LeTV TV sales: In fact, it is a helpless drink to quench thirst?

OFweek smart home network telecommunications Electric Business Festival big promotion, like to find a step to the various manufacturers can be, after all, the price is not just fall, have to find a suitable reason Caixing, E-commerce Festival is undoubtedly a great The reason is that "cheap" users, the manufacturers lowered their posture without being sick.

The annual E-commerce Festival is also quite general, Jingdong created 618, Suning created 818, Ali created a double eleven, time layout is very self-advertising. Missed this village, do not worry, there is the next shop, the price wants to come down, sales want to go up, "steps" are always there.

This year's 618, the most embarrassing use of this "step" is LeTV. In fact, as early as the industry on the eve of a big promotion, "the steps have not been paved before," May 27, Le Shi Mall official microblogging promotional information on the frequent, LeTV TV straight down 1,000 yuan. On June 13th, Le Shizhixin said in an interview with Yu Xinshi reporter that this round of promotion was "the greatest effort ever", and as for the end of promotional activities, "there is no timetable at present."

In order to catch up with the 618 promotion season, all manufacturers are downgrading some of their product prices. This is a very reasonable sales strategy. LeTV cuts prices down the line, and Coke regards it as a trend. A series of funding shortages (most employees did not pay social security for two months), LeTV's crazy price cut mode seems to be more than just flush sales.

Frequent price fluctuations: The cost fluctuations are tables, mismanagement

In the smart TV price, LeTV can be described as twists and turns. In the beginning, the game played by LeTV was a typical price butcher, and the industry’s price disruptors, like Xiaomi’s mobile phone, became the spokesperson for negative profit marketing.

LeTV, which has been a low-cost strategy, has also experienced a surge in price. At the end of last year, LeTV had raised its price twice within three months. At that time, LeTV said that due to the shortage of supply chain panel supply in the upper reaches, panel prices continued to rise too fast, and the amount of single-subsidy TV ecology subsidies increased continuously. In order to ensure the long-term operation of the company, a price adjustment decision was made. This is a normal adjustment, not only LeTV and smart TV manufacturers, air conditioners, washing machines and other home appliance manufacturers are facing such a problem, home appliances enterprises ushered in a surge in price.

The smart home appliance market has smashed into many Internet companies. Through low-cost hardware, content, and service revenue models, the price of smart hardware is greatly reduced, so for many manufacturers, profits are extremely thin, and raw materials are rising. Companies, especially Internet companies, have a good reason for price increases. Many manufacturers follow the trend of increasing prices. After the increase, the industry as a whole is in a rest period. Few manufacturers play low prices to promote this card, but LeTV is at this time. The “significant profit” strategy set at the end of last year was changed and a price card was issued.

Music watched ups and downs in the price of TV and did not follow the industry's inertia, behind the more is the anxiety of sales and funding shortages. The early LeTV TV price reduction, in my opinion, is quite reasonable, after all, LeTV as a new brand, has become a short few years, in order to achieve music as the ecological dream, quickly occupied the market, low-cost measures are undoubtedly the most powerful arms. LeTV’s negative-profit marketing has indeed brought remarkable results. In 2014, the sales volume was 1.5 million. In 2015, the sales volume exceeded 3 million. In 2016, the sales volume was nearly 6 million.

In recent days, the price promotion, on the one hand, is a large gap in funding, an urgent need for cash flow, no matter whether it is losing money or not, it can be replaced by cash, even if it is to quench your thirst, but also to resolve the urgent need. On the other hand, because of changes in the leaders, the saying goes, the new officials took office three times, especially in the industry structure and the turmoil of the company's internal chaos. Xiao’s management style with Cao’s style was unrealistic and drastic reforms. It is inevitable. After Liang Jun took over as CEO of LeTV in May this year, he staged “the new official took office for three fires”: a large-scale price reduction for LeTV, recouping the super TV sales right, and paying attention to ecological marketing and large-screen operation.

In the recent LeTV sharing television conference, Liang Jun told the media that the entire industry is now in a period of adjustment and is in a relatively painful stage. “I’ve also recently pondered whether or not LeTV should make new money so profitable. At present, the competitors in the TV market are generally paralyzed. We must quickly occupy the market.” Then, the fact that LeTV’s big price cuts came to the surface.

