channel innovation

Reason for selection: In this year, in order to get rid of the dependence on channel providers such as Suning and Gome, home appliance manufacturing giants continued to make efforts in building their own channels, and Haier's Goodaymart Group even became the second The third largest electrical appliance chain in Suning and Gome. Although the industry has always had mixed reviews, but today, when the home appliance industry has entered the era of high channel cost from the era of huge profits, self-built channel direct control terminals can be regarded as a beneficial attempt by enterprises to increase profits and avoid waste of resources.

Representative practice: Gree's specialty store model; Haier's Goodaymart Group

In July this year, Gree set up a central air-conditioning interactive experience center in Panyu, Guangdong. Compared with traditional specialty stores, the interactive experience center can provide users with Pre-sale, in-sale and after-sale one-stop professional services. And Haier's acquisition of Ri Rishun shows that the home appliance industry is becoming more and more enthusiastic about the control of channel terminals.

Looking back at the channel development history of the entire home appliance industry, "self-built channels, not hand-picking others" is the label of Gree's model. Of course, this model is not the first of Gree, but only Gree has carried it forward.

Love and hate are all due to the change of air-conditioning channels

To talk about Gree's channel model, we must talk about Gree's history. Every enterprise chooses a path based on its own development, and Gree is no exception. Looking back at its origins, Gree Electric has only one main business from beginning to end—air conditioners. Compared with Haier, Midea and other multi-product lines, Gree has always pursued professional ideas. Specialization means that the industrial chain touches a narrow and deep point. Since there is no such thing as "the east is not bright and the west is bright", how to control the profit lifeline and have absolute channel pricing power is the top priority of Gree's consideration.

So, we can understand why Dong Mingzhu cares so much about the battle for control. He does not hesitate to use any measures to make the dealers bow their heads and the big home appliance oligarchs to bow their heads. Gree has no way out. Unlike Midea and Haier, other companies can coordinate and interact with multiple product lines in terms of price. Other companies do have to make greater compromises and concessions to major home appliance chains and local dealers. As far as Gree is concerned, there are only air conditioners. If the pricing power of air conditioners is compromised, it will be hurt.

For example, Hubei Gree Air Conditioning Sales Company, which made Gree famous, due to market chaos, Gree made the first move of bundling and controlling distributors in order to stabilize the air conditioner business in 1997. Large distributors form a regional brand sales company through joint stock and become a provincial-level secondary management organization, and do not set up sales branches themselves.

This type of consortium model of manufacturers has been proven by the market in the future to be a good medicine to effectively solve the smuggling and vicious competition among dealers. At the same time, through certain property rights, it also partially solves the problem of creating and sharing interests. In other words, this model is also convenient for manufacturers to further strengthen the optimization management of channels.

However, with the development of the situation, the disadvantages of this model are increasingly exposed. The reason is very simple, because the bundling is mutual. Gree bundles several dealers, making them the main force in the charge, and gives discounts and rebates in the off-season. , year-end rebates and other preferential measures, but while helping Gree to open up the market, the channel dealers are also flourishing, and there are more and more complaints about Gree's many bundled strong practices. In 2000, the channel turned against the tide. In the following years, Gree was busy with "cutting the vassal" of the local princes, strengthening the equity, becoming the controlling shareholder, re-dividing the region, gradually taking the power to the headquarters, and strengthening the dominance of the Gree headquarters in the provincial joint ventures.

In the eyes of outsiders, this channel practice has a lot of controversy. Some people think it is to remove the grind and kill the donkey, and some people think it is a necessary measure to ensure the standardization of the channel. There are different opinions, but the only impressive thing is Dong Mingzhu's Iron-fisted measures, all those that touch the bottom line are removed immediately.

Crisis and Opportunity of Self-Building Channels

In 2004, the dispute between Gree and Gome could be said to be the fuse that accelerated the road to Gree specialty stores. At that time, many comments believed that major appliance chains were the mainstream trend. Gree gave up this channel and invested a lot of cost and energy to build and manage its own stores on a large scale. In the end, it would only be worth the loss.

In fact, chess players are always better than bystanders, because it is the chess players who are responsible for any action, and so is Gree. From the perspective of the product line at that time, Gree is different from Haier and Midea. We can imagine that, for example, in the Gome store, Gree removed the same product as an air conditioner, and replaced it with Midea, Haier and other companies with multiple product structures. The complete withdrawal of its products from the cabinet is another matter entirely. On another level, air conditioning is the lifeblood of Gree, and the pricing power of air conditioning channels must be dominated by Gree, and no one else can move it.

At the same time, Gree has put a lot of effort into the reciprocal relationship with local distributors, especially since 2004 is also a sensitive year. This year, Gree is gradually solving the impact of the previous distributor's anti-water incident. They are also watching how Gree manages the aftermath; at the same time, Gree's move to break up with Gome, the traditional provincial distributor most influenced by the big home appliance chain oligarchs, is no less than expressing his heart to them, so from the perspective of appeasing local princes, The pros outweigh the cons.

The high performance growth in the following five years also proved Gree's judgment. For the dealers, business profits were at the top of the list. Gree gave up the biggest chain oligarch at that time, which reassured the dealers. There was one less channel oligarch to compete, and everyone was full of energy. For Gree, since it was for the sake of pricing The right to choose the channel of self-built specialty stores is only a last-ditch battle. Then, with the joint efforts of manufacturers, Gree air-conditioning specialty stores have sprung up in many corners of first-, second-, and third-tier cities in just a few years.

However, the fast-paced panorama channel strategy has also caused Gree to suffer, because the management of these points mostly relies on regional sales companies. It is inevitable to ignore quality for the sake of speed, and various conflicts caused by poor management are also present. In 2007, a large number of exposures were made, and the dark war surfaced again. The overlord contract, "pay first and then ship", "off-season rebates", "repeal end-of-year returns" and other measures have also been accused by many dealers of only caring about themselves and passing all risks to Gree. downstream channels.

At this time, in order to tie up the major distributors in various regions in a deeper level, Gree resorted to the second move-equity transfer. In 2007, Gree gave 10% of the joint venture of 10 Gree local sales companies to the Hebei Jinghai Guarantee Company. These ten branches are commonly known as the top ten local princes of Gree in the industry, and they are the branches of Gree in Chongqing, Henan, Hebei, Shandong, Beijing, Zhejiang, Jiangxi, Hunan, Sichuan and Tianjin.

The latest news about Gree's channel reform is that Gree is building air-conditioning experience stores nationwide this year, and using this to upgrade its channel service system. Another more interesting news is that in August this year, the largest Gree air-conditioning flagship store in Tianjin opened. Gree is responsible. According to the person in charge, Shengshi Xinxing is a wholly-owned sales company of Gree Electric Appliances. The original Bohai Gree was established as a joint venture between the company and distributors. The employees of the two companies are old employees of Tianjin Gree. The structure has changed.

This move can't help but make people wonder, what does Gree want to do? Is this time not satisfied with the channel control of joint venture holdings, and trying to take full control of sole proprietorship? Although it is said that the dealer group has become the de facto second shareholder of Gree Electric Appliances, in front of the major shareholders, the second shareholder has insufficient authority after all, and how to do it still has to follow the decision of "Iron Lady" Dong Mingzhu. .

In addition, Gree's unswerving path of self-built channels can really go all the way? In the current situation of duopoly Suning and Gome, is it time to compromise and let the latter step? How to maintain a balance between the dealers who support itself and the chain of hypermarkets, and continue to gain the dominance of both parties; at the same time, how to deal with the aggressive channel poaching offensive of the pursuer Midea Electric is a test for Gree.