MINISO Private Domain Operation Guide!

MINISO was founded by Ye Guofu in 2013. Its business scope covers 11 major categories including skin care, cosmetics, electronic appliances, and home furnishings.

By 2018, MINISO has opened stores in more than 3,400 countries and regions around the world. By the end of 2021, MINISO will have more than 5,000 stores worldwide.

In 2018, MINISO began to experiment with online business. In 2020, MINISO's offline business was affected by the epidemic. In 2021, it launched the strategic Project G (omni-channel growth project) to deepen its private domain operations .

In order to better promote its online business, MINISO will also leverage external tools. Youzan is one of them.

Youzan New Retail is a new brand newly established under Youzan, dedicated to helping traditional retail store merchants achieve digital transformation.

In this article, let’s talk about how MINISO plans to develop its private domain.

1 — “Private” users of “public stores”

We say that the traffic ecosystem has been opened up twice.

The first time is the connection between online and offline. When the number of online sellers increases rapidly while the number of buyers increases slowly, the sellers who are scrambling to get in will inevitably grab one resource at any cost: platform traffic. This will inevitably lead to traffic costs, which will become more and more expensive. Eventually, it gradually converges with offline.

At this point, an offline shop can no longer support three generations; and it is also difficult to do business online. The traffic ecology has completed its first breakthrough. We call this traffic balance after the offline and online connections are connected: new retail.

So what is the second connection?

The second connection of the traffic ecosystem is the connection between the public domain and the private domain.

Private domain refers to those users that you own, can reach repeatedly and for free.

There are three elements in this sentence.

The first element is: what you own. This is the well. It's yours. You don't have to pay for using this well. You can also charge money for other people's use.

The second element is: repeatability. What does repeatable mean? As long as you want to reach someone, you can reach them for free.

The third element is: low cost or even free. Digging wells only makes sense if water is free. The lower the cost per reach, the better.

Directly owned, repeatable, low-cost or even free reach. This is the underlying logic of private domain.

But how can you have your own private domain?

Privatization.

How does MINISO do it?

The first thing they did was to "privatize" the users of "public domain stores" and turn public domain traffic into "private domain communities" in WeChat .

For example, MINISO has more than 5,000 stores, which cover a wide range and a large population base.

They have very good prerequisites. They don’t need to spend money to buy traffic. As long as they use the right methods, they can privatize the traffic in the pool at their doorstep.

Since the beginning of the epidemic, MINISO has initially tried the method of having store clerks scan codes to privatize the public users of stores.

A few months later, their private domain users reached 2 million.

Later, they launched a G project (omni-channel growth project), under which they continued to add water to the private domain pool.

2 —Use online stores to attract traffic

The private domain pool is getting bigger and bigger, and there are more and more online users.

At this time, you need to run your online store well.

We say that when opening an offline store, choosing a store is very important. Online, you also need to choose a good "store".

MINISO has its own mall, and this mall has cooperated with Youzan to build a new mall.

Why?

Because its business model determines that online stores must be operated using two different logics.

What does it mean? Generally speaking, there are two modes for opening a store quickly.

The first is a directly-operated store, where you pay for the store and manage it yourself.

The second is franchise stores, which is to find franchisees and adopt a light asset model. The franchisee pays and manages the business himself.

But there is a problem with this model. Because there is no unified management, quality control problems are prone to occur, which will damage the brand.

How did MINISO do it? They used a store opening model that was between direct operation and franchising, called "direct management". MINISO called this model a quasi-direct operation and franchising model.

Direct operation means investing and managing by yourself;

To join a franchise means that someone else invests and manages;

Direct management means that others invest and you manage it yourself.

Franchisees come to MINISO with two things: a good store location and money.

Franchisees use their local resources to select a location, and then pay the rent and decorate the store. MINISO will recruit, train and manage franchisees on their behalf.

MINISO pays its franchisees a percentage of its turnover as investment income.

Therefore, MINISO’s private domain users are actually divided into two parts, one part is added through offline stores. It means that franchisees direct offline traffic to online. If these users shop online, they need to pay the store according to a certain ratio.

Another part of users are converted through other channels.

So based on these two different logics, there are two "online stores" that receive traffic.

One of them is to leverage Youzan Mall.

Because Youzan Mall is an e-commerce tool on WeChat that is very good at social marketing and easy to use.

Currently, Youzan has connected WeChat, Video Account, Weibo, Alipay, Aiguang, etc., and can provide MINISO with a wide range of traffic channels.

In addition, Youzan helped MINISO find high-value distribution traffic sources in Tencent’s private domain system.

For example, distribution through live broadcasts by video experts, or looking for self-media distributors in the WeChat ecosystem.

For example.

