The washing machine market tends to be saturated and sales decline, and product upgrades and transformation to the high-end market will be the only way to go

Recently, semi-annual reports of the home appliance industry have been published frequently. Statistics show that washing machines experienced negative growth in four of the first seven months of 2018, and the entire industry entered a downward channel. Up to now, the total sales volume of the entire washing machine industry has increased by -0.81% year-on-year. In this context, Haier washing machines have increased by 11.51% year-on-year, Little Swan has increased by 1.95% year-on-year, and Siemens has increased by -11.6% year-on-year.

The washing machine market tends to be saturated and sales decline, and product upgrades and transformation to the high-end market will be the only way to go

The market tends to be saturated, the washing machine market starts structural transformation

The latest data from the National Bureau of Statistics show that there are currently 90 washing machines per 100 households. Industry insiders believe that this means that in the washing machine market, population growth and the dividend of home appliances to the countryside have reached the threshold, and washing machine products that only meet basic needs will gradually lose competitiveness. This requires washing machine manufacturers to continuously tap the deep-seated needs of users, speed up research and development, and use technological innovation as the long-term driving force for new growth.

According to data from research institutions, the decline in sales of China's washing machine market was most pronounced in July. The data shows that there are six retailers with a year-on-year decline in retail sales. Sanyo has the largest year-on-year decline in retail sales, with 41%; followed by Samsung, with a year-on-year decrease of 40.8%.

In the context of the disappearance of the demographic and dividend advantages of the third and fourth tier markets, the washing machine market has undergone a product structure transformation. Large-capacity, intelligence, and health have become the general development trend of the industry, and the trend of mid-to-high-end transformation is obvious. Taking high-capacity products as an example, data from research institutions shows that for washing machine products with a capacity of 8KG and above, the cumulative retail volume share in 2018 was 95%, and the retail sales accounted for 97%. It can be seen that large-capacity products have already accounted for the vast majority of washing machines. market.

In addition, the washing machine industry is also gradually trying to incorporate artificial intelligence into its products. According to data, in 2018, the total consumption expenditure of global smart home including equipment, systems and services will be close to 96 billion U.S. dollars, and the compound annual growth rate in the next five years (2018-2023) will be 10%, and it will increase to 155 billion by 2023. US dollars. In China, the Chinese smart home market shipped 29.89 million units in the first quarter of 2018, a year-on-year increase of 26.3%. The smart home market is expected to reach 150 million units in 2018, a year-on-year increase of 35.7%. For a market with such a huge prospect, the washing machine industry is also trying to integrate into it, with the help of the rising wave of the smart home market, let the market return to the upward trend.

Consumption upgrades change the market environment, companies vying to occupy the high-end market

With the maturity of the new generation of consumers, the Chinese market is undergoing the third consumption upgrade since the reform and opening up. With the further development of consumption upgrades, the market environment has changed. New consumers and new consumption concepts are gradually changing the home appliance market environment.

Industry insiders told the home grid that due to the development of communication technology, consumers in the new era have more personalized requirements for products. They choose different mobile phones and clothing to express their tastes and attitudes, and adapt the information flow to suit their own tastes. Content providers or media also purchase and even customize their own personalized home appliances through various platforms. This seemed like a fantasy ten years ago.

Huge changes in the market environment have also had a huge impact on the washing machine industry. According to the monitoring data of Zhongyikang, in the first half of 2018, the number of washing machines in the offline market was 154, a decrease of 8 compared with the same period last year; online The number of brands on sale was 124, a decrease of 4 compared with the same period last year. Behind the fierce competition is the further increase in brand concentration. Data shows that in the first half of 2018, the retail sales share of the TOP10 brands in the washing machine market was 92.1%, an increase of 1.2 percentage points compared with the same period last year.

Faced with changes in consumption trends, giants in the washing machine industry have accelerated their product upgrades to seize the mid-to-high-end market. According to statistics, among the top 10 washing machine brands, the product structure of the eight brands includes two types of pulsator and drum. In these two types of products, the share of retail sales of drums is greater than that of pulsator, and there is a difference in retail volume between the two types of products. Not big.

In addition, more high-end products such as large-capacity, smart, and dryers have also increased their market share. According to the data, in July, China’s offline washing machine market’s key technology retail sales penetration rate, drying share was 29.9%, up 10.2% year-on-year; frequency conversion share was 84.4%, up 3.9% year-on-year; smart share was 43.3%, year-on-year Increased by 0.3%; large-capacity (8.1KG+) share was 62.3%, an increase of 17% year-on-year.

Industry insiders believe that in the second half of 2018, under the general trend of de-scaling, the washing machine industry will gradually transform its products into the mid-to-high-end market. In the process of transformation, the market threshold will be further raised and the living space of small brands will be further compressed. For the development of the market, the survival of the fittest is the only way to a mature market.

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