Ceramic Industry Half-Month Talk • Issue 2
(This article is about 3800 words, it takes about 20 minutes to read)
Today's article is the second issue of "Half Moon Talk on the Pottery Industry".
The reason why I wanted to write the column "Half Moon Talk on the Pottery Industry" was not just a whim. The author is a veteran of the Internet industry and a newcomer to the ceramics industry. He has been in the Internet industry for many years and has worked in many jobs such as technology, product management, and operations. Later, he switched to the home customization and decoration industry, and he still has a little knowledge of the ceramics industry. But perhaps because of this little knowledge, I can interpret this industry from a different perspective, so I came up with "Half Moon Talk on the Pottery Industry".
I would also like to say hello to everyone. If there is an incomplete or biased analysis in "Half Moon Talk" due to a lack of sufficient understanding of the industry, please forgive me.
A few days ago, the author and my colleagues visited the ceramic tile sales markets in Chengdu and Chongqing. Although they are only the southwest market, you can tell the whole story at a glance. This is generally the case for the ceramic tile market across the country.
If we look back thirty years and look back at today's ceramic industry, perhaps the first half of the industry has ended and the second half is about to begin. It is currently in the transition stage. Mainly reflected in the following aspects:
First, the ceramic industry has shifted from the chaotic and barbaric growth of multiple brands to the intensive development of brands. It is an indisputable fact that the concentration of top brands is getting higher and higher, and the lives of brands in the middle are getting harder and harder.
Second, with the intervention of capital, the production bases of ceramic companies have continued to expand, personnel and teams have been continuously optimized, and they have sufficient capabilities to conduct market research. The ceramic industry has transformed from large-scale production to service-oriented production.
Third, the ceramic industry's attention has shifted from the back-end of production to the front-end of consumption. In the past, we were unable to understand the market immediately. The industry happened to be still in the blue ocean stage. Companies sold whatever they produced. The market response was relatively slow, which also gave the industry a correspondingly long response cycle. However, with the continuous development of Internet technology,With the development of China, people have more and more channels to understand information and obtain information more and more quickly. Consumers’ positioning, needs, styles, preferences and other information are fed back to the brand immediately, and the cycle of feedback and influencing production is getting faster and faster. short.
Fourthly,category extension, price extension, and service front-end have become industry trends. Due to the serious homogeneity of the ceramic industry, companies will use product research and development and upgrading as the main means to achieve differentiation when they are unable to obtain first-hand information from consumers. "Product is king" once became Corporate Creed. However, when product quality is basically the same, especially when brand concentration is getting higher and higher, brand value creation, multi-category operations, and service provision have become the most important parts.
Fifth, affected by national macro policies, channels are facing reconstruction. The two cities we investigated this time, Chengdu and Chongqing, are very different in terms of implementing the national full decoration policy. The proportion of finely decorated houses in Chengdu is as high as 80-90%, while the proportion of finely decorated houses in Chongqing is only 20%. -30%. However, if the disadvantages of material procurement are eliminated for finely decorated houses, it is still the general direction and trend. On the other hand, prefabricated buildings are gradually emerging in the country, and the national old house renovation plan is also advancing. Residents' needs for secondary decoration, sectional renovation, and improved housing decoration are all changing. Therefore, affected by national macro policies and industry development, ceramic tile sales channels are facing tremendous changes.
Sixth isThe emergence of a new species "rock slab" has broken the boundaries of product applications in the ceramic industry. While improving their production technology and product design, ceramic companies are facing the big business end (home furnishing dealers) that they have never faced before, and at the same time they want to take into account their original channels of small business owners. terminal (dealer). Although the slate is good, it is difficult to find channels; although the market is good, it still needs time to educate, and it may even take the curve of home materials to save the country.
The above six aspects show that for the ceramic industry, whether it is the integration of markets, products, brands, channels, marketing, services, or the home furnishing industry, the ceramic industry is forced to respond, forced to change, and enter the second half.
