LED usher in the era of indoor lighting

According to statistics from the GLII Institute, the output value of LED applications in mainland China reached 159 billion yuan in 2012, a year-on-year increase of 37%. Among them, LED indoor lighting output value of 33.5 billion yuan, an increase of 80%.

The advent of LED interior lighting era channel layout war has already begun

Since 2012, with the gradual release of upstream LED production capacity, the oversupply of the industrial chain has been further aggravated, and product prices have also dropped significantly. This directly leads to the fact that the overall cost of some LED lighting products is already comparable to traditional lighting.

Under this background, the channel resources of LED lighting companies have also expanded rapidly, and the channel layout war has already begun.

Engineering channels and exports still play a leading role

At present, LED lighting channels are generally divided into four types. One is engineering channels, mainly government and large-scale engineering projects. The second is export channels, including OEM and ODM exports. The third is traditional multi-level distribution agents represented by dealers, agents, supermarkets, and building materials home lighting professional markets. The fourth is the direct sales model of self-built stores and experience shops for lighting companies. It also includes a brand new marketing model represented by e-commerce.

According to GLII statistics, more than 70% of sales of LED lighting products in mainland China came from engineering and export markets in 2012, and the sales contribution through distributor channels and self-built channels is less than 30%.

"The price of LED in previous years is still relatively high. Although there are advantages that cannot be matched by traditional energy-saving lamps in terms of product performance and energy-saving efficiency, the price has always prevented it from actually going to the market." G20-LED Summit Member Tongfang Semiconductor and Lighting Industry Liu Yan, general manager of the lighting division of the headquarters, told reporters that the company’s choice of engineering project as a breakthrough point is to ensure that it can survive first, followed by setting up a brand through engineering projects.

However, the market size of engineering projects is limited after all, and the domestic market demand for LED interior lighting has not yet been significantly improved. Exports have become an inevitable solution for many LED manufacturers in the past few years.

According to relevant statistics, in 2011 China's exports of various types of LED lamps worth about 3.2 billion US dollars, as of the first three quarters of 2012, 2012 exports worth about 2.77 billion US dollars.

At present, the number of LED lighting applications in mainland China exceeds 10,000, and the GLII data show that in 2011, the proportion of indoor lighting products in mainland China reached more than 70%.

However, since the overseas economy continued to weaken last year, the barriers to product certification for export markets have also begun to increase, and exports have become increasingly difficult. Last year, many export-oriented LED companies dropped their overseas orders, and turning to the domestic market became the only choice for many companies.

Indoor lighting era is coming

After all, the number of construction projects is limited, and the company's qualifications, brand, technology, and capital requirements are relatively high. Many SMEs cannot enter this field. The biggest opportunity for LED lighting lies in the large-scale startup of indoor lighting, especially in the civilian market.

Dr. Zhang Xiaofei said that 2013 is a key year for LED lighting, especially indoor lighting. The price of products, especially LED bulbs, has dropped to near traditional lighting levels. LED's advantages are gradually being reflected, especially in the field of commercial lighting. The effect will be greatly accelerated.

GLII predicts that the output value of LED indoor lighting in mainland China will continue to grow at a high speed in 2013. It is expected to reach 55.7 billion yuan, an increase of 66% over the same period of last year. The output value will exceed landscape lighting and become the largest LED. Apply market segments.

In this context, many LED companies have begun to exert their full force on the indoor lighting market. From the perspective of the amount of investment in the industry, LED lighting companies have also become the "Hong Kong."

At present, many LED manufacturers, international brands, including many companies that have not previously been involved in the LED field, have begun to enter the lighting application market, have the ability to do their own work, no experience in the use of OEM or strategic alliances.

Evergreen, which has long been known as the “LED street lamp expert,” will also increase investment in the field of indoor lighting since 2013. According to Huang Guanzhi, Vice President of Qinshang Optoelectronics, the company will choose to produce a part of its own products, and other products will be manufactured through OEM and ODM in order to quickly occupy the market with the most cost-effective products.

Indoor lighting products are directly oriented to customers and consumers, which fundamentally determines the importance of channels. Whoever occupies high-quality channel resources will take the lead in the LED lighting market.

The choice of channel construction and channel model has become the top priority for every LED lighting company, resulting in the choice of speed, quantity, and quality.

Channel competition

The relationship between manufacturers and channels has always been a hot topic of debate in the lighting industry, and it is no exception in the era of lighting.

