A $300M beauty chain built for photos discovered photos don't repurchase

THE COLORIST (调色师) was a beauty collection store launched by KK Group, a Chinese new-retail company. Its shops were visually striking — walls of lipstick, neon signage, Instagram-ready displays — and they spread rapidly on the strength of Xiaohongshu check-in posts. In July 2021, KK Group completed a $300 million Series F round, the largest beauty-industry financing of that year, at a post-money valuation of RMB 20 billion. Expansion targets of 'one city, one store' or 'one city, two stores' followed.

The sector attracted at least ten funded competitors in 2021, including WOW COLOUR and B+ Oil Tank. All used the same formula: visually homogeneous stores, social-media-driven foot traffic, and multi-brand product walls. By 2022, the check-in novelty had worn off. Consumers who came for the photo did not return to buy. THE COLORIST closed many franchise stores; in Beijing, reports indicated only one location was still operating normally. The closure wave hit the entire beauty-collection-store sector simultaneously.

KK Group restructured THE COLORIST around direct-operated stores with tighter product curation — a buyer-plus-sales-data 'four-level funnel' selection system. By Q1 2023, revenue recovered to RMB 236 million, up 36 percent year-on-year. The brand survived, but the 2021-vintage store network — built on the assumption that a photo opportunity was a business model — was largely gone.

Rebuilt around direct-operated stores and a buyer-plus-sales-data selection funnel; by Q1 2023 revenue recovered to RMB 236 million, up 36 percent year-on-year.

The store was designed to be photographed, not shopped — check-in traffic is a one-time event, not a repeat-purchase funnel

Ten funded competitors copied the same format in the same year, so the 'novelty' that drove foot traffic was commoditised before any brand could build loyalty

Capital-fuelled expansion targets (one city, two stores) created pressure to open before unit economics were proven in existing locations

Franchise stores bore the brunt: the parent collected fees while franchisees absorbed the rent on traffic that did not convert

A queue of people taking photographs outside your store is a marketing metric, not a revenue forecast — the question is how many of them come back on a Tuesday to buy something at full price.