The whole region is gaining momentum and empowering, and innovative retail of home appliances is forging ahead into the era of diversified symbiosis!
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With the evolution of the times and technological leaps, China’s home appliance retail industry has developed from a single business format to a hundred flowers blooming, showing increasingly tenacious innovation and vitality. Currently, the application of global digital technology benefits thousands of industries, further promoting the emergence of new home appliance retail channels. At the same time, the explosive growth of multi-business models has also intensified fragmented development. When the voice of a single channel declines, how can various business formats leverage mutual assistance and develop symbiotically? The home appliance industry’s exploration of innovative retail continues…
On March 13, the “Diversified Symbiosis·Practice – 2024 China Home Appliances Innovation Retail Summit” guided by the China Household Electrical Appliances Association, hosted by China State Grid, and specially co-sponsored by Aowei Cloud Network was successfully held in Shanghai. As an important supporting summit event during AWE, this conference brings together colleagues from all walks of life including home appliance brands, platform e-commerce, social e-commerce, content e-commerce, offline TOP channel providers, e-commerce operation service providers, third-party institutions, industry experts, etc. , the participating representatives sat down to discuss new models, new opportunities and new developments in the home appliance retail industry under the current situation.
Times are improving, and the home appliance retail industry continues to develop
Looking back on 2023, “recovery” is the key word. Cai Ying, a senior industry expert at the China Institute of Macroeconomics, summarized the consumer market in 2023 with “recovery, service, rationality, and integration”; she used “restoration, expansion, optimization and upgrading” to describe consumption in 2024 The market made its judgment. Under the new economic situation, new consumption formats have attracted much attention. “The new consumption in the future will have several major characteristics: deep integration, efficient allocation, sustainable development, and smooth circulation. This is also the main direction and opportunity for future development.” Cai Ying said, from the perspective of sociology and law , the new consumption model may have a huge impact on traditional lifestyles, production methods, social division of labor, employment models, credit systems, legal and regulatory frameworks, etc. “
Against the backdrop of an expanding economic environment, the home appliance industry has also received good news since the beginning of this year. The decision to implement a new round of “old-for-new” home appliance products is of great significance to boosting confidence in the home appliance industry and stimulating market vitality. “The implementation of the old-for-new policy shows that the national and policy levels attach great importance to the home appliance industry as an important driving force of the consumer market. The majority of home appliance companies also hope that with the help of the policy, the home appliance market can return to the growth track.” Vice Chairman of the China Household Electrical Appliances Association Chairman Xu Dongsheng said.
Xu Dongsheng, Vice Chairman of China Household Electrical Appliances Association
In recent years, the field of home appliance retail has been changing rapidly, with emerging channels and models booming, and traditional channels actively adapting to consumer trends and industrial changes to accelerate transformation. At the same time, as the consumer market becomes more rational and objective, consumers have higher requirements for product quality and cost-effectiveness, and industry competition becomes more intense, Xu Dongsheng reminded: “We still need to keep in mind our original intentions and keep our business fundamentals in mind.” He also said: Home appliance manufacturers have put forward three requirements: first, they need to help consumers choose the highest quality and most suitable products; second, they need to strengthen service capabilities to meet consumers’ increasing quality needs; third, manufacturers must work together to create harmony. , a fair competitive environment and achieve healthy development of the industry.
In order to help the industry gain a more systematic and comprehensive understanding of industry development trends, consumer demands and the development status of various channel formats, at the summit, China State Grid and Ovi Cloud jointly released “Digital Breakthrough·Steady Growth in China’s Home Appliance Retail in 2024” and Innovation White Paper” (hereinafter referred to as the “White Paper”). The white paper is supported by the latest data and provides an in-depth analysis of the recovery trend of the home appliance retail market, innovative retail practice, and industry development opportunities. Wen Jianping, chairman of Aowei Cloud Network, further interpreted the white paper at the scene: “Driven by the dual cycle strategy, the home appliance industry’s overall production and sales are booming, and the trend is positive. The domestic home appliance market demand is ushering in a slow recovery, but the potential for growth is significant. Insufficient, it is expected that the full-year growth in 2024 will be 0.6%.” At present, the growth rates of each category are different, and the consumption of home appliances is K-shaped. With the changes in the entire business format, the industry is facing many opportunities and challenges. “Find the correct positioning and seize the real estate market.” The home decoration market, providing offline experience, and focusing on the sinking market are the four major opportunities for the current home appliance retail industry.” Wen Jianping said.
