Rebirth of England.

Chapter 781 The Potential of E-commerce

“With the acquisition of Feelunique, we have expanded our e-commerce business in the cosmetics sector and are preparing to continue expanding this business to other European countries…”

Nathan Ellington, CEO of Argos Retail Group, tells Barron's.

Currently in the European e-commerce market, Argos.com is firmly in the leading position according to the market share ranking. According to the latest survey, its market share exceeds one-third of Amazon, which ranks second. eBay ranks third. In addition, there are some emerging e-commerce companies in various countries.

As for Feelunique mentioned by Nathan Ellington, it is currently the largest cosmetics e-commerce website in the UK. It was founded in the UK in 2005 and is one of the first pure e-commerce beauty retailers in Europe. It currently has more than 500 products from about 2.5 brands, including beauty, makeup, skin care, hair care, perfume, equipment and health products.

Earlier this year, Argos Retail Group completed its acquisition of the company from London private equity firm Palamon, making it a wholly owned subsidiary of Argos Retail Group.

“We have just completed the acquisition of the French high-end perfume retail chain Parfumeries Rive Droite as a platform to develop the business in France and continental Europe…”

At present, Feelunique's main model is to set up multiple offline flagship stores in major cities. In these offline flagship stores, customers can log in to its website to complete orders directly with the help of store staff, and they can also serve as experience stores for the products sold by Feelunique.

Of course, users can also log in to Feelunique's official website to place an order directly at home - after all, for many women, the brands and types of cosmetics they use are often fixed, and they don't need to try them on every time they shop like they do when buying clothes and shoes.

Feelunique has just acquired Parfumeries Rive Droite, which has four boutiques across France, with its flagship store located on Marceau Street in Paris. By using these four stores as Feelunique's flagship stores in France, Argos Retail Group's cosmetics business will be able to enter the French market, and then gradually cover the entire country.

Just like Argos Retail Group's expansion into continental Europe, Feelunique will first enter the French and German markets, and after gaining a foothold in Western Europe, it will gradually expand to other parts of Europe.

It can be said that the e-commerce business of cosmetics is a very growth-oriented industry. Although Argos Retail Group has been involved in some cosmetic products before, compared with websites in niche vertical fields such as Feelunique, there is always a big gap in professionalism, and it can only be said that it is better than nothing.

However, judging from the revenue performance after the acquisition of Feelunique, the combination of Feelunique and Argos.com still produced considerable synergy effects.

Now, when you enter the beauty and cosmetics category on Argos.com, you will be directly redirected to Feelunique's website. Feelunique can also directly obtain the rich user resources accumulated by the Argos Retail Group. Therefore, in the past three months, the cosmetics business of the Argos Retail Group has shown a trend of month-on-month growth.

In fact, to date, the market value of Argos Retail Group's e-commerce business has slightly exceeded its market value in the physical industry - this is even taking into account the increase in the market value of its physical sales of Costco, which it previously acquired.

For comparison, Amazon's current market value is around 800 billion US dollars and less than 900 billion US dollars, and it has already expanded its business to many countries around the world.

Argos Retail Group's current market value is slightly higher than Amazon's, at around $1000 billion, and its e-commerce business contributes more than $500 billion to the group's market value.

Of course, this also includes Costco's e-commerce business attempts in the United States since last year. Barron naturally understands the future development potential of e-commerce. In terms of market value alone, e-commerce business can easily have an extra layer of Internet support compared to physical retail groups.

For example, in Barron's previous life, Amazon's market value exceeded 2 trillion US dollars, which is more than times its current market value - it is difficult for physical sales to achieve such terrifying growth at this scale.

Of course, now that there is competition from Argos Retail Group in the European market, it is hard to say whether Amazon can still reach this market value at this time and space.

But what is certain is that even if Argos Retail Group can just maintain their leading position in the European e-commerce industry, then in the future, their overall market value, not to mention more, is likely to exceed $5000 billion.

If it can go further and expand into the North American and Asian markets, it is very likely that its market value will exceed 1 trillion US dollars in the future.

However, everything is relative. From now on, we can see that whether it is the growth of Amazon's market value or the fact that Argos Retail Group's shares are beginning to be favored by investors, it is a consensus among many people that e-commerce has become an emerging outlet. Therefore, in the UK alone, or in London's Science City Entrepreneurship Park, there have been many e-commerce startup projects in the past two years...

If we expand to the entire European continent, we will find that almost every country has many entrepreneurial teams joining the e-commerce industry, and the approaches they take can be said to be diverse.

Therefore, the e-commerce industry is also facing increasingly fierce competition. Of course, Barron also knows that many big brands have not yet started to develop their own e-commerce channels. When that time comes, the competition will be fierce.

In addition, speaking of Costco, earlier this year, on October 10, which was China's National Day, Costco's first store in China, the Costco flagship store located in Shanghai, was officially opened.

The grand opening of Costco’s Shanghai store that day was truly impressive.

The location of Costco's Shanghai store is not in the city center of Shanghai, but it is not in the suburbs either, so transportation is very convenient. And most importantly, there are many international schools around this Costco, and many children of foreign nationals in Shanghai go to school nearby.

There are also many students from mainland China. It is conceivable that the parents of these students are also from high-income groups. They are able to send their children here and must be planning to let their children study abroad.

The consumption of these people can be said to be the group that is currently closest to integrating with the global community, and their purchasing power is very strong.

In fact, many people will ask their relatives and friends abroad to buy many products at local Costco stores and bring them back home, including health products, etc.

On the day Costco opened, there was even a traffic jam around the store...

There was a long queue at the entrance of the store, and as for the inside of the store, it was so busy and crowded that it was comparable to the Spring Festival travel rush!
(End of this chapter)