According to the 2023 Consumer Goods Listed Companies *** released the profile of listed companies in the 12 major sub-sectors of A-share consumer goodsThe explosive product we want to analyze this time is the head enterprise in the home furnishing industry - Midea Group. In the first half of the year, Midea Group and China United Network Communications *** hereinafter referred to as "China Unicom") signed a strategic cooperation agreement at the group headquarters of Midea, which will focus on in-depth cooperation in the fields of 5G+ smart home, smart building and information and communication services. Both sides said that they will strengthen innovation cooperation in multi-user scenarios, create newer and better benchmark cases in key areas such as 5G+ smart home and 5G+ intelligent manufacturing, and promote the development of high-quality products and services, which shows Midea's great ambition.
Founded in 1968, after more than 50 years of development, Midea Group has become the business card of "Made in China", and its lighthouse factory is the wealth of the world's manufacturing industry. Now, looking at the global home appliance giants, Midea has a relatively outstanding performance in terms of scale, category, industrial chain layout, and diversified development. In addition to the air conditioning business, Midea has made significant progress in consumer appliances, automation systems, intelligent robots, etc., which have provided strong support for Midea's diversified development channel layout. Nowadays, among the three giants in the major appliance industry, Midea has surpassed Gree and Haier in terms of market value, revenue and net profit. From the comparison of the total market value of A-shares, Midea even exceeds the sum of Gree and Haier. How exactly did Midea do it?
Market management solutions do the right thing
Actively carry out the reform of flat channels
Professor Jiang Xin'an, the first proposer of the "Theory of Explosive Product Addiction", said that understanding the market is a very important ability of a company. It's also called the ability to look at the cake, which talks about why market segmentation is carried out. Due to the fierce market competition, customer needs are diverse, the life cycle is short, and technical products emerge in an endless stream. Therefore, market segmentation is to find the vertical industry of the enterprise, and do not anchor the product first.
Gree, Midea, and Haier are home appliance companies that entered the industry earlierFrom 2005 to 2010, the industry developed rapidly, and the policy of "household appliances going to the countryside" stimulated. This is the same as the early days of European and American countries, which started early by borrowing funds to wage wars, starting early, increasing leverage, and then frantically plundering resources, and now it has become a developed country with a leading industry, and other countries are working hard, but if they miss the opportunity for development, it will be difficult to catch up. Midea and Gree frantically expanded their channels, and Haier operated steadily without increasing leverage at that time, and then fell behind.
To sum up, there are four steps: Step 1, looking at the cake to understand the market, also called scanning the market, or market definition;The second step is to cut the cake, which is the market segmentationStep 3, combinatorial analysis, using the SPEN plus fan model, also called the abacus in the heart;Step 4, Cake Eating PlanThe most important thing is to use Ansoff's model to define the company's strategy, define potential products, and define goals.
Founded in 1968, after more than 50 years of development, Midea Group has become a business card of "Made in China". In the early days of its establishment, Midea mainly carried out manufacturing and processing business, involving plastics, glass, metals, auto parts and other fields. In 1980, Midea officially entered the track of home appliancesStarted production of electric fans;In 1981, the "Midea" trademark was officially bornIn 1985, Midea entered the air-conditioning industry, and since then it has formed two major businesses: "air-conditioning + fan".
According to the survey data, because of the 800 billion home appliance industry, the major appliance subdivision industry occupies half of the country, that is, 400 billion, and the air conditioning industry occupies half of the major appliances, that is, 200 billion, so the air conditioning market home appliance industry is the largest segment, followed by refrigerators and washing machines are less than 100 billion each. Midea's business covers large and small household appliances, but its core products are focused on air conditioners.
In the past 10 years, under the background of the withdrawal of subsidies for household appliances to the countryside, the tightening of real estate regulation and control, and the entry of the white electricity industry into a downward cycleMidea actively carried out the flat reform of channels, including reducing channel levels and strengthening channel control, so as to achieve the purpose of reducing costs and increasing efficiency and getting close to the market. At present, Midea's channel system mainly includes offline dealer stores and KAs, as well as e-commerce models. Midea seized the market with high cost performance and enhanced its brand awareness in the market.
The strategic vision guides the global layout
Optimize and expand multi-brand and multi-category business
As the domestic market becomes increasingly saturated, there is still room for doubling the penetration rate of air conditioners, while the penetration rate of refrigerators and washing machines has basically peaked, leaving only the demand for stock improvement. Compared with the domestic saturated market, there is still room for growth in the international market, such as Southeast Asia, South America, and Africa, there are relatively broad home appliance application markets. After years of internal growth, external acquisitions and integration, Midea has a very complete domestic and foreign regional layout in the fields of air conditioners, refrigerators and washing machines.
