The closure of Zhang Dayi's store seems to many like the end of an era.
On September 19th, Zhang Dayi posted a lengthy article on her Weibo account, announcing an indefinite delay in new product releases for "My Favorite Wardrobe," "Skirt Gentleman," and "Jupevendue," which is tantamount to closing the store.
"My Favorite Wardrobe" is the store that Zhang Dayi built her career on and is a vital pillar of her business system. The store currently has 12.41 million followers and sells over 90,000 items per month, making it a leading brand in women's fashion on Taobao.
As the "first person to drive sales on Taobao" and an "original internet celebrity," Zhang Dayi is a quintessential representative of Taobao's internet celebrity e-commerce system. Over the past decade, she has evolved from a store model to an online shop owner, and then to a company listing and privatization, witnessing the ups and downs of internet celebrity e-commerce and growing alongside Taobao's women's fashion.
Therefore, Zhang Dayi's store closure feels to many like the end of an era. After the news of the store closure spread, many media outlets reported that she "once claimed to earn 300 million in a year." Zhang Dayi quickly responded on Weibo and Douyin live streams, stating that she never said she earned 300 million in a year. "If someone earns that much money, they won't stop."
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In her lengthy post, Zhang Dayi attributed the store closure to factors such as platform traffic competition and the drawbacks of growing internet celebrity e-commerce, and also expressed her intention to adapt to the market and continue to seek the next goal.
In the current climate where e-commerce women's fashion is becoming increasingly difficult, Zhang Dayi's store closure has caused quite a stir in the industry. From 2014 to the present, over the course of ten years, Zhang Dayi has experienced the journey of e-commerce entrepreneurship from scratch to success, reaching the industry's peak and being caught up in public opinion controversies. Now, she has chosen to end the first half of her career with the closure of her store. We inquired about the details of Zhang Dayi's store closure with Ru Han Company, and as of press time, Ru Han has not responded.
Store Closure and TransformationZhang Dayi mentioned three names in her lengthy post: "My Favorite Wardrobe," "Skirt Lord," and "Jupevendue." Among them, "My Favorite Wardrobe" is well-known for being a top-tier Taobao store with tens of millions of followers, a scale that signifies a top-tier store on Taobao.
The other two names are not as well-known as "My Favorite." Through multi-platform searches, we found that "Skirt Lord" is not an independent online store but a nickname for the "My Favorite Wardrobe" store. Additionally, the "Jupevendue" Taobao store was pointed out to have closed in February 2023. Currently, one can still find "jupevendue Apparel Flagship Store" on the Douyin platform, with 70,000 followers and 36,000 sales, but only 8 items are available for sale.
The customer service of "My Favorite Wardrobe" informed us that there will be a final round of new product releases on September 24th, after which new product releases will be indefinitely postponed.
As of now, when searching for "Zhang Dayi" on the Taobao platform, the associated stores include "BIG EVE BEAUTY Zhang Dayi Flagship Store," "My Favorite Wardrobe," "Skirt Sold OUTLETS Store," and "the vever." Among them, "BIG EVE BEAUTY Zhang Dayi Flagship Store" is a beauty store with 1.07 million followers.
After the store closure news attracted widespread attention, Zhang Dayi responded later by stating that she is "only closing the Taobao store, not quitting the apparel business." Zhang Dayi claims to have shifted more focus to her black-label store "the vever." "the vever" is also a women's clothing store, but the overall price range is higher than the old store "My Favorite Wardrobe," with basic T-shirts priced around 150-160 yuan. The store currently has only 43,000 followers but ranks sixth on the "Emerging Influencer Women's Clothing Store List - Repeat Customer List" with a repeat purchase rate of 32%.
The "black label" is a premium certification mark provided by the Taobao platform for high-quality merchants, aiming to provide higher credibility endorsement for those who perform excellently in product quality, service attitude, and delivery speed. Judging from the store style, product design, and pricing of "the vever," the quality and positioning of the store are higher than "My Favorite Wardrobe." Zhang Dayi is attempting a transformation, no longer blindly pursuing low prices and a people-friendly approach.
From Internet Celebrity to Businesswoman
In her autobiography, Zhang Dayi claims that she used to be a casual and unstructured person, finding it difficult to make long-term plans and arrangements. It was in 2014, when she started in women's fashion, that changed all her personality traits, from being laid-back to later entrepreneurship and listing, which sparked her fighting personality and active ambition.
