Sam's Club is not acclimatized?

●Case Study

Sam's Club has shown symptoms of acclimatization in China, which does not mean that the membership model is not good, but because it does not take into account the differences between Chinese regions and consumers. Its popularity in the United States is closely related to factors such as cultural traditions, shopping habits, popularity of automobiles, and convenient transportation. In order to develop smoothly in China, several important factors that affect the development of membership stores must also be considered.

Factors Influencing the Development of Member Stores

The main factors affecting the development of Wal-Mart's membership stores in China are as follows:

First, whether the transportation is convenient. Generally, large supermarkets in China are located in urban areas, and the goods you need are within easy reach. To a large extent, you don't need to go to a distant store to buy a lot of things at home, unless it has a special advantage. Wal-Mart's Sam's Club locations are generally more remote. "ZHAODABIN" from Beijing said: "Besides the fame, Sam's in Beijing has no outstanding features. The location is too biased. Going shopping there is like going out for an outing." And now there are more and more competitors for Sam's Club, "Once They have the advantage of location, and you are out of the game."

The second is whether there is a price advantage. Experts believe that once the membership store realizes chain operation, forms economies of scale, and reduces costs through large-scale procurement, so as to achieve low prices of commodities and truly benefit members, it will surely achieve long-term development. For Walmart membership stores, as long as the product price can be lower than the average market price by 5% to 10%, it will definitely have a strong vitality. The price difference of this kind of goods can not only attract some middle- and low-income groups, but also attract some small traders to conduct small-scale wholesales, and also help to unite some corporate group buying members.

But the price advantage at Sam's Club isn't obvious. "ZHAODABIN" believes that it is no longer enough to shake the nerves of consumers if only from individual specials or a small difference of a few cents. Coupled with the remote location, it makes shoppers feel that the gains outweigh the losses. "Consumers also need to calculate the economic bill. I may spend more money on gas than I can save."

Thirdly Whether it is in line with local consumption levels. In foreign countries, the basic hard indicator for opening a membership store is that the per capita GDP is more than 10,000 US dollars. In China, this level is far from being reached. This is also an important reason why it is difficult to accept membership fees. "Chen Yong VINCENT" from a university in Australia said in the discussion: "The method of charging membership fees is very common in Western countries and widely accepted by consumers, but the annual membership fee of one or two hundred yuan is very difficult for ordinary Chinese consumers. In terms of affordability, it is indeed worth considering."

The consumers targeted by member stores must have a certain economic foundation and be able to admit that they can buy hundreds of yuan or even thousands of yuan at a time. "Dower" said: "Due to the constraints of economic conditions, most people's demand habits are short-term demand-type, and they buy when they are in short supply, not at the consumption level of a few hundred yuan or even a few thousand yuan for one-time shopping. "

The fourth is whether it conforms to local consumption habits. "Swordsman" from Xi'an believes that the large packaging of Sam's Club products does not conform to the consumption habits of Chinese consumers. "Commodities must be bought in packages, and some commodities are too much for families or individuals." "Muzi 00" of a technology company in Shenzhen also believes: "Most urban families do not have the habit of hoarding goods, and are used to buying as much as they need. How much."

"Smoke Wave Tail" of an industrial development company in Shenzhen believes that Sam's Club offers a carefully selected product, but it deprives Chinese consumers of the shopping fun, and Chinese consumers prefer to use their own choice to buy cheap and affordable products.

Suggestions for Sam's Club

The improvement of China's economic level will soon reach the external economic environment required for the development of membership stores, which is beneficial to the development of this business format. Therefore, most of the CEConlines website members who participated in this case discussion should stick to the form of supporting Sam's Club, and gave the following suggestions.

Ways to improve existing Sam's Club stores First and foremost is to reduce prices, reflecting the price advantage of the club store. It can also be seen that Chinese consumers are sensitive to prices. "jerryxu" of a Shanghai Construction Development Co., Ltd. suggested: "Reduce the average selling price of goods, including establishing a direct supply chain with manufacturers or reducing the number of dealers and intermediate links, using bulk ordering, transportation, and online ordering. , telephone reservations, etc. After deducting the travel expenses, time and energy spent on purchasing goods, the price of goods is still lower than the goods sold by the same industry."

The second is to adjust the structure of the goods to ensure the quality of the goods. "kentt" of a group company in Henan believes that it is necessary to rationally adjust the product structure to meet the needs of major customer groups.

The third is to provide better service. To improve service quality, we can accurately grasp customer information and provide targeted service care through membership registration. Provide door-to-door delivery of bulk goods, provide convenient transportation services, and be able to provide free services at regular, fixed, and multiple times, and provide an elegant shopping environment.

Also strengthen marketing activities. "Dan Yunpeng" suggested to strengthen the marketing measures for car owners and unit purchases to maintain loyal purchases.

Suggestions for Expansion Sam's Club should first pay attention to timing, area and location when expanding. "xuezheng" suggested to choose the right time, and to open a member store when the consumption level of Chinese cities reaches a certain level. Regionally, developed cities are the first choice. The choice of location should take into account the traffic conditions and should not be too far away from the urban area.

You can use the method of first entering and then charging membership fees to cultivate consumers. "Super Vision" of a Zhengzhou Electronic Technology Co., Ltd. suggested adopting this "returning carbine" sales method. He said in the discussion: "You might as well give consumers an adaptation process and induce consumption methods first. Then you must give them a sweetness in the early stage. Membership fees can be waived for the first year, and then come back and adjust when they fully accept it."

Another transition method has also been proposed, that is, the coexistence of membership and non-membership, but in different areas of the store, in order to stimulate the transition from non-members to members. A company's "Hens" suggested that in a hypermarket, an area dedicated to serving members should be set up. Products should not only be differentiated by price, but high-quality and fashionable products should be carefully selected for members. After long-term cultivation, customers' preferences should be analyzed and products should be adjusted. Structure, brewing market for the future launch of member stores.

"Liao Zhuangjia" of a technology company in Shunde suggested implementing a two-track price system for sales of products, dividing the price of members and non-members, as much as possible to widen the price difference between the two, creating more favorable momentum for members and attracting more people to join the membership interest of.

In short, Chinese consumers have been able to accept many emerging formats in a short period of time, which shows that the market's ability to accept is still very strong, and the customer base targeted by member stores is also growing. Over time, it is not difficult for the retail model of Sam's Club to be recognized by consumers.

This article was compiled by Marisa Wang. For more case studies and online discussions, please visit the CEConlines website (www.cec.globalsources.com).