Reflections on the LED market "do not fight price war"

[Source: Gaogong LED's "LED Research Review" magazine February issue Reporter / Liu Qiaomei] LED lighting application product price war , there are mutual arrogance , there are clap people, there are hateful people, there are people who are frightened, but there is such a dial People--they don't do market spoilers, but stick to the first line of product quality and act as a communicator of word-of-mouth effects.

LED lighting bears brilliance and bears accountability; there are laughter, tears, and dreams. Already in the past 2012, the smoke of Lehman Optoelectronics' "quality dispute" has not gone far, and the incident of "recalling the door" of the LED lighting bulb of the long side is still vivid. In a price war, companies must stand up and stand up. Only product quality has become the touchstone for testing the firmness of corporate brands.

Jump out of the price war box

“Customers are blind and don’t understand anything. This is the worst. It’s only time to price, the whole market is broken.” Faced with the unique environment of the Chinese market, Huizhou Yuanhui Optoelectronics Co., Ltd. General Manager Shi Yucan is not worried.

"The real price is reduced, and the quality is no longer good." Wang Xiao, general manager of Zhejiang Mingxin Semiconductor Technology Co., Ltd. also expressed the same concern. "I will pursue the low price and neglect the quality of the product. foot'."

LED street lights have had such a "ugly sneak" - "dead lights", the company steals the problematic LED lights at night. “For the quality of the product, it’s like a child playing in a kindergarten.” Shi Yancan is most disgusted with this irresponsible business.

In recent years, the quality of LED products officially disclosed by the government is not uncommon. On January 16, 2013, the Guangdong Provincial Quality Supervision Bureau released the results of the special supervision and inspection of the quality of LED street lights and light source controllers in Guangdong Province in 2012. It was found in the batch inspection of 51 batches of LED street lamps and light source controllers, 20 batches. The number of unqualified products was 39.2%. In addition, among the list of notified non-qualified enterprises and products, there are a number of enterprises listed in the “2012 Guangdong Green Lighting Demonstration City Street Lamp Recommended Procurement Product Catalogue”.

At the end of 2012, the results of LED lighting products, energy-saving lamps, road lighting, fire emergency lamps and electric light sources in the country, which were randomly selected by the State Administration of Quality Supervision, the State Administration of Inspection and Quarantine and the Industrial and Commercial Bureau, showed that the qualified rate of LED lighting products was only 51%.

The above series of figures deserves everyone's deep thought. LED lighting should win a bigger market share in the future. The low price strategy may not be the best policy.

"Price war can only be a short-term effect, like drinking and quenching thirst, killing chickens and taking eggs." Zhang Xiaolin, deputy general manager of product development at Yuanhui Optoelectronics, said that especially when users have a certain awareness of products, in addition to price factors, quality will become users. The first element of priority.

"The LED market is so chaotic. Sometimes we can't figure out which one is a good product or which one is a bad quality. There is no standard in the country, and manufacturers have different opinions. Then we can only make small money with the flow." I was reluctant to say that I was interviewed by Gaogong LED.

"Now the 50W-60W LED tunnel light is calculated at 16 yuan/W, and the price is about 800 yuan. If you want to cut the price, it will drop by 10% (less than 80 yuan). Not that there is no price reduction. The space, but some subtle changes have taken place." Chen Bin, general manager of Guangzhou Zhonglong Transportation Technology Co., Ltd. calculated the account for the reporter: When the tunnel light sold 1,500 yuan, the price reduction of 10% is 150 yuan. Now the price has dropped to 800 yuan, and then the price reduction of 10% is less than 80 yuan. The more the price reduction power is less, the less attractive it is to customers. “The base of the price has become smaller, and when the base is large, price cuts are attractive to consumers.”

Word of mouth effect gradually

Coexisting with the chaos of the market is the customer's follow-up of the word-of-mouth effect of the manufacturer's brand. “We feel that this change is very obvious.” Chen Bin said, “Since the fourth quarter of 2012, we have received a lot of 'returning customers' orders. These customers have never used our products in the past, but now they come directly to us. ."

Chen Bin revealed that due to the quality of the successful bidders, all the tunnel lights in 2010 and 2011 in a certain province in China were forced to suspend, and none of the LED tunnel lights were on. Before 2010, the number of LED tunnel lights installed in the province ranked the top three in the country. “Now many owners have to go to the door to find sellers along with the word-of-mouth effect.”

This also comes down to the problems reflected in the different stages of the development of the LED industry in recent years.

Zhang Xiaolin has always looked in his eyes: "2008 to 2010 is the most crazy LED industry, including the crazy speculation of capital and the expected goals of the LED market. Some of the LED lighting products produced at this stage are due to quality problems. It hurts the customer's feelings of using the LEDs first. Until 2011, LED consumption began to move toward rationality."

Zhang Hongbiao, research director of the High-tech LED Industry Research Institute, said that users in the Chinese mainland market generally consider price and then consider quality and function, which is contrary to foreign market customers.

Companies that adhere to high-quality companies will not ignore product quality because of price issues. At the same time, in order to gain recognition in the Chinese market, these companies will choose to continue to develop more cost-effective products and reduce the cost of products through process and material innovation.

“Yuanhui Optoelectronics will not participate in the price war and will not aim at the lowest price. Yuanhui Optoelectronics has always regarded product quality and performance safety as the first priority, while taking into account the cost performance. You can do low, people can do lower, only Saying that in the case of the same quality of products, our price/performance ratio is the highest.” Zhang Xiaolin repeatedly stressed, “We will not look for customers who are very sensitive to price. If you hear the price, you can’t run away. You can’t Look for him again. Of course, some companies are propaganda gimmicks, saying that this thing is selling much, but in the end it is still profitable, this is hard to say."

"The Chinese market is not very standardized, but it will slowly get better in the future. Consumers will understand slowly, but this process is relatively slow. I estimate that this situation will improve after three years, and bad products will slowly Not very acceptable." For the future, Shi Yucan said.

"The real survival is those multinational companies, those companies that do well in products." Wang Xiao said.

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