Zhang Dayi initially was a model for magazines and online stores, often sharing her outfits on her social accounts and gaining the favor of many fans. In 2014, the model transformed into an online store owner. Zhang Dayi, along with Feng Min, the founder of Ru Han E-commerce, launched the Taobao store "My Favorite Wardrobe," which made it onto the "Top Taobao Women's Clothing Merchants" list with sales exceeding 100 million yuan in its first year. Ru Han also obtained Series A financing from SAIF Asia.
Zhang Dayi is both a partner of Ru Han and the leading internet celebrity. Most fans shop at the online store because of Zhang Dayi, and her personal IP has a significant impact on the store's turnover.In 2015, the store became the only women's clothing online shop to make it onto Taobao's popular store sales list. That year, Ru Han E-commerce was renamed Ru Han Holdings and received tens of millions of yuan in Series B financing from Legend Capital and others. In 2016, "My Favorite Wardrobe" became the first women's clothing store on Taobao to break 100 million yuan in sales during the "Double 11" shopping festival, setting a new record for women's clothing stores on the platform, and Zhang Dayi earned the title of "Taobao's Number One Influencer." That year, Ru Han Holdings' total sales exceeded 1 billion yuan, with a valuation of about 450 million US dollars, and received 300 million yuan in Series C financing from Alibaba Group, going public on the New Third Board.
In the documentary "Internet Celebrity" produced by Taobao about Zhang Dayi, she said with a smile, "2016 is definitely the era of Zhang Dayi!"
From 2016 to 2018, both the online store and the company took off simultaneously, with one setting new sales records on e-commerce platforms and the other thriving in the capital market. Zhang Dayi reached the peak of her career. In 2018, Ru Han Holdings delisted from the New Third Board and "transferred" to the US Nasdaq. In April 2019, Ru Han Holdings went public in the US stock market, and as the second-largest shareholder with a 15% stake, Zhang Dayi became the first internet celebrity to ring the bell at Nasdaq.
The excitement came to an abrupt halt after the stock broke issue. Ru Han Holdings' business model, which relies too much on top internet celebrities, was questioned by the market. A one-hour live broadcast by Zhang Dayi can bring nearly 20 million yuan in transaction volume to her Taobao store. From the fiscal year of 2017 to the first nine months of the fiscal year of 2019, Zhang Dayi's contribution rate to Ru Han's revenue was 50.8%, 52.4%, and 53%, respectively, occupying half of the market share. Ru Han has always been unable to cultivate another "Zhang Dayi."
From the fiscal year of 2019 to the fiscal year of 2020, Ru Han Holdings' revenue was 1.093 billion yuan and 1.296 billion yuan, respectively, but the net profit has always been in a loss state. On April 22, 2021, Ru Han Holdings announced that it had completed the privatization transaction and delisted from Nasdaq. After only two years of listing, Ru Han ended its presence in the capital market with a valuation shrinkage of 70%. At that time, it was considered by many as "success also Zhang Dayi, failure also Zhang Dayi."
In 2023, Hangzhou Ru Han Holdings Co., Ltd. changed its business status from existence to cancellation, and now the entity of Ru Han is "Hangzhou Ru Han Digital Technology Co., Ltd." According to the company's information, Feng Min holds 24.57% of the shares and is the actual controller of the company, Zhang Yi (Zhang Dayi's original name) holds 12.4% of the shares and is the second-largest shareholder of the company. Alibaba holds 6.37% of the shares and contributed capital on July 23, 2021.
It is difficult for internet celebrity e-commerce to regain its glory.
From the long article, it can be seen that a major reason why Zhang Dayi plans to close the store is that there are problems in the store's operation.
Internet celebrity e-commerce is an e-commerce model that relies on social media platforms, especially individuals with high attention and influence (i.e., "internet celebrities" or "internet celebrities") to promote and sell products. The core of this model is to use the personal charm, professional ability of internet celebrities, and the trust relationship with fans to convert traffic into purchasing power and realize commercial value.As a pioneer of the Taobao-based internet celebrity e-commerce, Zhang Dayi has always focused her main efforts on Taobao. She wants to switch platforms but finds herself unable and unwilling to do so. "So far, I haven't seen a single successful transition to another platform within the Taobao ecosystem," Zhang Dayi stated. She mentioned that the core value of internet celebrity e-commerce lies in being small yet beautiful, requiring the celebrity to manage the front line with a flat structure, which is the only way to achieve healthy profits while also meeting the needs of their fans.
However, in their subsequent operations, they have deviated from this core principle. The text mentions that the gross margin for apparel categories is slim, unable to support various operational costs. But as their stores and companies grew larger, they had to expand their teams, thus facing higher hidden costs. In this process, their products also gradually became more assembly-line, criticized by an increasing number of fans and consumers.
