2024, the "Battle Royale" of Internet celebrity women's clothing stores

In the wave of e-commerce, the women's clothing industry is experiencing unprecedented challenges. In 2024, as wave after wave of popular women's clothing stores announced their closure, we can't help but ask: What exactly happened to this industry?

The wave of store closures of women's clothing e-commerce companies continues.

On September 19, Zhang Dayi, the first-generation internet celebrity, published a long article on her second Weibo account, announcing that the launch of new products at @吾欢喜的衣墙, @裙君, and @Jupevendue’s stores would be delayed indefinitely, saying that it was “considered a store closure.” Among them, the five-gold crown store @吾欢喜的衣墙 had 12.4 million Taobao fans as of press time, with monthly sales of more than 90,000 items, ranking TOP2 on the Taobao God Store List of Korean casual women’s clothing stores.

Shortly after Zhang Dayi closed her store, internet celebrity Zhou Yangqing's Taobao women's clothing store "GRACE CHOW Zhou Yangqing" also issued a notice to clear out all inventory, saying that "in order to adapt to the market environment and changes in the company's strategic direction, this store has decided to adjust its business", which is suspected to be the intention of the store.

Before the women's clothing stores of these two well-known Internet celebrities "closed", news of the closure of online women's clothing stores came out every now and then. With the five-star gold crown store @少女凯拉 being exposed to have run away with more than 40 million yuan as an obvious beginning, the online women's clothing industry has ushered in an unprecedented wave of store closures. According to incomplete statistics, since 2024, no less than 40 online women's clothing stores have announced that they will close their stores or no longer launch new products. Among them, in addition to these stores opened by well-known Internet celebrities, other "old" and high-fan old stores have also emerged in an endless stream. Looking at the online women's clothing stores that are still in business, many store owners also said that life is not easy. Some merchants once posted a complaint on Xiaohongshu, saying that "I have been making women's clothing for many years, and this is the most difficult year, with sales falling by 15%."

The reasons behind the store closures are complex, but they all point to an obvious and cruel fact: the women's clothing e-commerce business, which once made a lot of money, is now becoming increasingly difficult to do. To survive better in this field, businesses need stronger support and competitiveness, and they also need to explore more boundaries.

2. Online women's clothing stores will fail in 2024

When the announcement was made that the store’s new products would be extended indefinitely, @吾欢喜的衣墙 had just reached its tenth year.

In 2014, Zhang Dayi, who was a model and had attracted a large number of fans by sharing her outfits and daily life on social media, launched a Taobao women's clothing store @吾欢喜的衣关 with Feng Min, the founder of Ruhan Holdings. With the support of personal influence, product selection, marketing and other factors, this store quickly rose on Taobao, achieving annual sales of over 100 million yuan in the first year of its establishment. In 2015, it became the only online celebrity store to be included in the women's clothing list. During the Double 11 shopping festival in 2016, the store's turnover exceeded 20 million yuan in two hours, and its total sales exceeded 100 million yuan.

In the following years, @吾欢喜的衣仓 continued its glorious period until 2020, when the store's sales began to decline significantly due to the public opinion storm about Zhang Dayi's personal life and other factors. As of press time, Kas found that the top three products in the store only had sales of 500+.

Like @吾欢喜的衣仓, Zhou Yangqing's online store @GRACECHOW周扬青 was also opened in 2014. The overall style of the brand is trendy and hip-hop. Zhou Yangqing not only participates in the design of clothes, but also serves as a store model. In the early years, with her online celebrity status and original product design ability, the store's sales and fans once soared, but in the later period, like @吾欢喜的衣仓, sales inevitably declined until this year when a clearance notice was issued.

It is not just these celebrity stores that are backed by influencers that will go bankrupt in 2024. Long before these two stores announced the clearance, the online women's clothing industry had already seen significant shocks:

In May, @少女凯拉, a women's clothing store with five gold crowns on Taobao and a main focus on low-price sales, was exposed to have absconded with more than 40 million yuan overnight, involving about 300 suppliers. At the time of the incident, the store had more than 5.5 million fans and monthly sales of more than 900,000 pieces, ranking TOP3 on the Taobao women's clothing store list, and was a top seller in the women's clothing industry.

In the same month, the Golden Crown store @古大爆, which has 1.22 million fans, posted a closure notice on its homepage, announcing that it would start closing the store and clearing out its inventory at the end of the month. At this time, 10 years had passed since its official opening. According to Kass's observation, many users on Xiaohongshu expressed regret that this "affordable and good quality" store was closing down.

