11 promotions are more affordable online and offline home appliances

October 10, 2020

11 promotions are more affordable online and offline home appliances

The Golden Week 11 has traditionally been the revelry of Gome and Suning and home appliance companies. But this year, this mad welcomes another competitor such as Jingdong and Tmall. JD’s menacing, indicating that they will spend RMB 100 million to participate in the promotion of 11 appliances, Tmall’s use of the slogan of “big buy electricity, National Day 100% free shipping” slogan, to effectively counter competitors that there is a large electricity company The saying that delivery is not timely.

In the same day that Jingdong launched the 11th promotion and announced “1 billion micro-letter red envelopes and discounts as low as 40%,” Gome Online has thrown out “promotion of national cool coupons with a total value of nearly 100 billion yuan”.

It is worth pondering that Gome Online's brother company Beijing Gome Electric Co., Ltd. "blasted" e-commerce is the first price increase after the phenomenon of price reduction. Beijing Suning put forward the slogan of “Buy your return price difference”.

Whether it is Suning’s “online and offline same price” or Gome’s “lowest price on the online or offline”, Jingdong’s realization of “national unified price” has caused consumers to look confused.

What consumers want to know is that there are a variety of promotional activities. Which one can buy the cheapest products?

From the general logic of the industry, the lower the merchant's cost of sales, the greater the space for product price reduction. Yan Xiaobing, vice president of JD.com and general manager of the home appliances division, said that traditional home sales costs for wires account for about 16% of products, while online channels cost less than 8%. Therefore, online channels are 8% cheaper than physical stores. If the prototypes, booths, and promotions that include traditional offline channels account for 8% of the cost of home appliance companies. From the perspective of manufacturers and retailers, online channels are 15%-20% cheaper than offline.

It is an indisputable fact that the hard cost of offline channels for store employees, rent, etc. is rising year after year. Consumers also have reason to believe that it is cheaper to buy goods online. However, Gome Online denied this and stated that GOME’s online logistics costs are lower than JD. Therefore, Gome has further room for price cuts. Wang Junzhou, the president of Gome, said earlier that the low price of Gome Home Appliances is an underwriting custom, so it can be the cheapest.

Perhaps these are unable to control which platform consumers choose to purchase. Some attentive consumers take a direct comparison of prices from the Internet, and then go to the physical store to find ways. The simple truth is "Who is cheaper? I will choose who." However, more consumers have found that online brands and models of home appliances that are not well-known online are not available offline, and vice versa, offline products cannot be found online.

The fact is that compared to the single, nationally-priced products such as automobiles, mobile phones, and foods, there are currently hundreds and thousands of product models for home appliances, and it is difficult for consumers to choose between them. In fact, home appliance brand dealers have differentiated products between different channels, online and offline, online and online, offline and offline.

A household electrical appliance company stated to Tencent Appliances that due to the benefits of price and channel, it is difficult to form the unity of online and offline products. "The cost of online channels is actually lower than the offline, but the low prices on the Internet will impact other sales channels in the country. It is difficult for us to make the same price online and offline, and the products are exactly the same."

It is reported that even if GOME and Suning have online and offline channels, the coincidence of home appliances is less than 30% or even lower.

Analysis of the industry, put aside the business festival promotions, consumers can hardly compare the same brand and model of the product online and offline price differences, only from the same brand, the same function of the product to compare the lowest price. Whoever is cheaper becomes a "false proposition."

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