Market management and product planning, which determines which markets we want to do, the order of our market entry, and the order of our products, the order of the market and the order of productsIt provides us with more directional guidance and a basic guarantee for the implementation of our strategic vision. Therefore, product planning and platform planning are very important plans.
Benefiting from the rapid development of China's economy and the increase in the penetration rate of household appliances, Midea continues to maintain a very fast growth rate. As early as 2006, Midea Group has begun to launch the Overseas Direct Investment (ODI) plan, and has acquired a series of home appliance brands overseas, among them, the acquisition of Egyptian air conditioning brand Miraco325% of the shares, completed the acquisition of 100% of the equity of KUKA Robot in Germany, and acquired 80% of the equity of the Italian air conditioning brand CLIVET.
Among the seven major parties of explosive product addiction, the first party is strategic positioning, grasping the market and customer segmentation, and the market is to solve the problems of segmentation, planning, research and development, detonation and iteration. When making strategies, it is necessary to narrow the dimensions and enlarge the scales. The strategic vision is actually the starting point of the enterprise, and which industry the enterprise should focus on. Through the vision and mission, we know the direction of our war and the direction of competition, and the strategy can make it clear that the starting point of the enterprise is the first placeThe core point of our business model is to pry up
Specifically, on the one hand, Midea relies on its manufacturing advantages to carry out OEM and ODM business;On the other hand, in the past few years, Midea has successively acquired Toshiba, a Japanese famous brand of home appliances, Clivet, an Italian air conditioning company, and KUKA Robotics of Germany, optimizing the company's layout in the field of white goods and expanding its multi-brand and multi-category business. In addition, Midea continued to promote the expansion of production capacity, and the air-conditioning bases in Shunde, Wuhan and Wuhu were put into operation, with a production capacity of 11 million units, which also paved the way for the internationalization strategy.
Midea actively explores overseas markets, and its first overseas production base was put into operation in Vietnam, and its overseas revenue has exceeded 20 billion yuan as early as 2010. Midea has also established a technology research institute to further increase the research and development of global advanced white goods technology, forward-looking technology and basic technology. At present, Midea has nearly 100 foreign technical experts, and has world-class laboratories such as VDE in Germany, LGA accredited laboratory in Germany, and UL accredited laboratory in the United States.
The clarity of Midea's internationalization strategy further proves the clarity of the company's entire development strategy. Midea is an enterprise that keeps calm about the development of the industry at all times, and has the ability to make dynamic adjustments and gradual changes in a timely manner. During the period from 2011 to 2020, the scale of Midea Group has grown steadily, and the quality of earnings has also further improved. In 2013, Midea Group was listed as a whole. From 2013 to 2020, Midea Group's revenue increased from 121 billion to 284.2 billion, with a compound annual growth rate of about 13%.Attributable net profit increased from 5.3 billion to 27.2 billion, with a compound annual growth rate of 26%.
Achieve product leadership based on technology leadership
Requirements management ensures that things are done right
Professor Jiang Xin'an said that platform development and technology development can be understood as the core of the core of the enterprise. For a home appliance company, the core of operation is to polish the products that consumers like. Requirements management can ensure that we do things right, pain points, itch points, cool points, and even user experience, these things can be solved through requirements management.
Its main function is to get product planning, according to product planning, we can also get technical planning, technical planning and product planning are two different concepts. To establish the core thinking of an enterprise, it is necessary to obtain it through technical planning, enter product planning according to technical planning, and enter product development according to product planning, which are complementary to each other.
But for a comprehensive intelligent manufacturing group, core technology and basic innovation become more important. From product leadership to technology leadership, Midea attaches more importance to the driving role of technology in the company's growth. Technology development solves core technologies, product development solves products, needs solve creativity, and platforms solve general.
The connotation of product leadership lies in technology leadership, structural upgrading, quality improvement, and the purpose of strengthening the company's product strength. On the one hand, product advantages can bring higher profit margins to Midea;On the other hand,Only by doing a good job in the product can we accumulate brand and reputation, so that the brand is addicted and the product is always explosive. Enterprises can use these four development processes to solve all the difficulties of enterprises in a real sense.
So,Midea attaches great importance to R&D investment, and invested more than 10 billion yuan in R&D last year. According to the data, Midea's R&D investment in the past five years is about 45 billion yuan. With the support of the company's R&D personnel, the number of invention patents of Midea Group has reached 3,460.