This year, Youzan took the lead in connecting a certain brand with a KOL of a video account. In May, a live broadcast took only a few hours and generated a transaction volume of 270,000.

This distribution method brings the diffusion coefficient to 6.9. What this means is that through the resources and tools provided by Youzan, it is equivalent to one person bringing in 7 users.

In addition, Youzan New Retail also provides brands with exclusive private domain operation consulting services to help brands effectively activate and close private domain traffic and create an omni-channel user growth strategy.

3 — Interest. trust. need.

We say that the purpose of privatization is to use repurchase rate to dilute the increasingly expensive initial customer acquisition costs.

With the "privatization" of users in "public domain stores" and the addition of users attracted from various online channels, MINISO has 15 million retained users in its private domain.

After privatization, how to retain these users?

1) Use interest links.

In 2020, Ye Guofu, the founder of MINISO, mentioned "interest-based consumption". He believed that being dominated by interest is the biggest consumption characteristic of this generation of young people.

Because the use value and emotional value of commodities are gradually separating, and young people pay great attention to cultural attributes and emotional value, they are keen on products that are good-looking, easy to use and fun.

How does MINISO “link” users through interests?

For example, through high-quality content such as articles, notes, short videos, live broadcasts, etc., we can constantly establish "interest connections" with users.

Don’t treat the private domain as a WeChat group that “expands as it’s filled up.” Rather, it is an "operating system" that can be adjusted according to the content at any time.

For example, some time ago, the "Strawberry Bear Hug" series launched by MINISO was very popular. A very important point is to link users with interests.

First, before the product was released, they established hundreds of communities about “Strawberry Bear Hug”.

Then, based on these private domain user portraits, invite interested fans to join continuously to increase the base of seed users.

Next, initiate topics of interest to increase user stickiness, allowing the relationship chain of seed users to naturally ferment and fission, attracting more people to join. As more and more people were attracted to join the group, we began to operate in a targeted manner based on these users' preferences for products.

For example, with the help of Youzan marketing plug-ins, limited-time coupon grabbing, daily flash sales, red envelope grabbing strategies, etc. are launched to maintain the activity in the group.

Gradually, users develop a sense of stickiness to the community and even a sense of belonging, which drives spontaneous dissemination and achieves the effect of self-operation.

2) Connect with trust.

Attract users through interests, expand the "breadth" of connections, and convert public domain traffic into private domain traffic.

Then, it is necessary to explore the value of each customer through operations.

Because repeat purchases are based on "trust".

How does MINISO do it?

For example, when you add the WeChat account of "Xiaoming classmate", with the help of rich tags, there will be multiple dimensions such as fan sources, personal interests, content preferences, etc. According to different dimensions, you will enter different communities.

Then, according to your preferences, you can complete the tags, and reach and retain users through methods such as product recommendations, good product recommendations, and community interactions.

In this community, you will find that everyone has the same interests as you, and you will talk about what you are interested in. For example, if you have read a book recently and you find that someone in the group has also read it, you can share it at any time.

Then, you will continue to discover valuable content in the group.

In this way, the value of incremental information determines that this group will not be "blocked".

For example, after the Strawberry Bear Hug series was sold, many users spontaneously posted their thoughts on Xiaohongshu and WeChat Moments, actively shared, and created guides and gameplay. Because of one product, customers become interested in other products, which leads to repeat purchases.

3) Pay attention to needs.

For private domain users, joining a group is not the end.

If they are in a group, their opinions can be heard and their feedback can be discovered. Because of the sense of participation, they will increase their loyalty to the brand and may even become “class representatives” who bring new members to play.

For example, if a group is full of beauty lovers, then there will be a lot of discussions about beauty in this group, such as which products are good and which are not, etc.

These are very real voices and demands of users, so a large amount of real content will be accumulated in the community every day, and these contents can be used as references for content development and product optimization.

Fine-tune the operation of private domain users, hear the users' true voices, and then translate these true voices into the language of the supply chain.

This is the value of private domain.

Final Words

We say that the traffic ecosystem has been opened up twice.

The first connection is the connection between online and offline.

The second connection is the connection between the public domain and the private domain.

Private domain refers to those users that you own, can reach repeatedly and for free.

There are three elements in this sentence.

The first element is: what you own. This is the well. It's yours. You don't have to pay for using this well. You can also charge money for other people's use.

The second element is: repeatability. What does repeatable mean? As long as you want to reach someone, you can reach them for free.

The third element is: low cost or even free . Digging wells only makes sense if water is free. The lower the cost per reach, the better.

The purpose of privatization is to use repurchase rate to dilute the increasingly expensive initial customer acquisition costs.

MINISO connects users through interests and privatizes public domain traffic.

Listening to the users' most authentic voices and then translating these authentic voices into the language of the supply chain further taps into the value of the private domain.