Author | Liu Baodan

Editor | Zhou Zhiyu

For a young man who wants to start a nail business, in addition to professional ability and a store, the most important thing is to purchase raw materials. Today, Meituan is eyeing this business opportunity.

On August 1, Meituan Beauty held an upstream brand alliance conference in Shanghai and officially launched the “Brand Mall” collection platform. This is a major move on the supply side of Meituan Services. The main service targets are cooperative merchants, upstream brands, and service providers in the beauty and medical industries.

The “Brand Mall” represents a new delivery model. Compared with the previous “brand-dealer-business-user” model, Meituan provides a “brand-user-merchant” path. The advantage is that it can achieve lower purchase prices and solve merchant inventory problems.

Behind this move, Meituan smelled the business opportunities behind the beauty industry.

The beauty industry generally refers to services related to personal image and beauty care, such as beauty, hairdressing, nail art, makeup, SPA, medical beauty, etc. According to the “2023 Beauty and Body Industry Development Report” issued by Meituan Research Institute, the scale of lifestyle and beauty transactions on the Meituan platform increased by 104% year-on-year from January to August 2023. The number of active merchants increased by 133% compared to the same period in 2022.

However, at present, China's beauty market has problems of low concentration and a high proportion of scattered and small stores. Small store owners mainly stock up goods all at once through offline exhibitions such as the Beauty Expo. However, this method is no longer able to meet refined business needs. Meituan has seen this pain point.

Through the procurement platform, Meituan can help physical beauty stores directly connect to upstream manufacturers, purchase cost-effective consumables at lower prices, and help small stores solve problems such as low bargaining power, inventory pressure, and supply quality.

Take Huaxi Biotech as an example. The company's skincare brand Quadi entered Meituan's “Brand Mall” in mid-late May. According to Wang Yahui, the offline head of the brand, the price of cinema products promoted by Quadi in the “Brand Mall” is a 3-5 percent discount on the merchant's own price, which is an extremely low “discount” price.

According to reports, the project has piloted cooperation with well-known upstream brands such as Swarovski, Filing, Huaxi Bio-Quadi, Songfeng, and Boca to provide offline merchants with products such as hairdressing, beauty, nail art, lashes, glasses, traditional Chinese medicine, and dentistry.

As the “Brand Mall” gets on the right track, Meituan will promote the further development of the beauty industry, particularly improving the trading ecosystem for upstream brands.

On the one hand, upstream brands have changed the traditional distribution model, directly connected users and physical merchants through the Meituan platform, and upgraded the entire link from new product launches to terminal sales.

On the other hand, by capturing popular consumer trends in the industry and combining them with new products from upstream manufacturers, Meituan innovates a supply combination model that is more in line with consumer needs, and refreshes store operations with new supply.

Meituan's ambitions don't stop there. The company has also upgraded “super group buying” products. Through the “super group buying” model, physical merchants can use supply chain brands and platform traffic to enhance store influence and transaction conversion efficiency.

At the same time, physical merchants can directly purchase consumables and products required for the “Super Group Purchase” service in the “Brand Mall”, opening up the whole process of group purchase, procurement and purchase, group order online, and contract fulfillment services, making store operations easier.

Thus, through innovative supply chain methods, Meituan finally realized efficient linkage and full-link digital operation between the platform, upstream brands, and merchants on the supply side.

Regarding the next development, the person in charge of the Meituan Beauty New Supply Project said that Meituan will introduce more upstream brands in the industry, expand the “Brand Mall” cooperative friend circle, and build a collection site without intermediaries. At the same time, it will use the platform's ability to link supply and demand to create a new supply of popular products with all parties in the ecosystem, and create a new growth curve.

Over the past few years, competition in the local lifestyle market has become more and more intense. In particular, Douyin successfully entered the local lifestyle market, making Meituan feel threatened. How to find promising vertical tracks in the local lifestyle market is particularly critical, and the beauty industry is clearly one of them.

The years of stability are over, and Meituan must also operate in a refined manner.