Home appliance retail continues to seek new growth. On March 30, Suning announced the business upgrade of “old for new”, which will realize the home appliances recycling on the door, and deliver the old for new goods to the home within one hour. As the price of home appliances becomes more transparent and the scale of home appliance market shrinks, home appliance retailers need to seek increment. In the view of industry experts, the price of home appliances is highly transparent, and enterprises should leave consumers with more favorable prices and convenient services. In addition, the replacement of household appliances is mostly concentrated in the sinking market, which coincides with Suning’s current business focus.
Retail enterprises have expanded their service market to find new traffic. Hou Enlong, President of Suning e-buy retail, said that Suning’s trade in business had been upgraded to “sending the new and delaying the old”. To this end, Beijing Business Daily reporter in Suning e-buy app experience found that after choosing to recycle the old home appliance service valuation and get the shopping voucher, you can directly discount the price to buy new goods.
According to Hou Enlong, there are more than 7000 engineers in Suning who trade in old appliances for new ones and handle about 50000 old appliances in a single day. Up to now, Suning’s capacity of exchanging the old for the new can reach 2942 districts and counties with full coverage. At the same time, Suning also launched 3C Huanxin fund, involving subsidies of 500 million yuan.
It is not difficult to see that Suning regards the sinking market as the main battlefield of exchanging the old for the new. According to the “2021 Research Report on China’s household appliances trade in” (hereinafter referred to as the “report”) released by lookout think tank, at present, China’s electricity ownership has exceeded 2.1 billion units. Among them, there are many families who are using the “trade in” policy from 2009 to 2011. According to the safe service life, this part of household appliances is about to or has entered the replacement period, and is currently in the peak period of household appliances scrapping. A person in the industry pointed out that a large proportion of these appliances exist in the sinking market.
An expert in the home appliance industry said that the home appliance retail industry reached its peak in 2017, after which the market contracted and the overall sales growth declined. Due to the problems of low purchase frequency and fierce homogenization competition, the home appliance retail industry is in a “downturn”.
According to the report, 160 million household appliances in stock have exceeded their service life. Waiting for the old appliances to be replaced. If all the 160 million household appliances mentioned above are replaced, and the price of each household appliance is calculated at 1000 yuan, it will be a consumption scale of 160 billion yuan. The market scale of 100 billion will undoubtedly inject new vitality into the home appliance retail market.
In addition, online home appliance retail gradually surpasses offline. Recently, the report of China’s home appliance market in 2020 released by China Institute of electronic information industry development shows that in 2020, the retail sales of China’s home appliance market will reach 833.3 billion yuan, showing strong resilience under the impact of the epidemic; the contribution rate of e-commerce channels to home appliance retail will exceed 50% for the first time, and the promotion effect of online retail on home appliance consumption will be further enhanced; high-end products, health products, etc The substantial growth of live appliances has effectively promoted consumption upgrading and industrial transformation.
It is not fresh for household appliance enterprises to implement the “trade in” mode to stimulate consumption, but it is an entry point for innovation. Wang Jianguo, an Internet strategy expert in China’s home furnishing and design industry, believes that home appliance retail enterprises need to improve the user experience of consumers, so that consumers can enjoy preferential prices, which can further tap the market potential. Head enterprises will have more competitive advantages. “However, the enterprise has solved the problem of” the old ones will not go, the new ones will not come “of the company, and trading the old for the new may become a new entrance to the consumption flow of household appliances,” Wang Jianguo said bluntly.
According to Wang Chikun, an independent economist, the consumption of household appliances has been in a mature stage, and the dividend period of the industry has passed. The market share of brands and channels is not growing together, but increasing and decreasing. Enterprises must obtain users through unique operation and promotion. Although the old for new model has promoted the renewal enthusiasm of consumers, home appliance retailers are faced with high recovery costs, which will damage some profits. However, trade in will promote market digestion and help enterprises get through the iteration period. After that, enterprises will have the opportunity to earn back the “lost” in the new cycle.
Beijing Business News (reporter Wang Weiyi)
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