What should the private brand of the e-commerce platform do?

Question 1: What should the private brand of the e-commerce platform do?

Zhang Songkun asked: We have our own brand, we do traditional OEM, and we also do some e-commerce platforms, including Amazon in the United States and Europe, which have begun to invite us to enter. The problem I am currently facing is that traditional customers have a long chain from wholesale to retail and increase prices, while e-commerce channels are relatively short and prices are lower. How should I balance the relationship between traditional customers and e-commerce sales?

Lu Shiying A: For the manufacturing industry, the long-term success of an enterprise is closely related to the long-term success of its industrial chain. Short-sighted companies rely on managing supplier prices to obtain short-term supply benefits. Long-term companies, on the other hand, attach great importance to managing the cost of suppliers, and achieve long-term win-win results by assisting suppliers to continuously optimize costs. According to my experience, some companies that have successfully implemented lean production will open a gap of 30% to 50% with their competitors in terms of manufacturing costs, and at the same time, the quality and delivery time will often be better than their competitors. This advantage is based on 3 It will be a solid competitive barrier built up by little by little improvements in five years. Therefore, if the future of manufacturing enterprises is difficult, it will be difficult for those enterprises that do not change and do not make progress.

Ben Wong A: Products that are too low-priced will soon be eliminated from the market and cannot last, so companies must have a long-term perspective when doing B2C. At present, e-commerce accounts for up to 15% of the global market, and 85% of the vast offline market. Most Chinese companies that are new to Amazon have two major problems in market expansion:

1. The pricing strategy is not Reasonable, I thought that only one price for online sales would be enough. Their simple pricing rules made it impossible for them to become offline channels in the future.

2. Lack of in-depth understanding of the differences in different overseas regional markets, thinking that the global market is one-size-fits-all, and there is no targeted marketing strategy.

The solution is, first, to separate online brands from offline brands, and second, to accept the natural elimination of the market.

Ye Zhihuai replied: We encountered the same problem as you a few years ago, and it was very painful. It is difficult for the entity and the Internet to be compatible with each other. It has something to do with how you position your brand. If you want to cultivate this brand , don't rush to pursue sales, because the brand should have many years of planning, and then slowly grow it. If you want to sell on Amazon, then the price advantage is more important. Everyone knows that domestic and foreign e-commerce companies will compare prices. I think it’s best to run online and offline brands separately.

Question 2: How should 2B companies price their 2C products on e-commerce platforms?

Xi Jinghai asked: When we make smart wearable devices, we found that some companies do not have factories, but just put the supplier's stuff on Amazon to sell, making much more money than the supplier, so many OEMs Suppliers are also trying to do 2C, selling things on Amazon. But they're doing it "secretly" because it competes with their customers. How should 2B companies do 2C? Are there any different pricing strategies?

Lu Shiying A: Let me explain my point of view by using an analogy first. The manufacturer of nails sells 10 cents for each nail, but the profit is only 3 cents, but the same nails can be sold in hardware stores. 3 cents, the shop owner seems to have made 2 cents. Ignoring the cost of the store, will manufacturers really make more money by recruiting troops to open hardware stores in various places? 2C's business seems to be profitable, but its employment concepts, management thinking, business methods and corporate cultures are all quite different. You need to think twice about whether your business should expand its territory or not, otherwise it will cause both the old and new barracks to be disillusioned.

Ben Wong A: Brand and OEM are completely different ideas. If the manufacturer wants to be an overseas B2C brand, the pricing strategy of online sales is very important. If you use the B2B idea, and add about 30% profit on top of the cost, regardless of future channel costs, then you can only do online sales. on the brand. In mature markets in Europe and the United States, the development speed of e-commerce platforms is very different from that in China, and online sales only account for 10-15% of overall sales. Unless you have enough strength to master all the direct sales of offline channels, the price will be competitive in the short term, but will soon be retaliated by the market. In order not to disrupt the market, experienced brands will differentiate the brands sold online from those sold offline, so as to give dealers enough profit margins to avoid the risk of cross-selling and other business operations.

As a professional foreign trade B2B platform, in order to effectively help 2B enterprises expand overseas markets with their own brands, Global Sources’ new Direct business can analyze the current situation for enterprises through interviews, clarify capabilities and Set goals; then evaluate opportunities for brands and products in terms of market size and business opportunities, market demand, product value positioning, etc., and then carry out detailed operational aspects such as pricing, channel strategies, logistics, after-sales support plans, and marketing plans. Strategy development to help OEMs formulate and execute 2C market entry strategies. In addition, Global Pass will evaluate the integrity records of third parties, recommend suitable partners for enterprises, and help enterprises develop potential customers through the massive information accumulated over the years.

Ye Zhihuai A: At the start-up stage of our own brand, if the customer's order is lower than the OEM's MOQ, we can discuss with the customer and give them similar products of our own brand, which can be wholesaled in small batches . This is equivalent to turning part of the profits into promotion expenses and occupying overseas markets.

To do research on your target market and terminal market, the needs of customers should be investigated from the perspective of consumers, not only from our brand dealers or wholesalers, but also directly from our brand owners or wholesalers. terminal. For example, I often go to the United States to see what their shopping malls and supermarkets sell, and do market research.

All the questions and some answers in this article are from the "Outsmart Future Export Forum" by CEConlines.