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The water heater market is under pressure, and JD.COM’s home appliance drive line grows.
Affected by the transmission effect of real estate market regulation, China’s household appliance industry was under great pressure in 2018, especially in the kitchen and water heater industries with typical post-real estate cycle characteristics, and the market scale declined collectively. According to the omni-channel data of AVC, the retail sales of electric water heaters in China in 2018 was 32.5 billion yuan, down 0.9% year-on-year; The scale of gas water heaters was 33.1 billion yuan, down 3.5% year-on-year. In the first quarter of this year, the retail sales of electric water heaters and gas water heaters declined by 10.3% and 9.1% respectively. .
Although the water heater industry is still facing a severe market situation, the fundamentals of the industry are still good, and some positive factors still form a strong support for the water heater market, such as online channels, which continue to maintain rapid growth in the overall market downturn.
According to Yang Wei, manager of household appliances kitchen and bathroom electric water heaters in JD.COM, in 2018, the throughput of all categories of JD.COM platform water heaters exceeded 12 million units, a year-on-year increase of 36.2%; While the traditional product categories of electric storage water heaters and gas water heaters continue to maintain rapid growth, the emerging categories such as air energy water heaters and gas-fired heating wall-hung boilers have achieved explosive growth.
As the largest home appliance retailer in China, which accounts for more than 60% of the home appliance online shopping market, JD.COM Home Appliances not only plays the role of an important growth engine in the home appliance industry, but also is one of the main driving forces for upgrading the product structure and terminal market consumption in China’s home appliance industry.
According to the data of household appliances in JD.COM, in the sales of platform water heaters in JD.COM in 2018, the retail scale of large-capacity gas water heaters with 13 liters and 16 liters increased by 10.5%, electric water heaters with cleanable inner liners increased by 76.4% year-on-year, and the proportion of maternal and child bath products increased by 3.2%.
JD.COM’s household appliances also help the category growth of water heaters by accelerating the sinking to the fourth to sixth grade markets. Up to now, JD.COM Household Appliances has operated more than 10,000 JD.COM household appliances stores in 420,000 administrative villages across the country, and the sales rate of water heaters in these stores is as high as 81.4%.
Guo Meide, president of AVC, predicted that in the next 2-3 years, the recovery of the property market and consumption upgrading will promote the sustainable development of the industry; In the next three years, the kitchen and bathroom market will stop falling and pick up, and the market will develop steadily.
A number of measures to promote the development of the industry to create 2019 JD.COM Water Heater Festival
Although the water heater industry has encountered short-term difficulties, mainstream enterprises are generally optimistic about the future market prospects of water heaters. Guo Meide believes that replacement and upgrading will be the two main themes of the kitchen and bathroom industry in 2019. Water heaters have become a necessity for consumers, and the consumption demand of water heaters is becoming more and more diversified, which has also created an upgrading trend of water heater products towards more segmentation.
For the category of water heaters, JD.COM Household Appliances will build a "multi-level, all-dimensional" product matrix, introduce high-end and luxury brands by setting up a high-end product operation team, and make personalized recommendations by analyzing the shopping habits and needs of high-income people to accurately adapt to various consumer needs; At the same time, JD.COM Household Appliances has also set up a new category operation team, strengthened the investment promotion of non-traditional categories such as wall-hung boilers, air energy water heaters and solar water heaters, and explored the retail model of redesigned installation categories.
On April 15th, at the 2019 JD.COM Household Appliances Industry Summit, Yan Xiaobing, Senior Vice President of JD.COM Group and President of 3C Electronics and Consumer Goods Retail Group of JD.COM Retail Group, announced four strategic directions of JD.COM household appliances in 2019.
Yang Muwei said that in 2019, JD.COM household appliances will empower the water heater industry through C2M reverse customization, marketing upgrade, service upgrade and comprehensive layout of new channels. This also means that the four new strategies of JD.COM household appliances in 2019 will be fully implemented in the water heater industry.
During the 2019 China Water Heater Industry Summit Forum, JD.COM Household Appliances announced that it would jointly launch the 2019 JD.COM Water Heater Festival with mainstream water heater enterprises such as Haier, Midea, A.O. Smith, Wanhe, Wan Jiale, Four Seasons Muge, Weibo and Fangtai.
It is understood that during the Water Heater Festival, JD.COM Household Appliances will make personalized recommendations to consumers based on JD.COM’s user big data and sales big data, so that consumers can buy products that are more suitable for them. At the same time, as the key project of JD.COM household appliances this year, Jingpin household appliances based on C2M reverse customization of big data will also be the key recommended products, bringing consumers the best cost performance. JD.COM’s water heater "installation fee capping" will also ensure that consumers have no worries about installation and have the best purchase experience. JD.COM Household Appliances will also launch diversified preferential activities such as the installation of water heaters in 0 yuan, the capping of the installation fee of 200-300 yuan, the maximum reduction of 300 yuan, and the free trial in the first year.
Yang Muwei said that JD.COM has always adhered to the business philosophy of "creating value based on trust and taking customers as the center" and is committed to becoming the most trustworthy retail platform for consumers. JD.COM household appliances jointly organized the 2019 JD.COM Water Heater Festival with mainstream brands in the industry, aiming at popularizing intelligent, energy-saving and high-priced water heater products, conveying healthy and comfortable bathing concepts to consumers, and enhancing consumers’ bathing experience and happiness in life.