Xu Jing, General Manager Of Red Star Macalline Intelligent Electrical Business Department: The Home Store Will Provide Fertile Ground For The Development Of High-End Electrical Products

With the rapid growth of China's economy and the deepening of supply side structural reform, the market of electrical appliance industry has entered a new operation cycle of consumption upgrading and product structure adjustment. The market share of high-end electrical appliances of major brands is constantly increasing, and high-end electrical appliances has become the future development trend of the market.

On May 1, the world's first "smart electrical life hall" of Red Star Macalline opened in Shanghai. Zhu Jiagui, executive president of Red Star Macalline home group and general manager of large operation center, said that the opening of "smart appliance life hall" is the starting point for Red Star Macalline to march into high-end electrical appliances.

How will red star Macalline locate the intelligent electrical life hall? What impact will high-end appliances bring to the industry? Recently, 21st century economic reporter interviewed Xu Jing, general manager of intelligent electrical business department of Red Star Macalline operation center, and asked him to introduce the prospect and influence of home appliance market layout in home store.

Entering the high end electrical appliance market

21st century: under what background did Macalline begin to build this intelligent electrical life hall?

Xu Jing: the core element is market promotion, and consumption upgrading has brought about tuyere. The background is actually the consumption upgrading of Chinese consumers, especially in the electric appliance sector. In the past, we recognized that electrical appliances were consumer goods at the end of the household decoration process. But in recent years, great changes have taken place in China's high-end consumer electronics.

For example, many homes now need to use whole house water purification, HVAC fresh air, central air conditioning and so on. The demand for these electrical products cannot be met in the traditional electrical channels, because they are closely related to home decoration. Floor heating and fresh air system electrical products must be in the forefront of the decoration on the pipeline preset, placement. Therefore, we proposed three years ago that we should take electrical appliances as the first strategic category of Red Star Macalline, so as to rapidly promote the development of the whole electrical industry.

21st century: how do we position and understand the intelligent electrical life hall?

Xu Jing: the global No.1 store intelligent electrical appliance living center, which opened on May 1, is the first successful implementation of the strategy of Red Star Macalline smart appliance life center in China. It is also one of the largest electrical appliances Living halls in China's home furnishing industry. In the process of building an electrical life Pavilion nationwide, we will follow the following principles.

First of all, we should enrich the categories. In the smart appliances Living hall, which opened on May 1, the exhibition hall has a volume of 16000 square meters, involving HVAC, water purification, kitchen electricity, black electricity, white electricity (including pure imported high-end electrical appliances), etc. For each category, we have made a very clear division and set up a strict spatial division.

Secondly, we will be rich but moderate in the number of brands. We will select the brands in the whole electrical industry that are suitable for operating in home stores to enter our channels. Because the medium and high-end home furnishing channels like red star Macalline are not suitable for selling some low-end electrical products. Therefore, as a channel, we will select high value-added and nested brands to enter the store. About 6-7 brands or 10 brands are preferred for each category. These are some principles for us to promote the electrical life hall in the later stage of planning.

21st century: compared with the offline entity established by a single brand, what impact will the smart appliance lifestyle model bring to the whole industry?

Xu Jing: now high-end electrical appliances, especially system appliances, are becoming more and more the entrance of high-end consumer flow. For our stores, it means that as long as a person is drained through the electrical category, it can bring three or four times the return for the customized furniture, building materials and bathroom, which is of great significance to the home furnishing stores.

For the electrical industry, all high-end electrical brand channels are maintaining rapid growth. Data shows that kitchen electricity, HVAC and other system electrical appliances have maintained a growth rate of about 20% in high-end channels in the case of last year's epidemic. In the future, the franchised store system built by each brand and the home store like red star Macalline will become the only choice for Chinese electrical appliances brands to develop high-end products and promote their own high-end products. At that time, all the layout of the electrical life hall will provide a very good fertile ground for the development of high-end categories of all electrical brands in China.

21st century: in recent years, the trend of mutual penetration between the electrical industry and the home furnishing industry is becoming more and more obvious. What advantages does red star Macalline have?

Xu Jing: the electrical strategy we put forward is to make a systematic plan for the existing electrical products. Especially in the past two years, we have spent a lot of efforts to expand the category, and have done a lot of category expansion and brand expansion on the original basis.

