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Every year, many people say that the LED lighting market is breaking out, but in fact, the real market potential of LED lighting has not been discovered. The definition of the LED lighting market explosion should mean that LED lighting products enter the homes of ordinary people. At present, LED lighting products are mainly used in municipal, commercial, supermarket and other engineering channels, and relatively few applications in the home market. As the price of LED products is gradually accepted by the market and the technology is constantly improving, it is predicted that LED lighting will usher in a real outbreak in 2014-2015. Of course, the market is big and the competition will be more intense. Emerging LED chips and packaging manufacturers are actively deploying the LED light source market. Traditional lighting giants are rapidly transforming LED lighting based on brand and channel advantages. More small and medium LED lighting companies also adopt network, engineering channels and physical stores to expand their business. In 2014, the LED lighting industry has started a full-scale battle. So which of the new rounds of competition is the main battlefield of the LED lighting industry?
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The price war escalated into a value war and mentioned the main battlefield of LED lighting. Most industry insiders said that 2014 is still the price war. From 2014 to 2016, it has been hailed as the gold of the LED lighting industry for three years. Almost all lighting companies regard LED lighting as the focus of their business. As more and more companies join the battle, market competition will further intensify.
Once upon a time, because of the high price of LED products, the acceptance of LEDs by mass consumers is very low. Nowadays, the industry has undergone tremendous changes. LED is no longer a conceptual luxury product, but a product that is close to the civilian market and enters thousands of households. At present, LED lighting has entered the micro-profit stage and has shown several typical characteristics: First, LED manufacturers have increased, competition has intensified, production capacity has risen, oversupply, raw material prices have fallen, and product prices have naturally declined. Second, LED chips have been monopolized by foreign companies. More and more domestic enterprises are participating in the competition of chips, and the increase of market share naturally lowers the price of upstream products. Third, with the development of LED product technology, the driving power supply is more and more stable, and the heat dissipation is also coming. The better, the innovation of industrial design leads to the reduction of the overall LED manufacturing cost. Fourth, the price war of LED is very fierce. Some enterprises use the blind spots of consumers to reduce the price by reducing the quality of products. This kind of irrational competition will Lead to abnormal development of the industry.
Many people in the industry are gnashing their teeth at the price war. They believe that they have undermined the rules of the industry, so that all enterprises do not have enough profit margins, resulting in the phenomenon that the entire industry has not increased profits. When product homogeneity is flooding the market, product features are scarce, and specialization is not high, in addition to price cuts, there are no other effective ways to solve product sales. The trend of price cuts is like a butterfly effect, sweeping the entire LED lighting industry. Those who are unsettled are swaying by the wind, and they are decisively fighting in the market with a larger price cut, and they want to die and die. There are still rational thinkers who are not moving, closely watching the market changes, and playing a market in the market segment. But now the market segment is about to become a red sea, LED lighting industry has long been no paradise.
The price war is so full of smoke, which makes the LED lighting industry very impetuous. Fortunately, some companies have found their way forward in the fog, and consumers are gradually returning to rationality after suffering from quality, from emphasizing product price to value. Price concessions must rely on technological advances to manage procurement, production, and corporate operating costs, rather than sacrificing product quality. At the time of the value war, the company's business philosophy, brand image, service capabilities, market reputation will also be more and more concerned by consumers. Upgrading the price war into a value war is not only for the sustainable development of the company, but also for the purpose of gathering like-minded enterprises and promoting the LED lighting industry to develop in a more healthy and orderly direction.
Engineering and e-commerce channels will become mainstream. When the price war has not stopped, many companies have pointed out that the channel war is imperative. As we all know, channels are a key resource in the LED lighting market. For different market segments and needs, LED lighting companies should adopt corresponding channel strategies. High-quality distribution channels help companies control the efficiency of capital use and avoid excessive bad debts, thereby improving the company's operations and profitability.
The so-called channel is the best in the world. At present, there are several modes of LED lighting channels: first, through the dealers, the traditional channel mode of large logistics and large circulation; second, through engineering and designers, the project operation is the main The engineering channel mode; third, the hardware channel mode of sales through the hardware stores all over the streets or in the countryside; fourth, the targeted channel mode for targeted sales for one or several industries or fields; E-commerce channel model for online sales through e-commerce.
Industry sources believe that engineering channels and e-commerce channels will become mainstream. From the perspective of LED product flow, LED lighting mainly relies on engineering to achieve sales. Although the impact of e-commerce on traditional channels is inevitable, in the short term, e-commerce is still difficult to shake. The investment in engineering channels is small, and the production is fixed by sales. It is the channel choice for the lowest risk of enterprises. Therefore, engineering channels are the way for brand enterprises.
According to current data, the proportion of e-commerce sales is still small, and there is no threat to traditional channels. As an emerging channel, the potential and speed of e-commerce market for LED lighting is also unimaginable. Especially for some new LED lighting companies that have a large number of blank areas in the national market, the development of e-commerce channels is non-stop. The industry believes that e-commerce has become the innovative way for new LED lighting companies to develop their own brands, which is also an inevitable trend of future development. Even existing businesses have completely abandoned the traditional channels that are being developed and are fully committed to the e-commerce channel. With the openness and transparency of information, online shopping is increasingly favored by the public. As a platform for virtual transactions, e-commerce is infinitely large. As long as there is a place for logistics, it can solve the problem of product supply. Instead, customers have a wider range of radiation. It not only solves various cumbersome problems of offline transactions, but also expands the cooperative relationship between enterprises and local regions.