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Corporate strategy: the "difference" to unlock the "price war" Knots
Release Time:2016-5-11    Reading:134 Times    Source:Lanbo Experimental Equipment
In China, due to the mild inflation and resource industries upstream production resulting from (the performance of the consumer price index CPI rising) are becoming the focus of public attention at the same time, there are still some scholars continue to decline as related industries, especially consumer electronics industry price realities and concerns. A large number of companies due to DVD Shenzhen price competition have been closed down news media just seen, few days, the domestic color TV manufacturers will come to the tragic news of the defeat came in the US anti-dumping proceedings, such as this no wake-up call, so many in the domestic price war golf badly beaten in the home appliance business international expansion strategy added variables. Price war hit home from abroad, but industry still get out of the vicious cycle of price competition, the domestic consumer electronics manufacturers in the end is how?
Analysys Consulting believe that the domestic DVD market buyer's market realities, upgrade of consumer demand, due to the popularity of the Internet leads to transparency and information industry gradually matured driven by reduced production costs, etc., are objective factors DVD market prices continue to decline, but producers can not get caught in a price war and the root causes more from its subjective aspect.
Price for market share in the low-price competition is the simple logic of the fuse. Many domestic enterprises, the pursuit of scale impulse often than the pursuit of return on investment. In order to increase market share at the expense of corporate profits in return, hope that through continued lower prices to increase market share. In fact, a little common sense knows that lower prices to compete to succeed must have at least two premises: first, the market demand for flexible enough, to make up for the loss of sales prices can be significantly improved earnings and surplus; followed by other competitors to maintain price constant. In reality, these two conditions do not exist: DVD industry has entered a mature stage, elasticity of demand is very small; many domestic competitors is difficult to stand. Based on the above facts, can only be the result of price competition into a price war with everyone, their share remained unchanged, the overall industry profits continue to decline. The end result of frequent price competition is only one of many small and medium firms in the industry do not have the cost advantage of the dead, and ultimately only a few dominant enterprises.
Competition is the confluence of substantive issues, many companies compete in the same direction, using almost the same business model, the same channel, the same technology, the same mode of production, and ultimately produce undifferentiated products, consumers have no choice only the price as the sole indicator of purchasing decisions, enterprises in order to survive only by constantly resorted to cheap banner, until no drop down and lose the basis of survival.
Being successful use of low-price competition appears to lack of precedent, Wal-Mart to "everyday low price" strategy jumped first in the world retailers often talked about man, but through the appearance we found that Wal-Mart's low-cost but unique corporate strategy results positioning and operational excellence brings cost advantages, not the reason to win. For the future the way many domestic enterprises do not have the cost advantage of how to go? In particular, how to develop an effective pricing strategy? Analysys Consulting said:
First, the creative differentiation to generate value. Market demand is diverse, the need for diverse products and services to be met. This will require many companies to abandon idealistic rush style imitation and following through to the real needs of the market and consumer understanding and mining, they can serve a good selection of market segments, giving up Tandaqiuquan false, develop unique and differentiated product and service enterprise systems to meet different needs. Only those who provide consumers with a unique value of the enterprise can only be in this "winner takes all" increasingly evident era, another way to find a niche for their survival, out of price competition misunderstanding. Shinco, Kim, backgammon and other brands of DVD producers should launch unique features required by the market new products as consumers opt for the heart, with the traditional DVD unsustainable production enterprises formed strongly contrast the way the market has actually been clear where .
Secondly, differentiated pricing to value. In many industries and enterprise to reduce costs by improving operational efficiency less and less space. How pricing management to maximize enterprise value more and more attention. With the rapid development of information technology and business improvement in the level of information technology in the past that rough price management and amortized cost information distortion caused by history, as well as to provide differentiated and personalized products and services for different customers occurred fine Get price and cost component information more easily, and even one pricing differential pricing possible. Enterprises can fine "pocket transaction price" management and "target cost" pricing and other pricing management tools to better differentiate the value created, so as to bring about sustained enterprise competitiveness.

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