Furniture industry will set off an e-commerce boom

Adapt to economic globalization and respond to the current difficult business environment. The advantage platform that innovates marketing thinking, enhances the competitiveness of the industry, and uses network marketing has become an inevitable choice for many furniture companies.

In recent years, the awareness of the furniture industry for the Internet has greatly increased, and more and more furniture companies have begun to use the Internet for brand promotion and online marketing. Network brand advertisements have also been increasingly accepted by companies, and furniture companies have continued to increase their investment in online shopping malls and B2B. Furniture e-commerce is on the rise.

Behind the e-commerce boom in furniture

Behind the gradual warming of China's furniture industry e-commerce is the result of the combined effects of Internet technology, e-commerce overall development and the current difficulties faced by the furniture industry.

1. The rapid development of the Internet and the maturity of e-commerce

The China Internet Network Information Center (CNNIC) "The 23rd Statistical Report on Internet Development in China" shows that as of the end of 2008, the number of Internet users in China reached 298 million, and the Internet penetration rate exceeded the global average of 21.9% for the first time by 22.6%. The number of broadband Internet users reached 270 million, and the number of CN CN domain names reached 13.572 million. The three indicators continued to rank first in the world, and the huge number of its ever-growing netizens provided ample room for the development of e-commerce in China.

2. Industry crisis touches corporate innovation

The global financial tsunami has brought a lot of impact to China, and many companies have faced more difficulties. They have gone bankrupt and layoffs have occurred from time to time. Among them, labor-intensive industries, including furniture, have suffered the most. Due to the low concentration of furniture companies and the lack of competitiveness in terms of economic strength, technical capabilities, brand, etc., only innovation and change can win the future.

E-commerce is the backbone of resisting the economic "winter". Enterprises use e-commerce to expand their market through the Internet, free from time and space constraints, can save a lot of costs, and can get more orders. Therefore, it gradually became the choice of many furniture companies. Its greatest advantage is that it can increase sales and reduce operating costs, improve operating efficiency, and thus bring profits to the company. E-commerce provides a platform for SMEs, so that they also have the opportunity to conduct online trade, companies can easily publish products through the platform, browse the supply information.

More and more manufacturing companies have opened online shopping malls outside the traditional sales channels. For example, domestic Haier, Lenovo and other IT companies, as well as Youngor and other apparel companies have opened online malls. Although the e-commerce of furniture companies still belongs to the initial stage of the beginning, there will be many difficulties and challenges, there will be sacrifices, but it is definitely worth the wait.

3, channel game give birth to the third way

At present, the Chinese furniture industry is dominated by distributors, and the store is the main channel model of the distribution platform. In recent years, with the rapid development of the real estate market, the number of newly-added furniture hypermarkets has continued to increase. At the same time, more and more foreign investors have begun to pay attention to and entered the domestic furniture distribution industry. In the furniture industry chain, the stores have gradually replaced the manufacturing brands, have the right to speak, and transformed the furniture industry chain from manufacturers to manufacturers, distributors, and distributors.

It is precisely because of the various drawbacks of the traditional furniture distribution model that many powerful furniture manufacturers and distributors began to get rid of traditional furniture stores, sell their products, stand out in the fierce market competition and rise rapidly. How furniture manufacturing companies create innovative marketing models has become the key to regaining control over the industry chain's dominant power. Under the catalysis of the Internet economy, e-commerce, the third channel model of the furniture industry, is emerging.

Furniture company e-commerce model

Enterprise e-commerce can be divided into two main modes: Business to Customer (B2C) and Business to Business (B2B).

B2C is a business model from the enterprise to the end customers (including individual consumers and organization consumers). This is a new business model that Internet technology directly delivers products and services provided by the company or other companies to consumers without any channels. In simple terms, it is the Shangshang Mall, which is operated by the company itself. The emergence of this new model of business enables people to stay at home and through the Internet, they can purchase goods or enjoy information services.

