Author: Zhan Guo, Editor: Zhao Yuan.
In 2023, if there is a word of the year in the retail industry, "* war" and "discount" will inevitably be on the list.
Among the many actions to expand the territory with ** as the anchor, the business war between Hema and Sam must be on the table.
Recently, the ** battle between Hema and Sam has been updated to the second season, and Sam blocked the IP incident of Hema headquarters and appeared on Weibo hot search.
The price war between the two retail giants has intensified, and netizens have shouted: roll up, roll up. A few months ago, the ** battle between Hema and Sam was on the hot search, and the number of readings on Weibo-related topics was as high as 80 million.
In August this year, Hema launched the "Moving Mountain Price", and the two sides started a battleOn October 13, Hema announced a 20% price reduction for more than 5,000 offline products, and announced the start of discount reforms.
Recently, Hema launched "Moving Mountains and Fighting Cattle", and said that in 2024, the first battle will continue, and beef will become a key category for price reductions at the beginning of the year. The war between the two sides ushered in another stage of comprehensive escalation.
Beef is Sam's core popular product, and Hema has attacked Sam's core hinterland, and Sam is a little "broken" in the face of this business war, and introduces the business war with Hema into the deep water area by shielding IP and investigating user questions.
Moving mountains and fighting cattle is also a blockbuster action after Hema announced a comprehensive discount, and it is also a continuation of the "moving mountain price".
According to news reports, the number one item in 2024 will be beef. Since the beginning of December, Hema has fully upgraded the beef to Angus 150-day grain-fed beef, including steak, hot pot slices and barbecue slices, etc., compared with the previous 100-120 days of beef, there will be more obvious snowflakes, more delicate taste, richer layers.
According to the news of the interface and the feedback of users on social platforms, Hema's "bull fighting" is basically sticking to Sam, which is very targeted.
There are also ** quoting Hema insiders as saying that Hema beef has completed industry-wide market research at the time of pricing to ensure cost performance and quality.
There is still more than a month to go before the Spring Festival of the Year of the Dragon, and Hema said that more than 3,000 cows have been prepared to welcome the arrival of the peak of the Spring Festival.
Moving mountains and fighting cattle is not only a follow-up to the durian mille-feuille war, an expansion of the results, but also an upgrade.
In August this year, Hema launched a 99 yuan durian mille-feuille, and Sam lowered ** from 128 to 989 yuan, Hema continued to drop to 89 yuan, Sam adjusted it to 1 yuan lower than Hema, and finally Hema lowered ** to 79, Sam to 85 yuan.
* The war has made the sales and traffic of Hema soar, and Hema data shows that the durian mille-feuille ** war has increased the sales of this product in Shanghai by 26 times. Aurora big data shows that after the launch of "Yishan Price", the average weekly DAU (average daily active users) of the Hema app increased by 133%。
* War is also the most immediate way to convey "more cost-effective".
Therefore, the discount road of Hema has gradually expanded from durian mille-feuille to cake baking, seafood, meat and poultry, milk drinks, rice, flour, grain and oil and many other categories, with an average price reduction of 20% for more than 5,000 products, and the scope has also expanded from Beijing and Shanghai to the whole country.
This time, Hema will take beef as a pioneer category in price reduction, which is due to the scale of the beef market and the meaning of lighting the sword.
Public data show that in recent years, the per capita beef consumption of Chinese has grown steadily, and in terms of market space, per capita consumption is not only more than 4 times different from the United States, but also has a certain gap with the world average, and there is a large room for growth on the demand side.
Hema internal data also shows that the proportion of beef is increasing year by year.
Beef is a very strict category, for example, in the United States, beef is divided into 8 grades. Currently, Sam's only sells the best two grades of beef.
It can be said that beef is Sam's trump card, and it is Sam's most popular category in the minds of users. The supply capacity of high-quality beef is also a microcosm of the excellent chain capabilities of international retail giants.
Hema has established a direct mining ranch in Australia through cooperation with Newland and other enterprises, realizing the direct mining of Angus 150 days of grain-fed cattle, saving 20% of the cost in the procurement process.
Knocking down the ** of the beef category, Hema has proved its own ** chain ability.
In the face of Hema's increasingly fierce offensive, Sam was a little nervous.
At the beginning, the business war only stayed in the dimension of "**".
For example, the price reduction of durian mille-feuille mentioned earlier, and for example, after the launch of the "Moving Mountains and Fighting Cattle" project, some users reported on social platforms that Sam's beef** had also declined, such as 107 before8 yuan of 900g Australian grain-fed fat beef hot pot slices, down to 898 yuan, but still slightly higher than the same model of Hema.
