Shi Jizhe, hot water product operations manager of the Group's hot water division from Midea, told China National Grid: 'Since 2018, the electric water heater industry will gradually enter the saturation phase; in comparison, it has advantages in both comfort and cost performance. Gas water heaters, with the advancement of gas pipeline network infrastructure, are expected to enter a high-speed growth stage.
In 2018, with the implementation of the National Clean Coal Clean Energy Policy, a series of follow-up impacts have become increasingly prominent. One of the important points is reflected in the 'coal reform' changes in the water heater industry's structure - the rapid growth of fuel heat, to a certain degree of compression Electric heat growth room.
Burnout advantage highlights
Constrained by the continuous regulation of the real estate market, real estate-related supporting industries have slowed down from the second quarter of 2017, and the water heater industry is no exception. However, compared with traditional kitchen and electric appliances, the robustness of the growth of the water heater market has continued. According to statistics, in 2017, the total size of the water heater industry exceeded 40 million units, sales reached 66.8 billion yuan, a year-on-year growth of 9.7%; and in the first quarter of 2018, the overall water heater market retail sales amounted to 18 billion yuan, an increase of 8.8% year-on-year. However, In the overall stable situation, there are still Pinghu minorities, such as favorable policies such as coal to gas conversion. In the past two years, gas water heaters overtake electric water heaters as a new growth point in the industry. In the first quarter of 2018, gas water heaters continued this trend. And Shi Jizhe's speech also confirmed this trend. 'For U.S., at present, our electricity and fuel products ratio is about 1.5:1. It is expected that in the future, the growth rate of fuel-fired products will still be faster than that of electric heating. At present, The company is also increasing its efforts in the development of burning heat.
Compared with electric water heaters, gas water heaters have the following advantages. Firstly, they do not need to wait for heating, ie, they need to be turned on and washed, which saves time and costs. Second, when several people bathe in a row, they can provide continuous hot water without stopping in the middle; The product does not need a water tank, so it does not cause problems such as scaling and stagnant water inside the tank. It is more in line with the concept of healthy bathing; In addition, with the advancement of gas technology, the temperature caused by factors such as air pressure and water pressure is not constant. Other pain points were gradually cracked. Therefore, based on the comfort test, in the area where gas pipelines are well-established, consumers' preference for burning hot products exceeds that of electric heating products.
In China, the scope of the gas pipeline network is limited. The promotion of gas water heaters is limited. However, with the advancement of coal-to-gas projects, the layout of the gas pipeline network is improving, and the scope of adaptation of gas water heaters is expanding. 'The next few years, gas water heaters The development of the industry will depend to a large extent on the advancement of the country’s infrastructure. The data we have learned is that the state plans to lay 20,000 km of pipelines every year. In addition, developments such as the Sino-Russian gas projects and the development of the South China Sea oil and gas fields are to a certain extent. The formation of the support for the development of the fundamentals of fuel combustion. We can boldly preset, the future of gas water heaters will become the mainstay of the industry, this year, gas products will continue to maintain a substantial growth.
Compared with the current growth trend of gas water heaters, the development of electric water heaters has entered a stable and inland waterway. 'The electric heating industry has maintained a steady growth. In the past few years, there have been shortages of electric heating products. As a result, everyone has expanded their production capacity, and some brands have actively entered the field. The increase in production capacity has led to a decline in the sales structure. With the saturation of the urban market, this part of excess capacity will enter the third and fourth line channels to digest. 'In addition, Shi Jizhe Mentioned, 'In 2017, Midea’s hot water division created revenue of more than 1 billion yuan, of which water heater products contributed over 80%. From the market point of view, the brand pattern of electric water heaters has been basically fixed, which is also one of the signs of a mature market. Currently, the top three brands of electric heating are AO Smith, Midea and Haier. The three companies accounted for more than 70% of the industry's share, basically forming an oligarchic pattern, and other brands share the remaining market; the gas water heater industry is not. Currently, no company can To achieve more than 20 points, everyone can find a place in their respective subdivisions. This field is still in a hundred disputes. '
Shi Jizhe told China National Grid that in the gas-fired water heater industry, foreign brands are relatively strong, but with the domestic brands competing for strength and nationals’ pride in their own brands, domestic brands have emerged in the field. 'For the gas water heater industry, Midea is full of confidence. As an integrated brand, we have obvious advantages in R&D and channels. Professional brands have advantages in technology accumulation and change, but comprehensive corporate learning ability is strong, and with the development of home appliance tying, A single category cannot support future development. The comprehensive brand's resources and financial advantages can support rapid R&D by the company and form a synergy. 'It is reported that the current US R&D investment in the water heater industry is fixed at 3-5 percentage points of sales.
