Cyber outlets at S.CN
06 September 2012
In an era of explosive e-commerce growth, S.CN positions itself as a stock clearance website for branded goods. In just three years' time, the mainland website became an enormous success by achieving more than 10,000 transactions daily.
The financial crisis in 2008 has resulted in steep contraction in China's footwear exports. In view of the gloomy export prospect, Fujian businessman Xu Songmao who had then been working in the footwear business for over 20 years launched www.S.CN in 2008. He wanted to make use of the internet to switch to domestic sales. From 2009 to 2011, S.CN's turnover increased by leaps and bounds, from Rmb38.6 million to Rmb120 million to Rmb20 million. S.CN now ranks among the top three B2C (business-to-consumer) enterprises in the footwear category in China.
Speaking at an interview with the HKTDC, S.CN's Chief Marketing Officer Han Buyong explained the operation of his company and its reasons of success. Here are some of the lessons to be learned.
Firstly, as a new B2C website, S.CN chose to become an e-tailer rather than an online platform because existing e-commerce platforms such as taobao.com, 360buy.com and yihaodian.com have together carved a 90% share of the user traffic. Positioning itself as a retail outlet can reduce the promotion costs. Also, after making a reputation for its own brand name, it is easier to attract customers. Secondly, S.CN started with selling sports shoes in the early days. Nike and Adidas shoes were sold at half price. The big stock volume of quality shoes in 2008 made it an instant success. Thirdly, low inventory levels in single brands will be fatal to S.CN. Therefore, there is the need to expand gradually the number of branded footwear and related sportswear and bags. At present, after S.CN has built up its own brands, branded enterprises are more willing to provide stock. Li-Ning is currently one of the leading brands on sale at S.CN.
Mr Han added that the success of S.CN is due to a number of other reasons. In terms of the basic infrastructure of the website, the company implemented the online ERP system from day one and has been constantly upgrading it since. Meanwhile, the company also takes the sales seriously at other leading mainland e-commerce platforms. Around 60% of the current sales are contributed by these leading sites. In 2011, S.CN began to establish its own brands, including Lantivy, Skomart and Aderson. Mr Han also revealed that the company has signed a letter of intent with Jack Ma's Alibaba.com which is going to inject close to Rmb100 million for an interest in the cyber outlets website. The prospect of S.CN is promising.
from Sophia Zhao, Fuzhou Office
- Mainland China
- Mainland China