作者：Blade

The third chapter: LED lighting industry marketing innovation “four gold strategy”

The development of new LED Lights markets: in the countryside

With the increasing fierce market competition, many enterprises have turned to broad villages and towns and rural areas, in the construction of new countryside under the banner, townships and rural appliance and lighting products demand is increasing, the last year the “home appliances to the countryside” policy to further stimulate the demand, therefore, more and more enterprises began large-scale development in three or four levels of led tubes markets and marketing campaign.

The third chapter: LED lighting industry marketing innovation "four gold strategy"

Mid-ea microwave start to launch “fair 1000 Town Line township promotional activities, which is a popular project of the National Health advocated by the United States in the microwave cooking, organizing related activities in the 1000 township tour last year. Penetrating the “health and efficient fashion” concept into general township. The idea of Mid-ea microwave is that as a microwave oven market, in order to maintain sustainable development, must be from the industry before the vicious competition into training users to expand the market. With the helping of “home appliances”, the vast scale of the township promotion, aiming at watering trees poured root”. The only way to close to the township consumer. So that the enterprises can grasp the initiative in the future market strategy for a population of 900 million.

Mid-ea rural strategy for the LED lighting industry is undoubtedly a useful inspiration. In fact, microwave and general lighting products, led flood lights sales prices and consumer groups are almost the same. Many lighting companies stay in the city, even in the country not involved in some of the pioneer which has been making great efforts to open up three or four markets. Australia  Keshi is an important case to develop the county-level market this year. This year, Australia Keshi lighting Cultural Festival “held in the vast areas of the county, loved by the masses of entertainment and sales promotion. In fact, this is a relatively common terminal promotional activities, but OES did a lot of character, which is very effective to OKES. The sales increased significantly. The next step is to continue to push forward to the town and villages. Of course, there is a certain difficulty for lighting companies. In the township of Chinese LED lighting industry, the store is still rare.

Identification and improvement of LED lighting appliances (1)

LED is a brand new lighting technology. A complete LED product is made up by LED Lights chips, control devices and other auxiliary lighting sections, such as projectors. In this article we will do some discussion about the identification and improvement of LED lighting appliances.

A complete LED product is made up by LED chips, control devices and other auxiliary lighting sections, such as projectors.

Terms of user related to people’s lives and property:

As a type of electrical appliance, operation & safety instructions and warnings contained in owner’s manual should meet the requirement of certain international standards. In this area, Chinese products are using IEC standard. Some made-in-China standards are still referred to the relevant terms in IEC standard and ANSI standards, only some tiny differences.

 

Performance manuals for LED street lights chips, control devices and other auxiliary lighting tools:

Customers bought a product. It is the product function that they actually purchased rather than the product itself. Meanwhile, product function was normally identified by means of performance manuals. “Performance Requirements for General LED Lighting Module”, “Performance Requirements for General LED Ballasts” and “Performance Requirements for DC/AC Supplied LED Control Devices” were three most recently published performance manuals for LED lighting appliances, in which lighting efficiency, light attenuation, service life, energy efficiency and other indicators has been cleared given out. It is rather important for export products. Foreign buyers will be more concerned about product performance as well as product quality.

 

Matching requirements among LEDs, control devices and auxiliary lighting tools:

  1. Different control devices for different LED lighting sources.

Control devices served for LED lighting sources, the design of which should depend on the specific module of LED chips. In theory, safety is the most important indicator of control devices. Since the testing requirements are basically similar to other electrical appliances, it is a bit of easier for comprehend. However, the situation is much complex in matching up with LED high bay lights chips. Optical and electronic related knowledge are necessary. The working conditions of LED lighting sources are generally controlled by control devices. The matching between them is directly affect the lighting efficiency, stability of lighting sources, service life and other performance indicators which are essential for the entire system. However, it is impossible to reach 100% matching. The best matching modes currently can only make LED lighting sources perform as much as 75%-85% of original conditions.


