In 2022, can home appliance companies still stir the market through price strategies? Due to the impact of the epidemic, the 2022 China Home Appliances and Consumer Electronics Expo AWE2022, which was originally scheduled to be held on March 17-20, 2022, will be postponed. If there is any new progress, further notice will be given. From the market point of view, whether it is in the incremental period or in the stock period, price is an inescapable topic. In the past, the home appliance market achieved market increments by virtue of successive price wars. Under the condition of stable raw material prices, home appliances Under the circumstance of low cost pressure, enterprises continue to live a good life with a broad market size and a slight profit level. However, this situation has begun to change in recent years. On the one hand, the saturation of the home appliance market has reduced the incremental space for the market size. On the other hand, under the marginal diminishing effect, low-price strategies are becoming more and more difficult to attract consumers to pay. . Especially after the epidemic, enterprises have fallen into the dilemma of rising raw material prices and raising cost levels, coupled with consumers’ bearishness about future expectations, and more frequent promotions, which make traditional promotion methods gradually fail. Today's home appliance companies are caught in a dilemma in terms of pricing strategy. On the one hand, companies hope to offset the impact of rising raw material prices by raising product prices, but they are faced with sluggish consumer demand and a decline in corporate shipments. On the other hand, by reducing product prices to activate consumption, it is difficult to cover costs and enter a state of no profit or even negative profit. This makes the company's pricing strategy more cautious.
1. Change of pricing strategy.
2022, the home appliance industry will change in pricing strategy, one of the most important factors is that the outbreak still unwinding of global supply chain problem, and finally the main change is that oil, copper and other basic raw material supply nervous, prices remain high, not only seriously affected the normal production and manufacturing, logistics costs are rising at the same time, The operating space of home appliance enterprise pricing strategy is further limited. With the impact of the epidemic still lingering and factors uncertain, it remains to be seen how tight the supply of raw materials can be eased. This puts enterprises in a passive position, and small and medium-sized brands have to raise product prices in order to protect themselves. Small and medium-sized brands have poor ability to digest costs. In the case of high raw material prices for a long time, small and medium-sized brands can only transfer pressure through price increases.
2. Turn to value wars.
The home appliance industry has been caught in a price war for many years, resulting in the dilution of profits for many years. Home appliance manufacturers need to adjust prices to guide the industry and the market to a healthy direction of development. In the case of raw material prices continue to fall, midea and other head manufacturers of the price logic is essentially based on this. In the past, when raw material prices were relatively low, the profit margin owned by home appliance manufacturers was used to expand the market scale. Although there was little downside in the Red Sea market, it was still a self-destructive way of hurting the enemy. As raw materials continue to compress profit margins, the drawbacks of "price war" begin to appear, and home appliance manufacturers feel severe pain. This makes home appliance manufacturers accelerate the "price war" away from the tactical scope. On the other hand, consumers have begun to grow up under the education in the market. They no longer regard price as the only factor of purchase, but pay more attention to the attributes of technology, design and innovation of products. The growth of consumers is also forcing manufacturers to face up to the needs of consumers, forcing home appliance enterprises to give up the strategy of changing quantity with price, and then transfer the center of gravity from "operation" to "product".
This is particularly evident in the promotional activities of enterprises. Consumers have lost interest in the more and more frequent, more and more template and routine promotional activities, which directly leads to the increasingly poor effect of the activities, and it is difficult to reproduce the scene of consumption triggered by promotional activities. This forces companies to make changes in their marketing strategies as well as their business strategies. Enterprises need to invest more efforts in promotional activities, so that promotional activities often do new, in the fight quantity, fight efficiency at the same time, but also fight quality, fight execution. In business, it is necessary to abandon the price war and turn to the value war and brand war to win users through better products and services at higher prices, so as to expand profit space. In the "value war" in which both product value and service value are upgraded, business opportunities may be won through innovation. Through continuous value-added experience, users will feel value, not just low price.
Appliance&electronics World Expo (AWE) adheres to innovation and change, and has achieved continuous breakthroughs in scale, quality and global influence. It is one of the three top home appliances and consumer Electronics exhibitions in the world. For more information on the exhibition, welcome to the site of AWE 2022.