channel sales scenarios are closed, and offline and online integration is achieved through digitization. In the era of big data, store intelligence is common, which improves customer shopping experience and efficiency. Online stores have a complete range of products and high logistics and distribution efficiency.

Traditional retail has a long history of development. From the initial over-the-counter transactions to the later supermarkets, it can be regarded as traditional retail. Shopping malls and department stores are the most important forms of traditional retail. They have obvious advantages. The shopping process can be combined with experience items such as trying on clothes, eating, and playing, which greatly meets the needs of consumers. However, there are many pain points in its development, including single channels, uneven development of commercial outlets, high costs, and insufficient data-driven applications. Industries suitable for new retail include fresh food e-commerce, supermarket chains, convenience stores, cross-border e-commerce, maternal and child stores, 3C, etc. It mainly solves sales channels, traffic introduction, and establishes communities to further integrate and expand sales scale.

Explore the subversion and investment opportunities of new retail on traditional retail

In the Internet environment, consumption concepts, consumption demands, and consumption methods with consumption upgrade as the main line have undergone profound changes. The traditional retail business model restricts the sustainable and healthy development of the retail industry to a certain extent. New retail is disrupting mom-and-pop stores, community stores, supermarkets, convenience stores, shopping malls, and department stores.

For traditional mom-and-pop stores and community stores, most of their customers come from surrounding communities, schools and other places. The crowd is relatively fixed, and the products are relatively homogeneous. Under the impact of new retail, traditional mom-and-pop stores and community stores are trying to change their business direction, changing from traditional product management to customer management, creating value for customers, and truly providing convenience and services to customers. Build a complete business system and continuously improve every business process of the store, procurement, warehousing, display, inventory management, financial management, etc. Quickly expand the business scope of small stores online.

China’s chain convenience store brands have obvious regional characteristics, and new retail has enabled brand chain convenience stores to expand across the country. For shopping malls and department stores, the omni-channel strategy includes opening up online and offline ecosystems and realizing the ultimate sharing of resources in merchandise, marketing, logistics, data, etc. The business model of traditional shopping malls has reached its ceiling, and the simple rental model is unsustainable. Transform shopping malls into super experience centers and world-class tourist destinations to achieve a multi-level mixed income structure.

With the huge market size of the retail industry and the current consumption upgrade, the traditional retail industry is depressed, and the growth rate of online shopping retail is slowing down, major e-commerce giants and traditional retail brand companies are exploring new retail. It also attracted a large amount of investment funds to enter the market. In October 2020, Logistics Supply Chain/E-commerce New Retail*** included 26 private equity financing events, with total financing exceeding 9 billion yuan. Although there are fewer private equity financing events than in September, the amount of financing is large.

Unfavorable environments such as the macroeconomic slowdown and the impact of e-commerce are difficult to dissipate, and its own difficulties such as regional fragmentation and joint venture models still exist. It is difficult for the fundamentals of the retail industry to significantly improve. The advantages of the fresh food supermarket format are gradually becoming more and more prominent, and offline retail is actively planning for the Internet + retail transformation, such as promoting the mobile social e-commerce platform model, improving the incentive mechanism or injecting high-quality assets through the reform of state-owned enterprises, and exploring new consumption growth opportunities in supply chain services and big health. , these will become investment opportunities that can be explored in the future.

For more data, please refer to the "In-depth Research Report on Business Model Innovation and Investment Opportunities in the New Retail Industry" released by the Qianzhan Industry Research Institute.