Rebirth of the Industrial Tycoon - Vol 2 Chapter 457

Chapter 457 Direct Competition

In a shopping mall, a young guy walked to the razor counter.

He subconsciously touched his mouth, where he had saved three months of salary. The guy planned to use the money to buy himself an electric razor.

The young guy looks in his early twenties, probably at the age when he should be looking for someone. He needs to pay attention to his own image, so he plans to buy an electric razor, he can shave his beard, and keep him fresh.

Seeing a customer coming, a female salesperson in her forties immediately greeted her.

“Young man, I plan to buy a razor!” The salesperson pointed to the counter and said, “This one is made in China, while the other is imported. The domestic one is cheaper, and the imported one is more expensive.”

The young guy glanced at the counter of domestic razors. There are mainly two products, one is a domestic reciprocating shaver, and the other is a domestic rotary shaver.

Domestic reciprocating razors, even after twenty years, there were no very good products, and it was even worse in the 1990s.

Whether it is a blade or a high-speed motor, the domestic reciprocating razor is a lot worse than Braun and Panasonic. Buying a domestic reciprocating razor is better than getting a hair clipper for haircuts.

The domestic rotary razors are all single-headed. At that time, the single-headed razor had a nickname called a plucker. Looking at the nickname, you probably know what kind of performance the domestic leading razor is.

Seeing the domestic products on the counter, the young man frowned very dissatisfied, and then went straight to the counter of the imported brand.

In the counter of imported brands, Philips, Braun and Panasonic shavers are available, but there are not many types.

Then the young man looked at the selling price and frowned.

“These imported razors are so expensive! The cheapest one costs 600 to 700 yuan!” The young man seemed to mutter to himself, or complain to the salesperson.

The salesperson explained: “These are pure imports, foreigners produce things, the price must be expensive. But you get what you pay for. Look at the workmanship of the imported goods, they are not much better than the domestic ones!

In addition, the imported shavers are less noisy and more durable, like this Philips shaver, there is absolutely no problem with using it for ten years. If it is made domestically, it may be broken after four to five years. ”

The salesperson was referring to a Philips HQ30 razor.

The guy looked at the selling price, six hundred and eight, and suddenly showed a dazed expression.

“Six hundred and eighty yuan, too expensive, can you get a discount?” the young man asked.

The salesperson shook his head: “No discount. There is no discount on imported goods! But this Philips razor is expensive and there are reasons why it is expensive. You see, it is a double-headed one, which is much easier to use than a single-headed one. It’s clean and it doesn’t hurt.”

The young man nodded. Of course, he knew that a double-headed razor was much better than a single-headed razor, but the Philips price of 680 directly dispelled the guy’s desire to buy.

The wages of young people are often not too high. It is indeed reluctant to spend 680 yuan on a razor.

The salesperson saw the young man’s mind, she said, “If you think imported razors are more expensive, you can consider domestic ones.”

“The domestic ones are all single-headed, which is not easy to use.” The young man said.

“There are also double-headed domestic products, but they are new products.” The salesperson said, pointing to a silver-gray razor in the counter.

“This is domestically produced? I thought it was imported! And it looks so beautiful, like a new imported product, I didn’t even dare to look at it just now.” The boy said.

“It is a domestic product, a new product launched by Puppy.” The salesperson said.

The young man looked down at the price and was shocked: “Three hundred and forty yuan, such a beautiful razor, only three hundred and forty yuan?”

The salesperson nodded, and then said; “There is also a razor bag and two blades in it. I’ll show it to you.”

The salesperson said, and gave the sample to the young man.

As soon as the sample got started, the young man felt that he couldn’t put it down. The appearance of this razor is so beautiful!

The HQ60 series that Li Weidong copied was originally based on appearance. In terms of performance, it is actually similar to the HQ5 series. The reason why it was sold at the beginning is more expensive than the HQ5 series, mainly because of the appearance.

This exterior design was placed after 2000, and it is very fashionable and technological. In 1995, it became the top design.

Moustache looked at the puppy razor in his hand, then looked at the old-fashioned Philips HQ30 in the counter, and suddenly felt that the imported razor was not fragrant.

The salesperson then introduced: “There are four types of this shaver, 101, 102, 103 and 104. The machines are all the same, but the colors are different.”

“I bought this! The silver-gray looks good!” The young man said without hesitation.

