Macaulay once said: "A single mountain wave may soon subside, but the tide never stops." The so-called situation is stronger than people means that the trend is like a trend that will never stop, and even human power cannot resist it. Throughout history, all companies or individuals that have achieved something have followed the trend of historical development; while those companies and individuals that have failed have also bucked the trend on their own.
On October 14, the 11th China Real Estate and Pan-Home Furnishing Industry Cross-border Conference was held with the theme of "New Trends, Big Brands", hosted by the China Building Decoration Association, hosted by the Material Application Branch of the China Building Decoration Association and China Ceramics Network. The Industry Summit and the 2021 "Top Ten Brands of Architectural and Sanitary Ceramics" Awards Ceremony were grandly held at the Sofitel Foshan Louvre Hotel. In addition to speeches by leaders and speeches by experts, China Ceramics Network also carefully set up a roundtable forum with the theme of "trends" at this event, inviting many industry leaders to discuss together, take the pulse of industry trends, and discuss brand development.
The forum was hosted by Zheng Zhe, editor-in-chief of NetEase Home News Center. Guests participating in the discussion were: Nan Shunzhi, founder and chairman of Dajiulu Ceramics, Peng Changhua, vice president of Shuncheng Ceramics Group and general manager of Shunhui Ceramics, Ou Zhang Shaojun, vice president of Shennuo Ceramics, Cheng Zhen, general manager of the ceramic tile division of Wrigley Home Furnishing Group, and Xian Jiantang, marketing general manager of Nengqiang Qianghui Group.
Topic 1: About Brand
Zheng Zhe: The current era is an era of coexistence of opportunities and challenges. We are facing unprecedented changes. For the ceramic industry, what are the real trends and what are the potential risks? ? Brother Hu, the founder and CEO of Yidoutang APP, made a prediction in his speech just now: with the birth of consumer brands, the market share occupied by the top 10 brands in the ceramic industry is likely to reach 80% in the next five years. This number can be said to be very amazing.
In recent years, due to factors such as the promotion of national regulatory policies, the rapid development of engineering and other channels, and the awakening of brand awareness, the reshuffle of the ceramic industry has further intensified. Large enterprises have frequently acquired and expanded their businesses and "enclosed land", leaving little room for small and medium-sized enterprises to survive. After being compressed, the Matthew effect began to become prominent, and industry concentration has been improved to a certain extent. Following this trend, what level will the industry concentration be in a few years? If expressed in data, what is the market share of the top 10 brands in the industry??
Peng Changhua:I think it is unlikely that the market share of the TOP10 brands will reach 80% in 5 years. According to the data I have personally, the market share of the TOP10 brands in 2019 is It is about 10.5%, while it is about 13% in 2020. There is still a lot of room for development in industry concentration. If it were not for the policies such as hard-decorated houses implemented by the country, this data may be less than 10%. So I think that in 3-5 years, the market share of the top 10 brands will only reach 20% at most. Of course, it also depends on the impact of policies.
Zhang Shaojun:In fact, consumer brands have already been born in the paint industry, because paint companies invest more in consumer brands than ceramic companies. The era of consumer brands has indeed arrived, and consumers’ awareness of brands has slowly increased. In the future, whether the market share of the top 10 brands will reach 15% or 20%, or even higher, depends on each individual. The investment made by leading brands to seize the minds of consumers. We will wait and see how far the industry will become concentrated in the next few years.
Xian Jiantang:I think ceramic tiles have their own particularity. After all, they are products that start from the production end, product end, and then to the consumer end. Therefore, in the future development, the TOP10 brands may not necessarily occupy a large number of products. Market share, it may be that the top 20 brands occupy more than 20%, 30% or even 50% of the market share. My opinion is that industry concentration will definitely increase, but it may not be monopolized by a small number of brands like other industries, because ceramic tiles have a nature that is difficult to change.
