Electricity Price War Is Not Conducive To The Sustainable Development Of The Industry. It Is A War Without Winners.

The noisy price war of over half a month has finally turned into a farce without a winner.

The price war appears to be a "cheap banquet", but in fact, the consumption demand is prepaid ahead of time, which will cause insufficient sales of electric appliances in the second half of the year.

Sustainable development.

"Noisy drums and drums" noisy for more than half a month, the electricity price war finally ended.

This war began with micro-blog, taking Jingdong Suning as its leading role, Gome, Yi Xun and so on, and once occupied the headlines of the major media. It evolved into a "wolf coming" farce under a "Herald" of the NDRC.

In fact, as long as the NDRC has not intervened, people who know the price better than before have already known that: when the price war started, Jingdong and Suning who shouted the most loudly and loudly, no one really entered the price war. Under the cover of models such as the difference of models and the break of goods, the war between the two giants was more psychological warfare and public relations warfare.

The monitoring data of a panning network showed that on the day of August 15th, the 6 largest B2C businesses of the whole network purchased more than 11.7 pieces of household electric products, of which only more than 5000 products fell, accounting for only 4.2%.

Among all the participating providers, only 16.6% of Gome's official website had a price reduction ratio of 6%, while the Jingdong Mall (micro-blog) reduced the proportion of electricity to 6%.

This is not a tragic price war indeed reached the effect of propaganda, the various media platform on the discussion of the masses, once again proved that Liu Qiangdong, known as the "golden sprinkling pot" of the character of the social media platform skilled use.

In this war, in addition to inciting the main force of the war, Jingdong, Suning, Gome, and all electric business enterprises that match and fight with soy sauce, and behind the intervention of capital side and brand suppliers, of course, less or less consumers who participate or watch the war.

However, after the war, the "chicken feather" was dropped.

This war has become more of a war without winners.

Behind the game capital side

"We have nothing but money. You can rest assured and fight."

This is the price war, Liu Qiangdong released on micro-blog's investment behind the Jingdong people are moving to speak.

Whether it is true or false, however, some people say that Jingdong's "taking investors as ammunition" does not seem to be accurate.

Because the price war itself is a "pocket" of great tightness, so the effect of this hype is greater than the actual price war, and the collateral damage to investors is not large, most of which is accompanied by shouting slogans.

An undeniable fact is that the essence of the war lies in the "decisive battle" between the Internet mode and the traditional mode, and the power to drive the decisive battle of these two modes is capital.

"Jingdong's price war is very clear, that is, Suning.

This is mainly aimed at Suning's previous financing plan.

Independent electric business analyst Li Chengdong bluntly said.

Zhou Xiang, an analyst with the China Electronic Commerce Research Center, said: "after many rounds of financing, the market value of Jingdong IPO has been very large.

Jingdong's current goal is to go public, otherwise it may be difficult to find follow-up investors.

At this point, if Jingdong mall can play Suning, it will be very beneficial for the listing. "

In fact, in order to succeed in the field of electronic commerce, several sides have invested a lot of real gold and silver.

Anxin Securities Research Report shows that Jingdong mall in August 2007, January 2009 and April 2011 carried out 3 rounds of financing, the original capital of about 9 billion 600 million yuan.

With such a scale of capital support, Jingdong mall has invested hundreds of millions of dollars in the logistics center, office and other fixed assets investment since its inception.

However, if it can not be profitable, there will be a huge drain on the huge financial backing.

Due to the self built logistics center and the purchase of super flagship stores, Suning Appliance's capital situation is relatively tight.

In July this year, Suning's private placement increased 4 billion 700 million yuan, and in August it announced a 8 billion yuan corporate debt financing plan.

Squeezed suppliers

The war of e-commerce enterprises is never "one man's war".

Behind the frenzy of the electricity price war, it is the crowding out of the electronic business platform for suppliers.

"The current settlement cycle of e-commerce platform is 60~90 days," suning.com (micro-blog) disclosed in its recent half year strategy.

During the price war, Haier group also stepped forward to announce cooperation with Jingdong, because its price was too low.

Brand Jasonwood could not afford to be squeezed and announced its withdrawal from Jingdong on micro-blog.

In view of this, the biggest damage to the price war is more than suppliers, especially those with lower brand premium.

"Suppliers do not want big price wars to extend online."

Lu Zhenwang, an e-commerce observer, told the successful marketing reporter: "take Jingdong as an example, it does not cooperate with all brands, and many goods are taken from dealers.

Because the brand does not want the price of the product too low to disturb the price system.

Of course, more and more big brands have increased the control and management of online channel prices due to the squeezing of suppliers and the shift of costs.

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Smarter consumers

"8. 15 electricity supplier war" at the beginning, many consumers secretly pleased, "snipe clash, fishing for profit" reason many people understand, but in the end many consumers found themselves to be the fool of the big business people.

In the end, Jingdong mall did not achieve "three year zero profit" of all the power companies, Suning Appliance also failed to fulfill the "online and offline price" commitment.

However, after the four deception war, consumers also made progress.

They are no longer as dumb as they used to be.

One obvious change is that their sensitivity to price increases.

This sensitivity is not only reflected in the price parity between the platforms, but also compares the price of online products with the prices of physical stores.

