Suning Tesco rushed to "6.18" and competed for the offline low price tag with the "big store strategy".

China Business Daily (Reporter Jiang Yongxia) On May 10, Suning Tesco announced that it would take the lead in opening "6.18" with the "517" air conditioning activity, and will also launch activities such as "ice washing" in the future. In fact, Suning Tesco not only rushed to the e-commerce platform in terms of time, but also actively joined the low-price battlefield of the "6.18" promotion, keeping up with the "lowest price on the whole network". In addition, Suning Tesco also announced that it will fully participate in the "6·18" offline this year, and will land more than 20 large stores across the country during the "6·18" period.

It is not difficult to see that as an important home appliance sales channel, Suning Tesco, which has returned to the offline focus, also wants to label the "6.18" offline low price.

During the "6.18" period, Suning Tesco will land more than 20 large stores across the country. (Photo courtesy of the interviewee)

Set off a storm of low prices

On May 8, a reporter from China Business Daily learned from Suning Tesco's "6.18" merchant conference that Suning Tesco will take the lead in opening the "6.18" promotion on May 17. At the same time, Suning Tesco announced that it would fully participate in this year's "6.18" offline and launch a low-price action in thousands of cities and stores.

The key words of "6·18" are promotion and low price, and Suning Tesco wants to become a player of the "6·18" promotion, so it is natural to keep up with the "lowest price on the whole network". It is reported that during the "6.18" period, Suning Tesco will join hands with Midea, Haier, Siemens, Gree, Casarte, Little Swan, Toshiba, Sony, TCL, Fotile, Boss, A.O. Smith and other head home appliance brands to refresh the low price of popular items in all categories and the whole network, and consumers can buy their favorite home appliances at the main venue of Suning Tesco online platform or Suning Tesco offline stores across the country.

Focusing on creating a "cheaper '6.18'", Suning Tesco launched specific actions. On May 10, Suning Tesco held the 2024 air-conditioning consumption trend release and the launching ceremony of 10,000 people grabbing air-conditioning in Beijing, announcing that it would take the lead in opening "6.18" with the "517" air-conditioning activity.

It is understood that the market price of air conditioning raw materials has risen this year, and the industry has launched a discussion on whether the price of air conditioning products will rise. Just when the market was in a wait-and-see situation, Suning Tesco took the lead in making a statement. Xu Zhong, president of Suning Tesco Environmental Commodities Division, made it clear that in the case of rising raw materials this year, Suning Tesco co-brand promised that the price of products would not increase during the "517" air conditioning period, so as to fully benefit consumers and truly realize the price of "6.18".

In addition, in order to meet the needs of users for quality improvement and replacement, Suning Tesco co-branded parties have increased the first sales of new products, increased subsidies, improved the scene and service experience, and effectively benefited consumers. Suning Tesco and the head brand launched a free trial of one million home appliances, focusing on categories such as kitchen and bathroom, air conditioning, ice washing, etc., and providing consumers with a 10% discount on payment. On this basis, Suning Tesco also cooperates with local governments, banks, different industries and other partners to create a quadruple subsidy of "government, enterprise, factory and bank" to further increase the trade-in of the old for the new.

From May 17th to May 19th, consumers can enjoy a high subsidy of 10% for trade-in, unlimited products of 1,999 yuan, and a full reduction of up to 3,000 yuan.

Air conditioning products take the lead

Suning Tesco fully participated in the "6.18" war, and air conditioning products became the vanguard.

As a hot-selling category of home appliances, air conditioners have this strength. According to the data of Aowei cloud network, the scale of the domestic home appliance retail market reached 849.8 billion yuan last year, a year-on-year increase of 3.6%. Among them, the retail sales of the air conditioning market were 211.7 billion yuan, a year-on-year increase of 7.5%. This growth rate is not only higher than the overall growth rate of the industry, but also ranks in the forefront compared with other home appliance categories.

"The domestic home appliance market demand ushered in a slow recovery, and the current retail sales growth rate of air conditioning products is relatively high. In the first quarter of this year, affected by the large base of the same period last year, the growth rate of retail sales of air conditioning products slowed down, and the data in the second quarter is worth looking forward to. Guo Meide, president of Aowei cloud network and an expert in the field of household appliances, said that "6.18" is the peak season for air conditioning sales, and the sales of air conditioners during this period will determine the overall trend of air conditioning products in the second quarter of this year.

