Ten misunderstandings of small and medium-sized furniture enterprise brand cultivation

Since 2010, the furniture market has shown signs of weakness, and the industry asserts: In 2011, the furniture industry will enter an era of meager profit. Faced with this situation, large enterprises have made great progress through capacity expansion, brand promotion, coordinated financing, and network expansion, which not only makes the scale of success arguing, but also makes small and medium-sized enterprises uneasy and confused.

Talking about the future of China's furniture industry, people are always willing to compare with the home appliance industry. They believe that in the next five to ten years, although the spring and autumn will be a battle, it will eventually form a very small number of warring states. The larger the enterprise, the more likely it is to use the lowest cost and the fastest speed to absorb all relevant resources and gain a monopoly position in one fell swoop.

For small and medium-sized enterprises, it is imperative to persevere within an unlimited period of adjustment and stand up under unlimited pressure; to hunt opportunities in a limited space and grow up in a limited time has become a top priority. But blindly moving forward will only make the company more difficult, especially in the era of brand operation, how to implement brand building in order to better integrate with its own company's sales and production, and beneficially occupy the market to become a capital chain. Fragile and nervous SMEs are confused and have headaches. To this end, the reporter specially invited Deng Jianguo, the chairman of the editorial board of the "Guide to Success in Furniture Store Shopping Guide Sales" with rich experience in brand packaging and promotion in coastal furniture companies for many years to be responsible for marketing and planning. . During the conversation, we found that the following ten major misunderstandings existed in the brand cultivation process of small and medium-sized enterprises, which are summarized below, hoping to give enterprises warnings and reminders.

1. Blindly expand the scope of product sales

In the process of brand growth, some companies' products are only suitable for a certain consumer group, or only meet a specific demand of consumers, but due to excessive pursuit of market share and sales volume, the sales target is expanded to all consumer groups. Sell ​​its products to all consumers. When consumers who do not need their products buy and use their products, they will lose their trust in the brand and affect the target consumers. Instead, their brand consumer groups will become smaller and smaller, which ultimately leads to the decline of the brand. For example, the popular three health products brand that year saw a rapid decline when the market sales peaked, and the brand disappeared in the market within a short period of time. One of the main reasons is the blind expansion of the brand's sales scope, which led to the death of the brand.

Therefore, in today's increasingly fierce market competition, the market demand is showing a diversified trend. Enterprises should carefully study the characteristics of products and define the target market of the enterprise, such as which type of consumer group the product is aimed at and what kind of consumers are satisfied. demand. Brands must have a clear and stable market positioning and a target market strategy that remains unchanged.

2. One-sided dependence on advertising investment

In the early stage of brand growth, certain market effects were obtained through advertising investment, and sometimes the sales effect was very obvious, which would cause an illusion to the enterprise, and simply infer that advertising investment will have a positive relationship with the growth of sales volume, thereby further Increase investment in advertising. At this time, advertising began to have a negative impact on the brand, but product sales fell, and the company faced huge financial risks, which eventually dragged down the company and caused the brand to die. The more typical ones are Qin Chi and Aiduo. Other companies use advertising as a catalyst for brand growth, relying on a single advertising investment to promote rapid brand growth. Advertisement investment greatly exceeds the ability of enterprises to bet on the market through huge advertising investment. The result is that after a huge amount of advertising investment, the company has not achieved the expected market sales, causing the company to make ends meet.

Advertising is one of the important elements of marketing. It plays a very important role in the process of establishing a brand. Reasonable advertising investment can quickly increase the brand's visibility, drive the market demand for products, and promote the rapid growth of the brand. Therefore, in the process of brand growth, according to the requirements of corporate marketing goals, combined with the characteristics of different stages of brand growth, scientifically determine the brand's advertising budget. Generally speaking, in the early stage of brand growth, because the product has just entered the market, the product is in the market development stage, the brand awareness is low, and the product sales volume is small, then the target task method and the affordability method can be used to determine the advertising budget, that is, according to the enterprise Market development goals and corporate financial affordability to measure the advertising costs that companies need to invest; in the rapid growth stage of brands, as products are gradually accepted by the market, product sales are growing rapidly, and brand awareness is on the rise, then the sales ratio method can be used to determine advertising Budget, which is to determine the advertising expenses according to the sales expected to be achieved within the planned year of the enterprise; the brand has entered a mature stage, the product sales have been relatively stable, the brand's popularity and reputation have reached a stable level, and the brand has a loyal consumer group At this time, you can use the sales ratio method and the competition balance method to determine advertising costs, that is, based on the sales achieved by the company in the previous year and referring to the advertising costs invested by competitive brands to determine the advertising costs of the company. When using the sales ratio method to determine the advertising budget, the average profit margin level of the industry in which the company is located should be considered to determine an appropriate ratio. For example, the profit margin of products such as health care products and pharmaceuticals is relatively high, and advertising expenses account for the highest proportion of sales. It's about 20-30%; but for products of low profit industries like food and home appliances, it's only about 5%.