……

Puppy Shaver’s advertisement appeared on CCTV’s prime time. Although it was only 15 seconds long, with the help of Mr. Ge, the advertisement had a very good effect.

The 1990s was definitely the period when TV advertising revenues were the highest. At that time, there was no Internet. Watching TV was the most common daily entertainment activity of the family. Basically, everyone would see the advertisements on TV.

And there are not many TV channels. In addition to CCTV, you can find four or five provincial satellite TV stations to advertise, so that TV viewers across the country can see your advertisement.

Puppy Appliances did just that. Advertising was placed on CCTV and several local channels. It didn’t take long for the puppy razor to become a household name.

Before the double-headed razor has been monopolized by Philips, domestic brands do not have a double-headed razor. Now Puppy Electric has launched a double-headed razor, which is equivalent to filling the gap in the domestic double-headed razor market.

All Philips razors are imported, and the price is not that expensive. The entry-level price is as high as six to seven hundred yuan, the middle grade is eight or nine hundred yuan, and the high-end razor is more than one thousand yuan. This was not the case at the time. Generally Chinese people can afford it.

Although the quality of Philips at that time was very good, a razor can be used for more than ten years, on average, it is sixty or seventy yuan a year, which is more than a dime a day.

However, there is a saying that zero-cut meat does not hurt. If consumers pay one or two cents a day for ten consecutive years, they may not feel anything, but if consumers pay six to seven hundred yuan in one go, it will be painful. .

In contrast, a puppy razor that is only half the price is obviously easier for consumers to accept.

In the mid-1990s, after all, there were few wealthy people in China. Imported Philips razors were a luxury item for most families. Many people buy Phillips razors, really intend to use them for ten years.

Consumer goods, price is always the most sensitive factor. The reason why Chinese manufacturing can spread all over the world depends on low prices.

Puppy razors are half the price, which is enough to make many consumers abandon Philips and switch to the arms of puppies.

The effect of the advertisement is still great. In just one month, Philips’ sales in China has been reduced by 30%. These markets have been snatched away by puppy razors, and puppy razors have quickly occupied China. Market.

In history, when the Feike double-head razor first appeared, it did not grab the Philips market. Instead, it squeezed out many domestic single-head razors out of the industry.

This is mainly because when Feike first went public, it adopted a reserve price strategy. At that time, the wholesale price of Feike razors was only a few dozen yuan, which was similar to other domestic razors.

Consumers who are willing to spend seven or eight hundred yuan on Philips razors will not go to see which cheap products for one hundred and eighty yuan, so naturally they will not pay attention to Feike razors.

Moreover, Flying Branch initially used Yiwu Commodity City as its sales channel, and Philip has already entered the counters of major shopping malls and stores.

The bulk channel for small commodities is also different from the bulk channel for hypermarkets. Those who like to buy goods in small stores or street stalls will not go to professional hypermarkets; the same reason is that those who shop in hypermarkets on weekdays will not buy street stalls. .

In other words, the early Feike and Philips were geared towards two consumer groups, and the markets they faced did not overlap. Even if the price of Flying Branch is very cheap, it does not affect the Philips market.

Until later, Flying Branch gradually developed and began to seize the Philips market. In the end, both parties accounted for more than 40% of China’s razor market.

Puppy appliances are different. Li Weidong has channels for major stores and home appliance stores. Therefore, as soon as the puppy razor is launched, it will directly compete with Philips razors.

Each bite of the puppy’s market share means that Philips will lose the market share of this bite.

……

Philips Asia-Pacific regional headquarters is in Singapore. It moved to Hong Kong Island in 2005 and only established a so-called Greater China headquarters in China in 2017. It can also be seen that Philips attaches great importance to the Chinese market.

The head of Philips Asia Pacific is named Ke Cilei. He is a German. He went to university in the Netherlands and joined Philips after graduation.

Ke Cilei was previously responsible for Philips’ audio and display components business, and was recently sent to Asia as the regional head.

At this time, Ke Cilei frowned as he looked at the sales data of last month.

Sales data in the Japanese and South Korean markets are basically the same as before. These two countries mainly use Philips components and are not too dependent on Philips consumer products. After all, these two countries have their own home appliance brands.

Sales data in Southeast Asia is steadily rising. The economic development of Southeast Asia has been very good in recent years, and the desire to buy imported goods is also very strong. It is a very good place for dumping goods.

