Image source @ Visual China
Text | The Tao always makes sense
Some time ago, Idle Fish released a mine sweeping inventory, and selected the "Top Ten Useless Commodities", "Top Ten Entrepreneurial Minefields" and "Top Ten Collapsed House Stars" on Idle Fish in 2021, of which the "Top Ten Useless Commodities" are air fryers, treadmills, e-books, curling sticks, breakfast machines, Polaroids, wall breakers, fascia guns, beauty instruments, and fitness rings.
Although this list has caused a lot of controversy, the results of idle fish are supported by platform resale data, open idle fish, search for keywords such as air fryers and treadmills, and resell these small household appliances. Coincidentally, in the past two months, the air fryer has been on the Weibo hot search three times, of which the discussion of "is the air fryer really healthy" was hung on the list for 12 hours, with more than 420 million readers and several times reaching the top.
After the epidemic, small household appliances are favored, young people with the idea of pursuing a refined life, consumer enthusiasm is high, but the activity of these small household appliances in the second-hand e-commerce platform may be another kind of "human truth".
Small household appliances that are idle are active in the second-hand market
Consumers who are keen to buy small household appliances are also keen to pick up leaks and shop for goods on second-hand platforms such as idle fish and turning.
This year, QuestMobile released a "2020 Small Household Appliance Industry Brand Marketing Insight Report", which shows that the target group of small household appliances is mostly women aged 25-35, which are mostly located in first-tier cities, with high consumption power and willingness, not only pursuing exquisite life, but also keen on shopping around, and have a high enthusiasm for the transaction of idle items.
On the App side, the small household appliance crowd has the highest active penetration rate in the three sub-sectors of integrated e-commerce, preferential price comparison and idle transactions, and from the perspective of use time, idle transaction applications rank second with 274.9 minutes, second only to traditional comprehensive e-commerce applications.
From this report, we can intuitively see that consumers are increasingly favoring small household appliances, so it has contributed to the active trading of small household appliances on second-hand trading platforms such as idle fish and transfer. However, from the opposite point of view, there are people who buy when there is a sale, and the C-end sellers will idle small household appliances, so that these products have returned to the circulation market. And a feature is that the value of small household appliances shrinks rapidly, 80% or 90% of new products, on idle fish usually sold at an average price of 50% or less.
Lazy to use, chicken ribs, trouble, less use of the scene... Young consumers are abandoning small appliances that they once thought would bring happiness for a variety of reasons, which is actually consistent with the problem presented in the idle fish list, which has become the "hardest hit area" for idle goods. Similarly, under the posts of Zhihu or Douban Group, "What I regret the most" or "What I bought has the highest idle rate", various small household appliances topped the list.
A study of small household appliances cooked by working women in urban China released by an institution also showed that the idle rate of small household appliances is around 70%.
The growth of small household appliances in the second-hand e-commerce platform may also directly impact the development of the primary market, because more and more consumers realize that they can spend less money to buy products of similar quality in the second-hand market. According to the data of Aowei Cloud Network, the retail sales of small household appliances totaled 25.08 billion yuan in the first half of this year, down 8.6% year-on-year, and the retail sales volume was 119 million units, down 8.2% year-on-year. Among them, the sales of blenders, wall breakers and juicers, which were the most popular during the epidemic last year, fell by 32.46%, 34.14% and 28.69% respectively year-on-year.
Taking the wall-breaking machine as an example, the price of a Jiuyang wall-breaking machine on Jingdong and Tmall is as low as 299 yuan, and the products of the same brand on idle fish are generally about 100 yuan; the original price of a brand of net red vacuum cleaner is nearly 3,000 yuan, while the price of the same vacuum cleaner on the second-hand platform is about 500 yuan cheaper, and the price of "used twice" can be up to nearly 1,000 yuan cheaper.
Of course, the most essential reason for the retreat of the small household appliance consumption boom is that the exquisite life concept created by pure marketing for young people, and the lack of performance and use experience of the product itself, so that the buyer has a huge gap and refuses to pay for it.
Pseudo-exquisite young people, pseudo-demand for small household appliances?
The retail market for small household appliances has declined as a whole, but specifically, the performance of sub-categories is not the same. For example, in the kitchen small household appliances, the turnover of breakfast machines on Tmall in the first quarter of last year rose by 453%, but this year's double eleven consumers are extremely cold to small kitchen appliances, and the sales of breakfast machines have declined significantly. Looking at dishwashers, as of the end of August, the total sales of domestic dishwashers reached 5.77 billion yuan, an increase of 15.8% year-on-year.
It can be seen that after the freshness subsides, the demand for small household appliances that take the lazy economic route can still remain stable, and the small household appliances that focus on health, health, beauty and other functions and claim to improve the quality of life are entering an obvious calm cycle.
Is refinement more of a pseudo-demand than the demand generated by "laziness"?
Naturally not, in all aspects of life such as personal care, beauty, pets, home appliances, travel, etc., refinement is the common pursuit of young people's consumption, especially Z generation women, the pursuit of refinement, the pursuit of ritual has become a core concept of consumption, which has derived many market segments with considerable consumption potential. But in the home appliance market, why is exquisite marketing gradually failing?
