Ceramic Industry Observation·Issue 1
People often say that choice is greater than effort. In this sense, following the right trends and stepping on the right trends is undoubtedly the best choice. Because of this, at the end of each year and the beginning of each year, analysis and prediction articles such as "10 major trends in ×× industry in ×××× year" and "6 major trends in ×× industry in ×××× year" will become eye-catching. Landscape.
Marxist philosophy believes that contradiction is the source and driving force of the development of things. It exists in everything and runs through the development of different things. This tells us that when thinking about problems and doing things, we must pay attention to contradictions. Only by grasping the main contradictions can we rectify the source, follow the trend and step on the trend.
What are the main contradictions currently facing China’s building ceramics and even the general home furnishing industry?
01
The contradiction between demand and supply
There are various contradictions in human society, but the decisive factor is the contradiction between demand and supply. Demand drives humans to continue to create and develop; supply provides the necessities for human survival, thereby ensuring that humans can continue to create and develop.
According to this principle, the development of the ceramics industry as a part of human society and economy has always depended on the contradiction between demand and supply. In the past, supply was in short supply, but now it is the coexistence of overall oversupply and local undersupply. The supply and demand structure is out of balance. The oversupply and unbalanced demand structure in the construction and ceramics industry are specifically reflected in three aspects. It can be said that there are still contradictions among contradictions.
First, there is serious excess production capacity.
On the one hand, the production capacity of the building and ceramics industry has remained at 120+ billion square meters for a long time, and has even grown further as some ceramics companies continue to expand production. On the other hand, market demand has slumped due to the impact of the real estate industry entering the "stock era" Sluggish, after falling to less than 9 billion square meters in 2018, it has hovered around 8 billion square meters for several consecutive years; on the one hand, backward production capacity accounts for a large proportion and has "tenacious vitality", and has been revived after repeated rectifications; on the other hand, it has low costs and no history Advanced production capacity with high burden and strong market competitiveness accounts for a small proportion and is growing slowly. Work such as "coal-to-gas" and "dual-carbon dual-control" are difficult to advance. Green, clean, low-carbon, digital, intelligent, intensified, The efficient innovative development model has just begun.
The serious overcapacity of total production capacity is an important reason for the intensification of "price wars" in the building and ceramics industry.
The second is that "product-based supply" cannot meet "service-based demand".
On the one hand, the problems of homogenization of products and lack of sales services in the building ceramics industry have always been criticized by people. Not only have they not been solved for a long time, but they have become increasingly serious. On the other hand, driven by social and economic development and the increase in people's incomes, , consumption is increasing day by day. In addition to increasing requirements for the appearance and quality of ceramic tiles, consumers also have higher and higher requirements for merchants’ services. They hope to enjoy services that increase in quantity as well as in quality. For example, it must cover a series of services such as design, delivery, replenishment and returns, guidance and supervision of paving or packaging, and achieve "perfect" delivery. At the same time, many brands have larger production capacity and better product quality, but they lack brand awareness, influence and service capabilities; some brands have brand awareness, influence and service capabilities, but lack production capacity and product quality. Something is lacking.
The extreme mismatch between "product supply" and "service demand" has become another source of low-price competition in the building and ceramics industry. It is also an important reason why consumers may not be able to get high-quality products and services at high prices. reason.
Third, sales channels have undergone tremendous changes.
In the past, the building and ceramics industry was dominated by retail channels.Sales channels (for manufacturers, dealers are their main sales channels; for dealers, retail is their main sales channel), dealers' business is booming, and the relationship between manufacturers is harmonious; later, with the construction of projects (mainly referring to real estate companies) The market has already undergone earth-shaking changes with the strong rise of channels such as finely decorated houses), complete decoration, new retail, and designers. Retail channels have been eroded, brands and their dealers have become polarized, and the Matthew Effect has become prominent. Although the market share of emerging channels is growing rapidly, many brands and their dealers are unable or unwilling to get involved due to many factors such as funds, teams, and brands.
In these emerging channels, a large number of low-price and low-value products flood the market, which not only seizes effective market share, but cannot truly meet the increasing needs of consumers.
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Therefore, if ceramic tile (rock slab) brand manufacturers and dealers want to win production and develop under the complicated and severe situation, they must seize the imbalance of supply and demand structure in which the overall oversupply and local undersupply coexist in the building ceramics industry. The main contradiction, compared with the specific manifestations of its three aspects, is to make efforts in building advanced production capacity, improving service levels, and multi-channel layout, and make up for what is lacking.
02
The contradiction between complete clothing and single product retail
Full decoration, as the name suggests, is "overall decoration". Its advantage lies in providing one-stop home improvement services covering design, materials, soft furnishings, customization, installation and other full services. Consumer groups are exempted from spending a lot of time and energy in design, material selection, construction and other series of links, and can also meet their personalized pursuits.
In recent years, decoration has become one of the biggest trends in the home furnishing industry. Relevant reports show that the market size of the assembly industry will reach 868.582 billion yuan in 2021, and will continue to maintain an annual growth rate of more than 20%. Complete decoration companies such as Shengdu Home Decoration have achieved rapid development. The "three customization giants" Oppein, Sophia, Shangpin Home Furnishing and other home customization companies have entered the decoration track. Ceramic companies such as Dongpeng and Yingpai have also entered the decoration industry in different countries. Time and using different methods to develop decoration channels are the reasons why decoration has become a trend and outlet in the pan-home furnishing industry.Best proof.
In this sense, the importance of decoration to the ceramic building industry is self-evident.
