来源 | 伯虎财经（bohuFN）
Author | Dreamed
In 2021, in the variety show "We Are New to the Workplace", Dong Mingzhu, chairman of Gree, praised Meng Yutong, saying that he met the standards for successors. Then in November of that year, Meng Yutong posted on social platforms that he had been in Gree for two months, and netizens were envious: "Debut is the peak" and "God chooses to work as a worker".
Just last week, a video of Dong Mingzhu's speech at the induction ceremony of Gree's 2023 college students circulated on the Internet, Dong Mingzhu once again cued Meng Yutong, who had already "flown solo", "I don't know what secretary it is, but I became an Internet celebrity with the help of our platform, we can no longer tolerate such a person in Gree Electric, so we fired her", which once again aroused heated discussions among netizens.
Another hot topic that made netizens talk a lot is that not long ago, Dong Mingzhu praised Wang Ziru for his strong professionalism in the show, and mentioned that Wang Ziru has experienced the exercise of the market, and has been working for many years, and his cognition of life is not on the same level as that of a recent graduate.
Interestingly, Wang Ziru and Meng Yutong joined Gree in the same year.
Whether it is Meng Yutong or Wang Ziru, the public has extended from them to Dong Mingzhu and then to Gree, and there are countless reports in all aspects. Ten years ago, the billion-dollar gamble with Lei Jun, the founder of Xiaomi, attracted enough eyeballs for Gree, and two years ago he vowed to train fresh graduates Meng Yutong as his successor, and saved hundreds of millions of advertising dollars for Gree, and now it seems that Wang Ziru is going to be pushed to the front of the stage.
However, the reaction from the capital markets may be more real. As of press time, the market value of Midea is 370.7 billion yuan, the market value of Haier Smart Home is 195.7 billion yuan, and the market value of Gree is 180.4 billion yuan, and Gree is at the bottom.
01 The "core technology" of the air-conditioning industry is the channel
From birth to the present, the air conditioning industry has gone through a hundred years, and this time span has made the market very mature, and the vast majority of the share is concentrated in Gree, Midea, Haier and other head players. At the same time, due to the slow iteration of technology, the essence of competition in the air conditioning industry is more aimed at the market side, that is, the marketing, channels and prices that we often mention.
Needless to say, Dong Mingzhu has been a frequent visitor to hot searches for many years, and has become a veritable marketing spokesperson for Gree with his "dare to speak" personality. Whether it is the 1 billion gambling contract with Lei Jun, or the appointment of a young man who has just graduated as the "next Dong Mingzhu", it has attracted enough attention on social platforms.
In terms of price wars, Gree has fought countless price wars, from offline store discounts to online live broadcasts, Gree has repeatedly participated.
But looking at the air conditioning industry, the real barrier lies in the channel. Gree has been a leader in the industry for many years because of the channel, and now it is temporarily falling behind because of the channel.
At present, Gree's offline stores are mainly directly operated stores, agent stores, specialty stores and dealer stores. The company mainly relies on specialty stores to sell goods, and when the sales of specialty stores are the highest, they account for about 80% of the company's electrical sales. The sales work is generally responsible for the regional sales management company, forming a solid sales channel system - provincial regional sales companies, county-level agents, and terminal sales outlets.
Among them, Gree holds shares in the provincial-level regional sales company, and the provincial-level sales company directly controls the county-level agents, and Gree does not settle with the county-level agents. Gree's most well-known "off-season rebate" model is also based on this.
During the transition between summer and winter, Gree provides discounts for dealers, encouraging dealers to make payments in the off-season and pick up the goods in the peak season. In this way, for Gree, the off-season production capacity has been improved, and the inventory crisis has been solved, and the dealers have greater profit margins, so that the two have formed a deep bond.
Under this channel model, Gree has formed a solid sales channel system across the country, which is the main factor for Gree to sit firmly on the throne of air conditioning for a long time. In 2019, Gree was selected into the Fortune Global 500 for the first time with a revenue of 198.153 billion yuan, ranking 414th, with a year-on-year increase of 0.02% in revenue and a net profit of 24.697 billion yuan.
