I recently lived in the United States for some time, one of the important activities is to visit the United States large and small shopping malls shops. And the same domestic, under the impact of the Internet, their days are not too good. Macy's two-year market value evaporation 2/3, Penny's share price since the beginning of 2012 collapse 90%.
However, Best Buy is an exception.
Frankly, before entering the Best Buy store, I have a preconceived idea: the retailer should be run by the Amazon run it. But after the store was surprised to find that the store's customers and not much. "Maybe they are here to experience it, go out and go up and down at Amazon." "I guess."
I checked the search earnings, the opposite is true. It is a bit surprising that in the past seven quarters, Best Buy has six quarters of revenue are more than Wall Street expectations. Last year, the company's stock rose 50%.
American media for the survival of Best Buy also surprised, in the narrative of its miracle, even with such a title & mdash; & mdash;
"Why is the death of the retail industry did not take Best Buy? & rdquo;
Here I take you to decrypt why the death did not take Best Buy.
And similar to the domestic Suning, Best Buy all kinds of household appliances and electronic products, refrigerator oven microwave oven, washing machine dryer game, as well as Apple, Samsung, Microsoft products show counters.
The two retailers at both ends of the earth, not just in the same category of business operators, is more coincidentally, for a long time after 2013, the two companies invariably carry out the same thing : Online and offline with the price.
At that time, in the huge shadow of the Amazon, Best Buy's performance has been declining for ten consecutive quarters, the past is not bankruptcy bankruptcy is crumbling; and on the side of the earth, Jingdong is not as strong as now, Performance has been growing year after year, it can be said that the situation is excellent.
But from the results point of view, Best Buy to achieve the same line with the line of the strategy, and has been out of the shadow of the Amazon, and Suning is no longer mention the slogan of the year.
Best Buy can now benefit from the current CEO Hubert Joly.
In September 2012, Hubert Joly was the CEO of Best Buy. Joly can be described as stepped in, in the previous ten quarters, Best Buy's performance continued to decline.
Joly's former CEO was dismissed after breaking the sex scandal, leaving the problem of Best Buy. At that time the company information system is outdated, many stores are in the loss of operation. Those who have attracted customers CD and DVD, are out of date. The most worrying is that, like other retail stores, Best Buy has become more and more like the product showroom - Consumers in the store to enjoy the trial, turned on the line under the single. Best of the past few days of the competition is too good, Circuit City has been bankrupt in 2008, Radio Shack also crumbling.
No one is optimistic about Joly will reverse the decline, not to mention Joly was just a hotel company's CEO.
Under great pressure, Joly bold use of online and offline with the price strategy, the price of the standard Amazon.
To shop experience customers in the comparison of other online platform prices, the natural choice in the store to buy. At the same time, Best Buy optimized the official website and App, all the online commodity prices are the same as the store. Customers can also be in the Best Buy official website and App orders, and at the same time choose to mail or take the goods receipt.
"Until our price is the same as that of Amazon, the customer stops losing." "said Joly in an interview with the media.
Parity strategy to Best Buy lost a lot of profits, but at the same time to the customer to stay in the store to spend the reasons, to avoid it to hand over to Amazon.
This is Joly made the most important decision, the price to the Amazon to reverse the performance of Best Buy has been declining decline, while escaping into the fate of the exhibition hall; and online platform and offline store price system is marked by the Best Buy Completed the Internet, from a traditional single channel retailers into a multi-channel retailers.
Best Buy's electricity business platform gradually began, the previous quarter's earnings show that Best Buy's current online sales accounted for 23% of total sales. With the power of the online platform, Best Buy's distribution will also change.
Joly's second major move is to optimize Best Buy's offline distribution system.
When Joly took over the company, Best Buy's online buying system and offline shop system was completely fragmented. If a customer orders from the Internet, Ta products will be shipped out from the central warehouse, if there is no central warehouse inside the product, then the customer will not get the goods.
Joly realizes that, as long as a slight change, every Best Buy store can send products to the surrounding customers, so the store also played the role of the warehouse. Now, as long as the customer from the Best Buy site up and down the single, the goods will be shipped from the nearest Best Buy store. This is a minor change, but can greatly reduce the delivery time and improve customer satisfaction. At present, about 40% of Best Buy online orders through the courier or shop to arrive in the hands of consumers.
In other words, Best Buy to integrate the original line with the offline logistics system integration, and gave the line store a new role in support of online sales.
In fact, Best Buy has an advantage, that is, it is now the only surviving electronic retail stores. Best Buy Many large rivals such as Circuit City, Radio Shack and HH Gregg have been bankrupt or completely closed. This means that if Samsung's brand side hopes to display its new products at large electronics retail stores, it basically has only one option.
In addition to the above initiatives, in order to control the loss and cut costs, Joly also closed those not profitable store, consolidate the business of overseas business. In 2014, he worked on the middle management team to streamline layoffs.
