Can "out of favor" kitchen appliances still capture consumers?

According to the report by China Central Radio and Television Corporation's Voice of China, "News has Viewpoints", kitchen small appliances represented by air fryers have been advancing rapidly in the past few years, creating many industry myths. From March to May 2022, in the online transaction volume of kitchen appliances, air fryers increased by 200% year-on-year, while electric steamers, fruit and vegetable cleaning machines, and electric auxiliary food cooking sticks all increased by over 80% year-on-year. However, after rapid growth, the small home appliance category is being "abandoned" by consumers, and since the beginning of this year, manufacturers' sales and revenue have both declined.

Is the "fall out of favor" of small household appliances due to market saturation? What adjustments have the industry made to this? Where is the next small appliance air outlet? China Central Radio and Television Corporation's Voice of China "News with Perspectives" specially plans "Industry Insight". This issue focuses on the small home appliance industry, and talks with Yuan Qingling, Executive Vice President of Jiangsu Home Appliance Association, Guo Meide, President of a Big Data Technology Co., Ltd., and Dou Huaideng, General Manager of a domestic electrical sales company.

Turning to the stock market, increasing growth pressure

Data shows that even in the spring of rapid sales growth, in 2022, the retail sales of small kitchen appliances nationwide reached 52.03 billion yuan, a year-on-year decrease of 6.7%; The retail volume was 220.49 million units, a year-on-year decrease of 12.7%. And the previous three years were the golden age of rapid growth in China's small home appliance industry.

In response to the industry's sudden sluggish growth after rapid development, Guo Meide, the president of a certain big data technology Co., Ltd., acknowledged this huge gap and pointed out that the growth pressure of the small home appliance industry is the "biggest one" in the home appliance market. But at the same time, he also expressed rationally, "The sales of small home appliances (this year) are similar to 2019, and saying 'currently not good' is a relative concept

So, why is this transformation happening now? What is the underlying mechanism of influence? Guo Meide further analyzed the social background, changes in market nature, and the commodity attributes of small household appliances. Firstly, during the epidemic, more people chose to cook at home, and the demand for kitchen small appliances surged. The ownership of small appliances by hundreds of households was rapidly saturated, and the incremental market gradually shifted towards a slowly growing stock market; In addition, from the characteristics of kitchen appliances, they are different from just needed items such as gas stoves and range hoods. Consumers tend to make impulsive purchases, which can easily cause significant fluctuations. Dou Huaideng, the general manager of a domestic electrical sales company, also explained this change from the perspective of export sales, pointing out that starting from the second half of 2022, the issuance of foreign consumption vouchers will be suspended, which has led to many foreign customers and foreign trade companies making adjustments to their inventory structure, and has also had a certain impact on the interruption of the rapid development trend of the industry.

Accelerated upgrade iteration, waiting for secondary growth

Move with the wind, move against the wind. After facing the cold, small home appliance enterprises are not waiting to die. What changes have occurred within the industry? Can these adjustments improve the current situation?

Based on the observation of the industry as a whole, Yuan Qingling, Executive Vice President of the Jiangsu Home Appliance Association, stated: "Emerging categories of small home appliances are still emerging, with low usage of popular small home appliances like a flash in the pan, but there will still be new ones after the flash." Dou Huaideng, a frontline practitioner in the industry, also pointed out: "Under fierce competition, the frequency of upgrading small home appliances is accelerating, and they are basically upgraded once a year or two, Continuously injecting fresh blood seems to be the magic weapon for the current small home appliance industry to fight against recession.

However, speed does not necessarily mean good, and blindly accelerating iteration has the same effect on industry development as drinking poison to quench thirst. Therefore, Dou Huaideng said that facing a further future, small appliances are bound to serve a healthy life, making high-quality small appliances a necessity for consumers, continuously meeting new needs, and improving everyone's quality of life.

In this direction, many manufacturers are already making efforts. Guo Meide stated that some companies have invested a large amount of research and development expenses in interaction and intelligence to adapt to the consumption patterns behind the beauty economy, lazy economy, practical economy, and smart economy, targeting the increasingly segmented demand of the consumer end, thereby driving the industry into a second growth period after a "growth recession". Small appliances will definitely usher in a second spring, but we need to wait, "Guo Meide firmly believes.

Capture young consumers and create new consumer demands

For the longer-term industry trend, practitioners and observers in the small home appliance industry have provided many keywords, all based on insights into the characteristics of young consumers.

Guo Meide compared the needs of consumers in the "Golden Three Years" with those in recent years and pointed out that consumers have shifted from impulsive consumption to rational shopping: "Their judgment time will be longer, the purchasing radius will be expanded, and their composure will be enhanced." In this regard, he believes that in the future, small household appliances should strive to be transformed into necessities through iterative upgrades, integrate multiple functions into more practical all-in-one machines, and innovate to explore new consumption scenarios, Comprehensive production of products with high appearance, intelligence, and convenience. Yuan Qingling, starting from the diverse consumption needs of young consumers, believes that "specialized, refined, and innovative" enterprises in the industry can constantly break new tracks and seize the new opportunities brought by new consumption scenarios.

In addition, in addition to exploring new consumer needs in the domestic stock market, the vast blue ocean of overseas markets is increasingly receiving industry attention. Dou Huaideng pointed out that "small home appliances are just in demand for European and American people, and since the second half of this year, it has been clearly felt that overseas consumption is rebounding." Guo Meide also agrees with this, emphasizing that domestic enterprises are currently facing serious "internal competition", and the rise of domestic demand may take time, but there is still a lot of room in the overseas market.

Taking into account both internal and external factors and advancing in multiple directions, there are still more ways for the "rejuvenation" of small household appliances in the future