LED bulbs will become the main stream in Japan’s LED lighting market

GFK Marketing Service Japan published a research report for LED lights sold in appliance stores in Japan last month. The result indicated that the sale of LED bulbs is around 43.5% in June this year, completely overtaking the No. 1 position of traditional filament lamps and becoming the main stream on the Japan’s LED lighting market. Meanwhile, the monthly sale of LED Ceiling Lights has taken over the traditional ceiling lamps in the form of fluorescent tubes. After the earthquake in East Japan last year, people’s energy-saving consciousness has been strengthened dramatically. This is one of the main reason for the increasingly popularity of LED lighting products in Japan. Changes are primarily showing up the stable growth of LED sales.

 GFK Marketing Service Japan published a research report for LED lamps sold in appliance stores in Japan last month.

Among all LED sales, LED bulbs took the best performance. In 2010, annual turnover of LED bulbs is only 20%, much less than 50% of filament lamps. After the East Japan Earthquake happened on 11th March 2011, the proportion of LED bulbs’ sales raised rapidly, while the sales of filament lamps dropped a lot. On May 2012, LED bulbs took over the No.1 position of filament lamps and became the best selling products among bulbs. This tendency was expected to be maintained until 2014. GFK Marketing Service Japan believed that under such circumstance, LED lighting products will not drop prices in short term. This market will remain an upswing trend until next year.

 

Same situations for LED ceiling lights, according to reports published on June 2011, LED ceiling lights shared about 15.8% ceiling lights market in Japan. This sale was increased to 42.7% on May 2012. During this period of time, the involvement of Panasonic in this area no doubt played a very important role. Since Panasonic involved in LED lighting field in 2011, the product line has been expanded. Thus in 2012, the sales of LED ceiling lights increased dramatically. The average price of LED ceiling lamps is about 38,000 yen, slipping down 9% compare with the beginning of the year. Diammable or RBG LED ceiling lights emerged in the market recently. These products are more “intelligent” and can change depending on the specific request of customers. GFK Marketing Service Japan believed that these factors are pushing users to redeem the LED ceiling.


International brands tend to enter the LED blue ocean market (2)

From the instruction of Mr. Fang, we can deeply feel that LED lights has developed into its final stage both in technology and in strategy. LED industry is a hot issue. Companies large and small intend to share this attractive cake and flooded into this market one after another. However, this sort of chaos did not disrupt the rhythm of giant enterprises. They definitely will enter the LED blue ocean market one day, but not now. They need to firstly measure their economic and technologic strength, choose a right developing direction, focus on LED lighting business and devote themselves to promote their products.

 From the instruction of Mr. Fang, we can deeply feel that LED has developed into its final stage both in technology and in strategy.

Giant companies must take a lot of actions in studying the market and preparing marketing strategy. Brand image is rather important for them. As we all know, attending Fair is an effective method to promote products. But these Fairs have various qualities. Some of them are really bad-performed, lacking of professional guidance, disordered management, even low-quality of customers. Giant enterprises will select Fairs to attend. The purpose of the enterprises to participate in such activities can be divided into multiple levels, including information transmission, brand promoting, new product introduction, and of course trading. Some effect can be achieved during these events, while others need a long-term accumulation. Sales played a rather important role in these activities. “They should have some professional knowledge if they from technological area. Some companies would ask their sales to learn something about their products (technologically). But we never did that. We only select sales from people whose major is related to our products and technique. Toshiba is a brand not an enterprise, its meaning is far more important than the enterprise. As a LED lighting company, we need to maintain a trusted and reliable brand image” Said Mr. Fang.

 

At present, government effort to LED lighting applications is reinforced continuously. Director of the Commission of China’s Environmental and Resources said the government will arrange about 8 billion yuan to purchase 4 million high-quality LED Street Lights during the “12th Five-Year”. In this regard, experts indicated that although this purchase plan is not “big”, but the government expressed their supportive attitude to LED industry. Currently, no one will deny the fact that China will be a LED blue ocean market in near future.


