Small order
In the past two years, the entire electronics industry has experienced a once-in-a-century shortage of cores. The market has entered a seller's market. The main competition lies in the competition for upstream supply resources. Companies that can obtain supply chain resources generally achieve greater growth in this market.
Regardless of whether it is a chip company or a finished product manufacturer, as long as there are goods, there will be orders. Everyone pays more attention to the supply side, while ignoring the value of the product itself.
After experiencing the carnival of the out-of-stock market, what followed was the downturn and weakness of the entire market demand, which suddenly turned into a buyer's market.
Every link is desperately reducing prices, and the price reduction does not seem to have brought about the imagined market prosperity. Instead, end customers are waiting and watching, which fully proves the consumer psychology of buying up and not buying down.
When the market returns to flat, some people are complaining that the market is not good and the sales volume has dropped sharply, while some people are silently polishing their products and practicing internal strength.
For companies that have always focused on products, no matter whether the market is good or bad, the entire business is developing in an orderly manner.
This article will talk from a sales point of view. What are the core elements of a competitive product? To put it more bluntly, as a business, what kind of product will sell better? Here are three key points: price, performance, and service .
01 price
Price is the simplest and most brutal means of competition, and it is also the favorite means of sales .
For veteran players in the industry (manufacturers with a relatively high original market share), more consideration is to maintain a certain high profit margin on the basis of maintaining the original share. For them, price is a part of adjusting their market share. It is a means, not the most important bargaining chip to open up the market.
Taking the sensors that are widely used in the security industry as an example, Gekewei and Steway have certain advantages in market share, and the possibility of their substantial price reduction is relatively small, because most customers have already used their sensors. They only need to continuously release small profits to keep existing customers or compete for the other party's stock market.
If these large manufacturers want to sacrifice greater profits to compete for the market, they have absolute advantages in terms of production cost (supply chain), quality, service, performance, etc., and the living space of other manufacturers will become smaller and smaller. It's just that this kind of price reduction is of little significance, and it may not necessarily increase in terms of the absolute value of profits.
For new entrants or players with a small market share, low prices are the most effective weapon.
No matter how the customer relationship is, or how low the company or brand is, when the price is low enough, there will inevitably be a corresponding customer group to use the corresponding solution (of course, this conclusion is based on the premise that there is no major problem with the product itself. Down).
Recently, whether it is a chip maker or a finished product, it is very difficult to promote products. Here I will give two examples to explain my views on product price strategy promotion in this market. One is Chengdu Micro, which is a sensor . Just, one is Whaleview, which is a finished product. I think their application of price strategy is relatively successful.
First of all, think about a problem in the way of empathy. If the customer is already using a mainstream material in the market, what is the motivation for him to change the supplier at this time? One of the key factors must have been making an offer that couldn't be refused.
ps: The prices mentioned below are just examples
For example, a customer has been purchasing Gekewei’s sensor for US$1.5, and as a latecomer, Shimmer still bids for US$1.5 or US$1.4 when he goes to grab the market of Gekewei. Give up long-term and stable suppliers, and the replacement plan will bring other uncertainties.
At this time, for Shimmer, if you directly sell a price of US$1 or lower, the cost reduction for customers may be the profit of the entire finished product, so it is naturally worth taking a risk.
What Shimmer has obtained is a breakthrough in the market and the establishment of a typical benchmark. Although there is no profit or a slight loss in the early stage, it will dilute the cost in the future when it scales up. At the same time, it will gradually make some products with higher profits through this customer. A besieger turned defender.
It can be seen that in the current consumer security market, the market share of Shimmer has been greatly improved, and there is also a relatively obvious label, that is, the price is cheap. Of course, it is not the bottomless pursuit of low prices, but the performance and other aspects There is a big improvement.
This is also accompanied by the continuous improvement of the scale effect. Just like the Xiaomi mobile phone was first released and was complained by countless people, when more and more users use Xiaomi, it also forces Xiaomi to improve the product experience.
Another example is Jingshi Technology, a company that has been engaged in consumer IPC for a few years after its establishment, and its development and shipments have begun to take shape in just a few years.
Of course, there are many factors for their success, one of which I think is very important is the low-priced product positioning.
When it comes to WhaleTV, people think that the price of their products is very competitive, which is the biggest selling point, just like when talking about OPPO, people think of "charging for five minutes, talking for two hours".
There is also a misunderstanding to be corrected here. Low prices do not necessarily mean bad products. There are two ways to make low prices. One is to cut corners (unsustainable), and the other is to optimize the plan. The latter is long-term sustainable.
Whaleview chose Ankai with a lower price when HiSilicon was the mainstream market, and they chose Low Light when Low Light was not used on a large scale. When the company is small in scale and the market is not well-known, it is the smartest strategy to use price as the most advantageous weapon to open up the market, and to maximize a certain advantage .