Cheng Zhen: Ceramic tiles are indeed a special industry. It is a low-frequency consumption + low attention. If the consumption frequency and attention of ceramic tiles are higher, I believe that the speed of industry concentration will be very high. quick. However, the current overall trend of the industry is obvious to all. It remains to be seen whether the top 10 brands occupying 80% of the market share can be formed in 5 years.
Nan Shunzhi:This data is indeed difficult to predict, but what is certain is that with the development of the industry, brand concentration will definitely become higher and higher. Instead of guessing whether the top 10 brands will occupy 20%, 30% or 80% of the market share in the next five years, it is better to think about how much market share each brand can occupy. Things are changing. Looking back at the development of the ceramic tile industry in the past few decades, the former industry leader may no longer be the leader today, so things are unpredictable.
Zheng Zhe: As leading brands continue to compete for territory, those small and medium-sized brands with distinctive characteristics stand out by virtue of their advantages in a single field. For most intermediate brands, they should How to plan in advance, break through the tight encirclement, and seize more opportunities in the future?How much market share?
Xian Jiantang: I personally think it is not impossible for waist brands to catch up with head brands. It can be observed that in the process of pursuing sales, most leading brands in this industry have an extensive brand organization. On the contrary, the positioning of waist brands is clearer and more focused. If waist brands want to break through, they should be more sophisticated and better in channels and products. In terms of brand positioning, whether it is a head brand or a waist brand, how to hit the target according to the company's own focus and the needs of the customer group is very critical.
Zheng Zhe: Dr. Shan Ren, a famous marketing strategist, mentioned in today’s speech that category is the real needs of users, and brands help customers make choices. In fact, the ceramic industry has also undergone great changes in the past two years. In the current stage of seizing consumers' minds and building consumers' brand awareness, what do you think of the phrase "category is the real needs of users"? How should we build the brand’s competitive advantage next?
Cheng Zhen:I think the key to highlighting brand advantages is differentiation. To build such a competitive advantage, companies first need to re-understand the nature of ceramic tiles; ceramic tiles are actually a large background and background color in space. Based on this positioning, the decorative nature of ceramic tile products should be more simple, so what I said Differentiation is not to make the product fancy, but to make the product truly fit the comfort of the home space. Secondly, companies must make the logic of purchasing ceramic tiles simple; Wrigley composite light-grained tiles have invested a lot of research in this area, such as adding various processes to the surface of ceramic tiles to make the details richer and the products more attractive, so that consumers can It is not easy to make mistakes when choosing and matching, and the logic of purchasing becomes simple. Finally, companies must make good use of differentiated focus strategies; because the ceramic industry has the characteristics of many categories and serious homogeneity, brands should focus on outputting the unique value of products to form unique recognizability in the minds of users.
Topic 2: About the product
Zheng Zhe: As we all know, products are the moat of a company. Since last year, slate has been firmly on the hot topic list in the industry. On the one hand, companies have been increasing investment in expanding the production capacity of slate. On the other hand, the shortcomings of terminal supporting transportation, processing, and installation services have become increasingly prominent. . Some people think that rock slabs currently have a problem of being "popular but not popular". So what is the future development trend of rock slabs? Is it a new blue ocean for the industry? What do you think of the "tile-to-slate and slate-to-tile" model proposed by some companies?
Peng Changhua: The topic of "slate tiles, tiles slate" is very interesting. It defines slate as an iteration of ceramic tile products. In fact, the origin of the term "slate" is very confusing. Its production process is almost the same as that of ceramic tiles, but many people don't understand the relationship between slate and ceramic tiles at the beginning, and what is the difference between the two. I think slate It is a system in the ceramic tile industry, an iterative product. Since it is an iterative product, the equipment, technology, and materials of slate are undoubtedly a step higher than traditional ceramic tiles. Both physical properties and decorative effects are superior. Therefore, slate has a wider range of applications, such as furniture, customization, etc. etc. Objectively speaking, many bosses in the industry are still too idealistic about the future development of slate, thinking that it is a cross-border high-end product. But to really bring slate to the market, the largest amount is used on the wall and on the ground, so Ceramic tiles will be a trend.