Wen Jianping, Chairman of Aowei Cloud Network
White paper release ceremony
New forces are in the ascendant, and the retail territory is expanding
In the new era, the digital economy is strongly empowered, and emerging formats in home appliance retail channels are booming. Among them, all-area interest e-commerce represented by Douyin e-commerce has shown strong growth momentum in recent years. Judging from the data disclosed by the Douyin E-commerce Ecological Conference, from May 1, 2022 to April 30, 2023, Douyin e-commerce GMV increased by 80% year-on-year in 2023, and the home appliance industry GMV increased by 109% year-on-year. At the same time , the number of mobile sales merchants in the Douyin e-commerce e-commerce industry increased by 84%. Douyin e-commerce has developed from a new channel for brands to a main operating position. It can be said that the all-interest e-commerce model has helped activate the deterministic growth of the online market in the home appliance industry.
Li Wentao, head of Douyin’s e-commerce brand business and home appliance industry, said: “Douyin e-commerce can smoothly connect content and products, allowing content and shelf traffic to interconnect, forming a flywheel. This connectivity mechanism is like a traffic flow an accelerator. At the same time, by doing a good job in user operations and user experience, the growth flywheel model of the overall global operation will be formed. The home appliance industry operates a good shelf store and is well linked with the content field. Douyin e-commerce driven by dual scenarios will Achieve sustained and rapid growth. At the same time, we are also very gratified to see that more and more brands in the home appliance industry are willing to work with us to provide consumers with more intuitive products and scene experiences, such as the ones we will promote to the industry in 2023 4 live broadcast micro-innovations, exhibition live broadcast to expand B-side exhibition, effect and sales integrated scenarios, CEO live broadcast to help the healthy integration of online and offline, factory live broadcast to trace the origin of the brand, and evaluation live broadcast to focus on exploring consumer pain points. , are all effective in giving consumers a more immersive shopping experience.” Lin Xuling, head of 3C electrical appliances industry strategy at Juju Engine, gave insight into the new growth of the Douyin platform: “During festivals such as Valentine’s Day and Women’s Day, The home appliance business has grown by leaps and bounds, and its driving force comes from the emotional value of users. The main scene of Douyin platform is ‘please yourself and please others’, which can amplify and stimulate user needs.”
Li Wentao, head of Douyin’s e-commerce brand business and home appliance industry
As consumer decision-making paths change, traditional marketing paradigms are also changing. In the past, competition between commodities occurred more in terminal channels. In the new paradigm, competition is moved to the grass-planting stage. Users make full comparisons and clarify their needs before making consumption decisions before going to the exchange to purchase. This requires people with the ability to A good product that understands and meets user needs. Patty, head of Xiaohongshu Commercial’s home appliance industry, believes that as an emerging channel, Xiaohongshu is constantly stimulating the potential needs of users, and adapts good products to users in response to these needs to create a beautiful home life.
At the beginning of 2023, the No. 1 Central Document clearly proposed for the first time “vigorously develop new models such as joint distribution and instant retail.” As a successful exploration in the home appliance and consumer electronics industries in recent years, instant retail has been recognized by more and more consumers for its richer, more convenient and faster life experience. In 2023, Meituan flash sales consumer electronics industry orders will see a clear growth trend, and its consumer groups are gradually penetrating from young people and high-tier cities to young and middle-aged people and low-tier cities. In 2024, Meituan Flash Sales will reach strategic cooperation with OPPO, Supor, Pinsheng, etc., leading instant retail to enter the deep water area.
“Meituan has developed comprehensive sales models based on the characteristics of purchasing scenarios for mobile phones, computer digital products, and home appliances, and has built multi-business cooperation models such as brand stores, electrical appliance chains, communication stores, shopping mall counters, and warehouse stores to provide all-round empowerment. The development of just-in-time retail. For home appliances, the transportation capacity and services have also been upgraded, from two-wheel transportation capacity to two-wheel and four-wheel transportation capacity operating simultaneously, so that more medium and large household appliance categories can be fulfilled through more professional distribution and delivery to ensure timely delivery of products to users. “The person in charge of Meituan Flash Sale’s digital home appliances said that according to data from the “Instant Retail Consumer Electronics Industry White Paper (2024.03)” released by Meituan Flash Sale and iResearch Consulting, the penetration rate of mobile phones, computers, and large and small home appliances will continue to grow. The entire instant retail consumer electronics market will exceed 100 billion in 2026. “The instant retail mobile phone, computer digital, and home appliance markets are promising in the future.”
