Summary of Key Points
Recently, Xue Zhiqian’s “Shangshangqian” hot pot restaurant closed down completely. This, along with the previous closures of celebrity-owned businesses such as Chen He’s “Xianhezhuang” and Zhao Lusi’s “RosyWylie” dessert shop, has exposed a common issue in the celebrity IP-derived economy: these ventures rely on viral popularity to gain momentum quickly but ultimately fail due to neglect of core product value, quality control, supply chain management, and aggressive franchise expansion. The article urges celebrities entering the IP business to abandon a short-sighted approach and adopt a more long-term strategy, focusing on product quality and professional operations.
Why Do Celebrity-Related Restaurants Succeed Initially?
Celebrity-owned restaurants benefit from their inherent fan base, which can drive traffic. For example, Xue Zhiqian’s fans would specifically visit “Shangshangqian” to support their idol and even repeat purchases. Passersby are also drawn in by the novelty of a “celebrity-owned” establishment. This rapid spread of word-of-mouth, combined with media coverage, can boost business in a short period. The success of “Xianhezhuang,” which opened over 800 stores at its peak, was largely due to Chen He’s influence in attracting franchisees and customers. However, this success was more superficial, relying on the celebrity’s fame rather than the quality of the products.
The Crux of Restaurant Closures: IP Cannot Sustain Quality and Management
Celebrities often do not manage their restaurants personally; Xue Zhiqian withdrew from “Shangshangqian,” and Chen He left the shareholders’ list of “Xianhezhuang.” They entrusted management to third-party teams, but many of these teams were more interested in profiting quickly from the celebrity brand:
- Poor Product Development: Basic aspects like taste and pricing are often neglected, let alone innovation.
- Lax Quality Control: Issues such as food safety at “Shangshangqian” stemmed from a lack of attention to ingredient freshness and hygiene standards.
- Lack of Industry Knowledge: Chinese cuisine cannot be standardized as precisely as Western food; the quality of dishes can vary across different locations, and this is particularly challenging for chain restaurants. Many teams lack the expertise to handle these challenges.
The Traps of the Franchise Model
Many celebrity-owned restaurants use the franchise model to generate immediate revenue. For instance, “Xianhezhuang” had numerous franchises during its peak, but most of them faced difficulties:
- Inadequate Supply Chain: Franchisees struggled to obtain affordable and high-quality ingredients, leading to higher costs.
- Lack of Training: New stores lacked operational guidance, resulting in declining food quality and service.
- Focus on Expansion Over Profitability: Brand owners continue to expand without considering the financial health of their franchisees, often leaving them in debt and forcing collective legal action.
The Right Approach to Managing Celebrity IP Businesses
The article suggests learning from companies like Disney and Universal Studios. While celebrity IP can be a valuable asset, the key to success lies in product quality and effective management:
- Focus on Product Excellence: Invest in developing delicious dishes and using high-quality ingredients.
- Hire Professional Teams: Choose experienced teams that understand the industry and are committed to managing the business.
- Gradual Expansion: Avoid rushing to open hundreds of stores; start with a few direct-operated locations to test the model’s viability before expanding.
- Build Long-Term Customer Relationships: Treat fans as loyal customers, not just temporary targets. Providing quality products is essential for sustainable growth.
Lessons for Consumers and Franchisees
For consumers, celebrity-owned restaurants are not always reliable; consider the taste and value of the food before making a purchase. For those considering franchising, carefully evaluate the brand’s supply chain and support systems to avoid being misled by the celebrity’s reputation.
In summary, while celebrity IP can attract attention, successful businesses require solid product development and professional management. Those seeking quick profits may end up damaging their brand’s reputation.