Core Viewpoint - The acquisition of the functional skincare brand Baizhicui by Juyigroup marks a significant shift in the Chinese beauty industry from a focus on traffic-driven sales to a deeper emphasis on technology and efficacy, reflecting changing consumer preferences among Gen Z towards ingredient-driven purchases [1][2]. Group 1: Company Strategy - Juyigroup's acquisition of Baizhicui fills a gap in its professional skincare offerings and represents a strategic move to enhance its competitive edge in the beauty market [1][2]. - The acquisition is seen as a "technical blood transfusion," leveraging Baizhicui's 13 years of medical research background and partnerships with 28 dermatology experts and 12 top-tier hospitals to create a competitive moat [2][3]. - Baizhicui's main product, priced at 380 yuan, is expected to triple Juyigroup's customer lifetime value and attract high-net-worth women in first-tier cities who prioritize clinical evidence [2]. Group 2: Market Dynamics - The anxiety within Juyigroup reflects broader trends in the Chinese makeup market, where brands like Judo and Yeoshu are facing declining repurchase rates and a lack of R&D investment, with less than 2% allocated to research [2]. - The loss of consumers aged 30 and above, who are migrating towards anti-aging products, poses a significant challenge for the beauty market, as this demographic represents the highest value segment [2]. - The acquisition is not merely an expansion of product lines but a reconstruction of R&D logic, allowing Juyigroup to engage with major tech players in the industry [3]. Group 3: Operational Synergies - The collaboration between Juyigroup's 6,000 offline outlets and Baizhicui's 5,000 medical beauty institutions creates a closed-loop ecosystem for consumers, enhancing the customer experience by integrating skincare and makeup [3]. - The challenge lies in convincing younger consumers accustomed to low-priced makeup to accept higher-priced skincare products, as well as balancing the fast-fashion nature of makeup with the longer R&D cycles of skincare [3]. - Baizhicui's medical assets have reportedly increased its valuation coefficient by nearly 100%, indicating that the acquisition is not just about product line extension but also about enhancing the company's capital story [3].