Head of Meituan Flash Sale Digital Home Appliances
After 2023, the home appliance e-commerce industry has entered a new era with both challenges and opportunities. How can platforms and merchants gain insight into market rules and prepare for a breakthrough in the context of intensified industry competition? As an e-commerce service provider born out of traditional dealers of home appliances, Dianjing Network has a unique understanding of home appliance sales channels. “The product domain is homogeneous, the marketing domain is diverse and complex, and the conversion domain is price-ravaged” are common problems encountered in the current home appliance retail industry. The solution provided by Dianjing Network is to adapt to the e-commerce trend and create a “people-based community” “Points” super hot style. Looking back at the development of e-commerce in the home appliance industry, Tan Biao, president of Dianjing Network, divided the development of home appliance e-commerce from 2010 to the present into four categories. They are 2010-2014, the e-commerce 1.0 bicycle-driven era; 2015-2018, the e-commerce 2.0 two-wheel drive era; 2019-2022, the e-commerce 3.0 four-wheel drive era, and after 2023, the e-commerce 4.0 smart-driven era. As time evolves, e-commerce models become more and more complex, and the requirements for corporate marketing planning and global operations capabilities are also getting higher and higher. How can a product penetrate the minds of a group of people, drive the explosive growth of a category, and create incremental brand value? Tan Biao concluded: “The product’s excellent functional points, memory points, and cultural imprints are the three pillars of creating a hit product. “
Tan Biao, President of Dianjing Network
As a financial supply chain service platform under the JD Group, JD Technology interprets how the home appliance industry can quickly find funding sources from the perspective of supply chain finance. After more than ten years of accumulation, JD.com’s supply chain financial technology has built a full industry chain, a full product chain, and a full scenario solution. “For each brand, we will form a structure from the brand itself to its upstream suppliers, multi-level distributors, and even e-commerce platforms, online and offline channels, and finally reach consumers. In this process, it covers many A variety of financial products to serve upstream and downstream enterprises centered on brand owners.” said Wu Fan, deputy general manager of JD.com’s supply chain financial technology business.
At this summit, JD.com Supply Chain Fintech officially launched the “Jiajia Subsidy”, a full-link 100 million yuan subsidy plan for B-end merchants and C-end consumers in the home appliance industry, aiming to comprehensively assist enterprises in the peak season competition and alleviate the difficulties faced by home appliances. Financing problems in the industry have further ignited a consumer boom. “‘Jiajiabu’ provides qualified dealers, distributors, logistics providers and service providers with a minimum purchase financing interest rate of 5.1%, which is 0.4 percentage points lower than before, effectively reducing their financing costs and increasing their funds. Usage efficiency.” Wu Fan introduced.
Wu Fan, deputy general manager of JD.com’s supply chain fintech business
The “way” of innovation lies in leveraging symbiosis
New forces are booming, and home appliance manufacturers and traditional channel dealers are also actively embracing innovation and thinking about changes. At the same time, home appliance manufacturers and traditional channel providers also serve as important supports for new business models such as live streaming e-commerce and instant retail. They work with new forces to seek value symbiosis and jointly promote the digital transformation of traditional businesses. Haier insists on transforming its user model based on digitalization and achieved a 13% retail sales increase in 2023. “With the current favorable national policies, economic recovery, and consumption recovery, the home appliance market capacity still exists, but it will face reallocation.” Xu Zhibo of Haier Smart Home Co., Ltd. said: “In response to changes in the market environment, Haier has proactively seized three types of market opportunities: Government and enterprises jointly promote trade-in, in-depth integration of home appliances and home furnishings, and new tracks of local life to create incremental space. At the same time, Haier is also committed to optimizing user experience and is actively promoting brand, marketing, digitalization, channel model, retail model, trade-in, etc. Lay out innovative practices.”
Haier Smart Home Co., Ltd. Xu Zhibo
In the view of BSH, the key to disrupting the new home appliance retail format lies in “integration, symbiosis, and diversified innovation.” Wu Cheng, senior vice president of BSH Home Appliances (China) Co., Ltd. and general manager of China e-commerce sales, said that in line with the development of digitalization We have made many attempts, including deepening the diversification of marketing models and opening up emerging channels such as social e-commerce; combining the competitive and cooperative development trends of major platforms to create more conversion opportunities; strengthening the coverage advantage of regional brand store network and integrating marketing resources to win the market; Optimize the sales model of home appliances and layout the integration of home appliances and homes. “Whether it is interest e-commerce, content e-commerce, live streaming e-commerce, or traditional shelf e-commerce, all e-commerce platforms must ultimately focus on conversion rates. In the current market environment, a full set of online platforms must be built to grow grass. Links, preheating, planting, and transformation need to achieve a closed loop.”
