Zhao Pu: Maternity Brand's Growth in October

In 1992, Zhao Pu and his wife Tu Wenhong opened a small shop in Hangzhou, selling their own brand of maternity dress "October Mommy", but also agents Denmark Lego and Italian Chico toys. In the early 1990s when state-owned enterprises laid off their staff, sales of “October Mommy” were extremely hot. Hangzhou TV station even produced a program that will “October Mommy” tree as a “typical of re-starting a laid-off worker”. In fact, their husband and wife resigned from the East China Design Institute and the Foreign Trade Bureau, discarding the gold rice bowl at the time and starting their own business.

"October Mommy" quickly expanded into a chain of stores. For the first time, Zhao Pu began to realize the contradiction between the identity of the agents and the persistence of his own brand "October Mommy." At this fork, Zhao Pu resolutely stopped all the agents and began to work on developing his own brand.

The demand for radiation protection was the main reason for the rapid growth of sales of “October Mommy” in the late 1990s. At the fastest time, Zhao Pu opened dozens of distribution stores within a year. In the early days, Zhao Pu took the approach of jointly developing franchise stores and franchise stores. This low-cost expansion formula quickly made “October Mommy” appear in malls across the country.

However, this business model soon encountered a huge crisis. Part of the crisis came from the outside, and the franchise model quickly achieved the nationwide distribution of October Mommy, but it did not bring about an increase in the sales volume. “Many times I told franchisees that you complained to me that October Mommy products are too expensive to sell. But have you ever wondered how many pieces of cheap products you can sell when you sell an October Mommy product? goods?"

The greater crisis comes from within. After 2001, as a common founder, Zhao Pu and his wife, Tu Wenhong, experienced a problem of how to manage collaboratively after Mommy grew faster and more than 10 million in annual sales in October. Zhao Pu and Tu Wenhong have completely different management concepts. "She is more emotional and I'm called her too rational." More specific disputes are reflected in how to build the October Mommy brand; whether it should be October. Mummy moved to Shanghai and developed from a local Hangzhou company to a nationwide chain brand?

This dispute reached a peak after a senior executive left his post and started his own career. Zhao Pu and Tu Wenhong are caught in a mood. Everyone thinks that he is making improvements for this company, and the two are heading south. Zhao Pu and his wife agreed to find a foreign aid advisor - Li Xiaoping, who has been the cat manager and the general manager of the Antarctic general manager. October Mommy is lacking experience in the national layout, and Li Xiaoping is also responsible for another function - "to pass on microphone".

Zhao Pu advised Tu Wenhong to temporarily release management rights. “Let me try it first. If I can do it according to my methods?”

During that time, Li Xiaoping’s phone was often blown up by the couple. Especially on the eve of Zhao Pu’s decision to spend huge sums of money to sign an advertising agreement with Small S, Tu Wenhong’s anxiety reached a peak. She believes that Zhao Pu’s experience in brand promotion is completely inexperienced.

The facts show that Zhao Pu's fight is extremely correct. As a company with annual sales of only 70 million, he spent a lot of money to invest in advertising (these advertising resources later had a market value of nearly 200 million yuan). Under the endorsement of Xiao S’s endorsement, October Mommy successfully created a national brand. From 2007 to 2012, sales of Mummy’s sales have doubled in October and reached nearly one billion sales in October.

"At that time, when I wanted to cast subway advertisements and there was a huge amount of endorsement fees, everyone opposed it. My wife didn't necessarily understand it. It turned out that our advertisements were very accurate," Zhao Pu said. For example, he was the first person to eat crabs on the subway screen. "The advertisements I want to fight are five to six people behind the pregnant women, so I got a subway ad." Zhao Puyi signed for two years and was high in the subway. In terms of density, "it has always been to be penetrated, penetrated and not penetrated, and quantitative changes and qualitative changes are completely different." In that year, Zhao Pu signed for five years in a breath, with a commercial value of nearly five billion yuan. Of which 200 million are for subway delivery.

In the small S's endorsement, Zhao Pu also used Qiao Jin. “Actually, we’ve calculated that Xiao S’s was still advertising P&G’s Qingyang at that time, and the high-density advertising actually had a synergy effect. In addition, the brand recognition of maternity dresses was very low, and after the advertising volume went up, there was a brand gap. "Zhao Pu said," At the time everyone saw such high-density advertising, and everyone definitely felt that the company was super-rich. Some people also said that we are Taiwanese or overseas companies."