Later, the trend of business warfare became "simple", and it was almost on an equal footing with the "watering the fortune tree of the other company" circulating on the Internet. That is, the aforementioned blocking of the Hema headquarters IP, Sam did not give a clear reply to this matter.
Recently, another user broke the news that Sam's questionnaire survey is also "targeted", the first question: which of the following supermarkets have you been to shop in the past month, and one of the options includes Freshippo. This is normal, but if you choose Hema, there will be more specific questions for Hema .
For example, shopping in Hema is whether it is online or offline, and there is even a score of satisfaction with the cost performance of Hema products. changes in price-performance ratio, etc. The last question also asks the user to list a product that thinks Hema buys the most cost-effective and **, this is an optional item, and the front is required.
The user said: "I feel like going to the supermarket now, it's like spying on the enemy."
These seemingly outrageous operations are actually the embodiment of Sam's full defense.
In the past, Sam has always been the object of learning and imitation of Hema, but now Sam has paid more and more attention to Hema and this time the level has risen again. Sam's CEO China has said that Hema may become Sam's only competitor in China, and now this competitor is becoming a growing threat to Sam.
In the normal competition between the two retail giants, Hema and Sam, Sam's actions are obviously defensive, and the more active is to lay out the sinking market.
For example, Sam's has signed a number of stores in Dongguan Liaobu, Jiaxing Jingkai, Shaoxing Yuecheng, Jinan Lixia, Wenzhou Lucheng and Jinjiang Chidian.
Such a layout also makes sense, since the **war has to follow, discounted goods** decline, Sam will no longer be "exclusive to the middle class".
The actions of Hema are not only reflected in the first chain, but also in the first chain, operation mode, and product operation mode that support the ultimate cost-effective goods.
As Hou Yi, CEO of Freshippo, said, the core of the discount store is determined by three things: differentiated product operation, vertical chain, and extreme operating costs.
In terms of chain, Hema has set up procurement centers around the world, vertically ** as mentioned above, the global cattle search, and signed direct procurement agreements with ranches. The fresh product department takes the base as the core, and the finished product department takes the factory as the core.
In terms of organization and operation, after Hema fully launched the discount store model, the original private label team, large import team and category procurement team were merged. It is reported that before the Spring Festival in 2024, more than 350 offline stores of Hema Fresh and Hema Mini will all be transformed into a "discounted" business model. It is also reported that the membership of the X member store may also be cancelled, because this has already conflicted with the full discount of Hema.
The differentiated product operation is reflected in the continuous increase in the proportion of Freshippo's self-operated products. Hou Yi mentioned that the goal of self-operated brands is 60%-70%, which is on par with international discount stores.
Sam's is a multinational company, and its stores are located in many countries, so the management difficulty is inevitably higher than that of Freshippo, and the ability to make decisions and reactions is inevitably slower, which can also be seen from the slow pace of Sam's new products.
Therefore, in the face of the menacing Hema, Sam tried his best to defend the safest way, and the counterattack was insufficient.
When some consumers received the Sam's user questionnaire, they commented: If you want to score Hema high, roll it up for me.
It's not a big deal to watch the excitement, Sam and Hema started a ** war, the most favorite and most enjoyable is the consumer, the more intense the fight, the more consumers enjoy the benefits.
The first-class war above the cost is a good thing, which not only allows consumers to enjoy low-cost goods, but also forces enterprises to improve the efficiency of operation and operation, and enhance their competitive advantage in the cruel business world.
Because competition will always exist, but it is not necessarily in the form of ** war.
McNell, a retail expert at Harvard Business School, once put forward the "retail rotation theory hypothesis" in 1958, arguing that the change of retail organizations is cyclical, showing a development trend like a rotating wheel: new retail organizations usually enter the market with low gross profit, low cost and low **. When it is successful, it inevitably leads to imitation and competition.
Sam's membership-based warehouse is a typical imitation object, Hema has been on par with Sam in many aspects, and the speed of new products and online operation capabilities are more than Sam's.
Therefore, the discount reform of Hema has achieved results, and after the market has achieved a certain scale, it will definitely usher in imitators. For example, at the end of 2021, Hema opened its first Hema Fresh Outlet store in Shanghai, focusing on discounted fresh goods and frozen productsIn January last year, Suning Tesco opened its first discount supermarket in Ma'anshan, Anhui ProvinceWumart Supermarket also opened an 80-square-meter "Meitao" discount store.
Finally, McNeill believes that after the fierce war, market competition will prompt it to adopt a competitive strategy other than the first. The ability to experience in the cruel war has accumulated valuable wealth for the long-term operation of the enterprise.