Zheng Zhe: In addition to slate, various types of functional tiles have also appeared in the industry in recent years, such as negative ions, heating, etc. Of course, there are some brands that have carved out a different path on their own. The well-known Bighorn Deer ceramic tiles focus on the point of being super wear-resistant. Now, I would like to ask Mr. Nan to explain to you why Dajiulu Ceramics focuses on the field of super wear resistance? What is the reason for its rapid emergence?
Nan Shunzhi: Whether it is ceramic tiles or slates, consumers are concerned about the wear-resistance, durability, practicality and decorative appearance of the products. Because my starting point is the terminal first-line market, I know how important the glaze of ceramic tiles is to the performance of ceramic tiles, so that I have changed from a person who does not understand production to an expert who studies materials and production every day. It has been three years since the Dajiulu ceramic tile brand was upgraded. It can be said that it is in a stage of rapid development. I remember that at that time, I expected to reach 1,000 stores by 2023. At present, it seems that it is very likely to exceed 2,000 stores in 2021. . In this regard, I think companies must ultimately return to products, and products are the core that impresses customers.
Zheng Zhe: In addition to slate products and functional products, is there any other direction for product innovation in the industry? Can Mr. Cheng of Wrigley Composite Light Pattern Bricks share your experience and insights?
Cheng Zhen: Product innovation in this industry can be said to be different. Everyone is constantly doing product research and development, introducing new products, and iterative upgrades. I think there is a crucial logic behind product innovation, which is the real needs of users. Therefore, product innovation must focus on users and use users’ thinking as the starting point for product development, rather than thinking from the factory’s perspective on how to make ceramic tiles more beautiful and distinctive. This is also a special feature.A common innovation misunderstanding. In addition to having user thinking, product innovation also requires extreme thinking. Only by pursuing perfection in every detail and every parameter can the product show the best effect.
Topic 3: About channels
Zheng Zhe: For many years, the ceramic industry has always been a model of "enterprises linking dealers, and dealers linking to consumers". Today, the channels of enterprises have become more complex. In addition to dealers, there are also There are centralized procurement of fine decoration projects, designers, decoration, etc., and the operating pressure of traditional dealers is also increasing. Under such a situation, how should brands work with dealers to transform and upgrade and overcome difficulties together?
Peng Changhua:The ceramic industry has indeed experienced an unprecedented change, which is reflected in the diversification of channels. Under "difficulties", it is difficult for dealers and manufacturers, which also reflects that our industry is still too traditional. How to change the status quo, I believe that first of all, manufacturers must empower brands and influence the market; secondly, empower end dealers, because the era of relying on dealers to work alone has passed; thirdly, they must empower secondary products. Yes, different channels need to use different products as weapons. From the perspective of dealers, dealers must also take the initiative to embrace changes and transform into service providers.
Nan Shunzhi:The profit model of terminals is a big topic. Some have changed from the employment system of a single boss to the partnership system of multiple bosses, and even evolved into a no-base-salary system. Wait, of course these models also have a lot to do with the company's genes. In the final analysis, the terminal channel is a business model, and it is crucial to develop a model that suits you thoroughly. In the past, most of the channels of traditional brands were fixed regional agents + distribution models. The complex distribution of interests made it difficult for companies to change and innovate. But Dajiulu Ceramics is different. We can follow a new business model designed by the headquarters. , to open up various channels, the terminal store can be an agent in a district, a county, or even a partnership.
Xian Jiantang: Why do terminal dealers find it difficult to do business currently? I think the difficulty lies in their unclear positioning of the market they are in, and even the brand positioning exported by manufacturers to dealers is unclear. Not clear. Therefore, when manufacturers export brands to channels, the accompanying marketing methods must also be focused, clearly telling dealers what points to do and what kind of brand core they should focus on. In this way, dealers can be more organized and organized when exploring more channels.