International brands tend to enter the LED blue ocean market (1)

“Blue Ocean Strategy is a business strategy book first published in 2005 and written by W. Chan Kim and Renée Mauborgne. What the authors believe is the high growth and profits an organization can generate by creating new demand in an uncontested market space, or a “Blue Ocean”, rather than by competing head-to-head with other led lights suppliers for known customers in an existing industry.” (Copied from Wikipedia)

“Blue Ocean Strategy is a business strategy book first published in 2005 and written by W. Chan Kim and Renée Mauborgne.

According to the relevant industry statistics, semi-conduction lighting will be one of the most promising industries in 21 century. The development of LED technology created the third revolution in lighting history, behind which is the huge profit potential. Over the past decade, the average annual growth rate is over 20% in global LED street lights market. High-brightness LED lighting market was growing fast. The average growth rate is around 46% from 1995 to 2005. It may probably be able to keep 40%-60% market share in next 5 years. The huge market demand spurred the development of the production. Even enterprise for other industry has diverted their attention and resources into this area, including some world’s 500 giant enterprises. They name it as LED blue ocean market.

 

In the interviewe, Mr. Xiao Fang, Vice Minister of Toshiba Lighting Planning sector, revealed that Toshiba have involved in both traditional fluorescent lighting market and LED lighting market presently. However, LED high bay lights will no doubt the top priority and primary objective in their agendas in consideration of sustainable long-term development. As a veteran in the electronic information industry, Toshiba intend to be a leader in the rapid development change rather than a participant. Toshiba products cover a broad range of area: radar, transistor televisions, microwave ovens, computers and other e-business products. Toshiba had a lot of confidence in entering the LED blue ocean market by virtue of their mature semiconductor technology, advanced driver design and valuable marketing experience gained from the traditional lighting business. Mr. Fang also said that brand effect brought both merits and demerits to Toshiba. No doubt, the tremendous force of the brand influence will give them an easy way to exploit the market. However, they will also be restricted in market positioning and promoting.


ASEAN – new LED strategic stronghold

Because of the European debt crisis, many European countries are striving to cut government spending, balance the budget, leading to a dramatic shrink of lighting-related government procurement and municipal construction projects. After the economic crises in 2008, Chinese led lights market and South East Asian market are two first recovered markets all over the world. Infrastructure will largely promote the development of their lighting market, including LED market. In 2012, WTO predicted that China will be new LED strategic stronghold.

Because of the European debt crisis, many European countries are striving to cut government spending, balance the budget, leading to a dramatic shrink of lighting-related government procurement and municipal construction projects.

With the economy development, China and South East Asia speeded up the urbanization process. LED lighting no doubt played an important role during this process. Indoor lighting, outdoor lighting, lighting for industrial purpose, lighting for commercial purpose, etc. There will be an sharply increase in LED lighting products demand.

 

ASEAN is now the world’s third largest regional organization after North America and the European Union, with a population of 576 million. The GDP has reached 1.5 trillion U.S. dollars in 2011. The China-ASEAN Free Trade Policy also made them as another LED strategic stronghold. China is the world largest production base of LED products, having formed a whole industrial chain in upstream, midstream and downstream. Industrial advantages are quite obvious. Meanwhile the mainland market also has great potential for development. However, in every part of the entire industry chain, there are a lot of competitions. Small and medium sized companies were hard to survive. With the implement of China-ASEAN Free Trade Policy, China’s giant LED suppliers turned their attention on this virgin land. “ASEAN market is an waiting-to-be-developed market. It is a virgin land to domestic LED manufacturers. LED lighting market was no longer an emerging market. Intense competitions made them more like to choose overseas market.” Said one of the government officials.

 

According to the new reports released by the Vietnamese Ministry of Construction, the national urbanization level Vietnam will reach up to 35% in 2015. The expected investment is 23 billion dollars from 2011 to 2015 and 27 billion dollars from 2016 to 2020. Thus, LED lighting will enjoy a huge expansion potential in the ASEAN market. There is no doubt that ASEAN will be the new LED strategic stronghold for China’s LED enterprises. This is a wise strategic layout of them in the global economic crisis.