With the advent of the 5G era, AIoT smart home has become one of the most imaginative IoT application scenarios. As a traditional manufacturing industry, Midea is very aware of its own advantages, that is, the research and development and production of household appliances themselves. On the road to the comprehensive layout of smart home, the beauty of the United States lies in daring to innovate and exploreIn the Internet technology reserves that he is not good at, step by step, so as to transform into a technology group.
Diversified product line layout to create competitive advantage
Achieve a steady increase in market share
Enterprises should choose the industry instead of anchoring the product, and in an industry, they also need to compete in the market, and the market segmentation in the company determines how many product lines you have. Do market segmentation in the product line and decide how many products you have. How many market segments you do in a product determines how many versions you have. Product management is to treat the product line as the management of a virtual company, and the ultimate goal is to achieve two things, one is customer satisfaction, and the other is competitive advantage.
When it comes to Midea Group, the first thing consumers think of is refrigerators, air conditioners, ......and other household appliances. In fact, Midea Group, founded in 1968, has become more diversified in the course of more than 50 years of development, and is not limited to common home appliances such as refrigerators, air conditioners, and washing machines. Midea also occupies a high market share in small household appliances such as electric fans, induction cookers, and rice cookers, which helps Midea to further improve the market competitiveness of home appliances.
In addition to smart homes and home appliances for consumers, it also covers industrial technology, building technology, robotics and automation, and other innovative businesses. In terms of sales channels, Midea has made a comprehensive layout in the market and established Midea's online home appliance brand. At present, Midea Group has formed a number of brand portfolios such as Midea, Little Swan, Hualing, Colmo, KUKA, Welling, Hekang, Gaochuang, Wandong and Lingwang.
In addition, Midea Group also plans to further deploy new energy vehicles. At present, Midea Group has cooperated with BOSH, Huawei, Baoneng, BYD, etc., to develop and establish a car-home interconnection system to realize the remote control of smart home appliances by the on-board system. According to relevant news, in the past three years, Midea Group has successively laid out a number of businesses such as new energy vehicles, elevators, semiconductors, medical devices and even cross-border e-commerce.
Whether it is in the online or offline market, Midea has ranked first in China in terms of market share in terms of retail sales in many product fields, such as electric fans, induction cookers, rice cookers and other small household appliances, becoming a manifestation of Midea's comprehensive strength. It is precisely this strategy of diversified product layout that allows Midea Group to occupy an important place in the home appliance industry.
At present, Midea has business in more than 200 countries and regions, with 31 R&D centers, 40 major production bases around the world, and more than 190,000 employees worldwide. Midea Group has also grown from a small factory mainly producing refrigerators to one of the leading enterprises in China's home appliance industry.
Stay forward-looking and insightful in the industry
Differentiation strategy for innovation and iteration
Not only that, Midea also dares to hit the young market that other traditional brands are not good at, which is a difficult road for Midea, and it is also a road that must be taken. How to race with the times and keep up with the times, we not only have to find the demand for high-frequency rigidity, but also to make products with the same frequency resonance. It is precisely in this way that Midea can stand out in the fierce smart home appliance market. As young consumers become the main force in the market, young consumers, who account for 15% of China's total population, will become the focus of future market competition.
How to establish the concept of co-frequency resonance with your users, so through co-frequency resonance, we can establish a very good way to link with users, and even it doesn't need to go through marketing, because attraction is more reliable than marketing. The rise of the young group of Generation Z is gradually becoming a new generation of consumer responsibility, they are open and inclusive, diverse and full of personality, no longer simply satisfied with the functional attributes of the product, but pay more attention to the appearance design, fashion, brand connotation and other emotional demands. As a leader in the small household appliance industry, Midea has long had insight into the change in demand.
In order to fully embrace the young people of Generation Z, Midea, as a leader in the small household appliance industry, has taken the lead in carrying the beam of innovation and launched a new generation of technological trendy products with high appearance, strong functions and social attributes, and is committed to leading the new trend of the industry. Among them, the most representative is the cute tide series co-branded with Pokémon, Kakaofriends, Momoplanet, Journey to the West and other well-known IPsIt not only has eye-catching appearance, but also has emotional resonance in cultural connotation, which has fully opened up the connection between traditional household appliances and young consumer groups.
Midea's innovation ability to break the routine is also reflected in the development of market segments. At present, the diverse needs of young people are forcing product segmentation. In this regard, Midea accurately grasped the industry trend, carefully studied the needs of users, and innovated and iterated on conventional categories with differentiated strategies, which also opened up a new growth space for the market. Among them, the knife and chopsticks cutting board sterilizer that pays attention to the health and hygiene of the kitchen, and the water washing wall breaker that solves the cleaning problems that have plagued users for a long time are the benchmark products of Midea focusing on market segments. According to the data, since its launch in September, Midea's washing series wall breakers have sold a total of 24,000 units, and they topped the industry's top sales volume in the first week of their debut.
