Gome has not been short of news recently, and now preach Gome group High-profile march into the gold industry

Gome recently has not lacked the news, now also preach Gome group High-profile march into the gold industry. In fact, as early as this March, Gome's subsidiaries of the multilateral Gold Online mall has been online, and September 19, located in Beijing West three ring Central TV Tower of the multilateral Gold Mall gold is also about to open. According to its plan, the business will invest nearly 1 billion yuan, to be in the 2020 online business to cover the whole country, and "do not pursue the number of stores." At present, the multilateral gold online mall has been settled in the United States, Beijing-East and the three-day cat home appliances business platform, offline entity shop is learned only in the weekend opening, according to legend, Huang Guangyu has done "a year loss 100 million, three years of unprofitable" plan.

Regardless of what you think of Gome as a gold dealer, it is clear that Gome wants to go through the reform of the business model for the edge category of gold, to kill a trail that others will not be able to replicate in the short term and, if successful, achieve sizeable flows.

So why does Gome think of entering the gold market?

Electric Shang think the main reason is two: first, the mainstream consumer purchase of electrical appliances with the purchase of gold mainstream consumer groups have a lot of overlap, no matter which age level of adult consumers, may be long-term or in a certain time period of gold products, especially gold ornaments have a strong just need. The second is the gold industry's products are mainly in quality and style, weak brand, standardization, customizable, and electrical products similar to the law, into the gold jewelry market, can make the United States to extend their electrical business in the price war, control industry chain and other classic play.

But the question is, does gome do the gold business? Does Gome make gold electric business feasible?

Electric Shang feel, to Huang Guangyu and his senior management team to the retail market law understanding and experience, do gold business although not easy to succeed, but have some success factors:

First, Gome fully has the ability to achieve the gold jewelry industry throughout the industry chain control. Gome, in addition to doing multilateral gold retail, has confirmed that the gold deposit will be set foot in the upper reaches of the golden industry chain. Gome now has the advantage of its proprietary business to gain greater control over product settings and prices by consolidating upstream product resources and refining downstream channels. At present, Gome is intent to build a closed-loop gold industry chain with the electrical business, which will be the core competitiveness of Gome's future gold business.

Secondly, the characteristics of the gold jewelry industry are channels, no brand, spelling is formal, style, gold. And the so-called brand, is the channel business, such as Chow Tai Fook, Zhousengshen, Vegetable Hundred, old Phoenix Xiang, old temple, Liu Fu and so on. Although Gome started with electrical appliances, but gome with multilateral gold as the channel brand, Gome entity store system and Gome online and other dual channels for the multilateral gold endorsement, as long as the multilateral gold can also provide quality gold ornaments, and through the product design and price customization to form a differentiation, and gradually subvert the traditional gold retail channel brand influence, It is not impossible to have a base.

Third, the gold jewelry industry is a typical heavy assets, low turnover, margin thin industry, the whole gold retail industry to collect design, production process costs and other additional costs as the main source of profit, while Gome can earn surcharges at the same time, the use of their own efficient supply chain control ability to eliminate intermediate links, reduce costs, To achieve the goal of increasing gross profit margin. or lower prices to achieve a lower price, through the price war on the basis of not losing money to seek greater market share.

The above is Gome Test water gold jewelry industry may have advantages, but there are also many adverse factors, such as the current domestic gold investment in the main crowd or middle-aged and elderly people, this category of people are basically offline consumption, such as the United States to do in the early days of gold to the feeling must be unreliable, because the cross-border too large, It will be one of the important problems in the new long march of Gome that how to establish the trust problem of consumers and how to build the brand identity of the channel.

The more unfavorable factor, is gome to do gold "mainly on line, not the pursuit of shop number" channel construction strategy. Electricity Shang believes that the United States to do gold to the electricity business as the main channel of thought is too quick success.

First, gome to do gold electricity, the cost of online drainage is actually not low, a multilateral gold brand influence has not been set up, and second, gome online existing traffic can not achieve a significant purchase conversion rate, Gome Gold Line sales future worry.

Second, the emphasis on both online and offline for the United States to do gold business disadvantage. Emphasis on the line, that is the pure business, but the gold jewelry category and no clothing, 3C products such a large consumer population and high repeat purchase rate, cost control and gross margin will be difficult to guarantee. and the emphasis on the line, then the United States and Zhou students to fight the price, it will be a real way of life. Gome should be based on the line, supplemented by the line, online products to be different, and online as a marketing channel, it will be possible to achieve the line under the double win situation, but also to build with other traditional gold retail channel brand advantage.

Third, the United States to do gold dealers, we must innovate O2O mode of electrical business. If Gome continues the current pure business model, it needs to face consumption habits, gold consumption trends, logistics distribution, security, insurance and other issues, which will be more troublesome than the field of fresh electricity business. Gome must make good use of its own Gome's offline store system and perfect its own offline store layout, to provide a convenient, safe, fast and feasible O2O mode in a certain area, it can let consumers change the consumption habit of buying gold under the line, and gradually accept the new way of buying gold products under the line, otherwise, the so-called online channels, will be worth the loss of the chicken.

In short, electricity Shang bullish gome into the gold business, Huang and his team's vision is very unique, starting from their own advantage to find a single point of breakthrough category, but the electricity Shang worry is Gome's pseudo O2O mode will not break out on the line, and may make the world more determined that the gold category is not suitable for the electric business.

Text/Electrical Business Update