The second chapter: LED lighting industry marketing innovation “four gold strategy”

Construction of the new cooperation between the LED Lights manufacturers

Whether it is home appliance industry or the lighting industry, almost all the problems of conflict by manufacturers. In the lighting industry, for example, this year, the biggest events is the NVC and its Zhejiang Operations Center China policy linkage disputes. NVC set up the undo operation center in Zhejiang, and the brand in other led lighting industry enterprises also exist in some part. Then, the lighting industry for cooperation between the manufacturers raise new questions, it is immutable or frozen, or destroy the old and establish the new? Although the lighting industry does not have any action in the channel model right now, yet for the futher, both sides can not think over.

The second chapter: LED lighting industry marketing innovation "four gold strategy"

Midea in the promotion of microwave oven, put forward to establish extensive Associated Companies act.Midea microwave oven promote the channel change which is the original “administrative standard” management for the improvement of “market oriented” management. Midea attention the market share of the net profit before, dealers are concerned about the net profits. It is often produce two appeals conflict. Associate Companies is established, the offices and distributors are tighly engaged. The Associated Companies and distributor signed a contract with is 5 years, what is equivalent to give dealers 5 years contract period, so he dared to plan, and to invest.  While the Midea’s opponent Galanz is widely established “joint venture subsidiary, the traditional marketing center and office management, model completely quit, and all sales subsidiary”, the traditional led lighting industry marketing center and office management model completely quit, all sales subsidiaries have independent legal personality, which is also means that each company has on the local market management decision-making, manage independently, and responsible for their own profits and losses. “Previously, manufacturer is among the sale, short-lived business, now, the sales has not adapted to the demand of new situation. Our future cooperation mode is the manufacturer to establish a sustainable profit, sustainable business model and business relations.” Du Jiangjun said, “the channel change is an inevitable  competition. Reform should enhance the competitiveness of the premise. Safe and controllable, energetic, healthy and sustainable, is the channel change.

The first chapter: led lighting industry marketing innovation “four gold strategy”

Survival and development of lighting industry and led lights industry must continuously reform and innovation. Not only is the technology innovation, marketing innovation can not be a lot of marketing reform which will tend to be more economic benefits. From the first shopkeeper to dealers, on behalf of the processing to the brand, the lighting industry has matured. Whether how the company works, in particular, specifically how to do marketing. This is a problem worthy of our business thinking of led lighting industry.

The first chapter: led lighting industry marketing innovation "four gold strategy"

LED Lamps City as a mainstream channel should be adept at mass marketing

In lighting field, lighting city is the mainstream channels. Most of products are sold by Lamps City. With the increasing of the lamp city, the other channels are intensified competition Lamps city is also faced with the issue of marketing innovation. At the Forum, introduced by the representative of the Hong Kong Harbour City marketing practices. Hong Kong, Harbour City, Hong Kong’s largest shopping center, in the growing competition of the market, the successful use of the product mixed strategy, operations strategy and promotional communication strategy, consolidate and improve market position. These three strategies, simply select marketable goods as much as possible, to improve the management of shopping centers and services. Strengthen external advertising.

led lighting industry is the consumer goods of all residents, but also for art and technology. Consumer packaged goods around Lamps City should seize these factors and to good use and play, like Hong Kong, Harbour City, as the form of promotion LED lighting products sales , to achieve win- win situation. Some other advanced Lamp City have shown. Colliers Beijing, Chengdu Golden Palace and in the choice of approach lighting brand, variety and quality are increasingly “picky”, to ensure goods in order to meet consumer’s demands, and adapt to the trend of consumption. Chongqing Oriental Plaza lighting, strengthen market management and improve service levels. Zhengzhou Jintai into holding model contest and led lighting industry culture festival, the Shilai River in Beijing City Lighting held the “spring breeze” public  welfare activities, and so on, these practices have successfully expanded the lamps city public influence, and promoted the sale of lamps. Of course, integrated shopping center have many successful experience which is worth of Lamp city to learn from.