In June, @大C来, which won the Emerging Women's Wear Award at the ifashion Taobao Merchant Conference, also stated in the store closure notice that the store has been in a loss-making state in recent years. Although they continued to adjust the clothing style according to market demand, it was of no avail, and they had no choice but to choose to close the store.

At the end of August, @大sim小sim, a women's clothing store on Taobao with 4.64 million fans, also announced on Weibo and the store's homepage that it would stop operating, and said it would take a month to clear its inventory. At this time, it had been 10 years since it officially opened. It is worth noting that some fans found that in September, the store was still operating after changing its name to nasaroad, and many users reported that the unit price of its current products was higher than before.

In addition, a series of Taobao and Douyin women's clothing stores, including @ The Bubble, @ 沉入深蓝 LOSVLUE, @ AlOHASTUDIO露合製衣, @ 三三家 Sansan, @ 午后店铺afternoon shop, @ JZ匠子, @ 卤卤lulu independent designer brand, @ Daisyhome, @ 卤卤lulu, @罗拉密码, etc., have closed down this year. Many of these stores have been open for nearly ten years and have accumulated a large number of fans. As of now, some of them have been completely offline, and some are still in the final clearance stage.

2. What’s causing the surge in store closures?

The surging wave of women's clothing e-commerce store closures seems somewhat "abnormal", but there is no smoke without fire and everything has its cause. Behind the seemingly "abnormal" situation, there are actually countless undercurrents. After combining the industry environment and watching the closure notices issued by many women's clothing stores, the answer to why this surging wave has arisen is already obvious.

Overall, Kas attributed the reasons behind the wave of store closures of women's clothing e-commerce companies to three levels.

First of all, there is a fiercely competitive market environment. The golden age of the women's clothing industry has long passed. Today's women's clothing market can be called a red ocean in a red ocean. Both emerging brands and traditional brands are competing for limited market share and traffic resources, which makes it increasingly costly and difficult for a single store to obtain traffic and user attention. Especially for small and medium-sized women's clothing stores, it is even more difficult to get enough exposure and display opportunities on the platform. Fighting for a little bit of market share has gradually become the norm.

In addition, the emergence of live streaming has further intensified competition in the women's clothing market. Some traditional women's clothing e-commerce companies are unable to transform, and their living space has been compressed again.

The second is the huge pressure brought by the platform.

On the one hand, the unbalanced e-commerce environment and the overly inward-looking market have caused many platforms to fall into price wars. As a result, many online women's clothing stores have been forced to get involved, and their profits have been continuously squeezed.

On the other hand, the platform's adjustments in algorithms and policies are also continuing to put pressure on merchants. Among them, the adjustment of algorithms and rules will affect the traffic distribution and search ranking of online women's clothing stores. Many merchants have complained in the notice that "the platform's traffic price is too expensive, and the store's investment and return are completely disproportionate." The adjustment of policies such as refunds, freight insurance, and overtime compensation has not only increased the operating costs of merchants, but also made them face the risk of fines if they are not careful when processing orders, which undoubtedly adds another level of pressure.

Another issue is the extremely high return rate and inventory pressure.

It is understood that 2-3 years ago, the average return rate of women's clothing e-commerce was about 40%-60%. Earlier, this figure could be kept below 40%, but now, the return rate of many stores has increased to 70% or even 80%.

A women's clothing e-commerce practitioner once said in an interview with the media that "for every piece of clothing returned by a user, the online merchant's loss can reach more than 10 yuan - 4 yuan for express delivery, 3 yuan for freight insurance, and 5 yuan for packaging", and the increase in the return rate also means that the amount of loss continues to increase. The high return rate makes it difficult for stores to accurately grasp the stocking and pre-sale links, resulting in an increasing backlog of inventory, and a series of costs including logistics, warehousing, and labor are also rising. At this time, if the merchant does not sell extremely high sales, it will be difficult to consume the inventory, and the value cost of the inventory will cover the original meager profits, and a large loss is inevitable.

In the first half of this year, Fang Jianhua, the founder of women's clothing brand Inman, publicly called on relevant departments to intervene in the crackdown on the platform's "mandatory freight insurance" on his personal WeChat account. In his opinion, mandatory freight insurance not only pushed up the return rate and generated a large number of invalid orders, but also encouraged bad social practices and tempted users to exploit loopholes and make improper profits. In addition, it also caused merchants to increase in ineffective investment and occupied resources for product research and development. In the long run, it formed a vicious cycle of bad money driving out good money, and it became increasingly difficult for consumers to buy good products.

Kas believes that from the seller's perspective, the return rate has skyrocketed, which is due to the malicious return and refund of some users, and is also closely related to a series of new return and exchange regulations of the platform. From the consumer's perspective, the quality problem of women's clothing e-commerce has been a long-standing problem.

