Unfortunately, the current market competition has reached a fever pitch, and advertising investment is also being marginalized. For example, TV advertisements - in the same time slot of a program, there may be more than a dozen cosmetic brands competing. How many consumers can truly pay attention? In the past, when fewer companies did TV ads, if you dared to be the first to try it out, you could also be the first to taste the sweetness of success. But now, unless your investment is particularly large or outstanding, it will certainly be drowned out by numerous other advertisements, and you're just helping the TV media put on a show. If this continues, it might still be tolerable, but TV media isn't something to be trifled with. With limited media resources, prime time only lasts a few hours, and there are only so many popular programs, so they naturally aim for maximum profit. As a result, prices keep rising, doubling every year, even making real estate prices pale in comparison. Thus, some of our makeup companies go all out to keep up, doubling their investment just to stay competitive. The current situation doesn't allow you to sit out; you have no choice but to participate. You're already caught in a vortex where once you stop investing, the hardworking dealers are ready to betray you. As long as you continue, your targets double accordingly. When the company's profits can't keep up with the speed of TV price increases, and when most dealers can't complete their tasks and want to shed the heavy burden, problems arise in the capital chain that sustains the company's fate, leading to a corporate crisis.
TV media, with its enormous influence, brings both sales and confidence to brands. However, it also comes with astronomical costs, often reaching tens of millions or even hundreds of millions of yuan. This is real money we're talking about. In this industry, which appears glamorous and highly profitable on the surface, the competition has reached a point where it feels like chewing on chicken ribs. Companies that can afford to invest have practically emptied their coffers, or are heavily indebted, just to stay afloat. What's the point? It's rumored that many companies want to inflate their brand value to sell it to foreigners at a good price, or to go public and make big money. This falls under what's called strategic investment, which I won't evaluate here. Let's talk about ordinary companies instead.
In the cosmetics world, where impatience prevails, very few remain calm and composed. Based on my years of observation, Yameizi Cosmetics is one of them. This brand took exactly six years to go from obscurity to becoming a household name in the mass fashion cosmetics market. During these six years, Yameizi seemed to maintain its own pace, steadily moving forward. Regardless of what grand plans other companies had made or how much glory they achieved, Yameizi remained focused on its own work. They didn't care about the grand gestures others made on TV, but rather concentrated fully on their own business.
The trend of following trends and impatience harbors hidden dangers in times of depression. Depression isn't the scariest thing. What's more terrifying is that during this period of depression, there are still huge expenses eating away at the company's capital chain - TV advertisements.
To sustain these enormous advertising costs, manufacturers start playing hardball. Sales targets keep doubling, 5 million this year, 10 million next year, and stores are no exception. If you don't meet the targets, don't blame me for cutting your territory or even canceling your agency. Under such immense pressure, distributors grumble incessantly, secretly plotting rebellion, but to retain customers and the brand, they dare not rise up unless absolutely necessary.
When visiting a typical northern market province, I discovered a current situation: after several rounds of fierce competition, many makeup brands have established many outlets for sales, but the sales situation remains generally average. Except for a few brands relying on advertisements to boost sales, most brands are constantly changing agents. Once an agent is replaced, they spend a lot of energy digesting inventory. Some brands have changed agents five or six times in just three years, and goods are everywhere.
Agents also repeatedly lay down points, replacing terminal retailers in rotation, yet the actual sales at terminals remain less than optimistic. And once a terminal retailer is replaced, they also have to deal with inventory. Even worse, when the manufacturer replaces an agent, the retailer suffers too because the old agent ignores them and the new one doesn't recognize them. They have no choice but to handle the remaining goods themselves, and not losing money would be considered lucky. Where is the hope of making money? Brands vie for dominance, treating stores as prey. Stores are persuaded by manufacturers and agents, sometimes without even being notified when they're replaced. After several rounds, only a few manufacturers benefit, while terminal retailers earn little to no profit. Even the manufacturers chasing dominance don't make money. Many agents and store owners express fatigue and helplessness when asked about makeup, admitting that although the development momentum of makeup is good, currently, very few makeup products sell well. Sales volume hasn't significantly increased, and most of the company's sales come from developing markets, resulting in inventory transfers.
The biggest reason for the market's depression is that most products are merely transferring inventory, stagnating in the middle stage, and not truly generating sales.
Under this restless state, the makeup market shows signs of depression. Recently, TV media frequently held bidding conferences, with bid amounts almost doubling. Limited column resources saw cosmetics manufacturers fiercely competing, determined not to give up until they succeed. This was partly due to audacity, but more out of helplessness and inability to quit because of addiction. Now it's a restless world where everyone chases efficiency. Brands want to grow big, companies want to get strong, salespeople want performance, bosses want profit, actors want overnight fame, and the masses seem unable to remain calm. Countless people have thought about getting rich overnight, but the development of things follows its own rules, requiring time and space, needing to accumulate quantity before achieving quality. Otherwise, extremes lead to reversals, and haste makes waste, which is exactly what the current makeup market is experiencing.
Currently, Yameizi has set up 500 mall counters and 3000 franchise stores in places like Shandong Yinzuo, Henan Dennis, and Qingdao RT-Mart. Layer by layer infiltration, breaking through one by one, continuously expanding its network, demonstrating a strong development momentum. In the depressed period of the makeup market, this brought a fresh vitality to the industry. We hope more makeup companies can be like Yameizi, abandon restlessness, focus on work, and enable our domestic makeup brands to break free from depression and develop healthily and steadily.
Maintaining stability, Yameizi develops strongly against the trend. Looking at the current makeup scene, the entire industry is permeated with restlessness. One wants to go public, another wants to become China's Maybelline, companies just standing on their feet want to rush to a billion, or even several billions. After nearly half a year of market visits, my conclusion is that the current makeup market is going through a depressed period, and many restless companies have more products stored in the market, selling less, having more outlets but fewer effective ones. People are paying the price for their restlessness.
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