Micro grid energy was applied in rural areas of India, low-power LED lighting became a light spot (2)

It its first LED Lights development stage, Mera Gao Power only had eight villages joint the plan. The first commercial Solar-LED micro grid was set up during the summer last year. In Shaad’s words, the initial situation was rather difficult. “Most people actually in a wait-and-see mode, they have not even used many electrical appliances before this. How could we make them completely trust the system?” Even for those villages open-minded enough to accept this new technology, Shaad and his friends had to spend a lot of time to teach them some basic knowledge of solar system and low-power LED lighting applications. Made sure that most of them know how to operate and maintain them properly LED Panel. Although it was not an easy job, Shaad did find happiness in it. It is a step forward of his country.

 Micro grid energy was applied in rural areas of India, low-power LED lighting became a light spot (2)

Last month, Mera Gao Power put forward another plan, in which more than 40 villages are going to be installed this kind of Solar-LED micro grid before next year. After a negotiation with U.S. Agency for International Development, they received a totally $ 30,000 grant. Mera Gao Power also expressed their wishes to help other companies to enter this industry, sharing their experience on these issues. According to World Resources Institute, the Solar-LED micro grid will have an average annual output value around 2 billion dollars in India. It will become a large LED Tube market.

 

A small sized Solar-LED micro grid system only cost $ 2500, can provide electricity for more than 100 households. The entire system will be divided into 15 groups, controlled by two power generating center. Every group was allocated a solar panel and a battery, using 24VDC. In this system, copper wires were replaced by aluminum wires, saving a large amount of cost. Before installation, Shaad would send out professional engineers to survey and draw the map of the village, ensuring the most effective arrangements for the distribution lines.

In villages where Solar-LED micro grid has been installed, each house can enjoy a 7-hour power supply, with an average current of 0.2A. This is enough for 2 indoor low-power LED lighting applications. Besides, they can have one more plug for cell phone charge. The estimated cost for every month is about $ 2.


Micro grid energy was applied in rural areas of India, low-power LED lighting became a light spot (1)

India has a population around 400 million, which is the second-most numerous nation in the world after China. However, the majority their people are living in rural areas. Due to the underdevelopment of grid system, a large number of villages are still living and working without electricity and LED Lights. For most of them, life is tough. They even need to take long-distance journeys to charge their cell phones. Their dim houses still use kerosene lamps.

 Micro grid energy was applied in rural areas of India, low-power LED lighting became a light spot (1)

In order to change the situation, Brian Shaad and his friends set up a new LED Products company named Mera Gao Power, using low-cost solar panels and low-power LED lighting applications to build a micro grid. This Solar-LED micro grid can provide simple and clear indoor lighting for every inhabitants and also period outdoor lighting for public places. Most of LED lamps used in this system were imported from China. “We did considered to import these lamps from German or America. They provide good products with good qualities, but the cost is too much. We have very limited budget, could not afford them currently. All these lamps are from China, they are pretty good, with reasonable prices, we appreciate that.” Said Brian Shaad. Once being promoted, Solar-LED micro grid received a very positive respond and has been applied in another three neighboring villages. This micro grid is more suitable for small regions, occupying relatively small space for power generation. Although there are other alternative solutions, like solar lanterns (provide lighting and charge cell phones), but the cost of Solar-LED micro grid is shared among villagers. This system can be improved by using large scaled system for power generation and storage, which has higher using efficiency. The manager of Mera Gao Power indicated that only low-power LED lighting applications can be used in small scaled micro grid. Large lamps consume too much energy that this small sized grid cannot keep up.

 

“Villagers expressed their appreciates to us, now they have enough light in their houses during nights. We should do it in an earlier time. This system should and will get more attention in near future, we believe that.” Indicated by Brian Shaad in a recent published report about the Solar-LED micro grid.