Is Siemens’ defeat in the innovation of domestic high-end home appliance brands the inevitable result?

After the domestic home appliance market has experienced rapid development and innovation in recent years, all kinds of products generally ended their rapid growth in 2014. Data show that the revenue of the home appliance industry grew by 10% in the first half of 2014, a slowdown from 17% in the same period last year, among which the revenue growth of white and black appliances slowed down most significantly.

Different from the trend of the traditional home appliance market, the domestic high-end home appliance market grew rapidly in 2014. Taking washing machines as an example, Aowei data shows that in the past three years, the market size of stand-alone smart washing machines has maintained an average annual growth of 50%, and this growth rate is expected to continue to expand in the next few years. Consumers' concept of quality consumption is gradually emerging.

Foreign home appliances are no longer popular

In recent years, the world's giant brands have frequently withdrawn from the home appliance manufacturing industry, and the high-end home appliance industry has been turbulent. In September this year alone, Japan's Sanyo withdrew from the Chinese market; General Electric of the United States sold its home appliance business to Electrolux; and Philips sold its black appliance business to TPV. Recently, Siemens sold 50% of the shares of BSH Home Appliances to Bosch, which also means that Siemens has withdrawn from the home appliance manufacturing industry.

With the rise of new generation brands, the era when the high-end home appliance market was monopolized by foreign brands is gone forever. The profits of high-end home appliance products are declining year by year and lack of technological innovation drive. It is difficult for them to survive in the increasingly fierce market competition with only the support of brand effect. These have become the main reasons for the annual decline in the market share of high-end home appliances of international brands, resulting in their collective delisting.

However, in the domestic market, due to the significant increase in national income in recent years, consumers have shown a strong demand for high-end home appliances. According to a Nielsen research report, quality assurance, advanced technology, and status have become the starting points for consumers to choose high-end home appliances.

The contradiction between the domestic consumers' explosive enthusiasm for quality consumption and the weak production of "foreign home appliances" has led to a huge gap in the domestic high-end home appliance market, which urgently needs to be filled by leading home appliance companies.

Who will lead the high-end home appliance market in the future?

Some people believe that without the guidance of foreign brands, the domestic high-end home appliance market will face great pressure in the future. However, the situation is just the opposite. The domestic high-end home appliance market is still doing well, showing strong resistance to pressure in all fields.

Take Casarte, a domestic high-end home appliance brand, for example. According to the high-end home appliance market data released by CIIIC in the first half of 2014, in the high-end refrigerator market above RMB 15,000, Casarte has firmly held the top spot in both sales volume and sales revenue with a share of 22.63% and 20.24% respectively. The latest data from CMM also shows that in the refrigerator market above RMB 20,000 and the washing machine market above RMB 10,000, Casarte has firmly held the top spot in the industry with a retail share of 52.2% and 53.5% respectively; in the high-end wine cabinet market, Casarte wine cabinets currently occupy more than 70% of the domestic market share, far exceeding European, American, Japanese and Korean brands.

At present, some domestic home appliance brands have launched a series of high-end home appliances. Compared with high-end home appliances in mature international markets, the gap in technical standards, industrial design, technological innovation, etc. is gradually narrowing, or even surpassing them.

The leading advantages of foreign home appliances in quality and technology have begun to be replaced by domestic brands with products that better meet the needs of local users. China's localized high-end specialty home appliances have entered a stage of rapid development and have become the new market leader after foreign home appliance brands.

Product innovation and catering to the market become the main driving force

Faced with intensified global competition, increasingly strong market demand, increasingly severe environmental and resource constraints on the home appliance manufacturing industry, and the great challenges brought by the wave of intelligence, how domestic home appliance brands can seek breakthroughs to maintain the steady growth of China's home appliance industry and the future development direction of the high-end market have become topics of concern in the industry.

According to a survey report released by Aowei Consulting, 97% of consumers have demand for smart home appliances based on their current lifestyle, and intelligence has become the main innovation trend of high-end home appliances.

At the 2014 IFA exhibition in Germany, which was themed "Future Smart Products", many domestic enterprises exhibited their smart products, and Chinese home appliance enterprises showed their impressive strength. In this regard, industry insiders said that all enterprises have equal opportunities in the field of smart terminals, especially in the field of high-end home appliances, where domestic home appliance products have shown a trend of catching up with foreign enterprises.

For example, when Casarte Bofen's high-end wine cabinet was exhibited at the IFA exhibition, it adopted a smart IoT dual-temperature zone design. Not only can the mobile phone be used to remotely control and check the status of the red wine, but it can also provide the most comfortable temperature zone environment for different types of red wine. In addition, the application of seven major technologies such as constant temperature compressor, famous brand fan, and central integrated temperature control system can achieve ultra-precise temperature control, and it was once praised by the organizing committee as the "smartest" home appliance.

The essence of intelligent products is to provide users with more diversified personalized services. As manufacturers of high-end home appliances, they should better understand the needs of consumers and capture their consumption expectations. In the future, domestic high-end home appliance brands need to keep up with the changes in consumer demand. Only by focusing on users and directly addressing user pain points can intelligent high-end products better lead the home appliance market.

According to the current prospects of the home appliance market, with the withdrawal of international brands and the rapid expansion of domestic home appliance brands around the world, the current market situation of "one withdrawal and one exit" also indicates that local brands will create new standards for international high-end home appliances in the future.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.