3. Overestimation of market demand

In the process of brand growth, some companies are overly optimistic about the market prospects and have determined a very high sales target, which greatly exceeds the market demand. Enterprises have invested marketing expenses in accordance with the expected sales target, especially after huge advertising costs, far from achieving the expected sales volume, resulting in a large backlog of products, the promotional expenses invested cannot be recovered, and the brand died.

In the process of brand growth, companies should carefully study the market demand situation and development trends, and make accurate predictions of product sales according to the law of brand growth. Generally speaking, as the brand grows, product sales show a gradual change from small to large. In this process, one is to have accurate sales forecasts when the product is experiencing rapid growth; the second is to avoid overestimation or underestimation during the rapid growth of product sales; and the third is to avoid still after the product sales have entered a stable stage from the rapid growth stage There are too high expectations for sales growth. At this time, if companies still pursue high-speed sales growth, they will face greater operational risks.

Fourth, the pursuit of visibility ignores reputation

Some companies pay great attention to the improvement of brand awareness when building a brand, but ignore the improvement of brand reputation. These companies generally think that the brand awareness has increased, and the reputation will naturally increase accordingly. This situation is often seen in the market, and some companies invest huge advertising costs to build brand awareness. It can be said that the brand has reached a household name, but the reputation of the brand is very low, forming a phenomenon of high reputation and low reputation unique to some brands, resulting in the abnormal development of the brand, resulting in extremely fragile brand vitality. In the event of an unfavorable brand, It soon died.

The formation of brand reputation is of course based on the prestige of the brand, but reputation is not equal to popularity, the two are two completely different concepts. Some companies are keen on brand awareness. In addition to the unclear reasons, there is another reason that the method of brand awareness is simple and effective. After a huge amount of advertising investment, the brand's popularity can be quickly raised, such as Gaizhonggai, Qinchi, etc. However, the reputation of the brand cannot be established by simple advertising methods, nor is it formed by the brand's packaging and concept hype. Brand reputation is formed by continuously providing high-quality products and services to consumers and communicating well with consumers by virtue of the company's own behavior. The establishment of brand reputation is a long-term process that requires the perseverance of the enterprise. For example, Haier has been adhering to the business philosophy of serving customers in good faith for decades and carefully building the Haier brand, which has formed today's extremely high brand reputation.

Since 2010, the furniture market has shown signs of weakness, and the industry asserts: In 2011, the furniture industry will enter an era of meager profit. Faced with this situation, large enterprises have made great progress through capacity expansion, brand promotion, coordinated financing, and network expansion, which not only makes the scale of success arguing, but also makes small and medium-sized enterprises uneasy and confused.

V. Ignoring the cultivation of loyal consumer groups

In the process of brand growth, some companies are keen on brand packaging and hype. For example, the popular CI fever and concept fever in the market have created the false prosperity of the brand. Because companies rely on advertising and price reduction to sell products for a long time, they rarely cultivate brand loyal customer groups by increasing brand value. Brands do not have loyal customer groups. As a result, companies spend a lot of money on advertising to convince customers to buy, and customers buy No matter in the future, failing to fulfill the brand promise will disappoint customers. This has led to some brands appearing to be strong, and their internal physiques are very weak.

Improving brand awareness and reputation is the prerequisite for building brand loyalty, and cultivating consumer loyalty to the brand is the foundation for building a strong brand. Through higher brand awareness and good brand reputation can attract consumers to buy, but the greatest opportunity to form brand loyalty. After purchase, the customer's experience when using the product is the key factor that determines their satisfaction and brand loyalty. Therefore, while providing customers with high-quality products and services, companies must strive to create a brand personality that is attractive to consumers, form a brand culture that resonates with customers, and continuously enhance brand value.
Six, do not pay attention to enterprise product innovation

In the process of brand growth, some enterprises are keen on advertising wars and price wars, do not pay attention to product innovation, and are not differentiated from competitive products. They are becoming obsolete and aging in the market, resulting in the lack of vitality of the brand and the continuous decline in market competitiveness. The market was eliminated, and many brands in the early home appliance market followed this path. Product innovation is the source of the brand's vitality and continuous development.