Topic 4: About Policy
Zheng Zhe:Affected by the "dual control" of energy consumption and power and production restrictions that are currently being strictly implemented by the government, and in recent years as the real estate market has entered the stock era from the incremental era, The contradiction of overcapacity has become increasingly prominent. Against this background, the entire ceramic industry has been on the rise since the first half of this year. From upstream to downstream, companies in various production areas are increasing prices. I would like to ask whether the companies where the guests work have experienced an "increase"?
Zhang Shaojun: Due to the substantial increase in production costs, in order to maintain product quality and effectiveness, Oceano has issued a notice of product price increase in October. "Carbon emissions" is a very serious fact faced by the whole world, and appropriate price increases are still necessary. Moreover, I personally infer that this general environment will not change much in a short period of time, and companies still need to think more about the continued rise in costs.
Cheng Zhen: I think price increases are still necessary. On the one hand, it is the increase in production costs. On the other hand, it is also due to some adjustments to product prices as the brand’s premium ability increases. . Our company hopes to bring real value to users by continuously improving the value of products. Therefore, behind the phenomenon of price increases is not only the increase in prices, but also the improvement of product value and the optimization of product structure.
Peng Changhua:The main reason for the price increase is the sudden increase in hard costs, such as raw materials, fuel, etc. In more than 30 years of working in the industry, this is the first time I have experienced such a large-scale price increase. In the past, companies increased product prices through some marketing methods or product iterations, but this time it was real and determined. The land "rose".
Nan Shunzhi:The difference between product pricing and whether it will increase is 5-10 points. Our brand considers more long-term and sustainable issues. Even if we have to raise prices, we will wait until the end of the year before raising prices instead of suddenly announcing a price increase. Of course, this also depends on whether the company's operating costs can be sustained.
Xian Jiantang: In fact, our group has not announced a price increase at present, and is even conducting "Golden Nine and Silver Ten" promotions. This is related to the stable price system of our group for many years. Although the current cost challenge is very large, we do not rule out that there will be a price increase in the next step, but it is certain that the extent will not be particularly large.
Zheng Zhe:What impact will the rise in ceramic tile prices have on individual companies, dealers and the entire industry?
Peng Changhua:I think the impact of price increases on the entire industry is still great, especially for some brands with relatively extensive management, low profitability and low market share. A very big challenge. It is possible that after experiencing this wave of rising gas and raw material prices and power and production restriction policies, many backward companies and dealers will be eliminated. And I would like to remind practitioners in the industry to remember to prepare for a rainy day. Changes in the industry will inevitably affect practitioners, and everyone should be cautious when changing jobs.
Peng Changhua:I think the impact of price increases on the entire industry is still great, especially for some brands with relatively extensive management, low profitability and low market share. A very big challenge. It is possible that after experiencing this wave of rising gas and raw material prices and power and production restriction policies, many backward companies and dealers will be eliminated. And I would like to remind practitioners in the industry to remember to prepare for a rainy day. Changes in the industry will inevitably affect practitioners, and everyone should be cautious when changing jobs.
Conclusion
Cheng Zhen:Although competition in the industry is currently intensifying and there is talk of “rising”, as long as we make products based on user needs, innovate based on insights into user trends, and provide services based on user value, I believe that the ceramic industry will still be There is much to be done.
Zhang Shaojun: The new products launched by Oceano this year are all in response to the call of "making people's lives better" in a way that enhances consumers' aesthetics. Similarly, in the face of environmental protection policies, Europe Shennuo will also actively cooperate and respond, and take the initiative to assume its responsibilities as a leading brand.
Nan Shunzhi: Changes bring crises but also create new opportunities. I believe that even in another 10 years, the ceramic industry will still be a sunrise industry.
Peng Changhua:The great motherland has provided us with a vast market as it becomes increasingly powerful, and this industry will also evolve with technology.Techniques become more and more powerful through iterative upgrades. Confidence is more important than gold, and everyone must have confidence in the ceramic industry.
Xian Jiantang:The key for enterprises to survive in this environment is to find their own ideas and ideas and tap their own value.
