euro-中国无店铺销售

1、Insights into Direct Selling in China,Introduction Chinese Direct Selling in the Global Context Framework of Direct Selling in China Category Performance Competitive Landscape Future Prospects Definitions,Scope,Introduction,This briefing on the global retailing market covers the following channels,

2、focusing on the year 2009:,The core objective of this report is to examine the current state of the non-store retailing channel, and direct selling in particular, in China in the context of the wider retail market. In addition to providing a channel overview, the report also analyses performance by

3、product sector, and the state of the competitive landscape, key trends and developments, and prospects and opportunities. The data and analysis are specific to the Chinese direct selling channel, and where appropriate and relevant it looks at greater detail in beauty and personal care and consumer h

4、ealthcare. The direct selling channel is examined in terms of forecast performance over the 2009-2014 period, with a closer look at 2009-2010 specifically, identifying key areas of opportunity in terms of product sectors.,Objectives,Introduction,Direct sales dominate non-store sales in China,China i

5、s the fourth largest direct selling market globally reaching sales over US$6 billion in 2009, with the direct selling channel accounting for the majority of non-store sales in the country.,Vitamins and dietary supplements remain the biggest category,56% of all direct sales in China are generated by

6、the growing vitamins and dietary supplement products sector.,Amway maintains a clear leading position,Amway accounts for 46% of all direct sales in China, and is by far the biggest player.,Contributor to growth,China was the biggest contributor to growth in Asia-Pacific in 2009, adding US$500 millio

7、n in sales, and was second only to Brazil globally.,Legal framework supports growth,Implementation of direct selling legislation has spurred growth since 2005, and created a stable and more secure environment for companies and consumers.,Food and drink products are the hottest,Food and drink product

8、s saw the highest growth rates over the review period, peaking at over 500% in 2006. The high growth has come mainly from meal replacement products like Herbalife Protein Mix.,Price premium,Products sold by direct sellers are typically mid- to high-end compared with those of store-based retailers. L

9、eading direct selling players, such as Amway, Mary Kay and Herbalife, are all positioned at the mid to premium end of the market.,Key Findings,Introduction,Introduction Chinese Direct Selling in the Global Context Framework of Direct Selling in China Category Performance Competitive Landscape Future

10、 Prospects Definitions,Chinese Direct Selling in the Global Context,Direct Selling In China,Amway Accounts for 46% of all direct sales in China and is by far the biggest player,56.4% Of all direct sales in China are generated by the growing vitamins and dietary supplement products sector,$6.1bn Chin

11、as direct selling market is now the fourth largest globally,Following the unprecedented contraction in spending during 2009, retail expenditure growth stalled to less than 1% globally. In contrast, Chinas retail sales grew well over the average for Asia-Pacific, and the increase of 8% marked only a

12、slight slowdown on previous years. The strong growth in non-store sales was even more impressive, as the channel was more dynamic than total retail grocery and non-grocery retailers alike, growth in sales of which slowed down during 2009, to 6% and 9%, respectively.,Chinas Growth Remains Strong,Chin

13、ese Direct Selling in the Global Context,Retailing Market Snapshot: Total retail sales in 2009 reached US$10.4 trillion Asia-Pacific retailing market was worth US$2.7 trillion Chinese market was valued at US$0.9 trillion,Globally, Internet retailing is the biggest non-store channel and the fastest g

14、rowing one. Total Internet retailing sales reached US$244 billion in 2009, up by 5%, despite the less favourable economic conditions. In China, direct sales are by far the most important non-store channel, with 60% of all non-store sales coming from direct sales.,Non-store in Focus,Chinese Direct Se

15、lling in the Global Context,Direct Sales as Share of Total Retail Sales,Chinese Direct Selling in the Global Context,Direct Sales as Percentage of Total Retail Less than 0.5% Between 0.5% and 1% Between 1% and 3% Over 3%,Introduction Chinese Direct Selling in the Global Context Framework of Direct S

16、elling in China Category Performance Competitive Landscape Future Prospects Definitions,China is the second biggest retail market in Asia-Pacific and the second fastest growing market, with the highest contribution to overall growth in actual terms. Direct sales in China rose by US$500 million in 20

17、09, making it the biggest contributor in the region. Asian countries show great affinity to the direct sales channel, and it is popular both in developed countries like Japan and in developing countries like China. Direct sales are particularly strong in markets with less developed retail system, as

18、 catalogues and agents can reach remote rural locations lacking retail infrastructure easily and cheaply.,China Biggest Contributor to Growth in Direct Selling,Framework of Direct Selling in China,In 2005 and 2006, many of the leading direct selling companies sales were negatively impacted by the ne

19、w regulations. The leading player Amway, for example, saw sales decline sharply between 2005 and 2006. Results of the regulatory changes: Consolidation within the industry. Increasing difficult environment for smaller players to operate in. Single-level marketing is now the most prevalent type of di

20、rect selling.,Chinas direct selling market is highly regulated compared with other countries in the Asia-Pacific region. This is as a result of government regulation on direct selling in late 2005. The regulations forbid multi-level direct selling, also known as pyramid selling. Direct selling compa

