In 2010, the Jingdong Dangdang price war provoked a lot of waves. Afterwards, some insiders commented that this is a realistic version of the Battle of the Three Kingdoms. Later, in 2012, the Jingdong Suning price war incident, which was also attended by Jingdong, once again opened the curtain of competition in the e-commerce industry. This price war originated on August 14, 2012, Jingdong CEO Liu Qiangdong issued two microblogs, Weibo as a fuse, quickly opened the prelude to this e-commerce war, followed by Dangdang, Yi Xun, etc. Joined, a sensation.
After the incident, all parties expressed their views on the matter. Some people said that the purpose of Jingdong’s move is actually to crack down on the ability of Gome and Suning to sell electricity. Others believe that without proper reasons, selling goods at a price lower than the cost is prohibited by the anti-unfair competition law. Regardless of whether we are right or wrong, we need to take this opportunity to reflect on this. The price war is an inevitable outcome of the market economy and an important part of marketing. It plays a positive and negative role in the process of enterprise development. If you are good at using, you can seize more market share, but once you use it badly, you will kill one thousand and lose 800.
Price wars are not only found in large companies, but in our daily lives, they are everywhere. We can often see the slogan of a certain store in a certain store, the store is full of graffiti and the price is greatly reduced. In order to compete for passenger traffic, the two similar stores use each other to reduce their prices. The price is a double-edged sword that can hurt people or hurt others. An irrational price war is usually equal to the same.
In the fierce market competition, the price war has been in existence for a long time. As a competitive ace mastered by the company, it exists in all walks of life. Although the price war has advantages and disadvantages, in the wallpaper industry, when it comes to the three words of price war, many people in the industry have to frown and shake their heads. Deliberate low-price competition has become one of the chaos that the industry has to face.
The castle in the air, the price war is self-destructive.
“The air-rise hall, the meaning of the cloud. Unrooted aerial lofts are often used to ridicule those unrealistic subjective dreams. There are many companies in the plate industry who are fighting price wars. They want to abandon other hard conditions. Winning the market alone to win the victory is undoubtedly also building a groundless castle.
Low-cost sales, can not be generalized, can be divided into several situations: the first is overcapacity, the backlog of products urgently need clearance, in order to win the flow of funds; the second is at a specific time or region The price cuts, such as the Golden Week holiday, the opening of new stores, and so on; the third is the benign and orderly market competition for competitors. However, it should not be overlooked that there is still a kind of low-price sales in the industry that is vicious. For the short-term immediate interests, blind dumping at the low price regardless of product quality and cost will disrupt the market.
As a means of competing for the enterprise, the price war is the survival of the fittest. It can, to a certain extent, eliminate some vicious competitors who only seek short-term benefits for the industry, so that the industry resources can be rationally utilized. On the other hand, it is also a self-injured sword. It is a way to obtain short-term profit growth by sacrificing its own interests. This is tantamount to drinking and quenching thirst, exhausting and fishing, and cannot achieve long-term development.
Some big companies really use price war as a way to seize the market. In order to seize the market opportunity, they implement a strategic loss plan. The big companies are relatively strong in their own strength and have certain brands. The effect is strong, and it has unique conditions in self-developing and innovative marketing. Under certain circumstances and conditions, it has the ability to compete in the corresponding price. These are unmatched by SMEs.
The above is based on the premise of benign competition, but in the current plate industry, low-price competition has become a vicious competition that affects the industry’s development. In the case of serious homogenization, similar style, your price is low, then my price will be lower than yours! Low price touches the bottom line of interest, long-term unreasonable low-priced sales, corresponding to profit After the reduction, the profits will be reduced, the investment in research and development, innovation, marketing, etc. will be reduced, the seriousness will lead to the quality of the products can not be guaranteed, affecting the development of the enterprise, falling into the cycle of repeated vicious cycles, the final result, Undoubtedly the self-destruction of the future.
Low price is no longer a competitive trump card, hard power is more important
“ high quality and low price is indeed the unanimous voice of consumers, and consumers are also the fastest applauding for price cuts. crowd. In the era when consumers are kings, many companies are holding the mentality of winning consumers with low prices. However, with the advancement of the times, changes in market demand, especially after the 80s and 90s became the main force of consumption, the new consumption concept followed the rise, and the price advantage gradually receded, no longer the only indicator to be able to collect consumers.
Compared with the price, consumers will pay more attention to product quality and brand. With the popularization of the concept of healthy home, environmental protection has gradually become one of the hard targets of the public. The superposition of all these factors makes consumers have more rational thinking about low-priced products. The change of consumers’ choice of ideas makes the possibility of profiting by price wars smaller, until the price of products approaches the cost or even lower than the cost. At the time of the company, it will become more and more difficult for the company to make a profit. When it is really unprofitable, it will be eliminated by the market, or it will start to seek other breakthroughs. Brand competition, quality competition, investment competition, service competition, etc. will gradually become the main way of competition. This benign competition will eventually end the malicious price war and promote the development of the entire industry.
The brand effect plays a huge role in the competition. When consumers don’t know much about the wall coverings in this industry, the influence of brand and word-of-mouth effect will increase. So more and more companies are starting to focus on brands.The creation, from advertising to celebrity endorsements, through a variety of marketing methods to make their brand awareness continue to expand.
Brands only let the public let consumers know about your existence. Really strong brands are based on excellent product quality, unique design and reassuring service. Therefore, when enterprises build brands, they also need to increase investment, pay attention to product R&D and innovative design, strictly control every step of product production, and ensure that the products that reach consumers are qualified and qualified.
“ Just as all goods and consumption have matured, the future of wallpaper terminals is definitely a quality product for brand companies. Some insiders say so. The competition of enterprises is ultimately only a contest of products. The compression of cost by malicious price competition will inevitably affect the quality of products to a certain extent. What seems to be similar, there may be no small difference in quality.
In the face of the status quo, the general manager of Guohao said in an interview, “Our industry development is very difficult. What is the difficulty? The main thing is that there are too few original things, everyone plagiarizes each other and hits the price. The war has made the industry more and more difficult. The products are not only excellent in quality, but more importantly, they need innovation, fit the times, and enter the hearts of consumers.
Therefore, in an increasingly mature market environment, sheet companies should not rely solely on price to win the market, but should put their own hard power indicators up, promote the brand, protect the quality, Good service, down-to-earth craftsmanship, dedication to development, in order to stand in the fierce market environment.
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