How will ceramic tile brands and dealers respond under such circumstances? Based on the terminal research in Chengdu and Chongqing, the author would like to share some of my humble opinions.
About the brand
1. Brands develop in a "U" shape. The head brands are relatively concentrated. The middle brands are at the waist or bottom of the "U" and gradually disappear. The wholesale brands show the development trend of Dashang (large building materials wholesalers).
In the first half of the ceramic industry, leading brands achieved rapid development mainly through channel expansion and market increment; in the second half, leading brands must rely on category extension, price extension and service front-end to achieve breakthroughs Performance growth. It is no longer appropriate for relatively weak brands to rely solely on channel expansion to achieve performance growth.
So, where does the weak central brand go?
In market research, the author found that some brands that take the characteristic route of segmented fields, although their market share is not very high, are still doing well. Then, the weak central brands may learn from it.Stop taking the "big and strong" route. They should "be strong first and then become bigger", look for differentiation, and do So focused.
The author summarizes the development paths of strong brands in the head and weak brands in the middle as follows:
Strengthening the local brand: Promote the public awareness of the brand, carry out channel penetration and expansion in all aspects, and comprehensively increase the terminal market share;
Weak brands in central China: Dig deep into differentiated brand awareness, focus resources on channel penetration, and conduct in-depth and precise customer marketing.
In short, the second half of the ceramic industry has begun, with brand concentration getting higher and higher, and it is time for a showdown between strong central brands and weak central brands. Not surprisingly, the top brands will eliminate a large number of middle-level brands. Under the high-pressure expansion of top brands, the only ones that can survive are those brands that insist on differentiation.
Perhaps in the early years, the ceramic industry has already been talking about this topic; with the intervention of capital, the industry reshuffle will intensify, and the market will not have much time left for central brands.
2. Through research, we found that, except for "Donnuo Mengma", other industry-recognized brands in Foshan may not do well nationwide. Many of the brands we consider to be old and big brands in the industry turn out to be in someCities are doing pretty poorly.
The reason is that on the one hand, due to the influence of brand concentration, brand awareness is indeed declining; on the other hand, it is also because many brands only focus on industry promotion and not on consumer promotion.
Judging from the development history of other home furnishing industries, brands must eventually reach the mass consumer end before they can be recognized and accepted by the public. There is no need to delay the transformation of brands from "industry-recognized brands" to "consumer-recognized brands". For brands in central China, it is even more necessary to increase investment and do a good job in popular brand promotion.
3. The homogeneity of products in the ceramic tile industry is very serious. Companies that make general products will grow into large-scale companies if they carry out brand upgrades, channel expansion, and market operations at the right time. Enterprises that have not taken the scale route need to explore segmentation strategies: Consumer segmentation, product segmentation, and market segmentation. If you fail to keep up with these rhythms, you will gradually be marginalized or eliminated.
This is why specialty brands in niche areas do better. In the future ceramic tile market, there will be either big brands, leading brands, or specialty brands. One of the two must be chosen.
Fourth, consumers either recognize big brands or product quality, there is no middle value. If a small brand has no characteristics, does not pay attention to product quality, and is highly homogeneous, it will be eliminated.
We found in the survey that the current consumer decision-making groups are mainly concentrated in the three age groups of 70, 80 and 90. Their consumption concepts are polarized. In the 1970s, they focused on brands, while those born in the 80s and 90s paid more attention to product quality. and value for money.
About the dealer
After talking about brands, let’s talk about dealers.
In the first half of the development of the ceramic industry, dealers accounted for more than 80% of the industry's sales channels. It can be said that the relationship between dealers and ceramic companies is closely related. Years of sharing the joys and sorrows and mutual achievements have also accumulated deep feelings between dealers and ceramic companies.
In any case, ceramic companies will never abandon dealers! So, how to change so that both parties can continue to win-win?
1. Multi-category operation.
Multi-category operation means that dealers sell not only ceramic tiles, but also other household products (or other auxiliary materials), forming a complementary relationship.Bring orders to each other and complement each other's resources to meet consumers' one-stop decoration needs.