In the area of ​​brand marketing, Zhao Pu is known for being bold, clever, and fine. One year before the World Expo, Metro Advertising DMG proposed that the advertising fee rose 1.8 times during the World Expo. Everyone thinks that this decision is too ridiculous, especially how the multi-year contract that has been signed can suddenly increase its price. Zhao Pu took the opposite route. He took the initiative to find advertisers and signed a two-year contract at 1.7 times the price at that time. Three months later, during the Shanghai World Expo, the advertising price of Shanghai subway rose sixfold.

In order to cast advertisements, he once took a subway back and forth in Shanghai and got off the bus to find the best advertising space. He carefully compared the relationship between various subway advertisements and relished talks about “advertising the competitors’ advertisements. Shoulong in his own cage."

"Advertising investment can directly drive sales. It is worthwhile to take out 10% of sales for advertising." Zhao Pu said that in the industry, this ratio may be only 3% or even lower.

After successfully building the brand, Zhao Pu began to be keen to lead "October Mommy" as a clothing company similar to Zara. When Zhao Pu visited the Spanish ISEC Business School in 2004, he asked the professor why the Spanish brand Zara did not transfer production to China, but left Spain. The professor's answer is that the climate factors of fashion have a great impact on apparel companies, and the accurate grasp of time directly affects the cost of the product.

Zhao Pu realized the method of process cost control. In October Mommy’s own factory has more than 100 workers dedicated to elastic lean production. Once a seasonal compensation slip occurs, the factory can complete the entire batch of clothes one morning and quickly make up for shortages in different regions. It may take a week before the orders are placed in other factories and the entire batch of orders can be issued. This kind of production management has unique advantages for the huge Chinese market of climate change layout.

At present, more than 80% of the production of Mommy in October is foundry, and only less than 20% of production is produced by its own factory. At present, Zhao Pu's factory only has more than 100 people, and he firmly opposes further expansion of the factory's scale.

“It will be more difficult to manage after the expansion, because the company management and factory management are completely two models.” Zhao Pu said that in the factory of more than one hundred people, he took the whole pattern of the driver, that is to say a piece of clothing. One worker completed and completely abandoned the streamlined operation.

"A lot of people say why you didn't do JIT, introduce pipeline operations, but that's all about people as machines. In fact, I expect that we will no longer be a clothing company. To be exact, we are a TMT. Company.” Zhao Pu repeatedly emphasized this sentence. “You noticed no, the October Mommy advertisement on the Metro TV was written in October when Mommy arrived! In the eyes of professionals, contrary to the principle of advertising, the first did not mention the product, and the second did not have any attributes. This is the concept that I want to shape. In the future, October Mommy is an identity and experience."

“We have been pursuing a product with the best price/performance ratio. We are not the lowest price, but from the aspects of brand, design, and fabric, we want to do the best product with the best cost performance, and finally this value chain will form a platform.”

This is completely different from the hesitation of Zhao Pu’s establishment of a proxy platform a decade ago or the creation of its own brand. This is a spiral increase. He believes that when there is no brand, diversification means losing its competitiveness. After the brand matures, how to establish a platform to quickly integrate multiple brand resources and achieve online and offline resource integration is the biggest challenge that needs to be faced in the next five years.

To this end, in October Mommy has begun trying to establish multiple sub-brands. In 2010, the brand introduced baby clothes. In 2012, they announced the sales of the Italian high-end maternity dress brand PB, which is expected to open the first store in Hangzhou. In APP applications, Zhao Pu developed the "Diary of Pregnant Women" and "BabyFace" application tools to market brands. "Distressed brush", "monthly meal" and other diversified service brands have begun to enter the store, in order to seek the greatest fit on platform services.

Zhao Pu has repeatedly postponed the timetable for listing. When the investment agreement was signed during the year, Sequoia was required to be listed within three years, that is, in 2014. Zhao Pu finally postponed the timetable to 2016, "I need to solve three problems before the listing." Zhao Pu said that these three points lie in the establishment of a platform, playing the basis of the cycle and solidification. He hopes to convert the current maternity dress business into a platform for pregnant women, children's clothing, and services for multiple pregnant children.

"In the next few years, terminal retail sales will range from 1 billion to 5-6 billion. In October Mommy will enter a rapid growth in the field of pregnant children." Zhao Pu's opportunity to see is no longer just a brand opportunity, but An opportunity to integrate the platform.

At the end of 2011, Mommy achieved nearly 70 million turnover on the e-commerce platform in October. It is estimated that in 2012 e-commerce platform sales will exceed 200 million. For a market segment, e-commerce sales exceed 300 million, which means that the brand has achieved an absolute monopoly on this market. Judging from the current trends, the goal of Mommy in October is within reach.