With a market scale of 100 billion yuan, will the home building materials channel be a new blue ocean for home appliance enterprises?
With a market scale of 100 billion yuan, will the home building materials channel be a new blue ocean for home appliance enterprises?
China's home appliance market has already moved from the incremental era to the stock era, and various home appliance enterprises have played games with each other in the stock space. Starting from the consumption scenario, explore permeable incremental opportunities, enter the front decoration market of home building materials from the back decoration market of traditional home appliance retail channels, and further expand the new model of home appliance sales channels.
In fact, as early as a few years ago, home decoration and home appliances have begun to integrate with each other. Home building materials industry duopoly unexpectedly home, red star Macalline are overweight to expand home appliance business, in-depth cooperation with various home appliance brands to achieve a win-win situation. This cross-border breakthrough in opening up the service chain and industrial chain is inevitable under the development of multi-channel integration.
How large is the front decoration market of household appliances?
Affected by the real estate regulation and control policies, the total amount of hardbound houses in China decreased significantly last year, but in inverse proportion, the proportion of refined decoration residential area in China is steadily increasing year by year. According to AVC data, from 2019 to 2021, the proportion of refined decoration residential area in China was 35%, 39% and 44% respectively. Among them, among the supporting household electrical appliances, the supporting rate of kitchen electrical products is the highest, accounting for more than 95%; HVAC, water heater and disinfection cabinet take the second place; The matching rate of traditional large electric products such as refrigerators, washing machines and televisions is low.
Specifically, in the hardcover market in 2021, 785200 sets of cigarette machines were matched, with a year-on-year increase of 12.2% and a configuration rate of 97.4%; 729000 sets of stoves were matched, with a year-on-year increase of 11.7% and a matching rate of 95.4%; 844000 sets of disinfection cabinets were equipped, with a year-on-year increase of 20.5% and a configuration rate of 29.5%; There were 542000 dishwashers, with a year-on-year increase of 46.1% and a configuration rate of 18.9%. The front loading market has a very obvious agglomeration effect on kitchen electrical products.
At the same time, with the development of whole house customization, one-stop purchase has gradually become a major demand of consumers. Coupled with the release of people's demand for home decoration and transformation, more and more consumers meet their own needs by combining home appliances and home products through front decoration purchase, set purchase and scene purchase of home appliances. According to the big data of AVC real estate, with the dual promotion of the demand stimulation of old house transformation and the incentive of fine decoration policy, the market scale of home decoration industry is expected to reach 3.8 trillion yuan in 2025, and the market scale of home appliances supporting home building materials will exceed 126 billion yuan.
The cooperation between home appliance enterprises and home building materials channels is getting better and better
The huge market "money" scene shown by the home building materials channel has attracted many home appliance enterprises to enter the market.
According to the financial report of Haier Zhijia in 2021, 723 home building materials contacts were added during the reporting period; Haier Zhijia's brand three winged bird layout front-end user entrance has covered more than 1100 building materials markets in China; In August 2021, LG Electronics released its Huanran series of products at incredibly home and opened a comprehensive strategic cooperation with incredibly home; In June 2021, Asko, with its classic product series, entered the home to create a new experience of packaged household appliances. In September 2018, boss Electric Co., Ltd. joined hands with incredibly home to comprehensively upgrade its strategic cooperation. On December 25, 2018, Midea's Colmo's first front loading experience store was officially opened in incredibly home. In March 2022, Midea cooperated with red star Macalline; In February 2022, Boxi home appliances reached strategic cooperation with red star Macalline, and will conduct in-depth cooperation in resource complementarity, store expansion and so on; Li Wei, vice president of Hisense China marketing headquarters / general manager of strategic channel business group, said that in their layout of channel economic construction, channels such as incredibly home and red star Macalline are their strategic cooperation units.
From the perspective of home building materials channels, the boundary between them and home appliances is gradually blurring. As early as July 2018, incredibly home officially signed contracts with first-line brands such as TCL, Gree, vantage kitchen electric, Siemens and boss electric, and became a strategic partner; At the meeting of strategic cooperation with Haier Zhijia at the beginning of 2022, incredibly home revealed that in 2022, incredibly home will open more than 500 stores and Gmv sales will exceed 110 billion yuan, of which the overall scale of smart home and electrical appliances will account for more than 12%. In February 2022, red star Macalline, together with dozens of domestic and foreign top home appliance brands such as Haier Zhijia, Hisense, Fangtai and boss, jointly launched the high-end home appliance market and announced to build 100 smart appliance living halls with an area of more than 10000 square meters in two years.