But since December 2020, Gree's share price has continued to fall, and it is currently about 31.49 yuan per share, which has fallen by about 45% from its high point, and its market value has evaporated by nearly 200 billion yuan. Air conditioning is still the lifeblood of Gree, accounting for 71.36% of revenue in 2022, but in the past three years, Gree's air conditioning revenue has not increased significantly.
In 2022, the first place in the market share of Gree household air conditioners will also be taken away by Midea.
On the one hand, the air conditioning market has cooled down in recent years, and the domestic household air conditioning market has continued to grow negatively, on the other hand, the live broadcast has gradually weakened the characteristics of air conditioning season sales.
02 How difficult is channel rectification?
Speaking of channel reform, you can first take a look at the United States, from the initial learning Xi Gree's "regional sales company" model, to the later headquarters will take back the sales into an operation center, and at the same time cooperate with the "T+3" model to flatten the channel, open the network batch model, and gradually surpass Gree in the new retail environment, which can be described as a model of homeopathic change.
According to the analysis of the Future Think Tank, Gree can draw three key points from the reform of the United States:
1. Reduce the channel level, and promote the flattening of channels by promoting the transformation of sales companies and agents.
2. Make efforts in e-commerce channels to increase online share.
3. Strengthen the underlying support for warehousing, logistics and digital construction.
It's just that for Gree, the resistance is not small.
During the "6.18" promotion in 2020, Dong Mingzhu brought goods in a live broadcast, setting a new record of sales exceeding 10 billion yuan in a single live broadcast. As a result, two days later, the provincial dealer alliance Jinghai Internet reduced its holdings in Gree. In July of that year, Jinghai Internet reduced its holdings again.
Obviously, this is a provincial-level regional sales company expressing its dissatisfaction with Gree.
The honey that was previously deeply bound has also become a bitter fruit.
First of all, Gree should leave enough profit margins for the channel, once the profit is reduced, all links in the distribution will lose the power to sell goods. Secondly, Gree does not carry out direct settlement with county-level agents, there is no direct contact, and Gree does not have much say in the intermediate link between the provincial sales company and county-level agents.
So if Dong Mingzhu wants to develop live streaming and increase the proportion of online sales, he must cross the level of provincial sales companies, and in the context of the cooling of the air conditioning market, Gree's channel system is also more bloated. According to public data, as of 2022, Gree has 26 channel-based sales companies across the country, covering 40,000 outlets at the most.
In this case, Dong Mingzhu began to reduce the number of his live broadcasts, and Meng Yutong was pushed to the front of the stage. There are two main purposes: 1. to promote channel reform through live streaming, and 2) to drive the growth of new categories.
She began to build momentum for Meng Yutong crazily, appeared in variety shows, was appointed as an assistant, and endorsed it as "Dong Mingzhu's successor" many times, creating countless gimmicks, but everyone also knew in their hearts that Dong Mingzhu wanted to make Meng Yutong Li Jiaqi of Gree.
Li Jiaqi's live broadcast ability is obvious to all, and at the same time, he has also single-handedly brought fire to domestic brands such as Huaxizi, but so far no MCN has been able to create a second Li Jiaqi. For example, the recent Dongfang Selection and Dong Yuhui incidents, in short, the reasons for a head anchor can be summarized by tens of millions, but one of the most important points is audience popularity, and this is a metaphysics.
In the case of Dong Mingzhu's support, Meng Yutong's first live broadcast GMV was 620,000, and in the next half year, her total sales in the "Pearl Yutong Selection" live broadcast room did not exceed 4 million.
Not to mention Meng Yutong, Dong Mingzhu's first live broadcast with goods also had a dismal performance, and later the live broadcast performance got better and better, and there were still dealers behind it. Dong Mingzhu launched offline dealer drainage in the live broadcast, and consumers placed orders through the exclusive QR code shared by the dealers, and the Gree headquarters shipped the goods directly, thus bypassing the provincial regional sales company. As a result, the provincial sales department began to fight back.
As the saying goes, the greater the expectation, the greater the disappointment.
In August 2022, Meng Yutong joined Gree for less than a year, and the avatar of "Pearl Yutong Selection" was changed from Dong Meng's group photo to Dong Mingzhu's personal photo, and the anchor in the live broadcast room did not have Meng Yutong.
The live broadcast was far less than expected, and the veteran employees fled, and Xu Spontaneously, the general distributor of Hebei Gree, held a banquet and announced in a high-profile manner that he would leave his old club and turn to Philips.