Wu Cheng, Senior Vice President of BSH Home Appliances (China) Co., Ltd. and General Manager of China E-commerce Sales
Aowei Cloud data shows that from 2015 to 2023, the retail sales of offline channels in China’s home appliance market dropped from 82.7% to 46.8%, while online channels increased from 17.3% to 53.2%. Offline channels have been transformed from “manufacturers” The era of dominance” has been transformed into the era of “platform is king”. In this context, TOP channel operators must adapt to the changes of the times and accelerate reform and innovation. At the meeting, as representatives of offline regional retailers, Chongbai Electrical Appliances and Tianshui Yongsheng shared their experience in actively breaking through the constraints of channels, exploring new models, and finding new increases.
Chongbai Electric is committed to strengthening its main track and exploring new tracks. By improving user consumption experience through direct sales channels, we will expand sales touch points, build a light-asset franchise chain operation platform through sinking channels, innovate online and offline integrated development models, promote the integration of home appliances, and the home appliance after-service market will feed back front-end sales, and innovate to create new scenarios. Through innovative transformation and exploration, it outperformed the market and achieved a year-on-year sales growth of 19% in 2023. “Facing the current market difficulties, we have established a ‘six-step’ strategy.” Zeng Qingquan, director of the Product Development Center of the Electrical Appliances Division of Chongqing Department Store Co., Ltd., said that he hopes to receive policy empowerment and product support. “On the one hand, we hope that a new round of subsidy policies for the home appliance industry will be introduced as soon as possible to activate the market and stimulate consumption. On the other hand, the full-channel and full-product transformation of traditional home appliances requires supply chain support to jointly promote market growth.”
Zeng Qingquan, Director of the Product Development Center of the Electrical Appliances Division of Chongqing Department Store Co., Ltd.
“As a physical channel, we have been constantly changing.” Liu Wenjuan, general manager of Tianshui Yongsheng, said, “Now physical commerce has long broken the restrictions of small-scale store business districts. Wherever the users are, our business districts are there, and people and goods are combined. Where. Promoted by diversity and integration, the industry will form a trend and future of mutual tolerance and mutual learning.”
Currently, there are still many uncertainties in the global situation. Under what business model will emerging channels and traditional channels integrate and develop? How can each channel help and coexist? This is a common issue faced by all home appliance people. At the summit, representatives from Xiaohongshu, Juju Engine, Tianshui Yongsheng, Kantar, Whirlpool, Red Star Macalline, Jiumu and many other companies respectively discussed “Opportunities and Challenges of Retail Changes”, “Diversified and Symbiotic Development of Various Channels”, etc. The key players shared their innovative retail experiences.
roundtable forum
Returning to the three elements of retail – people, goods and places to discuss the end point of innovative retailing of home appliances, Lu Shenghua, editor-in-chief of China State Grid, believes that in the past era when demand exceeded supply, goods were the key. Today, after more than 40 years of development, China’s home appliance market has become rich and abundant in goods, and consumer demand is the key. Consumer demand comes from people’s survival and development needs. Brand owners and sales channels must pay attention to and study consumers, provide consumers with emotional value on top of functional value, create new needs, and truly be “people-oriented.”
Lu Shenghua, Editor-in-Chief of China State Grid Corporation of China
around"people, goods, places"Regarding the three elements, many representatives at the summit also expressed their views. Wu Xiaojie, executive deputy general manager of Red Star Macalline Intelligent Appliances, said that as an offline platform, we will focus on every element. Pay attention to the flow of “people” traffic, user experience, and the construction of a good shopping environment, and select brands of “goods”. At the same time, in the high-end online track, the role of the “field” domain is more prominent.
Regarding how the entire home appliance retail market will develop and break through in 2024, Xin Jianing, Vice President of Whirlpool (China) Co., Ltd., said that first, the product side should focus on trends, including intelligence, high-end, packaged, etc.; second, the channel side should seize the opportunity to trade in old products for new ones. Opportunities, online people pay more attention to social interaction, and offline people need to keep an open attitude. As a professional kitchen appliance brand, Fu Ping, founder and chairman of Kantar, believes that the most typical feature of channel changes is the fragmentation of traffic. “Jomoo will abandon the era of Xiaomi and big guns, and will use more tools, follow the trend, and maximize online and offline business based on the platform.” said Lin Yu, director of new media marketing for Jomoo Couture.
This year marks the successful holding of the fifth “China Home Appliances Innovation Retail Summit”. “Diverse symbiosis, following the path”, as stated in the theme of the summit, empowered by technology, all channel dealers, home appliance manufacturers, and service providers are constantly breaking through industry boundaries, committed to improving the operating efficiency of the entire industry chain, exploring innovative retail models, Creative breakthrough marketing, and each channel will eventually move towards diversified symbiosis under the guidance of “people-oriented” consumer demand, jointly promote the upward development of retail channels, and further strengthen, strengthen and improve the home appliance market.
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