"In fact, we have always been connected with household appliance enterprises. At that time, it was the concept of electrical appliance house, which was to put all electrical appliances together to cultivate consumers' consumption awareness." Guo Jinyong, general manager of the smart home appliance business department of incredibly home, told the reporter of China home appliance network that incredibly home established the smart home appliance business department in 2019. At this stage, the smart home appliance business accounts for less than 10% of the overall business area of incredibly home, and its sales account for about 11% of the group's 110 billion yuan sales. The home building materials channel at the front end of the consumption chain can effectively concentrate the target consumer groups, drain each other among multiple categories and formats, improve the overall average customer unit price and improve the floor efficiency.
The emerging blue ocean channel highlights the high-end value of scenario
The extension, transformation and mutual integration of channels are accompanied by the development of the whole household appliance industry. The market channels of home appliances have become more diversified, from the enclosure of traditional home appliance hypermarkets, to the share grabbing of online e-commerce platforms, the accelerated promotion of the new retail model, and then to the gradual rise of home building materials channels.
At present, the home appliance market is increasingly saturated, and all channels of home appliances are under pressure. In particular, the living space of traditional home appliance channels has been further squeezed under the erosion of a large number of passenger flow by e-commerce channels. According to the report released by China Electronic Information Products Development Research Institute, from 2020 to 2021, the proportion of offline retail sales in the home appliance market continued to decline, accounting for 49.16% and 47.08% respectively, with a year-on-year decrease of 21.13% and 2.08% respectively.
With the help of the rapid popularization and application of the Internet, e-commerce channels have also experienced weak growth recently after several years of rapid growth in traffic dividends. According to the report released by China Electronic Information Products Development Research Institute, the growth rate of online retail sales in China's home appliance market from 2020 to 2021 was 14.48% and 11.1% respectively. The slowing growth rate indicates that the dividend of Internet traffic is quietly declining.
On the other hand, with the acceleration of consumption upgrading, China's home appliance market is accelerating towards high-end. Due to the lack of practical perception and quality concerns, it is difficult to drive the sales of high-end household appliances, which has always been the weakness of e-commerce channels. For example, Haier three winged bird and Hisense mentioned above, their efforts in high-end and integrated household appliances make it urgent to find a platform channel that can show consumers in an all-round way in terms of experience and scene. The home building materials channel can well meet the needs of household appliance enterprises, strengthen the home building materials channel of value-added experience of overall design and decoration style, and cater to some families pursuing high-quality life, It is also more in line with the sales demand of home appliance enterprises for high-end products.
From the consumer side, based on the trend of home integration, consumers also have higher requirements for the appearance experience of home appliances, and pay more attention to the adaptability between home appliances and the overall home and the integration with the scene. The home building materials channel that can match the home appliance products with a full set of comprehensive home products can bring consumers a stronger sense of experience, while the traditional home appliance hypermarkets are more display furnishings, so they lack the substitute impression of the whole home. "In the front dress, what we give consumers is a scene feeling." Guo Jinyong said.
For example, integrated stoves, sets and household appliances, the current main trend categories with higher requirements for home scene integration are confirmed in the sales data of home building materials channels. According to the big data of AVC real estate, taking the sales data of Red Star Macalline in February 2022 as an example, in addition to the traditional kitchen electrical products most favored by consumers, the central air conditioner ranks second with 18.7% sales. In addition, the whole house water purification and integrated stove also have good sales performance.
The home building materials channel has gradually developed from only individual categories such as HVAC and water purification to covering more diversified and comprehensive household appliances, maintaining considerable consistency with the mainstream channels and becoming an emerging blue ocean channel. Guo Jinyong said that they are very optimistic about the home appliance business, which is a sector that maintains a growth trend. It is expected that the business area of the home appliance business in the home can reach about 15% in the future, and the sales will account for 16% - 17%.
But at the same time, Guo Jinyong believes that compared with the home building materials channel, the traditional channel also has their strengths, such as higher understanding of home appliances and higher control over home appliance manufacturers.
However, no matter what advantages and disadvantages, commonalities or differences various channels have, only grasping consumers is the key to winning the market. We should accurately grasp consumers' demands, so as to change our ideas and fight the market with the core competitiveness of channels. Only in this way can we have a stable foothold and long-term development in a changeable environment. For home appliance enterprises, it is also necessary to accurately judge the changes of consumer consumption mode and structure, and expand the layout in accordance with the general trend of development, so as to seek greater profit space.