In addition, in the high-end electrical appliance market, the home market represented by Red Star naturally has a very big advantage. According to our judgment, China's future electric appliance industry is divided into three parts. The first one is a platform enterprise with a large share represented by the Internet. In terms of category, it mainly focuses on single piece and small electrical appliances.

The second part is a kind of enterprise represented by traditional electric appliance chain including national and regional. They represent the demand for middle end appliances. The third part is the consumer demand of high-end people in China's electric appliance market in the future. The home furnishing enterprises represented by red star Macalline just fill in this blank.

Therefore, the structure and channel of China's electric appliance market will be very clear in the future. The Internet from the middle end to the bottom will occupy an absolute dominant position, but in the middle and high-end markets, the home stores represented by red star Macalline naturally have very big advantages. Because of the shopping environment of shopping malls and the Category attribute of home decoration front-end, this part of people with consumption power will choose this part of high-end electrical appliances in the front-end of home decoration, which is a very big advantage that other peers do not have.

High end brand will face value war

21st century: what role can red star Macalline play in helping to shape the high-end image of electrical appliance brands?

Xu Jing: there are two most intuitive functions. The first is from the perspective of the environment. Red Star Macalline is creating an excellent and high-end shopping environment at all costs and costs. The moving line, lighting and decoration in the store are built according to the highest shopping environment standards. In the store, the brand positioning naturally has a high-end label, which can bring great endorsement to the brand side.

Second, in our stores, all electrical brands do not have to face a price war, but to face a value war. This is not available in all other channels in China. At Red Star Macalline, we never fight a price war, and we will not encourage or advocate any brand to fight price war in the future. We are the only channel that hopes that the higher the price, the better.

In red star Macalline, brand marketing is to maximize the value of all brands settled through accurate flow marketing. We use a large number of front-end categories, such as customized, bathroom, ceramic tile, floor and other products for drainage through the attributes of the mall.

The high-end intelligent electrical appliances Living hall is a systematic project composed of a series of actions, such as the whole marketing mode, sample form, and the layout of stores. Not only high-end brands and products are put together, but also a high-end store, in which the business logic is very different. At present, red star Macalline has a real one-stop service from the image display of product front-end exhibition hall, to the combination of brands, to the overall shopping environment, including back-end services.

21st century: what are the challenges in creating this kind of consumer scene of home store and electrical integration?

Xu Jing: for me, the biggest challenge is how to tell all the electric appliance brands how to do business in red star Macalline? How to build the business model of your business? The biggest obstacle is not the product, venue, brand, customer source and marketing, but the dealers who help the brand carry the high-end strategy. Objectively speaking, China's traditional electrical appliance dealers are essentially a capital platform, and dealers only need to have capital strength and do a good job in capital turnover. But the home market requires that the electrical appliance dealers have very strong customer acquisition ability and transformation ability.

21st century: do we have any specific plans for community marketing?

Xu Jing: on the marketing side, red star Macalline is different from other stores because we have very strong precision marketing ability. We have our own marketing in group, regional and shopping malls. Especially in shopping malls, we have a precision marketing team, which is specially responsible for accurate customer acquisition in every new development and old residential area.

In addition, on the planning side, we have community marketing tools. All shopping malls, categories and brands have customer groups and user groups. At present, the total number of customer groups in China has reached 20677, covering 3.48 million middle and high-end consumers in China. We will regularly communicate marketing activities, promotion and explosive products through the community, so as to arouse and activate new and old customers.

In addition, we have a cross industry alliance, which is one of the most commonly used and effective means in home stores. More than 400 shopping malls across the country will organize core dealers of various categories to form a cross industry alliance on a monthly basis, in which all brands share customer resources. Through the alliance of different industries, the brands participating in the alliance can obtain more than 10 times of the flow, forming a large number of effective transformation.

21st century: will smart life hall be promoted in other parts of the country in the future? What is the plan?

Xu Jing: now there are dozens of stores in the process of synchronous promotion. It is expected that by the end of 2021, we will complete the construction of smart appliances Living Hall of at least 30 No.1 stores in red star Macalline. The volume ranges from 5000 to 25000 square meters. Next year, we will cover all prefecture level cities with a scale of more than 100. By 2023, we will have completed the coverage of smart electrical life hall in shopping malls across the country.

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