However, in China, another big market in the Asia-Pacific region, sales of razors have dropped by 30%.

When he first saw this data, Ke Cilei even felt that he was dazzled, or there was a problem with the statistics.

If the sales volume is bullied by a small amount, it is normal, but the sales volume drops by 30%, but this is a very strange thing.

“Sales have fallen so much in a short period of time. There are three possibilities. One is that there is a problem with the supply; the other is that there is a problem with the Chinese economy; and the third is that there is a strong competitor.

There is definitely no problem in terms of supply. I have not heard of any shortages; China’s economy is on the rise. As the Chinese become more and more wealthy, the demand for all kinds of daily necessities should continue to increase.

That means that there is a strong competitor who is dividing up the Chinese market, so our sales will be cut in half. Who will this competition be? Is it Braun?

Impossible. After all, Braun’s business focus is in Europe. If Braun takes action, it will be implemented in Europe first. It is impossible for China to come to Asia to give the first shot.

That is Panasonic! Panasonic has always regarded the Asian market as their back garden, but in the Chinese razor market, Panasonic has not been our Philips rival.

However, this time, our sales were directly cut in half. It seemed that Panasonic had a big move and wanted to catch us by surprise. If I’m not mistaken, they must have also introduced a rotary shaver. ”

Rotary shavers have always been made by Philips, and the other two razor brands, Braun and Panasonic, all make reciprocating shavers.

So when Philips’ sales in China plummeted, Ke Cilei’s first reaction was that Panasonic also entered the field of rotary razors.

Thinking of this, Ke Cilei picked up the phone and dialed the phone number of Philips China.

“Did Matsushita Electric produce a rotary razor? Send me some samples immediately.” Ke Cilei said directly.

However, the other end of the phone replied: “Mr. Ke Cilei, recently, Matsushita Electric has not launched a new razor in China!”

“Not Panasonic? Is it Braun?” Thinking of this, Ke Cilei immediately asked: “Then Braun, do you have new products?”

“Neither did Braun.” The other party replied.

“That’s weird. Since it’s not because of competitors, why has your sales in China dropped by 30%?” Ke Cilei asked.

“Well, I have sent someone to investigate, and the results of the survey have not been fed back to me.” The other party’s voice paused, and then said; “But I think the high probability is because Chinese companies have also launched double-head razors. .”

“The Chinese also made double-headed razors?” Ke Cilei frowned.

“Yes, although I haven’t seen a Chinese double-headed razor, but I heard that the design of this razor is very beautiful, and the price is cheaper than our razor.”

The other party’s voice paused, and then emphasized; “I think the key is cheapness. After all, the income level of Chinese people is relatively low, and they are more willing to buy some cheap products.”

“Then we can lower the price appropriately!” Ke Cilei thought for a while and said, “I will give you 15%, oh no, it is a 10% price reduction authorization.

Our Philips shaver is number one in the world. Our product is so excellent. A little lower price can easily take back the lost market! ”

……

Before 1998, the vast majority of foreign investment only regarded China as a dumping ground for commodities, so their response to the Chinese market also appeared to be very lagging, and it was always a rhythm that was several beats slower.

European and American companies have always been like this. Even though the consumer goods retail market in China will be on par with that of the United States in later generations, many European and American companies still wear a pair of arrogant glasses to look at the Chinese market. When I was driven out of the Chinese market by a competitor, I started crying bad things about China again.

Because of this, the puppy razor has taken 30% of Philips’ market share, and Philips reacted.

But even if Philips reacted, it did not conduct in-depth market research, did not formulate a targeted strategy, but simply cut prices.

The key price cut is still reluctant to hemorrhage, only reducing the price by 10%.

There is no doubt that Europeans’ arrogance towards the Chinese market has deepened into their bones.

However, this time, Philips is facing Puppy Appliances, an opponent who is very good at price wars.

Zhong Yemao is responsible for the marketing of Puppy Appliances. This marketing master responds to the market much faster than Ke Cilei.

When Philips cuts the price, the puppy razor also cuts the price immediately, always keeping the price of Philips at half.

For Chinese manufacturing, there has never been a price war!

When Ke Cilei got the sales report for next month, he found that Philips’ sales in China was only half of what it was before!

Ke Cilei finally realized that if this continues, Philips shavers will probably be driven out of the Chinese market.

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(End of this chapter)