How do foreign electric dealers survive in the melee of local electric dealers?

The dilemma of foreign-owned electricity dealers

April 2012, by Lotte Group and Baidu jointly injected 50 million U.S. dollars to set up the company's website cool days, the survival time is only 1.5. As early as 2003, the foreign-owned electric power ebay Flash lost to Taobao, and the failure of the cool weather again for foreign investors sounded the alarm, foreign companies come to China if only to see China's huge market and rich returns, without considering China's national conditions, it is difficult to succeed.

It is not so much a collision between a foreign electric dealer and a local electric dealer as a contradiction between "heavy profit and user experience" and "sacrificing profits and rapid growth".

New Egg NET Marketing Director Meng Fanbo the new egg as an example, detailed analysis of the foreign-owned electric power companies in China to seek breakthroughs in the road:

First, the logistics cost is big. In the major electric power competition in the service, the Chinese users have been accustomed to free shipping, logistics logic of the day, the domestic e-commerce "blood spell" freight free of charge with the same day delivery, or even one day three send four send, let the logistics cost accounted for the proportion of total sales revenue to 3%-4%. In the United States, the United States has always been the continuation of the user to pay freight and 3 days delivery of the operating rules, so that the logistics cost is lower than the total revenue of 2%, to ensure profitability.

Second, the operating norms of foreign-owned electric operators, strictly abide by domestic laws. New eggs in the purchase of goods invoiced to pay 17% value-added tax, which led to a price disadvantage. In addition, the quality of goods strict requirements, to ensure that all goods are authentic licensed, no second-hand channels, for return and return are also internal digestion and will never be sold two times. In addition, the new eggs for the product review also requires complete authenticity, for malicious brush comments on the internal staff, once found, immediately dismissed, and for suppliers, no longer continue to cooperate.

Third, the marketing model is different. China's domestic electricity dealers can endure a period of operating losses because they have strong shareholder support behind them. But the foreign-owned electric power Company does not have the VC favor, can only rely on the actual operating profit to obtain the investment income. "We spend our money, we spend more pain, so we will be careful and prudent." Meng Fanbo told reporters.

Win in the stable

By contrast, the new egg net is luckier than the cool days and ebay, which is still maintaining a 50% annual growth rate, thanks to the 11-year experience of the new egg net in China and its understanding of China's national conditions.

Domestic electricity dealers burn money in exchange for market share, build logistics to enhance the user experience, this has become the Chinese local electricity business competition logic, although the new egg senior executives believe that the Chinese electric dealer such a loss making calls for the user stickiness is not high, no loyalty can be said, but in the real environment forced, this June, in a wave of a wave of electric sales promotion frenzy, New eggs announced to let 300 million yuan in the year to promote the plan, become after the day cat, Suning easy to buy and Jingdong, and another to join the business promotion of the big Electric sales.

Meng Fanbo told reporters, "The new egg nets do not advocate price war, but since has provoked, new eggs have the strength to fight, whether in the supply chain, product prices or services, new eggs are not lost to any peers." ”

But Meng Fanbo that, in addition to price, products and services is the key.

The important rule that new eggs can survive in China for 11 of years is to win. Meng Fanbo said that price can only bring short-term benefits, not long-term survival. Differentiated products and the promotion of customer value is the key factor to achieve sustainable development of electric business enterprises. "Like running a marathon, the current race has just begun, we have to maintain physical strength, in the domestic electric dealers burn money to make a yell of the big environment, walk steady enterprise, can go faster, farther, laugh to the end."

The practice of new eggs, for the local electrical and foreign electric dealers, there are many places to learn from:

First, build an open platform. From the new Egg network platform can easily find the open platform under the figure of the merchants, but also to buy wine, Jiuxian nets, Amoy shoes nets, Gome and other well-known businesses and the introduction of foreign products, all show the new Egg Net open transition policy of strength and determination.

The second is differentiated product advantages. New Egg Network set up the latest global unified product procurement Platform (Ccoss), breaking new eggs, China, new eggs, the United States and new eggs, Canada's geographical restrictions to promote commodity marketing, which means that domestic consumers in the first time to buy overseas hot goods.

Third, to adapt to China's national conditions of the logistics distribution system. New eggs now have their own huge logistics system, in addition, in order to apply China's national conditions, new eggs are also beginning to implement a day to send more to meet consumer requirements.

New Egg China President Zhou Zhaowu words also very good interpretation of the stability of the idea of winning, "We will not only rush to short-term sales, but the focus on how to consolidate the foundation, if the basis of matching did not keep up, do not do, the effect will become more and more obvious."