Kas observed that on platforms such as Douyin and Xiaohongshu, there are endless complaints about women's clothing e-commerce. Many users said that the clothes they bought were either boring in design, not the same as the ones in the pictures, too ugly in style, or the materials and details of the clothes could not stand up to scrutiny, or not worth the price. Faced with all kinds of dissatisfaction, they had no choice but to choose to return the goods.

Blindly following trends, ignoring quality in order to compete in speed, offering low prices in order to increase sales, distorted model pictures and other factors are the fuse that triggers users' dissatisfaction with women's clothing. The living space of some high-quality women's clothing stores has been compressed as a result.

In addition to these factors, the accumulation of a series of costs such as office space, warehouse space, employees, and operation teams has undoubtedly increased the burden on merchants. In a vicious cycle, many merchants, after struggling for a long time, finally had no choice but to give up.

3. Where are online women’s clothing stores going?

Faced with multiple pressures from the market, platforms, and users, how should online women's clothing stores get themselves out of danger? This is undoubtedly a question that is difficult to find a definite answer to. But the only thing that is certain is that in the face of users' overwhelming criticism and dissatisfaction with women's clothing, listening to their real needs, controlling the quality of products, and narrowing the gap between the real product and the model picture are undoubtedly basic principles. Based on this principle, new solutions can be developed.

While many online women's clothing stores have chosen to close, Kas has discovered that many women's clothing merchants have emerged in the past one or two years. By observing their operating strategies, we may be able to gain some inspiration from them.

For example, "Alice Clothing", a big player in the video account clothing track, previously used Douyin as its main battlefield. After switching to the video account in 2022, it adopted a series of operational methods that were in line with the platform's tone, thus becoming a benchmark women's clothing merchant on the video account. The GMV of the first broadcast exceeded 55 million, and it continued the advantages of its IP personality. Taking September as an example, according to a third-party data platform, the GMV of this account also reached 37.76 million.

Simply breaking down its operating methods, they can be divided into three levels.

First, the plot is developed around keywords such as "positive energy", "emotion", "life perception" and "workplace", and the character setting is done to the extreme through short videos, which has accumulated a large number of video account users, and this group of users is a perfect match with the target customer group of Alice, which focuses on "middle-aged women's clothing". Before this, although its Douyin also had more than one million fans, the video interaction data of the account was lower than that of the video account.

Secondly, multiple matrix accounts were incubated, and the popular content that was popular among users in the main account was "proportionately" copied. Based on the different number of fans accumulated in the matrix accounts, differentiated designs were made on the merchandise in the live broadcast room. This not only helped merchants attract target customers of different age groups, but also strengthened fans' impression of the IP and deepened their recognition of the brand.

Finally, the awareness of joint operation between public and private domains was established. With the enterprise WeChat as the core carrier, users were deeply communicated with, and the purchase rate and repurchase rate were increased through repeated contact.

It is worth noting that many online women's clothing stores are now shifting their business positions to the private domain. In their view, the essence of public domain women's clothing is price comparison and continuous profit squeezing, while the biggest advantage of the private domain is that they can make their own rules and hold users in their own hands without having to endure the intervention of the platform.

According to relevant media reports, Alice's user repurchase rate has reached more than 60%, but the return rate has dropped significantly compared to Douyin.

In addition, the Douyin anchor @刘一一, who caused heated discussions in the industry in early 2023, achieved sales of over 100 million in May of that year with less than one million fans, and in the past 30 days, its brand sales were still over 100 million. Its operating strategy can also be simply broken down into several levels.

The first is the differentiated product selection strategy. Its products are mostly minimalist clothing in black, white and gray, which are high-end, durable, versatile and practical, attracting a group of "rich and tasteful" fans - data shows that female users account for as much as 90% of its live broadcast room users, mainly aged 31-40, and most of them are from Zhejiang, Jiangsu, Guangdong and other places.

Second, they will use short videos to promote products, test models, and attract traffic. The average number of likes for @刘一一's works on Douyin is over a thousand. In the videos, she always wears a matching set of new clothes. In a Zen courtyard or an empty wilderness, she walks or sits. The characters and the scenery are perfectly matched, presenting an atmosphere of peace and tranquility, giving people a strong sense of healing.

The third is the unique "gentle narrative style". Facing the audience is like facing a friend, sitting on the sofa and telling stories. It doesn't seem like selling goods, but more like recommending them to friends. The last is the layout of the matrix account, as well as the strong team and supply chain support.

Ensuring quality, creating exclusive styles, adapting to the tones of different platforms and exploring wider boundaries... Online women's clothing stores operating in a difficult market environment need more solutions.