Consumption upgrade pushes down enterprise innovation
From 2016 to 2018, the average price of water heater products is on the rise. Shi Jizhe believes that the price increase is mainly due to two factors. One is the acceleration of costs, and the other is the consumption upgrade. 'Since the second half of 2016, the bulk raw material cost has soared. , Diluted profits, Formed a lot of pressure on the retail side, including many SMEs can not withstand pressure, bankruptcy. For the United States water heater is also a certain pressure, but on the one hand we have a strong right to buy the right to speak, on the one hand Hedging the cost of raw materials through product upgrades is less affected. ' However, Shi Jizhe believes that raw material price increases are a double-edged sword. 'On the one hand, it has accelerated the industry's reshuffle, on the other hand, it has forced enterprises to carry out product upgrade iterations.' At present, from the group level, Midea is advancing the strategy of 'innovating and selling high' - promoting upgrading, promoting high-end transformation - 'From selling value-to-money in the past to selling technological innovation, functions and services.'
Take the gas water heater industry as an example. At present, everyone is pushing the concept of 'zero cold water'. This technology will push the product from the original price segment of 2,500 yuan to the price segment of 5,000 yuan. The advantage of zero-cold water products is better experience and solutions. The impact of cold water at the beginning of the bathing period has accounted for a doubling of the share of zero-cold water products for three consecutive years. It can be said that in the context of consumer upgrades, consumer demand for functionality and comfort is very strong. Selling points change from practical to comfortable.'
Shi Zhezhe pointed out that for gas water heaters, safety is first, followed by constant temperature and quietness. 'The guarantee of bathing safety is a standard feature. Everybody spared no effort in this regard and reached a new height as a whole. At present, the technological progress of the industry The foothold is at a constant temperature, such as zero-cold water technology, such as reducing the temperature difference during the bathing process. For gas water heaters, the lack of air pressure is the main cause of the temperature difference, such as staying at a high level or taking a shower during the peak cooking time. Gas pressure is not stable; in addition, it is the instant of switching water and it is prone to hot and cold. In response to this pain point, Midea introduced a series of high-end products, such as water temperature zero fluctuation technology, which not only changes the water temperature during bathing, but also shuts off the water. No fluctuations, improved bath comfort.
On the basis of the rapid heating and safety of electric water heaters, Midea will focus on healthy bathing and introduce healthy and live aquatic products. 'Since the water heaters purchased in the earlier period began to age, some consumers are concerned about the serious water scales in old water heaters, and the concept of living water is also consequential. Widely sought after. At present, the United States of the living water technology in the high-end market recognition is very high, the concept of health-driven product premiums from the original 1,000 yuan to 3000 yuan.
Since 2016, Midea has launched the high-end water heater brand 'Beverly', which is a brand shared with washing machines. Once launched, the growth rate is significant. ' Shi Jizhe said that currently Midea has launched a high-end customized home appliance program. Brand replacement is An important part, 'We did not simply change the brand of water heater from 'Beauty' to 'Beverly', but we developed a brand new platform from R&D to manufacturing to sales to service for Beverly. It is a complete set of different systems. Beverly water heaters use technologies that are two to three years ahead of existing products. At the aftermarket level, Beverly products are also served by dedicated personnel. At the group level, we also have plans for other high-end brands to meet with you.
In line with the customized home appliance program, Midea's home improvement products have gradually increased. 'Home furnishings' is the future direction of development. In line with this, our kitchen and seafood products have packaged products, such as light luxury series, Jane Eyre series. , For different groups, set different package attributes, such as water heaters, water purifier packages, one stop in place. In the second half, the United States will also introduce some special-shaped, small-size water heaters, to solve the original water heater covers an area, affecting the room decoration and other pain points . '
In addition, Shi Shizhe also revealed that the United States and Tmall, Huawei reached a strategic cooperation, in the smart home appliances in the new attempt.
In 2018, the overall idea of Midea water heaters was to continue to push new highs in the terminal, sell quality and high-end through innovative products, and actively channel down the channels to allow consumers to enter the town. Seeing the beauty shops, but sinking channels, we will also promote the upgrading of product performance. For example, the original 1 kW product will be upgraded to 3 kW, and the comfort will increase through power boost.