21、nies carrying out activities in China are required to apply for a licence from the Ministry of Commerce. To get a licence, companies need to fulfil at least four important requirements:,Legal Framework,Framework of Direct Selling in China,Direct sales regulations requirements: Registration capital o

22、f no less than RMB80 million. Capital reserves above RMB20 million. Monthly payment for direct sales personnel, and caps on bonus payments. Special retail outlets in regions where the company has direct selling licence to provide easy access to prices, refunds or other services for consumers and dis

23、tributors.,Person-to-person,Direct selling personnel can provide detailed descriptions and demonstrations of the products they sell, offering tailored service to consumers.,Convenience,Direct sellers can sell and deliver the products at the homes of their customers, which is convenient for busy cons

24、umers.,Unprofessional manner,In China, as many direct selling personnel tend to be less educated, they lack skill in presenting themselves in a professional manner.,Perceived as pushy,In underground stations of large cities, such as Shanghai, frequent encounters with direct selling personnel from di

25、fferent companies can lead to impatience among commuters and a negative impression of direct selling as a format, which will have an adverse impact on the company or brand the personnel represent.,Consumer Perceptions,Framework of Direct Selling in China,By July 2009, 24 companies had licences to op

26、erate as direct sellers in China. Between 2008 and 2009, four companies received direct selling licences. Among the four new players, Harbin Pharmaceutical Group and Jiangsu Longliqi Group Co Ltd are already strong in store-based retailing, and direct selling is intended to be a complementary distri

27、bution channel. Jiangsu Alpay Biotech Co Ltd and Harbin Pharmaceutical Group are mainly engaged in vitamins and dietary supplements direct selling, while Kelti (China) Daily Necessities Co Ltd and Jiangsu Longliqi Group Co Ltd focus on beauty and personal care.,Direct Sales in 2009,Framework of Dire

28、ct Selling in China,Direct sales of home furnishings and housewares saw 40% value growth between 2008 and 2009. The food and drink sector grew at a 128% CAGR between 2004 and 2009. This rapid growth came mainly from meal replacement products like Herbalife Protein Mix. Vitamins and dietary supplemen

29、ts was the biggest actual contributor between 2004 and 2009, with an increase of RMB4.4 billion.,Direct sales dynamics over the last five years,Framework of Direct Selling in China,Introduction Chinese Direct Selling in the Global Context Framework of Direct Selling in China Category Performance Com

30、petitive Landscape Future Prospects Definitions,Home furnishings and housewares category saw the strongest growth in direct selling in 2009. In late 2008, Amway launched high-end cooking utensil products under the Amway Queen brand. By mid-2009, the industry was describing this launch as success. Th

31、e high value sales achieved by this sector is in large part based on high unit prices. Single set of cookware products retail at a price as high as RMB6,000.,Household Goods Enter the Market,Category Performance,Source: A,Domestic electrical appliances direct selling underperformed the market in 200

32、9. Vorwerk is the only direct seller offering such products via direct selling in China. The limited product choice has hampered sales. According to industry sources, vacuum cleaners are the only product type available within this category, and many consumers, especially in rural China, perceive vac

33、uum cleaners as a luxury product rather than a necessity. Vacuum cleaners have a low penetration in China, lower than other appliances such as washing machines, fridge freezers and air conditioners. Unit prices for these vacuum cleaners are very high, at around RMB3,000 per unit. In the current mark

34、et context, it is unlikely that there will be any dynamic growth for this sector in direct selling in China in the near future.,Limited Product Range in Consumer Appliances,Category Performance,Cleaning Appliance Series VK35 Clean Host Daily floor cleaning care, as well As above ground furnishings c

35、leaning dust,Cleaning Appliance Series EB351 Deep Cleaning Machine Deep cleaning carpets, mattresses and other fabrics inhibit the propagation of dust mites and reduce allergens.,Products sold by direct sellers are typically mid- to high-end compared with store-based retailers. The products of the l

36、eading direct selling players, such as Amway, Mary Kay and Herbalife, are all positioned in the middle to premium price range.,Direct Sellers Maintain a Premium,Category Performance,In 2009, vitamins and dietary supplements accounted for 56% of direct sales in China. In 2009, direct sales of VDS gre

37、w by 9%. This was more than double the overall growth of the sector in China (4%). Amway is the leading player, with 16% of value in 2009, up from 14% in 2008. Healthy growth, as well as lucrative profit margins in direct selling, have already attracted many traditional manufacturers to apply for li

38、cences to extend their businesses into this channel. Traditional VDS players are entering direct sales and applying for licences. Between late 2008 and early 2009 Harbin Pharmaceutical Group and Jiangsu Longliqi Group Co Ltd obtained licences to operate via direct selling. The VDS category is relati

39、vely new and requires on-site person-to-person explanation of the products benefits. The direct selling channel is well placed to meet this need.,VDS Direct Sales Continue to Attracts New Players,Category Performance,Store Sales Suffered in 2009,Category Performance,In 2009, as a result of the aggre

40、ssive expansion of direct selling players, such as Amway, Infinitus and Herbalife, bricks-and-mortar store sales of vitamins and dietary supplements suffered.,Direct sales growth 8.8%,Beauty and personal care is the second largest category within direct sales in China. Direct sales of beauty and per

