Gome calls on electricity dealers to calm

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On the eve of Qingming, Gome Group senior Vice President, Gome online Chairman Shangui first released the "Electric Business eulogy" A article, this just let people remember the existence of Gome electric. In the fierce competition in the electricity market, Gome seems to have been forgotten, the existence of Gome electric quotient has lagged behind its old rivals Suning and the electric business giant Beast Jingdong. Today's gome, like the decline of nobility, want to regain the style of the year, but also powerless, the rest of the more just that noble pride. Once the protagonist has become the supporting role of today, if no effective measures to turn the tide, it is likely to become a mass actor.

Gome calls on electricity dealers to calm down competition for survival?

Shangui first "electric business Eulogy" "discerning" can be seen in the dark irony of Jingdong, at the same time, triggered the industry to reflect on the price war, the constant price war on the retail industry more harm than good, consumers may have to pay a greater price for the temporary benefits, price war may let more retail enterprises disappear, In the end there were only one or two oligopoly companies, and the word "consumer is God" did not exist.

From the current situation, the "electric Business eulogy" In addition to obtain a little public opinion, and did not give gome to take other practical interests. Beijing east to Gome's stance, and the effect of the topic marketing is limited, not let Gome electric business anniversary became Hot topic, but to let people feel that Gome has been unable to withstand the impact of price war.

Gome sales last year, although the realization of growth of 119 1% to 44 1 billion yuan, but the loss rate reached 15%~20%, spread to the listed company's losses nearly 500 million. Suning last year's sales revenue has reached 16.716 billion yuan, an increase of 157.9%, the loss of more than 160 million. Suning use Gome 1/3 of the loss of Gome sales 3.8 times times the performance, which is a huge blow to the United States, but also a warning, price war is not gome to compete for electricity market effective means. Last year, different parity sites show that some of Gome's products price is indeed lower than their competitors, from this perspective, gome in the electricity market last year, the real investment in the huge capital, but the effect of input-output ratio is far less than competitors.

With last year's lesson, Gome should be aware that the electricity market competition is not simple price competition, but also includes user experience, logistics distribution, category richness, marketing and other factors, the price of the electricity business has access to the threshold, and currently gome has not crossed this threshold, Even a 1 billion loss this year may not be able to catch up with rivals through price wars.

Gome this year if the price war may be a wise choice, if you can change the size of the price war losses, the United States need to have a cut wrist bleeding, but now the situation is even if you do not have the flow of blood may not be able to trade with Jingdong, suning comparable market size. The tasteless price war has lost its meaning to gome, but it will drag gome into the abyss. Give up the price war and steadily promote the development of electric business, improve the basic construction of electric business, stabilize the traditional electrical business practices may make gome even more.

Of course, the opportunity cost of gome doing so is very high, if this year to give up the promotion of electric business growth, to the initial stability of the market next year, Gome and its competitors will be greater gap, then want to catch up with opponents, pay the price will be much higher than today, if this year to give up the electric business, also said that Gome has been completely left behind. So, Gome continues to launch a price war is more likely, short-term losses will not be the fate of Gome, but to abandon the scramble for a market seat in the electricity business is likely to let Gome lose everything.

Gome does not adapt to the market size of electricity dealers will lay eggs of the rooster

Shangui's "Electric Business Eulogy" Article also highlighted the dilemma of Gome to adapt to the electric business play. Many people say that the essence of E-commerce is business, retail play is the core of E-commerce. In fact, this is only half right, the essence of E-commerce is not only business, but also electronic, Internet play is also the core of E-commerce. Ali, Tencent, Baidu, Youku and other Internet enterprises have billion-level users, there is flow assurance, internet business traffic is the source of income.

For internet companies, traffic is the source of profits. Ali through the retail information attracted a large user base, in the cultivation of large flow of Taobao's market scale continues to climb, but also to foster the growth of the cat, Alipay, and other platforms, these platforms are to give Ali constantly bring benefits of the golden eggs. Similarly, with 700 million registered users of Tencent is this kind of play, through QQ expansion of the game business, the expansion of the micro-letter business, the portal business. Internet enterprises are this kind of play, through the user scale to promote economic efficiency. Jingdong wants to do the same thing.