Of course, there are other factors for their success, such as HiSilicon being out of stock, their experience in overseas markets, and so on.
So in summary, price competition is the simplest and most brutal way to acquire customers, and does not require too many skills and business relationships. In the long run, the low-price strategy must not be to compress product quality without a bottom line, but to seek new solutions and new solutions. Make a breakthrough and establish the absolute advantage of the solution itself, so that competitors are stuck in the throat. If you want to get rid of this thorn, you have to sacrifice huge profits at the cost of it, instead of trying to test customers by dropping a little every day .
02 performance
We often say that we want to make cost-effective products. It can be seen that performance and price are inseparable. The ideal state is that this product is both cheap and unmatched in performance, just like HiSilicon chips.
But it is hard to imagine the difficulty of both at the same time, so in my opinion, if the price cannot be the ultimate, then weaken the price and maximize the function, so that customers have to pay for your product performance. Buy at a high price .
The performance here does not refer to the stacking of product hardware parameters, but the use functions and product stability that consumers care about.
There are often chip manufacturers who say how powerful their chip is, so the price will be more expensive. What consumers care about is the function of this product that they spend more money on. It is the function that does not convert the parameters into actual functions. Redundant parameters.
When the market is not good, most of the most dead and the worst are definitely product performance (stability, function) that is not up to standard.
Those with poor stability are called bad products, and those whose functions cannot be satisfied are those that have not followed the market in a timely manner (such as converting from analog to network).
Take Amazon customers as an example. These customers are actually the best customers. As long as your product has a good Amazon link, the probability of these customers going to your product is very high.
Because good sales firstly prove the market space of this product, and secondly prove the stability of your product. After the e-commerce customers invest hundreds of thousands in a link, the risk is basically controllable.
The difficulty lies in how to do a good job of the first link. At this time, the actual test is the competitiveness of the product itself.
Many equipment manufacturers may not have the confidence to meet the most basic requirement of the return rate. In the case that the functions of the existing JCET IPC products are basically the same, if you dare to sign a guarantee agreement on the return rate with e-commerce customers, what reason do the customers refuse? Woolen cloth.
The success of Anker Innovations and Reolink, which are good e-commerce companies, is not only operated by experts, but stable products are the cornerstone for their high-rise buildings to be built higher and higher.
A good product must have no more than three core selling points. If you are super confident in your product, you only need to thoroughly understand one selling point. Can't remember.
OPPO charging is invincible in the world, Vivo photos can shine your beauty, what to drink if you are afraid of getting angry (you think about it yourself), this is the best refinement of product function selling points.
03 service
To be the next customer successfully, in addition to providing cost-effective (price and performance mentioned above) products, there is another essential factor, that is service.
In vernacular terms, service is to make customers feel comfortable working with you, think what customers think, and be anxious about what customers are anxious about.
The ultimate goal is to strike a balance between the interests of the company and the interests of customers, and to maximize the interests of both the company and customers.
Based on the understanding of the industry and the product, the value of digging out the value-added part is far greater than the value of bargaining with each other, because this is a state of ebb and flow .
Taking IPC products as an example, how to tap cloud storage, 4G traffic, message push, AI intelligence, etc. to expand new sales revenue is particularly important.
Bargaining with each other is a limited profit, which belongs to throttling. If it can make customers make more money, then it is open source.
Pinpoint the customer’s pain points, help him find more income growth points according to the customer’s situation, and give more reasonable opinions. This is the soft power of sales, which is irreplaceable by price.
I call it sales empowerment. Sales is not simply selling a product to customers, but helping customers make more money.
I never think that "customer first", which is regarded as the value of many companies, is correct. No one is the first, only a win-win business is long-term.
Of course, this process is very difficult, and the corresponding sales pain points are not easy to find. At the same time, when you give reasonable opinions to customers from an objective perspective, customers are more alert, and they may always feel that You are in order to complete the performance, the probability of Bole and Maxima meeting at the same time is always so slim.
Summarize
Originally, I wanted to talk about the importance of brand operation in it, but after much deliberation, for the upstream and most manufacturers, it is enough to do one of the above three points in depth.
In fact, after spending so much time talking about it, the most important point I want to express is to stick to the bottom line of product quality no matter what I do, make product features on this basis, and give myself a label.
The "bucket effect" emphasizes the balance of all aspects. I think that there must be a long board with the highest height in product development, as long as the other "boards" can basically meet the requirements of holding water.
If you are only asked to use one word to summarize the core competitive advantage of your product, and think about it before taking action, I believe that no matter how the market environment changes, you will definitely be the one with the strongest ability to resist risks one.