How do LED companies find a balance of development?

With the prevalence of online shopping, the term e-commerce has gradually penetrated into the hearts of the people and has become the most important change in the business field in recent years. Not only has the legendary Ma Yun been promoted, but it has also driven the development of a number of industries. For the LED industry, where the terminal is king, the demand for LED lighting is increasing rapidly, the profits of lighting companies are generally increasing, and the competition for channels is becoming increasingly hot. E-commerce seems to be a magic weapon for LED companies to expand sales channels. Many companies have begun to explore how to make a transition from traditional pipelines to e-commerce. However, there are no successful examples of current e-commerce channels to learn from. Everyone is crossing the river by feeling the stones. How to balance the relationship between traditional channels and e-commerce channels has become a topic of concern to everyone.
Compared with the traditional channels, the e-commerce channel has two major advantages: firstly, it is not restricted by geographical restrictions and has a wide audience; secondly, the intermediate circulation link is shortened, the initial construction cost is low, the profit margin is large, the return time is short, and it is easier to achieve flat management. This is undoubtedly an opportunity for emerging LED companies that have no achievements in traditional channels. Because it is very difficult to get into traditional channels quickly and with large traditional lighting companies. The low-cost and wide coverage of e-commerce provides a good opportunity for them to quickly open the channel and seize the market.
From the market acceptance of LED lamps, users also need to understand the acceptance of LED lighting through experience. The physical store not only can bring consumers a sense of physical experience, feel its material, light color, workmanship, and the most critical distribution and after-sales service, but e-commerce is difficult to achieve. Although the initial construction cost of the e-commerce channel is low and the profit cycle is short, since the price of the e-commerce platform is relatively transparent, the profit space is greatly compressed, and a large amount of funds are needed for brand promotion, so that the latent hidden cost is very high. The profit cycle is also uncertain.
Compared with the advantages and disadvantages of the traditional channel and the e-commerce model in 2013, the LED industry has quietly kicked off the battle between online and offline. Looking at the situation of many companies participating in the double 11 promotion in 2013, the lighting brands of Op Lighting, Ao Duo, Chau Ming Han Yuan and other lighting brands have all exceeded the 10 million mark, and Op Lighting has a sales volume of 60.18 million yuan. At the top of the list, sales in Taobao Mall are nearly 50 million yuan. However, the sales of LED lighting giants such as Sanxiong Aurora and Qinshang Optoelectronics are not worth mentioning. Thus, the layout of e-commerce channels is not as simple as imagined.
Traditional channels have formed a relatively complete supply chain, and factories and distributors have long been acquainted with commodity pricing, sales areas, and profit ratios. However, emerging e-commerce channels want to break this stable pattern and inevitably create some conflicts with traditional channels. Therefore, before making a choice, we must first clarify two things. One is to clarify what is the positioning of doing e-commerce? The second is how much is the relationship between e-commerce and existing channels? What are its advantages and disadvantages? How to balance the relationship between old and new channels? There is a large degree of correlation between the operation of e-commerce channels and traditional channels. Although there are certain conflicts between the two in terms of price and supply, as long as the control is in place, properly handled, and find a good solution, they can complement each other and coordinate development.
After clarifying the above two core issues, we began to enter the implementation phase. From the operational point of view, there are many problems involved in the e-commerce channel. For example, how to publish it online? How to display products online? How to do after the sale? How to improve the post process? In order to solve these problems, companies should stand on the perspective of a consumer in order to truly understand the needs of consumers.
At the actual operational level, there are many problems that need to be overcome. Among them, the division and balance with the offline channels are particularly prominent. Xiaobian browsed other successful e-commerce channel cases in other industries and found that in order to truly balance the relationship between traditional channels and e-commerce channels, we can start from the following three aspects: information transparency, after-sales service network publicity; product selection accuracy, Effectively separated from offline; establish communication mechanisms to maintain online order.
The first is information transparency, which mainly includes two meanings. On the one hand, the product information must be clear, and on the other hand, the follow-up package must be made public, such as the external national after-sales service network. In the product display, highlighting the product features and functions, as well as some comparisons with other brands of products, the customer's general concerns have been sorted out and answered, and constantly improved. Selecting some products and separating them from offline channels greatly reduces product and price conflicts. In addition to the product segmentation, it is necessary to establish an orderly order and rules to establish a smooth communication mechanism. On some specific issues, such as price, whether online or offline, to achieve a unified caliber, we can balance the old and new channels and avoid some conflicts.
Xiaobian summary:
In the face of e-commerce, a new type of sales channel, emerging LED companies regard e-commerce as a new opportunity to conduct product sales and channel investment on major websites. However, not all traditional enterprises are suitable for e-commerce platforms. In the process of transitioning to e-commerce platforms, they will face challenges in platform construction, talent reserve, information systems, business models, etc. Therefore, LED enterprises must combine their own product features. The development of the company, we must not blindly cut into the e-commerce platform. Balancing the relationship between traditional channels and e-commerce channels will make it possible to find a new era in emerging channels.

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