Promotion management, new subject of electricity business, price war also need to be alienated

"51" small holiday is often the year's traditional channel promotion of the first climax, but the electric business Channel promotion battle has been launched ahead of time.

in the price is transparent, relatively easy to compare the electricity business channel, the so-called promotion war is actually a naked price war. "Festival is not important, lower prices are kingly" "April Special Storm" "Breakdown of the entire network price" ... A massive promotional campaign will be suning easy to buy, Bowser nets, Jingdong Mall, Amazon, Xun nets, shop 1th, such as platform-type electric dealers rolled in. In addition to the promotion of sales price of household appliances, 3C category, but also include clothing, cosmetics, food and other department stores.

because the supply chain system of electric business enterprise and the traditional channel supply chain are very different, in addition to the systematic prediction, planning and the importance of early warning can not be overlooked, as a result of low price promotions brought about by a large number of orders in a short period of time, to warehouse storage, logistics delivery, and even the system server affordability is a huge challenge. Therefore, low price promotion is not only a competition for users, horse rodeo means, but also a supply chain management test. How to ensure effective promotion and good user experience is another important issue behind the low price promotion performance.

in "51" before the war to seize the line of demand

in the near future, the net has at least 20,000 3C digital, home appliance commodity prices fell to more than 20%, and previously the average price reduction of such a range of less than 10%.

"The whole network afternoon, on Saturday (April 7) night from 19:00~24:00, Jindong chairman to Suning all high-level meeting, clearly issued to launch the whole network of general offensive instructions, this mobilization is different from the past, not for a marketing activities of the discussion, is the establishment of a year-round adjustment. Zhang always clear instructions, the entire year 20 billion of the task is not a problem, the team must fully sprint 30 billion, lifting all worries, full sprint! This is April 9, from Suning Min Sina certified microblog on the message.

the other day, Suning general manager Li bin announced Suning will launch 20% price reduction action. April 23, Li bin at the foundation ceremony of Suning Tesco headquarters revealed that in the April 18 to April 20 promotional activities, Suning Average daily PV Browse volume of more than 50 million, three days total sales of 400 million yuan.

The big promotion that suning buys off is not only the attention degree but the price war. Then, on April 23, Amazon started a big promotion. "China Business newspaper," Zhang Jianfu, vice president of Amazon China Products, told the interview, the Amazon Store celebrates a big promotion has been prepared for 3 months, promotional period 3C digital, home appliances, home and other hard department stores hundreds of thousands of of goods average decline of more than 30%, is the largest ever sales of Amazon China.

gome (micro-blog), vice president of the Bowser network Pengliang pointed out that, in fact, Bowser is the first to start promotion of the company, in April before the Dingdonghua of the first Bowser CEO has started a low price promotion, won the sales of 300 million yuan. Pengliang pointed out that the major electric platform earlier than the "51" for a big promotion, is actually want to take the line in advance of the festive consumption dividend, advance promotion can be under the line overdraft part of consumer demand. Therefore, the electric business platform all rush in "51" before ignited the price war.

an industry personage analysis, this promotion battle is not by the Jing Dong such pure electric business company launches, but by Su Ning easy to buy this to originate from the traditional enterprise's electricity merchant to initiate. Although the traditional electric power supplier has the advantage of supply chain, it is difficult to get rid of the problem of the mutual fight under line. Therefore, avoid the traditional channels of sales peak can not only rob the share of the pure electricity dealers, but also to avoid the embarrassment of self-grappling.

from a Amoy network of testing shows that in the near future, the entire network has at least 20,000 3C digital, home appliance commodity prices fell to more than 20%, and previously the average price reduction of this category is not more than 10%, such large group sales price reduction in the Internet is very rare.

because this launch price war enterprise is to home appliances sales mainly suning easy to buy, therefore, home appliances, 3C first became the weapon of price war. Pengliang pointed out that, because 3C digital, home appliances are standard products, user sensitivity to the price is very strong, coupled with high price, therefore, low price promotion can not only bring users, but also to create higher sales. And most importantly, low prices are indeed the most effective means of pulling orders in a short period of time. "When it comes to promotions, the order will be five or six times times the normal amount. "Pengliang said.

Suning easy to buy the price after the war, Jing Dong also did not stay out of the world, also launched the "51" storm, the participation of goods in addition to home appliances, digital, there are department stores clothing. Jingdong "51" promotion is intended to directly rob the share of the line. However, from Min April 25 the latest micro-blog "Even the traditional offline promotion season ' 51 ' are not spared, market demand exists to do, pull all the mining sales Mister Together ' conspiracy ', but also super strength" can be seen, although have robbed their own line of business suspicion, but Suning easy to buy "51" also did not have "stop" meaning.

price war also has to be differentiated

to the product configuration for example, which is the popular goods, which is the flow of products, which are required to produce a quantity of products, which is the profit of goods and so need to be in the promotion of the appropriate ratio; At the same time, it is necessary to attract users with low prices at the same time, improve

Low price strategy is very effective for the electric business user. Amoy Network public relations catch Tiger in an interview with reporters said: "Recently, a Amoy net 3C, home appliances category comparison behavior is obvious, the price of the search Rose 30%, which indicates that the user is more valued for the prices." Amoy network through the extraction of nearly two weeks in the six major consumer mall 3C digital and household appliances category, search for the highest number of users in the ranking of 30 items in total 180 pieces of merchandise research found: suning easy to buy the recent low price strategy has begun to yield, a total of 77 items have obvious price advantage, accounting for the total number of 41%; And the flow through the search for parity has also increased by 5 times times.