Midea's products have frequently achieved good results in the market, which strongly confirms Midea's forward-looking and insight in the new trend of young consumption. Midea develops products based on the pain points of user needs, does not blindly follow product trends, and focuses on home appliances with long-term demand spaceAnd based on user thinking, build product brands, improve sales channels, and optimize service processes. It not only successfully captured young audiences, but also led a new round of industrial upgrading in the small household appliance industry.
Iterative evolution of lifecycle management
Carry out effective targeted market play
Only by running faster and better than competitors can enterprises have the possibility of long-term sustainable success. So, in layman's termsThe long-term sustainable success of the enterprise is to be able to obtain a faster growth rate of sales revenue and profits than competitors in the industry under the conditions of the right direction and controllable risks. Then, the senior management team, which can directly and significantly affect the business results, becomes the key factor for the long-term sustainable success of the enterprise.
The life cycle is very important, not only in the process of evolution, not only in the evolution of the product, but also in the evolution of the entire product organization. The evolution of the organization and the evolution of the product are two very important evolutionary modes in the life cycle. How can you learn a good set of market play?Enterprises should learn to look at some basic product data, according to the region, according to the product, according to the customer, time, and so on, to analyze the trend and curve of the productIt is necessary to find the key crux of the product, and then have some targeted marketing methods.
In the context of the downturn in the entire home appliance terminal market again, and the transformation of the home appliance industry and the transformation of enterprises into a stage of confusion, Midea's internal organizational change is also a manifestation of its response to market competition. At the same time, with the development of large household appliance enterprises for many years, some enterprises have problems such as system solidification, unbalanced resource sharing, and low efficiency. Along with the upgrading of the strategy, the organizational structure of Midea Group has also been readjusted to adapt to the development goals of the new stage.
In the early days, Midea divided its business divisions according to home appliance categories, but now Midea has redivided into five major sectors: smart home business group, industrial technology business group, building technology business group, robotics and automation business department, and other innovative businesses. Smart home and industrial technology involve the most product categories and application scenarios, smart home business group is the most familiar with the beauty of the product, including various categories of home appliances, the future will be towards the whole house smart home, high-end, set of direction of development.
The Industrial Technology Business Group mainly focuses on upstream components of home appliances such as compressors and motors, as well as industrial automation products such as inverters and servos, as well as businesses for new energy sources. The main products of the Building Technology Division are air conditioners, in addition to elevators, building control systems and other businesses, where the building control system can be understood as an operating system that connects all the equipment in the building.
The main products of the Robotics and Automation Division are industrial robots, as well as logistics and medical transmission systems, and the main downstream customers are manufacturing enterprises, which meet the needs of industrial automation and have synergies with the industrial technology business group. Other innovative businesses include enterprise-oriented digital services, exporting Midea Group's intelligent and digital operation mode (Meiyun Zhishu and Ander Logistics), as well as Wandong Medical, which provides medical products and services.
The adjustment of the organizational structure is mainly to coordinate the first-line marketing and promotion business between the different product lines of Midea Group, seek the synergistic competitiveness of different categories in the market under one platform, and accelerate the integration of multiple categories from R&D, manufacturing to marketing, and seek a game of chess. KnowAccording to a source, Midea is trying C2B to allow users to participate in the co-creation of home appliances. Midea hopes to promote this model to more categories in the future, and the new household appliances after the merger provide the possibility for the promotion of such models.
Conclusion:
From global development to global breakthroughs, Midea has established a stronger core competitiveness in the global market. On the one hand, Midea has strengthened its own brand in the international market and gradually opened up the market space for high-value home appliances. On the other hand, Midea has improved the localization layout in various countries and created a first-class chain and channel system suitable for the local area. Midea stands at the forefront of the times, always leads the industry, uses strength and action to get closer to the young group, and realizes the consumption transformation of the brand with youth. The ability to perceive, the technology to realize, and the top-level design are the fundamental reasons why a large number of Midea's new products are being welcomed by consumers around the world and continue to lead the trend. As the starting point for the layout of small household appliances by a large group with a market value of more than 600 billion yuan, Midea's household appliances have incomparable advantages compared with their peers, such as: brand potential energy, R&D advantages, high-level manufacturing strength, etc. More importantly, even if it stands in the highest position, Midea has never stopped, driven by continuous innovation, Midea has "infinite possibilities".