Jing Dong in the electric business industry 9 years of time, has been to ascertain the context of electricity, the so-called e-commerce, both business, and electronics, "business" is the basis of their own development, the profit is hidden in the "electronic". Only traditional retail play is not enough, the Chinese retail trade is generally low margin, combined with successive price wars, the retail trade margin is lower. Their own hard to do the supply chain to pull a point of gross profit, and Taobao has long relied on the flow and scale dividend to enjoy the benefits of the electricity dealer. Not only that, Taobao has relied on traffic and market size to hatch a few golden rooster.

It is precisely because the Beijing-east to see the cat model more profitable, will be in these two years to increase the construction of pop platform, the platform can make the market scale of jingdong more large, larger scale for its advertising business, logistics, financial services, data service business to bring profits.

Traditional retail play can be enhanced by the size of the market discourse, to upstream suppliers to higher returns to improve profits, but not only the electricity business, Gome still need time to understand.

The price war is not right for a while.

After writing the first two paragraphs after the stunned discovery, Gome and the electricity price war. In fact, Shangui's first "electric business eulogy" Last words have already said that Gome will launch a price war in April. For Gome, there is no better way to attract consumers than to use price wars to stimulate consumption.

As mentioned above, this year for the United States is very critical, or lose the car to protect handsome, give up the growth of the business, do a good job of the basic construction of electricity, stabilize the traditional retail business, or through losses in exchange for market size, to shorten the gap with the competitors, to win a seat of the It seems Gome has opted for a loss of size, so the current gome needs to do something to arouse public opinion, and thus attract the attention of consumers.

It is important not to be overlooked by the public, at present, the electric business public opinion focus more concentrated in Ali, Beijing East, Suning body, Gome is often overlooked, so do not do point show, engage in some topic, Gome's anniversary celebration, shop celebration month activities can not arouse public opinion. Public opinion needs the topic, the topic needs to have the contradictory point, the more contradictory conflict place is easier to produce the news, the Gome contradictory to let the media to the Gome electricity merchant more interested.

Although Gome's initial design may have been through Shangui's "electric business eulogy" sparked public opinion on the 418 of the United States, but because in the "electric business eulogy" only in the end of the text with 4 words with a slight mention of Gome will be in 418 activities. This let the attention of public opinion focus on the Beijing-east of the dark irony and the price of electricity dealers in the reflection, according to the original plan is a blunder topic marketing. However, it is Gome's reflection on the price war and the price war again between the formation of contradictions between the media to the price war this month "special attention", the original blunder topic marketing has played an unintended effect.

Since the United States launched the current round of the electricity dealer price war, will not miss this year 618, 818, double XI, double 12 of these several rounds of the key electric Business campaign, this year, Gome chose to the price war to the end.

Conclusion: 418 of the Soviet-American dispute

April may form the "Su Mei" two old opponents in the field of electric business in the first round of confrontation. Suning easy to buy 418 promotional activities have already begun, Gome also put the promotion plays on the 418 day, the 18th this month, the first contest of the Soviet Union is worth attention.

Since the Beijing east should not be the Warring States, the United States need to point to the contradictions of Su Ning to obtain public opinion of the tipping point, suning also needs such a challenger sparked the industry to Suning 418 promotional activities of concern. At the same time this month, the 418 Soviet-American dispute is not only the sales performance dispute, but also the public relations propaganda controversy. Last year, 618 Jing Dong and Tian Cats have had "elephant weight" of the PR story. The price war plays desperately, after the game the public relations propaganda is equally important.

Since the Soviet Union between the United States has aroused public concern, Jingdong is not to consider taking the opportunity to cop-out, join the Soviet-American game, and then play a "fake" price war, enhance the performance, but also for the help of opponents?

Finally, I would like to say that Gome still have the opportunity, but the opportunity is not from themselves, but should draw on the external forces, to attract internet companies to join, plus their own years of retail experience, Gome breakthrough is still possible. But to roll over, Gome must first give up that pride.

Author/Wang Liyang electric quotient researcher