The dilemma of e-commerce + home appliances cross-border model

Color TV brands have suddenly become popular. With the continuous increase in the penetration rate of smart TVs and the gradual rise of TV shopping, as the only portal for TV shopping, the right to embed products inside color TV sets has become a hot spot for major shopping websites.

E-commerce websites compete for TV shopping portals

The era of free TVs has finally arrived. On a shopping website called "SofaGo", the words "TVs are free" are clearly written. It is understood that this e-commerce website has signed a cooperation agreement with the domestic color TV company Skyworth to carry out the "buy vegetables and get a TV for free" benefit activity in Shenzhen. Users only need to prepay 3,999 yuan to get the latest Skyworth 42-inch full HD LED smart TV, which is priced at 3,999 yuan on the market. The prepaid amount can be used for shopping in SofaGo Mall, and can be used to buy daily chemicals, food and other products.

Such cases of "recharging" to get free products are common in the mobile phone field, but it is the first time in the TV field. Therefore, some netizens commented that the era of "buying a smart TV for 0 yuan" has arrived. In response to this, Li Congxiang, the spokesperson of Skyworth Group, said that this is just a set of promotional plans implemented by the business department at the terminal. The purpose is to increase sales. From the current situation, it is not possible to say that TVs are given away for free. Home appliance analyst Liu Buchen also said that the sales pressure of color TV companies this year should not be underestimated, and they will open up the market through various bundling sales methods. This kind of free is not the same concept as the previous discussion in the industry that only pays the subscription fee and watches TV for free.

In addition, Shafagou also stated that it has signed strategic cooperation agreements with TV manufacturers such as Skyworth, TCL , Changhong , Konka , Haier , Lenovo, and Sharp, and has pre-installed all series of smart TVs, occupying more than 70% of the market. However, the public relations managers of TCL and Konka said that they were not aware of this activity. Not to mention the specific number of 70%. Liu Buchen pointed out that e-commerce websites exaggerate publicity in order to increase brand influence. He hopes that color TV companies can be influenced by the "herd mentality" and increase cooperation opportunities.

Sofa Shopping chose a traditional TV brand, while Global Shopping, a TV shopping channel under China Radio International, chose Wangjiu.com, which is controlled by LeEco. The two parties cooperated by implanting TV shopping content, and will jointly create a multi-platform integrated column "Global Wangjiu Hui", based on which they will further cooperate in product sales. Su Liang, a digital new media industry analyst, pointed out that Global Shopping chose Wangjiu.com because it valued the existing and incremental market of TV in the color TV market. The cooperation methods are similar, and they are actually competing for the sales port of smart TVs.

Brand TV manufacturers may be sidelined

Data shows that the penetration rate of domestic smart TVs reached 56% and the activation rate reached over 77% in the first half of 2014. Software and hardware manufacturers are vying for the entrance to the living room terminal with smart TV as the core, trying to quickly expand the user base in the living room terminal through smart TV to form a platform effect, and then explore new development space in value-added services, advertising, e-commerce and other aspects.

Although the statement that "the era of free TV hardware has arrived" is still arbitrary, Wang Sanshou, president of data company Jiujifang, said, "The business model of free hardware is not yet mature, but it will definitely be a trend in the future, and color TV manufacturers will be impacted in the future." In this regard, Li Congxiang said that no matter what business model is adopted, televisions must be produced by companies, and this is the profit point of color TV manufacturers.

An unnamed e-commerce company told the reporter that in order to reduce costs in the future, e-commerce companies may choose to choose products from OEM color TV companies when delivering color TVs. In this way, brand color TV manufacturers will be sidelined, and the brand color TV market sales will face new forces.

Changhong Group spokesperson Liu Haizhong bluntly refuted such claims, "The key components of smart TVs, including chips and programs, are in the hands of the whole machine manufacturers, which is something that OEM companies cannot compete with. OEM products cannot be compared with brand manufacturers, let alone impact the existing market of brand manufacturers." He also pointed out that "whether free products are favored by consumers is a psychological issue."

In recent years, domestic enterprises have made great breakthroughs in industrial design and functional research and development. The gap between OEM products and OEM products is getting bigger and bigger. Liu Buchen believes that the remarks made by e-commerce companies to undermine brand manufacturers are intended to indirectly stimulate the whole machine companies to accelerate cooperation with e-commerce. He also suggested that whole machine manufacturers improve the competitiveness of their own products, improve the application experience of smart TVs, and widen the gap between OEM products and brand products is the core way to improve competitiveness.

Cross-border cooperation looks beautiful

This kind of cooperation is related to the State Administration of Radio, Film and Television's rectification of the Internet TV content market. Starting from June this year, the State Administration of Radio, Film and Television issued a ban order, requiring illegal content and apps on illegal video websites to be removed from the shelves. Compared with before, the content viewing channels of smart TVs are restricted to a certain extent, and the content richness has decreased compared with before. Liu Buchen believes that "content is king, and color TVs provide the impact and experience of visual content, which is also the most prominent reason for consumers to buy." From past experience, whenever content playback is restricted and sales are affected, companies will attract consumers through other means, such as TV shopping, TV games, etc.

But can the marriage really kill two birds with one stone as the partners expected, opening up the whole machine market and increasing the number of visits to shopping websites and significantly improving the conversion rate? It is understood that data from iResearch, a domestic research agency, shows that the time Chinese people spend watching TV is gradually decreasing, and the age structure of TV viewers is also beginning to "age", with the mainstream population being over 40 years old. However, the TV shopping population is showing a trend of getting younger.

"Cross-border cooperation is a seemingly beautiful design and blueprint. However, the problem of mismatched audiences is difficult to solve, and it is not easy to change the behavior of mainstream TV viewers," said Zhang Yi, chairman of iMedia Consulting.

Even with cross-border cooperation, the conversion rate of shopping websites cannot be improved. Under the premise that e-commerce cannot make a significant profit, it is difficult to reach a suitable profit-sharing model. Sofagou has not disclosed the current profit-sharing model with its partners. However, a person in charge of a color TV company who does not want to be named told the author that free actually means that e-commerce bears part of the cost and color TV companies bear part, but the conversion rate of TV is low. If the part borne is low, then such cooperation will not be sustainable.

In addition, the operation of TV shopping with remote control is not ideal. Liang Zhenpeng, an observer of the home appliance industry, said that in fact, many color TV manufacturers have built-in shopping functions in their machines before, but the process of placing orders and entering addresses is very cumbersome to operate with remote control, and the user experience is very poor. People born after 1985 and 1990 find it difficult to operate, and it is even more difficult for middle-aged and elderly TV viewers.

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.