Solution:
Put y=1. Then f(f(x))=x2f(x).
Put y=f(z), then f(f(z)f(x))=x2f(xf(z))=x2z2f(xz)=f(f(xz)).
But f is (1,1) so f(xz)=f(x)f(z).
Now suppose f(m)>m2 for some m. Then by (1), f(f(m))>f(m2)=f(m⋅m)=f(m)2.
But f(f(m))=m2f(m), so m2>f(m). Contradiction.
Similarly, suppose f(m)<m2. Then m2f(m)=f(f(m))<f(m2)=f(m)2, so m2<f(m).
Contradiction. So we must have f(m)=m2.