This is consistent with the logic behind why decoration companies are popular. When consumers purchase building materials, buying good ceramic tiles is their basic need; on this basis, we can help them quickly find their favorite building materials and style combinations. If it can be done in one stop, it will meet their expected needs. At the same time, various building materials categories can bring orders to each other, which will also enrich the business scope of dealers.
When we walked to the terminal this time, the most eye-opening thing for us was the Chongqing dealer of Tongli marble tiles, which integrated elevator and tile sales. Even the showroom was perfectly matched and took orders from each other.
2. Service front-end.
For consumers, ceramic tiles are a low-frequency consumer product. Many people only decorate their houses once or twice in their lives and only buy ceramic tiles once or twice. Therefore, services such as selection, purchase, transportation, paving, return, and maintenance of ceramic tiles are Take it seriously.
For ceramic companies and dealers, ceramic tiles are semi-finished products that require later paving to achieve results. In fact, this is also the reason why ceramic tiles have not done very well in the e-commerce field.
When everyone is selling relatively homogeneous products, the element of service that solves consumers' pain points becomes prominent.
During research in Chengdu and Chongqing, the author found that when many dealers talk about service, they simply think of it as a service attitude towards customers. In fact, this is not the case. There are a lot of services before, during and after the sale of ceramic tiles. If we provide good services in these links, we will quickly win the market, win users, and win reputation. We will weaken our products and strengthen our services. Every dealer store will become our service outlet. Only in this way can we strengthen the service radius and respond quickly, so that consumers can buy and use with confidence, and ensure quality and safety.
This includes many services that originally belonged to the brand headquarters rather than dealers, so we call it "service front-end".
In our research, we found that some of the better services include the delivery of finished products provided by Chongqing Nobel Ceramic Tile, and the warranty card provided by Chongqing Jinyi Ceramic Tile.
3. Product lines are complementary.
During the visit, we found that some dealers found a new way to represent two brands, one of which is a popular brand in the mid-to-high-end line, and the other is a distinctive brand, forming a ""High-precision" combination.
This is actually a complementary product line.
At the actual sales terminal, some consumers rely on the brand, and some rely on the degree of product preference. However, a single popular brand with serious homogeneity often does not have strong competitiveness when competing with leading brands. At this time, if you represent a specialty brand, it will be easier to catch the customer's itch and let them Customers stay, and eventually the two stores complement each other to meet customers' one-stop purchasing needs.
This can be regarded as a very effective means for dealers to compete in the market.
For example, Mr. Zhou Zhiye, a ceramic tile dealer in Chongqing, also represents two brands of Douglas tiles and SK (Shenke) tiles, which complement each other and shine.
4. Central warehouse mode operation.
The operation of the central warehouse model requires the coordinated operation of the ceramic tile brand headquarters and dealers. Setting up a central warehouse by the headquarters alone may be a mere formality, difficult to manage, and cannot achieve the effect of a real central warehouse. However, if a ceramic company sets up a central warehouse in a certain area and allows dealers to participate in the management, it will achieve twice the result with half the effort. Effect.
There are three major benefits to setting up a central warehouse: First, it can deliver goods quickly, seize market opportunities, and help dealers achieve short and even sales; second, it can effectively reduce dealer business risks, including reducing product damage caused by transportation and alleviating inventory pressure. , to help dealers pack lightly and fully participate in market competition; third, to help dealers create competitive advantages in engineering channels.
For ceramic tile brands, setting up a central warehouse is imperative and is also a responsible approach for dealers.
The above are the four aspects for dealers to respond to market and industry changes. In addition, there are many other methods such as the big business model, cross-industry alliance operations, and vigorous development of new retail, but without exception, they all Ceramic tile brand headquarters and dealers need to work together to seek change and win together.
Follow China Ceramics Network and Liu Shi's "Half-Month Talk on the Ceramic Industry". See you in the next issue.
Author:Liu Shi