After Meng Yutong left Gree, Dong Mingzhu was "unforgettable", but Gree's "Li Jiaqi" strategy did not work, what should Gree do.
03 What's next for Gree?
Wang Ziru, who joined the company with Meng Yutong, began to walk to the front of the stage.
Some time ago, Wang Ziru and Dong Mingzhu appeared on the show for an interview together, and they dominated the hot search on the screen because of some "shocking speeches". In the show, Wang Ziru's new title in Gree also surfaced: leader of Gree Electric Appliance Headquarters and leader of the channel reform project.
According to the Yuanchuan Research Institute, in the past year or so, Wang Ziru has traveled to Anhui, Jiangxi, Hebei and other places, and held conferences for local dealers everywhere he went to promote a new system called "cloud network batch".
Interestingly, Midea also had a similar system at the beginning, called "Meiyun Pin". At that time, e-commerce giants such as JD.com and Suning directly reached consumers through direct brand procurement and factory direct supply; compared with the traditional channels of distribution by home appliance companies such as Midea, the markup rate was lower, and their terminal prices were even lower than the wholesale prices of traditional channels, making them more competitive.
As early as 2017, Midea began to flatten the channel level. Abolish the secondary distributors, and at the same time promote the transformation of the function of the primary agents to operators. At the same time, through Meiyun sales, the network batch model is realized, the direct connection between terminal dealers and manufacturers is realized, and the digital transparency of important information such as channel sales, channel inventory quantity, and channel policies is realized, so as to promote the sinking of channel management and the improvement of circulation efficiency.
It's just that, compared with the original "killer" of the United States, Gree's channel reform is still relatively "mild": Gree did not violently abolish the previous model, but chose two channel networks in parallel.
At the same time, Dong Mingzhu has also continued to move towards a new manufacturing industry in recent years, for example, Gree has continued to make efforts in semiconductor and new energy business, and even acquired Gree Titanium (Yinlong) to enter the field of energy storage.
From the perspective of income type, Gree's business currently covers four major areas: air conditioning, household appliances, high-end equipment and smart home. On the one hand, however, diversification has not changed the fact that Gree relies on the air conditioning business. According to Gree's 2023 semi-annual report, the revenue of the air conditioning business still accounts for 70.5% of the company's total revenue, other "household appliances" account for only 2.19%, and the increasing green energy and intelligent equipment account for only 2.94% and 0.25% respectively.
Another example of diversification progress being hampered is that investors have begun to express their views in real money. On the evening of December 19, Gree Electric announced that it planned to acquire 24.54% of the shares of Gree Titanium New Energy Co., Ltd. (hereinafter referred to as Gree Titanium) for 1.015 billion yuan. After the opening of the second day, Gree Electric fell by more than 7% in a single day, and the cumulative market value evaporated by more than 13 billion yuan.
Not only investors, but also an industry expert is not optimistic about Gretitanium. Mo Ke, founder and president of True Lithium Research, said that lithium titanate has existential value. But don't expect to make lithium titanate much bigger, because it's really a niche market.
But the good news is that Gree still has time to make a difference. On the second day of the stock price crash, Gree released a performance forecast for 2023, which is expected to have a net profit attributable to the parent company of 27 billion yuan to 29.3 billion yuan in 2023, a year-on-year increase of 10.2%-19.6%, and a total operating income of 205 billion yuan to 210 billion yuan, exceeding market expectations, thereby driving the stock price back. Judging from this year's semi-annual report, Gree's book wealth management and cash are about 200 billion, which is also far ahead of its peers.
In the Fortune Global 500 released in August this year, Gree failed to make the list. In the face of a reporter's question, Dong Mingzhu said: "I know whether the enterprise is good or not, and I know whether there is a disease or not." "Gree is still a good company, but there are clearly problems that need to be solved.
Reference Sources:
1. Yuanchuan Research Institute: Don't be too embarrassed by Meng Yutong
2. Yiouwang: Wang Ziru is up, Gree is down
3. Yiouwang: Dong Mingzhu is tough, and Gree is weak
4. Future Think Tank: Special Report on the Home Appliance Industry: Gree's Channel Reform from the Self-Evolution of Midea
5. Guangdong Satellite TV: Q&A