For this radical change, Liang Jun explains: “This is like stocks. When everyone is crazy, you have to be very calm, but when everyone starts to calm down, you have to be radical. LeTV believes that This is a golden opportunity, and those companies that do not have the ability to compete will be even more severe after such a strong competition.After setting aside panel prices, let’s assume that the two companies are doing exactly the same thing and are willing to view the ecological pricing model. It may be 20% to 30% cheaper than other companies."

Looking at Smart TVs from Smartphones: Hardware Negatives, Service Charges, Implementation Conditions

Let's TV from negative profit marketing to rising prices to today's negative profit marketing, short-term loss, the establishment of a complete eco-mode after the profit model is established?

In fact, the "hard-core hardware, after-service charge" model is not music as the first, the beginning of the play is the millet phone. The current smart TV game is similar to smart phones. We look at smart TVs from smart phones. Where are the margins and days of diminishing marginal costs?

"It does not rely on hardware profits, but on Internet software services," which is Lei Jun's many business models mentioned. This is a new model full of imagination, which is even more "advanced" than a one-hundred-dollar business that sells mobile phones to make money. However, there are too many preconditions for the success of this model, the most basic, before the profit, the mobile phone manufacturers must have enough money to resist losses.Sufficient sales in order to support this model may be achieved, the ultra-high sales of red rice Let Xiaomi basically walk through this model. Xiaomi quickly harvested the smart phone market with a price of less than 1,000 yuan by using red rice. Within three years, Red Rice completed sales of 110 million units.

The reason behind the high sales is the pricing below the cost. According to media reports, Xiaomi would have to pay 200 yuan for every sale of Redmi Note 2. At the same time, high sales allow Xiaomi to be used as one of the leading channels for advertising or application distribution. Xiaomi builds application stores, themed stores, game centers, browsers, video centers, and cloud services based on the MIUI system. A complete set of systems that want to be profitable. According to Reuters, Xiaomi’s software service revenue in 2015 reached 3.7 billion yuan, of which 2.6 billion came from the game business. In addition, to remove these late-stage profitable projects, Red Rice was pre-installed with a large amount of software at the factory. Although this affected the user experience to a certain extent, it made up for Xiaomi’s loss on hardware.

It is not all millet models that play this model, but the red rice Note 2 phone.

From the case of smart phones, we can see several conditions for the establishment of "hard negative interest in hardware, post service charges": sufficient funds, sufficient sales of single items, LeTV's crazy price cuts, and its main purpose is to maintain cash flow. Adequate support for long-term low prices may not be possible. The other reason is that even though LeTV sales are not small, they are the leading figures in the Internet TV industry. However, the sales volume of single products is not high enough to talk about the phenomenon level.

More than that, the idea that hardware does not make money also has an implicit drawback: If the product itself can establish a brand, such as smart TV, then the "hard negative interest in hardware, post-service charges" play is harmful to the establishment of the brand. . This style of play may establish certain popularity, but the establishment of reputation will be relatively poor. Red rice Note2 is pre-installed with a lot of software, which affects the user experience to some extent.

Nowadays, with consumer upgrades, content payment is rampant, users are willing to pay for advertisements for good content, and LeTV's TV boot advertisements have always been criticized. Even if it is for paying members, it is difficult to escape advertising problems. This is a "hardware negative interest, after-service charges "The ills of the model. Since the price wars are in a state of low level of competition with each other, they are generally unable to do real research and development, and they are unable to create real quality products. This is obviously not conducive to brand building.

Promotional users can buy affordable? Potential risks and lack of head content

In the above section, we analyzed the business logic behind LeTV's crazy promotion on the business level. Now we analyze whether the promotion can buy real benefits from the user level.

In fact, according to Zhi Gang, a listed company with a large body has only two main intersections for the melon-eating masses: one is the stock price, and the other is a product or service. Let's talk about whether LeTV's share price is worth buying.

From the price point of view, have to admit that LeTV TV crazy promotions, it is attractive, if it is that other smart TV manufacturers, such as millet, then even if it is a demon storm TV, engage in big promotions, then consider the start on the line, no need Consider other factors, but it is LeTV. Given the current precarious situation, there are not many considerations before buying.