The

price war has become a powerful tool for electricity dealers to gain market share, but only low prices are clearly not a long-term solution. Jingdong Mall Senior Vice President Shengchang (Micro Bo) in an interview, said that the price war is a way to enter the E-commerce market, the traditional enterprises to fight a price war shows that they have a deeper understanding of e-commerce. From an industry point of view, this is not a bad thing. The advantage of traditional enterprises lies in the depth of cooperation with the brand, the strength of resource control and the advantage of price purchasing. By virtue of these advantages, real to do or can do, but do a good job in E-commerce is definitely not a price war.

Shengchang points out that user choice has slowly been moving from price-oriented to branding and integrated service orientation. Today's users still have a strong price sensitivity, but has been gradually beyond the price sensitivity, convenient, anytime, fast, standardized service experience, the friendliness of shopping carts has become a number of deep online buyers of the consensus of choice. Therefore, the future of E-commerce enterprises, the need to pay attention to is not a simple price, customer service response speed is not fast, after-sale repair service is not good, delivery is not a fast and so are needed to focus attention.

"Electric Dealer is a systematic project, do not allow too many short board." Shengchang said that Jingdong Mall's advantage is its own online retail market familiarity, depth of access and understanding of the ability to buy consumers online. This understanding of the ability to buy online users refers to: know what the net shopping users really need, what is the user really need services, including promotional play and marketing methods. In other words, the electric quotient gene and the internet gene are the key to the real success.

Shengchang said that Jingdong did not shy away from the price war, the traditional retailer to complement the course of the east is also strengthening, but only because of the resources to have a good e-commerce argument, is not reliable. For the traditional enterprises, its employment model, the Internet play, assessment mechanism is an unavoidable challenge. From the mode, the traditional enterprises to do electrical and electronic business, in fact, is difficult to good or bad, who is more powerful, who can find the Chinese users and netizens, who will be able to better grasp the trend of online retailing, the last to become winners.

"price wars also have to be different, just that each commodity is directly cheaper than the competitor is not sensible." Pengliang pointed out that promotion is a system engineering, including marketing, selection, product configuration, logistics and so on. To product configuration For example, which is the popular goods, which is the flow of products, which are the needs of the quantity of products, which is the profit of goods and so need to be in the promotion of the appropriate ratio; At the same time, it is necessary to attract users at the same time, to increase the conversion rate For example, Bowser network in the promotion, attract traffic by the popular goods, such as the ipad, the iphone and so on, and after the user came to buy goods such as home appliances, but also recommend users to buy extended warranty services such as goods, while the latter's service margin is usually relatively high.

price war to compete low cost operation

Suning easy to buy the whole network gauntlet, provoked the year's first round of price war.

this can not help but reminiscent of the December 12, 2010 Jingdong Mall launched the book War against Dangdang. In the past year, Dangdang because of the price war, its gross profit margin from the fourth quarter of 2010 down to 10.5% in the fourth quarter of 2011, such a decline caused Dangdang's share price plummeted, fell nearly 80%.

in the second half of 2011 capital in the winter, there have been a number of business e-commerce companies to shrink and collapse, but this does not affect the overall situation, because more than 80% of the market accounted for the business of the TOP20 enterprises are mostly continue to maintain high-speed growth.

suning purchase turnover of 5.9 billion yuan last year, the goal of the "Great Leap Forward" this year is 30 billion yuan; Amazon China in the past year also rapid expansion of the warehouse to 500,000 square meters, this year is expected to break through 800,000 square meters, and the current number of actual orders is not enough warehouse production capacity of One-second, Therefore, the increase in advertising low price promotion is the inevitable choice.

Before, Jingdong Mall's low price big scale, increased the bargaining power to suppliers; Wal-Mart bought shop No. 1th and strengthened its position in China's retail market by expanding its market size at a low price. Therefore, no matter from which latitude, 2012 years will be a continuous war year.

So, observers point to the question: "E-commerce companies in addition to the price war has no alternative?"