Since decoration is so important, how should ceramic tile (slate) brand manufacturers and distributors, as the main body of single product retail, embrace decoration? Several industry luminaries put forward their respective opinions at a themed live broadcast forum held by Taocheng Daily on the twelfth day of the first lunar month.
He Xinming, chairman and president of Dongpeng Holdings, said, "I think the opportunity for dress-up has come. I can't mistakenly lead everyone that the spring for dress-up is coming, but the opportunity is definitely coming. Because with the age structure of consumers, With the changes in the world, young consumers demand more and more individuality and convenience. He is not short of money. He will not go to the store by himself like us born in the 60s and 70s. To compare with thousands of households, he will not, he will Leave it to decoration companies, home improvement companies, and designers, and get it done in one stop. This is a fundamental change in consumer behavior, becauseWe do feel at the market terminal that consumers are increasingly demanding overall solutions. It’s getting stronger and I think it’s a new hope.”
"We who make ceramic tiles and materials are different from Oppein and Sofia who do customization. The decoration we do is based on our characteristics and is delivered as a whole, not customized. Delivery as a whole means consumers In terms of hard decoration, such as tiles, toilets, hardware, wooden floors, coatings, etc., these can be delivered as a whole. This will bring greater convenience to the decoration company and the project, because consumers are realized through the B-side. , instead of going around every household like before, so for us, the opportunity lies in overall delivery. I think this is something that materials companies and ceramic tile companies still need to seriously consider."
Chen Xianwei, President of Yingpai Industry, Chen Xianwei believes, “In fact, ceramic companies themselves are also part of the decoration industry, and they have dealt with a lot of decoration companies in recent years. The word "installation" has a bit of a negative reputation, because a large package such as 688 yuan per square meter makes the whole decoration very low-end.With the decoration similar to that of Oppein, there is actually a trend With the new trend, we can gradually move towards high-end, which is branded decoration."
Meng Zhengqiang, director of the large home furnishing business department of Mona Lisa Group, said, "There are many things to do to complete the decoration, and the investment is also huge. I think it should be solved from the perspective of consumers first The delivery of ceramic tiles and rock slabs is extended to complete decoration. In addition to hard decoration, rock slabs are also more malleable. Whether it is customized countertops or bathroom cabinets, this is also a direction. Do not replaceThe table is ready, but there are still many areas that can be expanded and tried."
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Based on the current situation of the pan-home furnishing industry and referring to the opinions of major players, if ceramic tile (rock slab) brand manufacturers and dealers want to seize the contradiction between complete decoration and single product retail,they must be user-centered, or It is an upgrade from single product operation to multi-category integrated operation, or it is to effectively solve the delivery of ceramic tiles (rock slabs) for consumers.
03
The contradiction between branding and de-branding
Branding is a concept that everyone is familiar with and needs no explanation. But what is de-branding? It is not as simple as the literal meaning. Here we need to borrow the words of well-known brand expert Li Qian to explain.
"De-branding is mainly a 'call of the times' issued by channels (e-commerce, micro-commerce, etc.) for product brands, and this 'call' seems to be addressed to consumers.' You see , the brand is a bad thing, it increases the premium, wastes your money, and you spend some money in vain. Now let's go to branding together, take away those premiums, and enjoy the best products at the ex-factory price easily!' Consumers are happy. After all, what a wonderful world without middlemen making the difference."
“Later, in some fields such as home furnishings and consumer electronics, we saw one business model operation after another. These channel brands, which started as channels, relied on the powerful zero information gap of our huge country. With the advantages of the supply chain and their own traffic advantages, they provide cost-effective and well-tuned unified brand products, directly to consumers in the form of OEM or ODM. While they are selling goods crazily, they are also educating the suppliers of the products: Go ahead. Branding, consumers no longer like brands, this is the future trend. ”
It can be seen from this that the so-called de-branding initiated by channel brands only removes the brand of the product, but strengthens itself, that is, the platform itselfbrand. What they shout is "Don't buy branded products, the premiums are too high. We have helped you select the most affordable and high-quality de-branded products. Buying from us is the most affordable and safest way." The subtext in my heart is "We are the brand, you must be right when shopping with us."
Without a brand, there will not be enough profits to support services and brand value. Ceramic tile (rock slab) brand manufacturers and dealers that take the high-end route must undoubtedly adhere to branding and use high-end dimensionality reduction to attack low-end, high-, medium-, and low-end products. Ceramic tile (rock slab) brand manufacturers and dealers are also inseparable from branding.
Ceramic tile (rock slab) brand manufacturers who pursue small profits but quick turnover and do not want to make a big difference in brand-driven marketing may consider taking the so-called de-branding route and choose to cooperate with channel brands (platforms). However, in a situation where there is serious overcapacity, The odds of winning are still unknown. Distributors who join because they lack brand power must think twice. Choosing so-called de-branding is tantamount to seeking death. What channel brands (platforms) want to get rid of are the ones that have been making the difference between brand manufacturers and distributors. him/her.
Of course, dealers must not only promote the manufacturer's brand, but also build their own IP with the help of the manufacturer's brand. Only by organically combining the two can the brand play its maximum role.
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In the future, branding and so-called de-branding will definitely coexist for a long time. Whether ceramic tile (slate) brand manufacturers and distributors choose brands or so-called de-branding depends entirely on their own positioning and goals. There is no right or wrong with existing conditions, just look at the results.
Instead of rushing to follow trends and follow the trend, it is better to recognize the essence of things and grasp the main contradictions that determine the development of things. How many of the three main contradictions in the ceramics industry have you discovered?