It is understood that in the Suning, Gome and other offline retail outlets, consumers are no longer willing to accept the previous "marked price" form, will be compared with the online price.

Reputation damaged "Su Dong"

No matter whether it is traffic or word of mouth, Liu Qiangdong launched a high-profile war.

After the war, neither the Jingdong nor Suning Gome seemed to be able to improve their reputation. Instead, they exposed many weaknesses in their supply chain and even jeopardize the credibility.

In the course of shopping, consumers find that goods are out of stock, delivery is slow, prices are stall up, and models are not comparable.

In terms of traffic volume, although Jingdong has gained some gains, it has benefited more from the "US Soviet Union" than previously known in Jingdong online shopping.

NetEase's data show that on the first day of the price war, suning.com's traffic rose by 706%, while the state reached 463%, while Jingdong was 132%.

The short burst of traffic also brought about a boost in sales.

Jingdong mall said its sales of domestic electricity exceeded two hundred million yuan in the two hours after the price war started.

The United States and Soviet Union are fighting against Jingdong's price war. Suning.com and Gome online store and Gome's micro-blog are behind them.

This situation directly led to the popularity of the two traditional retailers' online stores. According to people familiar with the matter, suning.com made an increase of 12 times compared with the same period on the 15 day.

However, in the long run, the war parties have gained short-term traffic growth, but the price is a long period of downturn after the end of the price war.

At the same time, Liu Qiangdong's high-profile declaration of war, which was collectively exposed by the industry and the media, was dubbed "flicker" and "Thunderstorm and heavy rain" in the whole process, and its reputation declined sharply.

Moreover, it is not a good thing to be summoned by the NDRC.

Electricity business entering the internal consumption period

"After every price war, the electric business will fall into a low period.

Take this price war as an example, 8. 15 weeks before and after the war business enterprises are more lively, sales data also have a certain degree of rise, but after this, it has not been too slow.

Lu Zhenwang said.

In his view, because the price war is mainly concentrated in the category of household appliances, and the prices of household appliances are generally higher, the purchase cycle is longer, and the consumer's consumption ability is limited. Therefore, when the number of online shopping users grows slowly, this price war will advance the demand for overdraft, which is unfavorable to the normal development in the later stage.

The price war is not going to be as new as ever. New users are moving from line to line. Now there are so many user groups. Every price war is a process of internal friction. A price war will lead to a prolonged downturn.

In other words, the price war appears to be a "cheap banquet", but in fact, it is in advance of the consumption demand, it will also cause the lack of stamina in the second half of the year, which is not conducive to the sustainable development of the industry.

Historical review

1, Suning Appliance issues 8 billion yuan corporate bonds.

(1) Suning completed the preparation of 13 billion yuan of funds in one month.

(2) a large part of it will be used to develop online businesses, and Jingdong will be the first to pull down.

2, Liu Qiangdong micro-blog said Jingdong three years of gross domestic product

In August 14th, Liu Qiangdong said on micro-blog:

(1) Jingdong's three year gross domestic product

(2) all power companies are more than 10% cheaper than Gome Suning.

(3) the staff will be stationed in Suning Guo Mei store.

3, suning.com Li Bin said that all commodity prices are lower than Jingdong.

At 16 o'clock on August 14th, suning.com vice president Li Bin micro-blog responded to Liu Qiangdong:

(1) all commodity prices are lower than those of Jingdong.

(2) help Liu to complete the reduction of staff and efficiency.

4, Liu Qiangdong micro-blog said Jingdong has no bottom line.

At 16:52 on August 14th, Liu Qiangdong said:

(1) Jingdong has no bottom line.

(2) Suning dares to sell 1 yuan, and the price of Jingdong must be 0 yuan.

(3) Jingdong has nothing but money.

5, the United States and Yi Xun joined the melee.

(1) Gome: the price of goods on the whole is 5% lower than that in Jingdong mall, and the same price under 1700 outlets.

(2) Yi Xun: large household appliances /3C is cheaper than Jingdong.

Relying on the shopping platform to set up a website and establish its own website, under the double insurance plan of professional carriers, Zhang Huata went to search for a processing factory to build his own clothing brand.

"In many people's view, online shops are small investments and good operations. In fact, the electricity supplier is definitely the industry that burns money."

Zhang Hua told reporters that initially, she intended to invest 100 thousand yuan, but when the first month's salary was raised, she raised her investment threshold to 300 thousand, but six months later, she had invested about 500000. The main money and energy were spent on the flow. "The purpose is to let more customers know your website or your store."

In order to get fame in a short time, it is essential to pay high publicity expenses to the shopping platform, and this part of the fund is the first hurdle that electricity providers generally have to face. Some people choose to accumulate less and get more. Step by step, the powerful electricity supplier chooses to spend money in the past, and Zhang Hua, who is eager to succeed, chooses the latter.

2010 is a year of e-commerce blowout, also represents the intense online shopping.

In order to compete for customers,

There is a price war between shopping platforms. As a small and medium-sized business provider who relies on these platforms to promote operation, or another noun, people familiar with online shops not only need to be "joined" but also pay high cost of activities and deduction. In the last activity, many shopkeepers are losing money and making money, earning only traffic.