U.S. survey data show that 70% of consumers choose to shop online because of the price advantage, 43% of the people because the online more convenient. Chinese consumers are earning far less than Americans, and users will not be sticky about specific Web sites because of the quality of experience. Because of their weak consumption ability, they are more sensitive to price, so the price war is the most effective way to promote the sales of e-commerce companies in the short term.

the US online retail TOP20 is mainly dominated by traditional companies, only Amazon is a pure E-commerce company, while others are Wal-Mart, Best Buy, GAP, Apple, Dell and other traditional enterprise online retail enterprises.

on the contrary, China's online retail is basically driven by pure e-commerce companies, TOP10 in addition to suning easy to buy, Gome, all the pure E-commerce companies take venture capital. Amazon's gross profit margin in 2011 was 22.4%, while some of its peers in China were apparently less than half of it. A lot of homogeneous competition, in the foreseeable two or three years, this kind of low price situation will not make much difference.

price war does not necessarily mean loss. In a large number of subdivided vertical fields, there are also a lot of profitable e-commerce companies, such as the largest online ticketing company in the country, as well as a network of 600 million yuan in the number of Gram diamonds and so on, and secondly, the cause of the loss is not what we think is too high marketing costs, but mainly because of the low gross profit margin.

only precision marketing, in order to attract new users with the lowest cost, only a good user experience, to ensure that users can repeat the purchase rate enough to reduce marketing costs; only efficient supply chain, can reduce inventory risk, improve the use of capital efficiency; only by using technical means to reduce the reliance on labor, Can increase the sales ability of each person. Therefore, under the continuous capital winter, how to realize low cost operation under the condition of low gross profit margin will become a compulsory course for e-business enterprises.

However, if the enterprise only hopes to enlarge the scale of operation by the low price, even give up the user experience for the scale, will not only gain the candle, but also lose the price advantage, which will cause the whole e-commerce project to be demolished again. Excellent E-commerce companies, emphasis is not short-term low-cost sales capacity, but a sustained low price and can provide a stable quality of user experience E-commerce companies.

How does Amazon do systematic promotions?

low price promotion in the short term to form a large-scale order, for E-commerce enterprises, whether it is Order volume or warehouse productivity and logistics distribution, is a pulse-type impact. Therefore, the systematic planning, the data supported by the selection, all need to be based on the forecast volume and equipped with the corresponding logistics resources. Only these aspects of coordination, in order to increase the premise of orders, to ensure a good user experience, to achieve the maximum promotion effect.

in this regard, as a technology data-driven company, Amazon's approach is worth referencing. Amazon in the data-led marketing management operation process analysis can be seen, benign promotion is not only to reduce prices, but the data supporting the internal departments and the entire supply chain linkage.

, vice president of Amazon China Products, told the China Business News reporter, Amazon China's big promotional preparation time earlier, since the end of last year began. Such a promotion, the departments involved include Seattle, India and China's operations, it technology, Treasury, customer service, logistics and other departments, and therefore need to be fully discussed in advance. In the discussion, each department is clear about its responsibilities in such an event.

For example, domestic sales promotion means the most commonly used is limited time low price seconds to kill, but there are many professional second customers, that is, some people who understand technology to kill the robot to participate in the second kill, which in fact will lead to a lot of ordinary users hard seconds to kill goods. After the problem was raised, Amazon's American technology team developed a function to prevent the second kill robot.

is a process to raise questions and solve problems. In Amazon's promotions, all departments are involved, and decisions are based on data. Through data collection and analysis to develop their own selection strategy. A lot of decision-making is systematic, to home textile category, for example, at the end of April, the beginning of May, what products for low price promotion? Through the database analysis for several years, 4 May is the key point for users to buy cool products in summer. Take a mat this single for example, what material, the size of the product to promote it? Through the accumulated data analysis over the years, found that the largest proportion of user demand is double, bamboo mat.

After the category is selected, the price is set. Through the analysis of the price of such products over the years, the data model calculates the corresponding proportion after the price reduction may bring sales, to develop a certain competitive price range, the procurement department will be based on the system forecast the sales of the purchase stock.

according to Zhang Jianfu, Amazon's system accounting calculates the price range and sales forecasts for each category, but the team is not mechanically executing the system decision. For example, a single product in addition to reference system calendar years of data, artificial decision-making will refer to the economic environment, costs and other factors, formulate a certain discount strategy. In addition, some global partners to expand their brand and market share in China's E-commerce market, will also give some very favorable conditions, these concessions can also be directly reflected in the discount. Amazon's 46-inch LED TV, for example, offers a very big discount. Such discounts are implemented with the support of the vendor.

large-scale promotions will attract a large number of users, Amazon's page will intelligently recommend products to users to improve conversion rate. Some products, despite the strong discount, if the user recently has the same product or similar goods purchase behavior, the system will no longer recommend the same products to users, but will be based on their browsing track and purchase records to recommend users may be interested in goods.

Promotional management of the systematization, not only reflected in the page specific merchandise discounts, as well as inventory and distribution. The reporter found in the Amazon warehouse: The Warehouse management team will be based on the system data on the commodity warehousing adjustment, those who sell large, in a short period of time will be sold goods, usually closer to the delivery port, which can improve the efficiency of picking and packaging.