Home appliance live streaming is flourishing: not allowing distributors to make a profit?

In recent years, the sales channels in the home appliance industry have undergone profound changes. The F2C (Factory to Consumer) model, represented by brand direct e-commerce and live-streaming sales, has rapidly emerged, achieving price transparency and efficiency improvements by reducing intermediate links and directly facing consumers. However, against this backdrop, the survival space of traditional home appliance retail stores, which profit from the "markup between factory and retail," has been severely squeezed, and home appliance companies are also facing the challenge of how to balance online direct sales with offline channels.

Recently, in the "Home Appliance People" WeChat group, many local physical store dealers have been venting their frustrations: brand manufacturers are building their own IPs, and the influence of brand direct stores and live streaming sales is growing. The overall demand in the home appliance market has not significantly shrunk; rather, the channels have changed, with many sales bypassing middlemen and going directly to consumers. This explains why there are fewer people in physical stores, why it is becoming increasingly difficult for middlemen to make money, while the annual profits of leading brands continue to rise.

Contradictions and Challenges: How Do Enterprises Balance the Interests of Direct Sales and Distributors?

The rapid development of the F2C model has brought various impacts to the home appliance industry. For manufacturers, the F2C model reduces intermediaries, lowers costs, and allows for direct sales to consumers, thereby rapidly increasing the consumer base and boosting product sales. Moreover, through direct interaction with consumers, manufacturers can more accurately grasp market demands, timely adjust production strategies, and develop products that better meet consumer needs, forming a consumption pattern of mass customization.

However, this model has a huge impact on traditional brick-and-mortar appliance retailers. The previous business model that relied on information asymmetry to obtain high product price differences is becoming unsustainable. It is increasingly common for the purchasing price of physical stores to be higher than the selling price of e-commerce, and even some offline direct-operated stores supplied directly by manufacturers still cannot escape the price disadvantage, resulting in a continuous erosion of market share by online channels and a progressively difficult living environment.

In the face of challenges brought by the F2C channel model, home appliance companies need to balance and optimize from multiple aspects. In terms of channel strategy, companies should promote an omnichannel marketing strategy that integrates online and offline. They can allocate live stream orders to local distributors through a commission model or engage in regional live stream collaborations (such as partnering with local distributors for localized live streaming) to enable distributors to participate in traffic monetization.

In terms of the pricing system, home appliance companies should establish a reasonable and unified pricing system for both online and offline channels. They can develop differentiated yet relatively balanced pricing strategies based on the characteristics and costs of different channels. This will help avoid channel conflicts caused by significant price differences. At the same time, it is essential to strengthen price control to prevent malicious low-price competition from distributors or online retailers, thereby maintaining a healthy market price order.

Entity store self-rescue: transformation from "selling goods" to "service ecosystem"

For home appliance retailers, it is also necessary to actively seek ways to rescue themselves. In terms of business model, they need to shift from traditional sitting merchants to marketing service providers. Strengthen the experiential attributes and create scenario-based consumption. Offline stores should shift from simple product displays to lifestyle scene showcases.

Deepen localized services and build advantages in the "last mile." Physical stores can leverage geographic advantages to actively reach out beyond the storefront, advance sales channels into urban communities and rural areas, get closer to users, understand user needs, provide personalized product solutions, and strengthen multi-faceted services such as pre-sales and after-sales to retain consumers through service.

Layout private domain traffic to achieve precise operations. Dealers can accumulate private domain users through community operations and the establishment of a membership system, utilizing online platforms to attract and acquire customers. By integrating online and offline channels, they can provide users with a more convenient shopping experience.

The wave of live streaming e-commerce is inevitable, but the extreme situation of "not allowing distributors to make a profit" may not become a reality. The key lies in whether companies can reconstruct the channel value network, allowing the efficiency of direct sales to complement the warmth of offline interactions. For physical stores, it is essential to break traditional thinking and build a new ecosystem centered around users that combines "products + services + experiences" in order to break through in times of change. As industry observers have said, "Live streaming is a tool, but the essence of retail is always to meet demands."