Online price is not the antidote to Su Ning's dilemma

"Since February this year, Suning appliance renamed Suningyun Business, June 8, Suning officially announced the implementation of double line (line online), the same price strategy." The implementation of the two-line price is an important step of suning multi-channel integration, which marks the full operation of Suning O2O mode. ”

In order to verify the authenticity and validity of the two-line suning, I picked up 12 common 3C household appliances on the website of Suning easy to purchase, and went to Suning Sanyuan West Bridge shop for investigation, and found that:

Selected 12 3C home appliances, offline Shop has 4 of goods, the label price and online products are not in line, the label price is generally higher than the line, the promotional staff will remind the line below the same price, tell the real price; then, why not the price tag update? Among the enquiries, a promoter said that the recent unusual promotion prices would soon return to normal prices, price tags in exchange for too much trouble, offline shop weekdays customers rarely, less than 5:30 P.M. (business end time is at night 8:30) Many counter promoters have off work, because the price difference between the two-line price, by the factory subsidy, Some manufacturers of the two-line price policy dissatisfaction, that they have been kidnapped by Su Ning ...

Objectively speaking, Suning's dual-line pricing policy now seems to have a certain authenticity, but the overall view is more than practical significance. Su Ning faces the main line business under the impact of the line, the overall revenue growth slowed down the dilemma, the two-line price can not solve this dilemma. Suning needs to do is to increase the investment in independent technology research and development, improve the online user experience, change the internal management thinking, accelerate to the scientific and technological enterprises closer.

Suning two-line same price gimmick is more than actual

Su Ning launches the double line price, has the subjective to maintain its dominant line business intention; But at the same time, Su Ning and deliberately put the line offline to do the partition. Suning easy to buy more than 1 million of the SKU, and the number of goods under the line shop is very small, line online under the coincidence of the proportion of goods is even smaller, the so-called two-line price base is very weak; and, even the main 3C home appliances, suning line shop often do not sell online products, this is the manufacturer's strategy, It is also Su Ning's own intentional partition. I tested 12 common 3C household appliances, the offline shop has 4 of the goods, store promoters bluntly this is intentional. And for other non-3C home appliances category, double line price is completely meaningless.

Su Ning through the promotion of two-line price, can be to some extent to maintain the original preferred offline shopping crowd, but on the attraction line user role is not small. First of all, like online shopping users a large proportion of the daily work of the working-class, free time is relatively small, working days (Monday to Friday) basic no time to go to the line shop, I June 14 in the afternoon in Suning three West Bridge shop to see very few passenger flow. Second, even if some users into the Suning shop experience a high price of 3C home appliances, as long as the price of suning is not the most preferential prices, customers can easily landing on other web sites to buy. Suning Double line is just the Suning line under the shop and Suning easy to buy the same price, and can not prevent the customer Su Ning and other online platform for parity, Suning's line under the shop still can not get rid of the public "Hall" identity.

Double-line same price can't solve the dilemma that Su Ning faces

Suning two lines of the same price can be effective operation of the foundation is suning in the price than other sites more favorable platform, but the actual situation is not so. Suning implementation of the two-line price, the fundamental point is to deal with the main line of business under the impact of online, revenue growth slowed down, the capital market so the plight of its failure to see. But not only to develop good online business, but also want to maintain a good position under the line, it is very difficult, but also, double line with the same price to achieve scale and profit margin, and then pull up the capital market confidence is very slim.

The root of Su Ning's predicament is not because the line is not strong, but the line is still lack of the real cat and the strength of the Beijing-East contest. Su Ning is a offline retail business, the offline has done quite well in all aspects, even if the offline business growth stalled, it can still maintain the top position in the industry, and can still be profitable. Su Ning by the capital market decline is an important reason for the last two years its online business has not reached the expected, 2011 online Goal 8 billion, the actual completion of less than 6 billion, the 2012 online target of 30 billion, then changed to 20 billion, after the acquisition and frenzied introduction of business, officially announced the final completion of 18.3 billion, Still not reaching the target, and the water is not small. Suning's double line price, can promote the offline business is hard to say, but to promote its online business development does not have much benefit.

The performance of Suning's predicament is the slowing of revenue growth and the decline of profit margin, double-line price if it is the same as the lowest price of the net, then the revenue has to promote but damage to the profit, to change the size of losses; double-line price if there is no price advantage compared to other platforms, the revenue scale will not grow too much. It is very slim to expect both the same price and the increase in profit margins. At present, the price difference produced by the double line is subsidized by the factory, which is not a sustainable way. Moreover, the offline itself has a fixed rent and human costs, offline and online should be reasonable to separate rather than blunt to carry out the same price; At present, suning in the backstage supply end of the two-line unified management, but in the front of the sales end did not achieve the two-line mutual promotion.

Su Ning's urgent task is to accelerate closer to technology enterprises

I June 14 in the Suning store and a promotional staff chat, the other party is very proud to say that Su Ning can achieve line on the same price, because they use the world's most advanced system. I asked whether the system is suning development, the other answer to Su Ning is a retail enterprise, Money can buy the system does not need to develop their own ...

Objectively speaking, suning than its offline retail peers pay more attention to technology, informatization level in the forefront of the industry; but from Suning easy to buy all the time when the site response speed, suning management way, suning and real internet companies still have a big gap. Whether online or offline, retailing is ultimately a competition for efficiency and a user experience. Su Ning's attitude towards technology is mostly "buy doctrine", although early saves some time, but later, the core technology control is more and more important to the business development. From the experience of Suning easy to purchase, in the past year there has been a greater improvement, but compared with the cat and the east, there is still a large gap.

In the case of Amazon and Best Buy, their revenues were 61.1 billion dollars and 50 billion dollars in 2012, and their staff numbers were 88,000 and 165,000, and the average efficiency of Amazon was much higher than Best Buy, which is one of the big reasons why capital markets value Amazon and look at the worst. 2012 Suning's revenue of 98.4 billion yuan, the number of employees (including the manufacturers stationed in the promotional staff) in about 200,000, the corresponding Beijing-east 2012 revenue for suning about half, but the staff size of Su Ning's 1/6, in this has a reference value of the indicators on Su Ning significantly behind.

Suning needs to do is to increase the investment in independent technology research and development, improve the online user experience, change the internal management thinking. Instead of focusing on the promotion of online technology and user experience, it is better to focus on improving the efficiency and management of the electricity business than it is for a two-line price that doesn't have much practical significance. The two-line price of stranded best buys does not stop the Amazon from eating it, and the US electricity tax bill increases Amazon's costs, but does not save the best Buy. Suning needs to do is not double line price, but more stride to the Internet Technology enterprises transformation. Fortunately, Su Ning's rival Jingdong is not as powerful as America's Amazon, and Su Ning seems more determined than best Buy, although there is not much time left for Suning.

[Huang, research director, Internet industry analyst, micro-credit public, "Universal Society" (Micro-signal: Puji-she)]