Seven, relax product and service quality requirements

In the early stage of brand growth, due to the pressure of the market and competition, companies attach great importance to improving product quality and service quality. When the brand has a certain reputation and reputation, and has obtained a certain market foundation, then the company's requirements for product and service quality begin to relax; at the same time, because the company's production scale continues to increase, the market scope continues to expand, the company's internal management and market The increase in management loopholes has led to the gradual decline of the company's products and services, which has a negative impact on the brand and the brand's image has been continuously damaged. The recall of the "Toyota" car in Japan is the best example.

To ensure the healthy and stable growth of the brand, companies must establish a business philosophy of always serving users in good faith, continuously improve the quality of their products and service levels, and create greater value for customers. This is the most basic work for companies to build brands. The core content, such as the reason why Haier can become a famous brand in the domestic appliance industry, is inseparable from its long-term commitment to providing users with quality products and services.

Eight, no single price war

Excessive price wars have not only caused a significant drop in corporate profits, but also have lost the ability to develop themselves. They have also had a large negative impact on the brand image, increased consumer sensitivity to product prices, and produced sustained price reduction expectations. Build brand loyalty.

Price competition is an important way of market competition. Moderate price competition is conducive to active markets and enhances the competitiveness of brands. But companies should avoid excessive price competition. Enterprises should pay attention to the use of non-price competition methods, take the increase of product value as the fundamental point of competition, comprehensively use technology, products, service innovation and other methods to participate in market competition and enhance the competitiveness of brands.

9. Blindly extend brand coverage

In the process of brand growth, in order to explore the market potential of the brand as much as possible, some companies do not follow the law of brand extension and arbitrarily carry out brand extension. Where there is a chance, the brand will be extended to which industry. The product brand extends to low-end products and so on. The field of brand extension has nothing to do with the original field, or conflict with the original field, which not only does not help the introduction of new products, but also causes serious damage to the brand image.

As the strength of the enterprise grows, the enterprise should continuously expand new business areas and develop new products. If the new products are related to the original products, such as similar product attributes and the same target customer group, the brand extension strategy can be adopted. , That is, new products adopt existing product brands, or use existing brand resources to develop markets. For example, sofa manufacturing enterprises in the furniture industry can extend bedroom products to form a one-stop service for home consumers. For example, Shenzhen Telewell Furniture Co., Ltd. launched the bedroom soft bed and European post-modern new products at the 11th International Furniture Fair in Chengdu in July 2010, which not only achieved product upgrades but also enriched the product line. . Of course, companies should also do brand maintenance to avoid damage to the brand by new products. If the new product has nothing to do with the original product or conflicts with each other, different brand strategies should be adopted.

10. Randomly change the corporate brand image

Each brand will have its own unique image. It is difficult for a brand without a fixed and unique image to leave a deep and indelible impression on the public. When a famous brand is established and widely accepted by generations, the brand has gone beyond the meaning of just being a commodity, it has become a symbol and symbol, and has become a part of culture. When people see a brand, they will think of something other than the goods it represents, such as status, dignity, tradition, and memories of the past. When a consumer consumes a brand, he consumes not only the use value of the product, but also self-confidence, status, and even vanity. In many cases, use value has become a secondary thing. Therefore, when a traditional brand is still full of vitality, changing the image of the brand at will may be opposed by consumers, and it will eventually outweigh the gains.

Once a brand has formed a stable image, its limitations will also be formed, and its product categories, consumer groups, etc. will have a relatively stable range. It may be dangerous to break through the limits of this range and open up new fields. This kind of risk lies in the possibility of losing the original market, and whether it is possible to obtain a new market is still unknown. Just like Parker, its consumer group of Parker pens is a relatively socially wealthy person. When Parker Pen tried to fight for the low-end pen market, it lost its original customers because the traditional image of Parker Pen was changed, and ended up being acquired. This tells us that when an enterprise wants to develop a new market, it is best not to take the famous brand that has been established to take risks, especially when the original brand image has some conflicts with the new market, and you can consider Create new brands to occupy new markets. Of course, when the image of the enterprise itself has been fixed, attempts to create new brands may also be difficult. In this case, companies should consider other efforts to obtain higher sales and profits.

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