Despite a weak economy, Mc Jeans chief believes data analytics and e-commerce will help the company amid tight competition.
Data analytics to drive turnaround, writes Pitsinee Jitpleecheep
Myriad negative factors, including toxic smog, the latest Covid-19 outbreak and the country’s economic slowdown have stressed some business operators, but not Chananyarak Phetcharat, chief executive of SET-listed Mc Group Plc, the maker and marketer of Mc Jeans, as she remains bullish about the business.
“Despite the country’s economic slowdown, we still see good prospects for jeans sales,” said Mrs Chananyarak, who was appointed chief executive of Mc Group in October last year. She has more than 30 years experience with international companies in logistics, telecommunications and IT.
Mrs Chananyarak set a three-year turnaround plan that includes overseas expansion to revive sales of Mc back to its record of over 4 billion baht in recent years.
“There is opportunity in crisis. We are confident Mc has huge room to grow if we approach consumers with good products, acquire a new customer base and explore new sales from new channels,” she said.
Established in 1975, Mc Group manages the retail business of apparel and lifestyle under brands owned by the group of companies and other companies.
Mc is a well-known jeans brand in terms of quality and innovation, said Mrs Chananyarak, with over 600 points of sales across the country. It also has a complete supply chain.
Denim items represent 60% of Mc’s products, with non-denim items making up the remaining 40%. Some 70% of sales come from upcountry and the remainder is from Bangkok.
“We are focusing more on customers aged 20-39,” said Mrs Chananyarak. “We’re applying a 4C strategy — a customer-centric and data-driven approach, customer base expansion, a connected supply chain and a captivated brand experience — this year to drive business growth.”
With a data-driven approach, the company hopes to become much more efficient in product allocation to each shop, she said. The number of products available at each store has been decreased to 450 items from 1,500 in the past. In doing so, operations costs have declined substantially, with sales improving as well.
Apart from more efficient product allocation, the company has also revamped Mc Shop with a new chic image. The first branch was opened at Robinson Lat Krabang in November last year. New products by younger designers will be launched to new customer groups, said Mrs Chananyarak.
“We’ve earned a relatively positive response. Our sales surpassed those of international jeans brands at the shop nearby. More than 10 lifestyle Mc Shops will be opened in Bangkok to tap into urbanisation,” she said.
Mrs Chananyarak said Mc will not only grow its sales from existing core products but also from new hero products, which will be promoted through viral effects and influencers.
Moreover, Mc allows staff to sell products via e-commerce.
Through e-commerce, sales staff earn more income because they can sell the products online both at home and during work hours. With this scheme, the turnover of sales staff declined from 50% to 25% at present, with the rate hopefully expected to stand at 10% in the future.
She said people outside the company will be allowed to sell Mc products via its e-commerce channel in the future. Online sales of Mc tally about 300 million baht, with the figure expected to reach 500 million in the medium term, said Mrs Chananyarak.
She believes despite disruptive technology, the denim market is still growing. With a data analytics strategy, sales of Mc across all channels — freestanding shops, department stores and e-commerce — from October to December 2019 grew by 12% to 1.13 billion baht, a three-year high. The country’s jeans market grew 5-10% during the same period.
Thailand’s jeans market was estimated to be worth over 20 billion baht in 2019. Thais own an average of 8-10 jeans per person. Market competition is quite stiff because fast fashion brands such as Zara, H&M and Uniqlo also provide denim products apart from jeans brands like Mc, Levi’s, Lee and Wrangler.
The company expects the turnaround plans will drive sales growth by 8-10% per year.
Mrs Chananyarak said after building a strong foundation, the company looks set to resume investment over the next few years.
“We are interested in acquiring both local and international companies, especially in skincare and accessories that can help augment the current Mc business,” she said.