Best Buy has also restored the discount system for internal employee discounts, and has set up a staff training mechanism to give employees a better understanding of all new products such as VR glasses and smart homes.
Joly said that if you want to compete with Amazon, Best Buy must do what Amazon can not do, that is, the service is better, and the service is Amazon's electric business ceiling. This is also one of the important connotations of the concept of "new retail".
Compared to Best Buy, Suning online line with the price of the road to go quite rough.
June 8, 2013, Suning grab 618 before the announcement of the online and offline with the price of the strategy. Suning has already announced that Suning will be merged into one by line two companies, for Suning, the Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, Suning, This is the decision to completely change the Suning model.
At that time Suning said, there is no condition to create conditions, clear all obstacles to achieve this goal, chairman Zhang Jindong even held in the evening group of national video conference stressed that online and offline is "must" and "landing.
However, Suning online line with the price of the strategy did not pass through, a Suning appliance supplier friend told me that, including him, many suppliers in the Suning line to the shop and Tesco supply Time, will take the same batch of two kinds of product number of the way, the so-called "online specifically for" and "line" specifically for the line under the store salesman to explain a rhetoric, but in fact Interfere with the line line parity.
In fact, Suning in the Ali after the thigh, no longer mention the line with the price of this thing, seems to try to slowly forget this pain and unsuccessful "deformation & rdquo; experience.
Suning is not the lack of commitment to achieve uniform online and offline, but the implementation of online and offline with the price is a pull the whole body of the decision, in the actual operation, Suning encountered many problems, including the internal background system adjustment , Rights and interests and so on. Some of the problems even related to the basic model of Suning
Best Buy did not do Suning, the fundamental reason is that the lack of Suning line to achieve a unified price under the conditions of birth. And Best Buy to the smooth implementation of online and offline with the benefit of the United States is not the same consumption scenarios and consumption habits.
And online low prices to maintain unity, means to cut the profits of offline stores, Best Buy is generally located in the cheap place away from the city center rent, and Suning a large number of stores in the expensive commercial center, only this point to Suning To achieve online and offline prices unified set a high obstacle; Second, Best Buy store only a small amount of staff, Suning has a lot of sales, human costs and higher than a length.
In addition, away from the downtown center of the Best Buy store is usually a large area of retail centers, store area and form of little difference; and the Chinese market densely populated, retail scene complex and diverse, Suning stores from the core business district Suning Square opened To the cell door of the mobile phone store, the size and shape of the gap, the quality of staff is different.
It can even be said that the store shape of Best Buy is only a subset of all Suning store form, and is a high degree of standardization, easy to manage that subset. A single store shape to facilitate the Best Buy in the reform of unified action, while the complex state of Suning is facing a huge challenge.
Due to the lack of electricity business gene, Suning for online promotion cost a lot of money, but the high cost of online traffic acquisition, Suning online sales accounted for a huge leap did not appear.
Until the alliance with Ali, Suning online business sales accounted for a qualitative change.
2013 2014, Suning self-income in the main business income in the proportion of only 21% in 2015, 2016 this data into 30.1% and 42.2%, online income also began to grow substantially, 40 billion, 50 billion.
And online and offline with the price of the strategy, is the old retail giants do not want to easily compromise to the Internet positive reform, but also a aggressive trial and error. Jingdong again and again in the cruel price war, the heavy model of Suning played very hard, the main business profit margins decline year by year. After the failure of the battle in 2013, Suning had to give up the independent development of the line, choose to hold Ali's thigh.
Best Buy and the implementation of online and offline with the price and Suning failed to complete, not used to evaluate the two companies in the retail reform success criteria, but at least shows that in China's extremely complex, fragmented retail market , And strive to line with the price is not feasible.
For Best Buy, it is temporarily back to the safe area; for Suning, although the online platform and slightly separated from the line, but has considerable size, electric business path basically pass, but Suning there are a lot of various forms of Stores need to upgrade, it's retail change there is still a long way to go. But because the Suning line under the volume is too large, at this stage so that the online platform through the line with the price of the rope with the entire Suning take off too difficult.
But on the line line integration is the industry trend. In addition to Suning, a number of platforms, retailers and brands are in the test line on the line with the price, which also includes the price war with Suning Jingdong.
And Suning line from the line against the contrary, Jingdong is relying on online platform development line shop.
Jingdong home is Jingdong in this area an important attempt. Jingdong home of each product are Jingdong hot goods, category focused on electronic products.
Jingdong to provide these goods to join the Jingdong home electronics retailers, commodity prices signed on the two-dimensional code, making consumers confirm the same line with the fact that the line, and Jingdong through Jingdong logistics to these stores supply.
And Suning is different, Jingdong chose anxious, seeking to change the line shop, the data and logistics capabilities to the latter.
As a small-scale attempt, Jingdong can quickly explore the Jingdong home model, but Best Buy can still be as a very important reference for Jingdong, as Joly said, and if you want to compete with Amazon, Best Buy must be in the Amazon can not do Of things, that is, the service to do better. & rdquo;