In order to fire the first shot of this year's "6.18", Suning Tesco spent a lot of thought on grabbing air conditioners.

The reporter learned that during the "517" air-conditioning event, Suning Tesco prepared multiple promotional activities, mainly including trade-in, explosive products at a fixed price, and the three main activities of full reduction, and also arranged to celebrate the 20th championship of Inter Milan Serie A, free air conditioning red envelopes and international Milan official peripherals and other activities.

In addition, Suning Tesco has launched a number of service measures for the replacement of air conditioners, including free cleaning of millions of air conditioners, free trial and free design of 10,000 air conditioners, instant installation, free inspection and maintenance, and 10 free installation services.

It is worth noting that during the event, the debut of many new air conditioners became a major highlight. It is reported that in Suning Tesco's "517" air conditioning activity, Suning Tesco will release a number of new air conditioners in 2024 in conjunction with Midea, Haier, Hisense, Beko and other brands. In particular, the application of some products in emerging use scenarios has become the focus of many people's attention.

It is understood that at present, the market of air conditioning products in traditional scenarios such as living rooms and bedrooms is close to saturation, and home appliance brands and retailers urgently need to find new increments.

Xu Zhong said that from the analysis of the scene of China's air conditioning industry in 2023, the bedroom study and living room scenes account for a relatively large proportion, but the growth rate of the air conditioning scale in this scene has slowed down; For example, the market size of air conditioning products in kitchen scenes has exceeded 550 million yuan, with a growth rate of 128.8%.

Aowei cloud network research also shows that air conditioning products in new scenarios such as kitchens will be the next growth space for the home appliance industry. "The current penetration rate of air conditioning products in the kitchen scene is less than 1%, and the expected penetration rate in the future is 15%, and there is a great opportunity for development in this field." Guo Meide said.

"Big Store Raiders" consolidates offline advantages

Since the beginning of this year, Suning Tesco has accelerated its physical retail layout, which has also become a strong boost for its competition for "6.18".

This year, Suning.com focused on omni-channel construction, supply chain development, and service capacity improvement, and accelerated the upgrading of retail service providers. Among them, for the offline market, Suning Tesco focused on the "big store strategy", solidly promoted the "100 stores and 10 billion" plan, and launched a new and upgraded large store format - Suning E-home Super Experience Store (Max) and Suning Tesco Super Flagship Store (Pro).

On the eve of May Day, Suning Tesco landed 17 large stores in 13 cities including Fuzhou, Nanjing and Beijing, with an additional business area of more than 250,000 square meters. In the Beijing market, on April 17, the company signed a contract with Zhongta Company to win the Beijing CCTV Tower project, an important landmark commercial body in Beijing, and will build the first Suning Yijia Max super experience store in Beijing of more than 20,000 square meters.

The reporter learned that during this year's "6.18" period, Suning Tesco will also land more than 20 large stores such as Suning E-Home Max and Suning Tesco Pro in more than 10 cities such as Chongqing, Hefei and Wuhan.

For Suning Tesco's return to offline and the increase in the layout of large stores, there are many optimistic voices in the industry. "Suning Tesco was able to open stores in a big way, and it seems that it has eased up." Zhuang Shuai, an expert in the retail e-commerce industry and founder of Bailian Consulting, believes that the return of the core business means that Suning's hematopoietic capacity is constantly recovering. For the market, this is a positive sign.

Suning.com's financial report data also proves this. According to the financial report data released by Suning Tesco at the end of March this year, last year, Suning's net cash flow from operating activities was 2.91 billion yuan, a year-on-year increase of 561.37%. In addition, the sales scale of Suning's core home appliances business increased by 11.9% year-on-year, and the gross profit margin of household appliances and consumer electronics business was 11.86%, an increase of 11.28% year-on-year.

After the financial situation improved, Suning.com's rapid opening of stores to consolidate its position as an important offline home appliance retailer was also recognized. Zhuang Shuai believes that offline channels are important retail channels for home appliances, which is irreplaceable, and not long ago, Jingdong also laid out a super experience store format offline. There are great opportunities for the development of offline home appliance retail channels, and there is no problem for Suning Tesco to increase the number of offline stores.

Relying on the offline store strategy, it is worth looking forward to whether Suning Tesco can start the first shot of this year's "6.18".