In the first quarter of this year, the retail sales of the home appliance industry fell by 30%, but the small home appliance sector has withstood the impact of the epidemic.
Why do small home appliances go against the trend
According to the "Report on China's Home Appliance Market in the First Quarter of 2020" (hereinafter referred to as the "Report") released by the China Electronics and Information Industry Development Research Institute, the retail sales of the Chinese home appliance market reached 120.4 billion yuan in the first quarter, a year-on-year decrease of 35.8%. Despite the slump in the entire industry, the small home appliance sector successfully managed to break through the trend and withstood the impact of the epidemic, achieving a "starter", many of which have more than doubled sales.
Why can small appliances stand out? What is the consumer demand behind? What is the future development space of the industry?
Young people favor small appliances
"Report" pointed out that affected by the epidemic, the performance of most home appliance companies fell or even lost money in the first quarter, such as Gree, Hisense and other large companies are expected to have varying degrees of revenue decline. However, when the entire industry was hit, small home appliance companies rose against the trend. In the first quarter, Xiao Xiong Electric, which specializes in small home appliances, is expected to have a net profit of between 89.874 million yuan and 107 million yuan, an increase of 60%-90%.
The relevant person in charge of the China Household Electrical Appliances Association told this reporter that, based on the feedback from the company, the domestic sales of many small household appliances have recently increased slightly. In February, the online sales of small appliances such as rice cookers, induction cookers, electric pressure cookers, soymilk machines, cooking machines, juicers, and electric kettles all increased; in March, the sales of desktop electric ovens and cooking machines increased by more than 100%. In addition, in the first quarter, health-related small home appliance products also increased more, such as online sales of disinfection cabinets increased by 51%, air purifiers increased by 25%, and vacuum cleaners increased by 38%.
"The main reason for the growth of small kitchen appliances is that the epidemic has inhibited consumers' demand for dining out. Some people have turned to cooking at home, which has driven the sales of related products." The official said.
Instant water dispenser, all-purpose pot, breakfast machine, air fryer, sweeping robot... Xiao Chen, who has been drifting for 5 years, lives in a 60-square-meter rental house. In order to improve the quality of life, she adds herself Many small appliances. "These small appliances can be taken away when moving, the price is not expensive, and it can make me feel the warmth of the home."
Young people like Xiao Chen are the main user groups of small appliances. According to data from Xiao Xiong Electric, the main consumer groups of Xiao Xiong Electric are "post-95" newcomers and "post-90s" new homes. Among them, female users account for the majority, and they basically gather in first- and second-tier cities. "This group has a strong personality demand, high acceptance of emerging products, but also pay attention to the product's face value, sociality and convenience." Xiaoxiong related person analysis.
"In recent years, especially during the epidemic, people have generally paid more attention to the home life experience, interacting frequently with home appliances, and increasing the demand for quality life. Small home appliances have a wide variety of types that meet the usage habits and needs of Chinese households, so they are affected by consumers’ Welcome," said the head of the China Household Electrical Appliances Association.
There is still much room for growth in the future
Why are small appliances selling well?
Support online channels. Small home appliances are generally low in price, small in size and do not require installation, and are suitable for online channel sales. The relevant person in charge of Xiao Xiong Electric introduced: "Our online business accounts for 90%, so during the epidemic prevention period, overall category sales have shown significant growth." "Report" shows that in the first quarter of this year, online retail sales accounted for 55.8% of total retail sales in the home appliance market For the first time, online channels propped up the “half of the sky” in the home appliance market. In the context of the industry affected by the epidemic, the online channel first regained its vitality, and the online home appliance market began to return to normal in early March.
Get on the live express. In recent years, live broadcasting has become a new outlet, especially because of the impact of the epidemic this year. On June 1st, Gree Electric Chairman Dong Mingzhu live broadcasted on Kuaishou and JD.com, and handed in transcripts of 310 million yuan and 703 million yuan, respectively. In Dong Mingzhu's live broadcast room, small household appliances such as purifiers, juicers, and rice cookers were popular. "After 95" Xiao Xin bought a lot of things in the live broadcast rooms of major platforms. In her view, "compared to home appliances such as air conditioners and washing machines, the prices of small home appliances are not high, and it is easier to stimulate my shopping during the live broadcast process. Desire to form impromptu consumption." During the epidemic prevention and control period, Xiao Xiong Electric live broadcast for 8 to 12 hours a day, realizing the daily live broadcast. "We will form the brand's live broadcast ecosystem this year. In addition to the official flagship store, we will also work with major distributors to create a live broadcast ecological ring." Xiao bear electrical related person in charge said.