On the one hand, the performance and use defects of the current small household appliances are really not enough to support consumers' yearning for exquisite life, and even sometimes increase the burden. Such as portable juicer, when consumers squeeze juice, they need to peel the fruit, cut into small pieces, and then put it in to squeeze the juice, and then wash it after squeezing, this set of processes down, at least half an hour; and then the breakfast machine, the size is limited, the ingredients are difficult to put in, it is easy to overflow accidentally, and it is not easy to clean up.
As a netizen complained on the social platform, "once the freshness of small household appliances has passed, I found that the takeaway is really fragrant."
The performance of small household appliances is essentially because it is the product of the sudden outbreak of demand during the epidemic last year, coupled with the fact that most companies emphasize marketing and light research and development, rather than focusing on a product for performance improvement, they are more willing to choose to expand the category and win the attention of consumers. As a result, the quality of small household appliances on the market is uneven, which is diametrically opposed to the pursuit of high-quality life.
On the other hand, after the epidemic, young people are increasingly unable to live a refined life, and from pseudo-refinement to exquisite poverty, reflecting their increasingly pragmatic pursuit of consumption.
As early as last year, there are data reports showing that China's post-90s have become the main debt group, the average debt is as high as 127,000 yuan, debt overwhelms the income, becoming 18.5 times the latter, in addition, the average debt-to-income ratio of young people is 41.75%, and only 13% of young people are unsolicited.
Under the high debt, the consumption capacity and concept of the mainstream consumer group have changed, Ai Media Consulting pointed out that from the perspective of consumption, a considerable part of the population in China still has a high sensitivity to commodity prices, and consumption downgrade characterized by "low price, debranding, good quality and low price, and basic functions" has become a phenomenon that cannot be ignored. Therefore, we have seen that retail models such as advent food and small sample economy that enjoy exquisite consumer experience at affordable prices are sought after.
Epidemics, debt, unemployment... The exquisite life of young people is broken, and it is not the happiness created by small household appliances that can make up for it.
Who is the delicate "trap" of small household appliances?
Last year's epidemic, small household appliances on the social platform with overwhelming content, to create a beautiful life scene, greatly stimulated the consumer's desire to buy, for a time, a variety of small household appliances became one of the hottest product categories during the epidemic. But when the marketing routine of exquisite life is punctured, it is not only consumers who are "blinded" by fantasies, but also perhaps home appliance companies themselves.
In the past decade, the traditional home appliance market has continued to be sluggish, consumers have insufficient motivation to replace new ones, and the entire industry has been seriously saturated. According to the data in the "2019 Semi-annual Report of China's Home Appliance Industry", in the first half of the year, the retail sales of the domestic home appliance market were 412.5 billion yuan, down 2.1% year-on-year, of which the retail sales volume of the color TV market was 22 million units, and the retail sales were 64 billion yuan, showing a trend of "volume decline" compared with the same period last year.
Affected by the epidemic, in the downturn of the home appliance market, small home appliances have exploded unprecedented consumer demand, which has become the only bright spot in the industry.
The contrarian growth of small household appliances has made many traditional home appliance companies and kitchen appliance companies go down, they take this as a breakthrough to break the market downturn, and in the short term, this strategy has indeed brought positive effects. For example, Jiuyang, according to the 2020 financial report, Jiuyang achieved operating income of 11.224 billion yuan, an increase of 20.02% year-on-year, and net profit attributable to shareholders of listed companies was 940 million yuan, up 14.07% year-on-year, which was the first time that Jiuyang's revenue exceeded 10 billion yuan.
Traditional home appliance giants have also tasted the sweetness of the small home appliance market. Compared with Gree and Midea, according to the "China Business Daily", Dong Mingzhu has believed that the small household appliance business is a "chicken rib" since taking office - the quality is difficult to control, which will damage the reputation of Gree electrical appliances, so small household appliances are gradually marginalized within Gree, and Midea will gradually transfer the small household appliance business to the line around 2014, with the outbreak of new small household appliances, last year's revenue growth was obvious.
Gree and Midea have each and for a long time, and many people in the industry have attributed one of the reasons to the different attitudes of the two sides to small household appliances.
However, home appliance companies borrow small home appliances to drive the new growth potential of the entire home appliance market, this idea will inevitably make them fall into blind optimism, and when the consumption boom cools down, many home appliance companies are immediately "beaten back to their original form". For example, Xiao Bear Electrical Appliances, on July 23 last year, the stock price of Xiao Xiong Electric Appliances soared all the way, reaching a maximum of 165.90 yuan / share, and then began to fall, as of December 8, the closing price was 61.83 yuan / share, even the highest point of the fraction is not enough.
"Because the tone set last year was too high, it formed a high base for this year's performance," explained people in the small household appliance industry why the financial reports of companies such as Xiaoxiong Electric Appliances were not good.
Compared with small home appliance companies, the market sense of traditional home appliance giants is more sensitive. As early as January this year, Fang Hongbo said at the 2021 Midea Group Management Annual Meeting that the small household appliance business of the United States is not facing development problems, but survival problems. Therefore, Midea has readjusted its small household appliance business and obviously begun to develop in the direction of intelligence.
In addition, it is worth noting that the growth miracle of small household appliances last year, to a large extent, marketing stimulated consumption, and how small household appliances came out of the common disease of the industry of "heavy marketing and light research and development" is also a major problem.
In the home appliance market, only by forming technical advantages and hitting the actual needs of consumers can small household appliances be truly recognized.
This is also the road to be taken by small household appliances in the future, rather than "adding bricks and tiles" to the second-hand e-commerce platform.