This week’s research focus: 618 promotion from the perspective of platform and brand momentum
In recent years, driven by the joint efforts of relevant national departments such as the Ministry of Commerce and major e-commerce platforms, 618 Shopping Festival has gradually become an annual e-commerce platform S-level promotion activity. Driven by this, may to June each year has become the peak season of e-commerce consumption across the country. This paper combs the calendar of events of the main e-commerce platforms in 618 this year, the measures of the platform to help businesses under the background of the epidemic, and the strength of home appliance brands on the product end on the eve of 618.
\u3000\u30001. Calendar of 618 promotion activities
618 activities, as an important node to stimulate optional consumption, are increasingly concerned by platforms and businesses. For e-commerce platforms, it is urgent to boost users’ shopping enthusiasm and confidence through a shopping festival in the post epidemic stage. Businesses also need to return blood through sales to reduce backlog and run quickly. Different from the atmosphere of rendering discounts and focusing on marketing in previous years, trapped by the scattered and frequent outbreaks of the epidemic, the operation of upstream manufacturers and downstream sellers have encountered practical challenges. Therefore, this year, the major e-commerce platforms have shown a posture of fighting side by side with merchants in the warm-up of activities, which is intended to alleviate the business pressure of merchants and help merchants activate and accumulate potential energy in all aspects.
1) Amoy system: compared with previous years, this year’s 618 has started preheating in advance since May 10. The time span of the activity has been extended to nearly one month, and the threshold of pre-sale and payment has also been reduced. Consumers’ payment basically starts at 20:00, so there is no need to stay up late to rush to buy. This year’s tmall Shopping Festival has adjusted the cross store discount rule to reduce 50 yuan for 300 yuan (the discount rate reaches 16.7%), further increasing the profit transfer to consumers. In order to relieve the pressure on businesses, tmall launched a total of 25 “618” business initiatives this year, twice the number of double 11 last year, and the amount of funds used exceeded 110 billion yuan. The initiatives cover five aspects: financial subsidies, logistics dredging, flow subsidies, special epidemic prevention measures and technology upgrading.
2) jd.com: the pre-sale of jd.com is earlier than that of Amoy. After taking the lead in advancing the big promotion activities from 0:00 to 8:00 in the industry on November 11 last year, jd.com 618 will continue the “8:00 p.m. late” experience of not staying up late this year. “No. 1 Beijing Post” will be upgraded to cross store full reduction, and users can enjoy a discount of 50 yuan for each full 299 yuan. From 8:00 every night on May 31, it will go online in turns, including limited time spike, red envelope rain, large surprise coupons, etc. the discount is also increased compared with previous years. In order to help businesses relieve difficulties, reduce costs and increase efficiency, JD 618 will further implement full link services this year, deepen trend operation capacity, and improve consumers’ purchasing power and business development confidence in combination with 30 “three reductions and three excellence” business support measures, “JD new department store” collective business format, “Green Plan”, etc.
\u3000\u30002. From the perspective of explosion and discount, the power of household appliance brands
In recent years, most home appliance enterprises have started 618 major promotion preheating in late May. We sorted out the activity rhythm and main products of major core home appliance targets released in tmall flagship store. Specifically, Haier and Hisense, the leading white power enterprises that have released 618 promotion activities, comply with the development trend of the industry and mainly promote high-capacity ice washing products; All kitchen and electric enterprises have started 618 large-scale promotion of preheating. The boss focuses on variable-frequency three-sided and variable-frequency double chamber cigarette machines. Integrated stove enterprises mainly promote high-end steaming and baking products, and the upgrading of product structure is expected to be further deepened. Marssenger Kitchenware Co.Ltd(300894) first promotes the independent new product e7bc of steaming and baking, and the product matrix is improved; Zhongbeiding and Xinbao, small kitchen and electricity enterprises, have opened 618 main product appointments and given large discounts; Among the clean electrical appliance enterprises, Ecovacs Robotics Co.Ltd(603486) , stone launched new products in 618, and Tianke and stone took the lead in opening reservations. Considering that the sales volume of the clean electrical appliance online channel in June 21 accounted for 16% of the whole year, the advanced pre-sale of some products by major brands is expected to build momentum for brands and occupy the minds of consumers in advance.
\u3000\u30003. China Transportation tracking
From May to June, the recovery degree of China’s logistics will have a certain impact on the sales effect of this 618 promotion. We observed that the number of newly diagnosed cases in China on covid-19 has gradually decreased recently. With the gradual resumption of work and production in the sealed and controlled areas, combined with the rapid rebound trend of freight flow after the unsealing of Jilin Province, China’s overall transportation situation is expected to improve.
Investment suggestions: according to the current situation, there are three allocation ideas: 1) large household appliances: Historically, credit is transmitted through the path of “credit → real estate → large household appliances”. This round of credit easing + real estate policy easing is expected to gradually exchange the real estate sales data, and the improvement of sales data is conducive to the improvement of household appliance valuation. At present, the real estate sales base of 3q21 is low, and the 1 + 2q policy may play a role in 3Q after it is released this year. Second, the epidemic situation of 2q this year has an impact (already pricein), but some demand may be delayed to the third quarter (especially 2b). Third, the cost has been declining recently. On this line, we maintain our previous recommendations, [ Haier Smart Home Co.Ltd(600690) ], [ Midea Group Co.Ltd(000333) ], [ Hangzhou Robam Appliances Co.Ltd(002508) ], [ Zhejiang Entive Smart Kitchen Appliance Co.Ltd(300911) ], [ Marssenger Kitchenware Co.Ltd(300894) ]. 2) 2q low base + subject of potential epidemic benefit. This line is mainly small kitchen appliances. On April 10, we began to add [ Zhejiang Supor Co.Ltd(002032) ], [ Bear Electric Appliance Co.Ltd(002959) ], [ Guangdong Xinbao Electrical Appliances Holdings Co.Ltd(002705) ], etc. 3) In the medium term, there are growth tracks, such as floor sweepers, which are projected to a good layout position. Due to concerns about consumption power and 2q epidemic, PE has fallen back to the level of small household appliances, but in the medium term, the track can grow as an emerging variety, mainly focusing on [ Ecovacs Robotics Co.Ltd(603486) ], [ Beijing Roborock Technology Co.Ltd(688169) ].
Risk tip: the expansion of the epidemic situation, the risk of fluctuations in the real estate market, exchange rate and raw material prices, etc.