Internet celebrity stores like "My Favorite Wardrobe" have influenced the fashion and apparel consumption mindset of many consumers. Over the years, they have gradually expanded and moved towards a more corporate direction, establishing their own supply systems. As Zhang Dayi said, content (video, print, text), live streaming on various platforms, hosts, models, backend, design, warehousing, are all moving towards a more formal and physical presence. In addition to Zhang Dayi, similar internet celebrities include Xuan Li, Teng Yujia, Xia Xia, Lin Shanshan, Zhang Linchao, and others. However, with the rise of other e-commerce platforms in recent years and changes in the consumer environment, the fate of Taobao internet celebrity stores has become more uncertain.
Compared to other commercial brand stores, internet celebrity stores are highly linked to the celebrity themselves, with every word and action affecting the value and reputation of their personal brand. At the end of 2021, internet celebrities Xuan Li and Lin Shanshan were involved in tax evasion, leading to the closure of their long-operated women's clothing stores.
Zhang Dayi also fell into a long-term controversy in April 2020 due to personal life issues, with her elegant appearance in white at the NASDAQ bell-ringing ceremony becoming the last highlight of her career to date.
After the public opinion storm, Zhang Dayi's online store was also affected. Consumers even "tacitly" placed orders in Zhang Dayi's store when they needed to make up for discounts, and then refunded them. Such behavior was once denounced by Zhang Dayi.
The founder of a women's clothing online store told us that in the past, Weibo internet celebrities would open stores on Taobao, but now it is basically internet celebrities from platforms like Xiaohongshu and Douyin. They would choose to live stream and sell goods or open stores on Xiaohongshu, but they no longer have the momentum of the early wave of Weibo internet celebrities. In her view, "the threshold has been lowered, there are more choices, and the internet celebrity effect has weakened."
Now, consumers have a wider variety of women's clothing options. In addition to traditional offline channels, internet celebrity stores, and brand stores, in recent years, white-label factories' alternatives have attracted more attention. The non-stop product display in live broadcast rooms constantly stimulates consumers' desire to buy, and celebrity live streaming has gradually become a trend. Internet celebrity stores like Zhang Dayi's can no longer monopolize girls' wardrobes.
At the same time, the entire e-commerce women's clothing industry is also going through a difficult period. In the past two years, with e-commerce platforms like Taobao, Douyin, and Pinduoduo engaging in fierce low-price competition, many merchants have said that business is getting harder and harder, and profit margins are being further compressed. At the same time, due to industry malpractices such as plagiarism and poor quality in clothing e-commerce, return rates continue to rise, causing many merchants to complain. This year's 618 saw topics like "e-commerce women's clothing return rate as high as 80%" trending on hot search lists, with long-standing issues such as incorrect products, long pre-sale periods, and low quality on various platforms.
The aforementioned online store founder mentioned that this year, the Taobao platform has successively introduced compulsory additional costs such as freight insurance and service fees, and there are more discount activities, leading to increased sales volume but lower profit margins and higher return rates. "Indeed, there is a feeling that it's not as good as it used to be year by year."In fact, Taobao also supports internet celebrity stores and increases its investment in live-commerce. For instance, in August of this year, when the Hanfu internet celebrity store "Hua Shang Ge" was live streaming, Taobao invited a top-tier team in the industry to create a live streaming room for it. Currently, there is no clear data to prove its effectiveness.
According to reports from Lian Shang Wang, since 2024, at least 40 women's clothing online stores have announced their closure or cessation of new product launches. These closed stores include well-known large stores with millions of fans as well as small stores with thousands of fans. They are concentrated on Taobao and also on Douyin. However, considering the relatively short development time of Douyin's e-commerce, the wave of closures among internet celebrity stores on Taobao is also significant due to its large base.
In June, the top women's clothing brand on Douyin, Lola Password, announced its withdrawal. Its personal account has 5.01 million fans and has set a record of selling billions in a year. Additionally, in May, the Taobao women's clothing store "Shou Nv Kai La" was exposed for running away with the money, which has 5.53 million store fans and sells over 900,000 items per month.
Some stores have expressed the reasons for closing, which can be summarized into three major factors: First, the market environment is challenging, leading to operational losses; second, the cost of returns is too high, and the platform's handling is unfair; third, personal reasons of the store owner, lacking the energy to continue managing the store. These are the common pressures faced by women's clothing online stores at present.