B2B is a business model between enterprises and enterprises. It is through the internal information system platform and an external website that the enterprise connects the procurement business of the upstream supplier and the sales business of the downstream agent to organically reduce the cost of each other. Transaction costs increase satisfaction. B2B, both in terms of transaction volume and trading coverage, is more substantial than B2C and has far-reaching implications.

B2B is more familiar with furniture companies. In recent years, the comprehensive B2B website has provided e-commerce education for all industries and has helped many small and medium-sized enterprises successfully develop new markets. This specialized third-party industry B2B platform, because it does not require too much investment in the enterprise, greatly reduces the threshold of e-commerce, so it is attractive for small and medium-sized furniture companies.

The Two Major Obstacles to the E-commerce of Furniture Enterprises

At present, the average percentage of e-commerce transactions in developed countries such as Europe and the United States accounts for 56% of the total trade turnover. That is to say, more than half of people’s shopping behavior is conducted on the Internet, and online shopping has become a very common mode of consumption. , and a relatively large impact on the local traditional department stores.

The introduction of e-commerce in the field of furniture is a major international trend. According to statistics, the proportion of US furniture sales in the Internet is getting higher and higher, and online sales have accounted for 58% of non-store sales. With the popularization of e-commerce in various industries, in the field of home e-commerce, online transactions have gradually become the mainstream. It can be foreseen that there will be more and more furniture companies involved in e-commerce and online sales in 2009. However, e-commerce in furniture companies is not easy. There are two major obstacles that must be solved before enterprises.

1, need to straighten out the network price and distributor price system

Most furniture companies use distributors and agents to join the system. The sales prices of physical stores around the country may have different degrees of difference. Enterprises need to provide lower prices on the Internet to attract consumers, but also to avoid impact on the local distribution price system. Of course, if companies adopt a self-operated store-based channel system, the conflict in this area will be greatly reduced.

2, need to solve the consumer's experience and after-sales service needs

The particularity of furniture products and consumer spending habits determine the “experiential” sales approach. Consumers have become accustomed to understanding commodities through physical observations and emotional contacts. The characteristics of network virtualization will, to a certain extent, inhibit consumers' desire to purchase. Therefore, online shopping malls often need to be integrated with physical stores in their own businesses or dealers.

In order to enhance the customer experience and achieve a seamless connection between the physical store and the network, the 15,000-square-meter home e-merchandise experience center, which has been successfully launched by a century-long home, is full of technological content, online transactions, offline experience, and comprehensive e-commerce. With the advantages of traditional home stores, it brings a brand new shopping impact to consumers. Ximianbao Online Mall also integrates self-operated store systems in dozens of cities across the country.

How Furniture Enterprises Cope with the Development Trend of Electronic Commerce

With the abundance and continuous improvement of e-commerce service platforms, the transformation of traditional trade into online transactions is accelerating. According to the "2008 China Internet Business Research Report" provided by the Organizing Committee of the China Internet Commerce Conference, the number of individuals who continue to use e-commerce to conduct business activities has grown from 4 million in 2004 to 35.5 million at the end of 2007. According to IDC's forecast, the proportion of online shopping transactions in China accounted for the country’s retail sales of consumer goods, which will increase to 4.06% in 2012.

The most successful example of a successful transformation of traditional companies to the Internet and e-commerce is DELL computers. DELL was originally a telephone direct-computer company. Although it was also very successful, when the Internet revolution began, it did not hesitate to seize the opportunity to move all its business to the Internet and follow the requirements of the Internet. Elaborate its own organization and process, develop an e-commerce system that includes the entire process of sales, production, procurement, and service, use the Internet to provide users with personalized customization and distribution services, which greatly improves customer satisfaction. It has maintained a growth rate of more than 50% for many years. It has become one of the largest computer manufacturers in the world today, and it has also caused tremendous threats and challenges to other slower competitors.

At present, although there are still many problems in the development of e-commerce, it has become one of the outlets for enterprises to adjust their industrial structure and get out of the predicament. Some small and medium-sized enterprises that have strength in traditional fields should change their business models through the development of e-commerce, save various operating costs, develop new marketing ideas, and enable enterprises to emerge from the predicament and usher in new and greater development.