People’s Network Finance and Economics Research Institute released ＂Observation Report on Consumption Trend of＂ Home Scenes ＂

People’s Daily Online, Beijing, August 24th In July 2023, the Ministry of Commerce and other 13 departments issued the Notice on Several Measures to Promote Household Consumption, proposing to vigorously improve the quality of supply, actively innovate consumption scenarios, effectively improve consumption conditions, and strive to optimize the consumption environment to support the development of the household consumption market.

Household consumption involves many fields, such as household appliances, furniture, home textiles, home improvement, etc. The downstream chain of the industry is long and the scale is large. Taking targeted measures to boost it is conducive to releasing the potential of household consumption, consolidating the development momentum of consumption and enhancing the basic role of consumption in economic development.

On August 24th, People’s Network Finance and Economics Research Institute released the "Observation Report on Consumption Trends of Home Scenes". Taking Suning.cn as the research sample, the report explores the development status and core advantages of the "home market" consumption model based on in-depth observation and analysis of its supply chain upgrade, scene innovation, channel reform and service upgrade, and looks forward to the future development trend of the home appliance consumption market.

According to the report, with the continuous development of digital technology, household appliances consumption shows the trend of omni-channel integration. At the same time, consumer demand has become more diverse, and consumer behavior has also shown a trend of scene, one-stop and integration. The maturity of digital channels and the change of supply and demand side have prompted home appliances to enter a new era of "scene" consumption. Home appliance retail enterprises represented by Suning.cn are committed to creating a "scene" consumption mode, providing users with immersive shopping space and one-stop consumption scenes, and ensuring users’ shopping experience by building a perfect service provider ecology.

Changes in the proportion of online and offline retail sales in the home appliance market. (Source: GfK China)

First, fully digitalize and accelerate the transformation and innovation of retail channels

The overall digitalization of the retail industry is promoting the reform and innovation of household appliances retail channels. Digital tools can help build online and offline integrated retail channels, and realize the digitalization of goods, supply chain, user management, store operation and other links, and improve the operational efficiency of channels; Digital capabilities can also help home retail enterprises to quickly explore the sinking market. By providing "multiple empowerment" such as supply chain, operation, service, technology and finance for county retailers, products and service experiences that are indistinguishable from first-and second-tier cities can be quickly gathered in the low-end market; Retail enterprises can also use digital capabilities to quickly build new models and open up new tracks, such as live e-commerce, instant retail, local life, private domain e-commerce, etc., and explore new possibilities for the innovation of "home" consumption patterns.

Second, the diversification and upgrading of consumer demand drives supply-side innovation

With the rapid development of economy, the rejuvenation of mainstream users and the rise of rational consumption concept, the consumer market of household appliances in China is facing an all-round upgrade of demand side. On the one hand, consumers of household appliances have turned from pursuing low-priced goods to pursuing high-quality cost-effective goods, showing an obvious grading trend. On the other hand, consumers’ consumption state has also changed from meeting basic needs to meeting more diversified quality needs, and new trend products such as intelligence, high-end and green are increasingly favored.

The change of demand side promotes the optimization and upgrading of supply side. Brand manufacturers began to give new functions to products through product innovation and hardware upgrade, guided by user needs. Retail enterprises have also begun to strengthen the contact with manufacturers, streamline the channel level, and bring users a more favorable and faster shopping experience. At the same time, retail enterprises with a large number of user insight data have also begun to strengthen product co-creation with brands, bringing users higher quality and more accurate goods supply.

Third, the "home scene" consumption pattern leads the market development

Users’ consumption behavior presents a consumption trend of household appliances integration, one-stop and scene. On the one hand, users pay more and more attention to the creation of lifestyle, and the "scene" lifestyle brings "scene" consumer demand for home appliances; On the other hand, consumers begin to pay attention to the integrity and unity of home decoration, and prefer one-stop shopping experience.

Based on this consumption trend, home appliance retail enterprises have created a "home scene" consumption model, built an immersive shopping space and a one-stop consumption scene for users, and provided a complete home scene solution. This consumption pattern not only makes it more convenient for consumers to shop, but also improves the operational efficiency of upstream and downstream partners.

Fourth, improve the service ecology and promote the consumption upgrade of "home scene"

In order to create an immersive one-stop shopping space and promote the real upgrading of household appliances consumption to "home scene" consumption, the retail platform needs to establish a perfect open ecosystem of service providers, and help small and medium-sized retailers, franchisees, manufacturers, service providers, operators, property owners and other participants to improve their service capabilities and operational efficiency through the digital empowerment of stores, supply chains, commodities and services, and achieve efficient cooperation among them. In addition, retail service providers also need to build a service system from pre-purchase, in-purchase, delivery, installation and after-sales to provide users with a convenient and secure consumption experience.

V. Future development prospect of household appliances consumption market

Product innovation and iterative upgrading are important driving forces for the sustainable development of household appliances industry. In the future, retail enterprises and brand manufacturers need to keep innovating at all times, continuously introduce new products to meet the needs of users, and also need innovative models and services in terms of channels to provide more efficient matching between people and goods yards in order to continuously win the market. In addition, home appliance enterprises need to actively carry out digital transformation and promote the omni-channel integration of online and offline, and the omni-channel digital operation ability will become an essential ability for enterprises. On the demand side, the differentiation of user groups will become the main driving force for demand upgrading, such as the growth of user groups such as elderly people and people living alone, which will promote the rapid popularization of sub-categories such as aging household appliances and small household appliances.

[Click to download the full text of the "Home" Scene Consumption Trend Observation Report]