Bliss Cake announced that it will open 1,000 physical stores and 5% of these stores will be baking-experience stores. The bold act of opening offline market somehow is too cautious.
Bliss Cake is a leading O2O (online-to-online) bakery retailer in China, who is based in Shenzhen and has penetrated over 241 cities nationwide by far. As Introduced earlier on EqualOcean.com, Bliss Cake made its name for its C2M (customer to manufacture) business model, which is customer’s need-triggered production. The business model is different from traditional bakery sales – the traditional bakeries only have a rough estimate of pastries and cakes for the day, which leads to either surplus or short, and they have weak connections inside the bakery network and customers.
Along with general consumption upgrading when China’s capita GDP is close to USD 10,000, discretionary consumption’s ratio rises in citizens’ budget and hence gives an opportunity for the retail industry. Bakery, as a non-traditional diet in Chinese menu, is considered a branch under discretionary consumption. Hence, the rapid growth of Bliss Cake is partially credit to the economics growth and citizens’ elevated consumption level. Beyond, in the past decade, consumer behavior has embraced a giant shift from cash to e-pay and from physical to virtual. Bliss Cake was originally a physical bakery chain based in Shenzhen in 2008, but it shut all physical bakeries and transformed completely to O2O in 2014. At the end of last year, Bliss Cake restarted its physical retail chain in Shenzhen, which seems to go back to the origin – it was a physical bakery chain at the beginning. The backward transition is outside of everyone’s expectation after seeing how quick and how successful Bliss Cake is as being an O2O bakery giant.
After Luckin Coffee opening 2,073 stores in 2018 and Nayuki operating 150 experience-featured tea rooms with an average area of 2,150 sq ft, Bliss Cake announced in December 2018 that it would open 1,000+ physical retail bakeries with highlighting pastries and drinks. These physical bakeries will radiate their neighborhoods within a radius of 1-2 miles. Based on its original O2O business facilities like the satellite factories and cold-chain logistics, the radiation ability of these 1,000 physical bakeries should be a piece a cake for Bliss Cake. However, as China’s takeout business matured as it is now, the logistics’ completeness cannot differentiate Bliss Cake from other already-in physical bakeries in the market.
In last week, when Bliss Cake unveiling its new seasonal product in Shenzhen, a manager of Bliss Cakes’s new retail department stated that among 1,000 new physical bakeries, 5% would be presented as baking libraries to exhibit bakery culture and allow customers to participate in baking process at the bakery workshop. Selling from pastries to baking experience is an eye-catching shift for Bliss Cake. Though being bold, Bliss Cake is not bold enough at the meantime – only 5% of 1,000 stores will be rebranded as baking libraries, which means the rest 95% will be as common as other already-existed bakeries like Nayuki, who also sells pastries and tea drinks.
The café retail is an emerging industry while Luckin Coffee claiming it would surpass Starbucks in store numbers in 2019 and Nayuki and Heytea continuously releasing new drinks and pastries. Bliss Cake, a heavy internet-based O2O bakery company, has begun to land on the real ground from the virtual world.