The market environment has changed. Industry insiders pointed out that more than 5 million college graduates enter the workforce every year, and renting a house makes them prefer small appliances. The average living area of young people struggling in first-tier cities also makes them prefer small appliances that are small, versatile, and meet the needs of segmentation. As consumption is upgraded, urban households, especially middle-income groups, pay more attention to convenient life and refined life, and bring new types of small household appliances.
Against this background, there is still much room for development in the small home appliance industry in the future. The Prospective Industry Research Institute estimates that China's small household appliance industry will have an average annual compound growth rate of 12.63% from 2019 to 2023, and the market size may exceed 640 billion yuan in 2023. According to analysis by relevant experts, although China's small household appliance market has exceeded 100 billion yuan, the number of households in each household is still below 10, and the Chinese small household appliance industry still has at least three or four times room for growth.
"Small and beautiful", good quality is the foundation
In recent years, the small home appliance industry has maintained rapid growth, showing a state of blooming flowers.
Relevant person in charge of JD.com told this reporter: "The sales of small appliances on the JD.com platform show a relatively high-end, intelligent, and personalized trend. In the first half of this year, healthy small appliances for disinfection and sterilization and small appliances suitable for home use were received The pursuit, especially for small appliances in the health category, continues to decrease."
In this year's Jingdong "6·18" warm-up event, sales of small home appliances are gratifying. Just after 10 minutes at zero on June 1, the turnover of the 600G flux water purifier and air disinfection machine on the Jingdong platform has increased by 8 times year-on-year, and the turnover of beauty equipment has increased by 5 times year-on-year. From June 1 to June 2, the turnover of high-end vacuum cleaners increased by 260% year-on-year, the turnover of neck massagers increased by 6 times year-on-year, the turnover of electromagnetic heating rice cookers increased by more than 150% year-on-year, electric ovens, air fryers, multi-purpose pans, The turnover of chef machines and other products increased by over 200% year-on-year.
The person in charge analyzed that behind the rapid development of small home appliances, it shows that people's consumption concepts are increasingly changing in the direction of pursuing health, comfort, high value and meeting personalized needs.
Consumption upgrading is an important internal driving force for the development of the small home appliance industry. "With the improvement of material living standards, consumer concepts are changing with each passing day. Especially the new generation of consumer groups that have grown up with the Internet, pay more attention to individual needs and pay more attention to product quality. As life-optimized products, small appliances can meet the personalized needs of a better life , In line with current consumer trends and consumer habits. We expect the small home appliance industry will usher in better development. "Xiao Xiong Electric related person in charge said.
"Small and beautiful" should also be based on good quality. Taking Xiong Xiong as an example, internal training is the core of Xiong Xiong's steady development. "The reason why Xiao Xiong Electric can break through the trend is that after 14 years of accumulation, it has continuously enriched product categories, brought consumers a new consumer experience, and built a perfect online sales channel, which makes Xiao Xiong Electric more than 30 Most of the categories can occupy a leading position in the market." The above-mentioned person in charge said.
"The offline market is gradually recovering and accelerating adjustment. Taking the opportunity of '6·18', a new consumption model of online and offline integration is accelerating. Affected by the epidemic, the main battlefield of sales in the second quarter is still online." The "Report" believes that As the effectiveness of consumption promotion policies gradually emerged, markets at all levels gradually recovered and the overall market environment improved. However, due to the uncertain global epidemic situation and the slack prevention and control of the domestic epidemic situation, the market recovery is limited, and the operation is cautiously optimistic.
"As the home appliance industry upgrades and technological innovations continue to strengthen, regardless of the size of home appliance products, they are helping consumers to enjoy a better quality of life in terms of functionality, experience and even entertainment attributes," said the relevant person in charge of the China Household Electrical Appliances Association.