The user chooses which smart TV to buy. When determining a specific product, two things must be considered: One is the post-maintenance and the second is the TV content.

When buying a car, people generally choose a vehicle with a large amount of stock in the market. A large amount of goods means preservation of value, as well as maintenance convenience and easy access to auto parts. For example, to give a more tragic example, Oaks this company, doing air conditioning also do mobile phones, but few people know that Oakes has also done a car. Oaks, who could enter the auto industry for just over a year, suddenly withdrew from the market. This move has caused Aux owners throughout the country to be deeply troubled by the issue of after-sales service protection. In the following years, disputes involving consumers, distributors, repair shops, and parts suppliers have also been escalating. In order to safeguard their rights, some owners have even litigated the Oaks Group.

It was like buying a house, delivering the house, and the developer ran away. Then the property management of the community would inevitably be affected.

Will the purchase of LeTV be the same as the Oaks car of the year? In the opinion of Zhi Gang, it is almost impossible. First of all, smart TV technology is now mature, belonging to durable goods, and will not cause major problems for many years. Unlike regular maintenance of automobiles, it will consume large amounts of water, and TV quality will not be a problem. Users rarely change TV because of TV rings. What's more is because of technological upgrading and catching up with new trends. Therefore, regardless of the outlook for LeTV, the user has no worries in terms of hardware.

Let's look at the content again. At the beginning of the construction of LeTV, the entire industry was still in a state of piracy. Jiayue Ting was very keenly aware that the future business logic would be doomed to have no room for pirated content to survive. He chose to accumulate a large amount of genuine content at the low price of copyright, and thus LeTV's commercial success has laid a good foundation, and later it has used online self-made dramas that cater to the tastes of Internet users to attract young users and become an important competitive element in Internet marketing.

We purchased a large number of genuine movie and TV dramas at ultra-low prices. In 2012, we had more than 50,000 episodes of television dramas and more than 4,000 movies. We obtained exclusive online copyrights for about 70% of domestic popular movies and TV dramas.

This accumulation has given LeTV the greatest driving force behind the development. In the income model of “platform + content + terminal + application” that LeTV has been constructing, content is used as an engine.

Although LeEco built a large ecological strategy in the late stages and entered the automobile and mobile phone industries, LeEco's base camp is still a video, and its content is still a strong link. Although the basic content is relatively complete, the latest hot content is not enough for LeSports, and it is difficult to make money later. Purchase copyright. The “People’s Name” TV drama series hitherto broadcast on the show for example, can be seen on almost all video websites such as Tencent Video, iQIYI, Youku Tudou, Sohu Video, PPTV, Mango TV, etc., but not on LeTV. It is unthinkable for LeTV to use the pattern of self-produced copyrights for copyright distribution. Perhaps when the funds are sufficient, this model is quite competitive, but once the funds are in short supply, the advantages of this model are not only lost, but even counterproductive, that is, change to release many opponents have always been competitive pressure on the LeTV model.

On February 28, the official AFC official announced that it would cancel the four-year event broadcast rights with LeTV Sports. Physical and sports powers will receive the all-media copyright and signal production rights of all AFC-owned tournaments in mainland China, including World Cup Asian Qualifiers Finals, Asian Cup and AFC Champions League and other events last for four years from 2017 to 2020.

Therefore, on the hardware, LeTV is unlikely to have problems. In terms of content, LeTV has accumulated a large amount of copyright in recent years. The basic content is complete, and the latest content resources may not be as strong as before.

This time LeTV's big price cuts are a good thing for users who don’t value content. LeTV’s big price cuts are a good buying opportunity for them.

Write last

After four years of hard work, although LeTV occupies a certain dominant position, it is not the overall situation that has been set. From the television business, short-term has been involved in other ecological issues and the performance has fluctuated. However, LeTV and its content brands have already established a certain foundation, and the volume has already reached the scale. For LeTV, LeTV, LeTV and other developing businesses, due to the market's competitive landscape, the maturity of the profit model, and LeTV's current status The location of the office also needs to observe the selection and implementation details of its specific strategic direction.

There is not much time left for LeTV, leaving LeTV with less time.