41、sonal care amounted to RMB16 billion in 2009. The international players Amway, Avon and Mary Kay dominate direct sales in the category. Skin care was the most important contributor to category sales in 2009 with a 60% share of value sales. Colour cosmetics, hair care and bath and shower are also imp

42、ortant contributors to sales.,Beauty and Personal Care Direct Sales,Category Performance,Further to the right categories with much stronger growth in direct selling: deodorants with 32%, skin care with 21%, and colour cosmetics with 14%. All these products have also a high share of direct sales in C

43、hina.,Beauty Products Growth and Shares,Category Performance,Note: Size of the bubble represents percentage share of direct selling in category sales,The bubble for Mens grooming category is too far on the right to fit onto the chart, due to exceptionally strong growth rate. Mens toiletries such as

44、mens skin and hair care are a new and exciting territory for personal care industry players.,Introduction Chinese Direct Selling in the Global Context Framework of Direct Selling in China Category Performance Competitive Landscape Future Prospects Definitions,Corporate strategies in Direct selling,C

45、ompetitive Landscape,Amway Undisputed Leader,Competitive Landscape,There are similar numbers of multinational and domestic players among the top 10 players in direct sales. Multinational companies, such as Amway, Avon and Mary Kay, have focused more on building up successful brands and growing their

46、 direct selling businesses across the country, while domestic players, such as Infinitus and Tianjin Tianshi, have put more efforts into their product portfolios. New entrants from traditional store-based channels will raise the level of competition in direct selling. Harbin Pharmaceutical Group and

47、 Jiangsu Longliqi Group Co Ltd are well-known manufacturing companies in vitamins and dietary supplements and beauty and personal care in China. High brand awareness for the two companies gives their direct selling personnel easier access to their targeted consumers.,Amway continued to lead direct s

48、ales in 2009, with 46% of value, thanks mainly to its efforts in product innovation, as well as strong support through marketing activities. Its core business includes beauty and personal care, vitamins and dietary supplements and household care products. In 2009, strong double-digit growth was seen

49、 within its beauty and personal care product lines, especially for skin care, under the Artistry brand. This was a result of a heavy marketing campaign from the company, as well as frequent product upgrading targeting the most dynamic anti-ageing subsector. Price increases also contributed to the hi

50、gh value growth of the Artistry brand. However, the real star performer of 2009 was the companys consumer health product brand Nutrilite. Amway held around 10% of the total consumer health market in China in 2009. The Nutrilite brand represented over half of Amways total sales in China. Nutrilite is

51、 the leading brand in vitamins and dietary supplements, in China with around 13% of value sales. The brand enjoys very high brand awareness in upper tier cities in China, thanks to years of marketing efforts, including TV ads, celebrity endorsement and sponsorship of sports events, such as Nutrilite

52、 Health Running. As the leading brand in Chinas consumer health market, Nutrilites product lines have been stable in recent years. While protein powder is reaching saturation in the market, in 2009, Amways focus was on the promotion of its multivitamins Double X, accompanied by ads on TV, in streets

53、 and magazines. Amway launched a refill pack for Nutrilite Double X in March 2009. As a result of the good performance of Double X, Amways total share increased from 21% in 2008 to 24% in 2009.,Amway Keeps the Momentum,Competitive Landscape,As the leading direct sales company in China, Amway (China)

54、 Co Ltd will continue to increase its presence at the upper end of the market, with the focus laid on its two flagship brands of Nutrilite and Artistry. In addition, Amway seeks to diversify its product ranges through investment in new product lines in air purifiers, water purifiers and energy-savin

55、g kitchen wares. The company has experienced dynamic growth in recent years, and it is expected that it will see slightly slower but still health growth over the forecast period, due to its long emphasis on sustainable operations in the Chinese market.,Strategic Direction for Amway in China,Competit

56、ive Landscape,Tiens Biotech Group Inc, with its Tiens brand, lost ground in 2009, due to fierce competition from other players, such as Perfect, Amway and Infinitus. As an early starter in direct selling, Tiens suffered from maturity in terms of product innovation, marketing format and distribution

57、channel, which pulled down the overall performance of the company in 2009.,Infinitus (Lee Kum Lee Co) the Best Performer in 2009,Competitive Landscape,Infinitus (China) Co Ltd enjoyed the biggest share increase in 2009, of over half a percentage point, to 6%. Positioned as a direct selling player so

58、lely providing traditional Chinese medicine (TCM) ingredients-based products, Infinitus saw strong growth during the review period, as consumers perceive TCM-based vitamins and dietary supplements to be healthier.,Infinitus, as a pioneer in TCM ingredients, has applied a wide range of TCM ingredient

59、s, including wolfberry and royal jelly, in Infinitus Nuri-Suit Supplement Meal, benefiting human kidney and liver health. Meanwhile, it also offers products with traditional Chinese magnolia vine, ginseng and tuber of dwarf lily. Infinitus brand awareness remains relatively low in Chinas wellness product market, particularly in tier I cities, such as Guangzhou. Infinitus is more of a low-profile com