Electricity business trapped in "burning money to fight the market" cycle price war high temperature difficult to eliminate

According to the Labor Daily report, the spread of several months of the electricity industry price war before the waves. Jingdong Mall, Suning and other business executives have said recently, the company will continue to implement price war. In this situation, the second half of the domestic electricity industry is expected to stage the "Burning Money" war.

Electricity dealers ' price war is getting worse

Jingdong Mall Board Chairman Liu 16th announced: "The third to fourth quarter of this year will set off the largest, most tragic and most comprehensive price war in the history of China's electric power!" and Jing Dong will continue to lead the price war! " He also said that from the same day, if the company manager who is responsible for the product price is not the lowest, then "class" leave.

In response to Liu's price war speech, another domestic electric business enterprise Suning easy to buy executive Vice President Li bin the same day, said: "The price is a battle is suning easy to buy this year and even next year the established long-term strategy."

"The electricity dealer who the price is low, a Amoy net parity rate at a glance, do not have to flicker." Dangdang CEO Guoqing the same day also publicly said that every day I see the price index daily, found not the whole network of the lowest price directly downward. "Only the book dares retaliate against the price war, because the book is still the profit category." ”

"Low price is the main factor to attract the current network consumers, whether it is the performance of Taobao holiday promotional activities, or the company's listed companies Macquarie's financial results show that the impact of promotion on consumers is very direct and efficient." "China E-commerce Research Center analyst Feng Lin told reporters that through the price war, some companies want to be able to compete for market share, some companies want to ensure revenue growth, and some companies want to be able to raise the industry threshold."

"Increase not increase profit" into the industry common problems

"The strongest price war in history" has attracted enough eyeballs and traffic for the major electric dealers ' websites, but the major "advocates" who invested heavily in the price war have faced the embarrassment of general unprofitable. For example, Jingdong Mall, the first half of this year, the company's sales growth of more than 120%, but the net profit is still negative.

At the 12th session of the China venture capital and private Equity Investment forum held in Shanghai recently, Jiang Haotien, director general of Northern Aurora, said that the competition in the domestic electric business industry is too fierce, and the major electric dealers ' websites are willing to reduce themselves to unprofitable positions to compete with their rivals. The cost of Internet traffic has risen very badly in these two years, which also makes the electronic business enterprise encounter huge market promotion cost pressure. Because the electricity trader makes the price war to be more convenient than the line, the consumer sees where is cheaper to switch to which website, the electricity merchant anticipated "to be beneficial to stick the consumer" to become empty talk. In addition, from the capital point of view, "The electric business website nearly two years to obtain the capital too much, basically is holding the investor's money to fight." ”

In the industry's view, the price war of electricity dealers is bringing a lot of negative impact on the industry. Feng Lin that too fierce price competition for the industry has long been in the position of profits and even losses, at the same time, it also caused the infringement of the channel, the sale of goods and so on, in addition, the management of electric business enterprise, after sales and rapid growth of the revenue is disjointed, in reducing the user experience at the same time for the site's own development of hidden dangers.