High-quality distribution channels can help companies quickly open the market, increase sales, and increase brand awareness and influence. The dealers will also make huge profits through cooperation with manufacturers. "Now LED lighting channels fall short of demand, and there are so many good and powerful distributors. All manufacturers are eager to ask. I almost always receive calls from different LED manufacturers asking for cooperation." Hangzhou Weiyang Lighting Chairman Shen Weiyang told reporters.

Shen Weiyang stated that the core resource of the manufacturer is the brand, and the core resource of the business is the channel. The main business objectives pursued by both parties are the increase in market share and profits. Manufacturers need quality channel resources, and businesses need the best products.

At present, the competition for channels, especially quality dealer resources, has entered a period of intense progress. Various investment advertisements and investment conferences throughout the country are commonplace.

“We have laid dozens of stores in more than a dozen provinces and cities across the country and have developed about 100 dealers. The subsidiary, Ledia Lighting, which specializes in lighting business, has also introduced a general manager with extensive experience in channel construction. And set up a dedicated sales force to expand sales channels.” Deputy General Manager of Hongli Optoelectronics and Deputy Secretary Tang Shoutie said that with a good product is the first step, the channel is the key to truly push the product to the market.

During the lighting exhibition held in Guangzhou recently, many LED lighting companies have made huge advertising campaigns for investment across the country. Many business leaders have said that the focus of this year's business is to invest heavily in channel construction and to seize opportunities.

According to the reporter’s understanding, Qinshang Optoelectronics will also hold a nationwide channel investment promotion conference recently. The conference has invited nearly 1,000 dealers from all provinces and cities across the country to participate. According to Li Xuliang, chairman of Qinshang Photonics, the company will increase its investment in indoor lighting products this year and select a group of high-quality dealer channels to develop with the company.

At the same time, many international brands have also defined this year as the year for channel development. At the G20-LED Summit Jiaxing CMO meeting, Zhou Xuejun, marketing director of Philips Asia Pacific, also stated that in 2013, the lighting market will usher in a breakthrough period, brand and channel construction. Will be the most important thing.

“The construction of the channel cannot be delayed.” This is the unanimous view of many LED lighting manufacturers and industry experts at the “2013 China Good Product Tour Exhibition and Investment Conference” sponsored by the Senior Engineer LED. From Hangzhou, Changzhou, and Nanjing to Linyi, the enthusiastic participation of many lighting companies and channel distributors has also confirmed the fierce competition in the battle for channel construction.

From "investment" to "selector"

The quantity and quality of the channels will directly determine the sales status and market position of the company. Therefore, in terms of channel selection, the focus of many LED lighting companies this year has shifted from the previous two years of “investment” to “selection”.

On the scale, the distribution system is complete, there is a background in the field of engineering, agree with the corporate culture concept of a strong distributor has become the object of competition for major manufacturers.

According to industry insiders, many non-traditional lighting LED companies have taken a lot of detours in the channel construction of the previous two years because they do not understand the channel conditions of the lighting market. Most of the dealers recruited are small in scale, and many do not have traditional lamps. The sales experience has led companies to spend a lot of money, but there is no obvious effect. Even if you have opened some stores, you will only lose money. "Without a perfect channel system, there is naturally no competition."

“At present, the competition for high-quality resources in the channel is the most intense, but manufacturers should also have their own channel principles, and should not be used for anything.” Li Wenjing, sales director of Lianchuang, a member of the G20-LED Summit, believes that suitable distributors should first have a good local society. Resources and sales channels have a good company management model and lighting industry background. At the same time, they have a deep understanding of the LED lighting products industry and agree with the corporate culture.

Huang Guanzhi also stated that when Qinshang Optoelectronics selects distributors this year, it will focus on those oligopolistic distributors and core distributors that are dominant in the regional market. "Good distribution channels and engineering background are the main considerations."

With good distribution channels, product performance, product line richness, after-sales service, etc. are the real test of the LED lighting company's touchstone.

At present, LED lighting market is flooded with low-priced, uneven quality, and inseparable after-sales service assembly products. In turn, dealers are also faced with the confusion of how to choose the LED brand.

A dealer said that as long as the product quality is excellent, after-sale protection, and a certain price competitiveness, we will recognize.

“2013 will be the outbreak of LED lighting channels. With the continued penetration of LED, the shift from traditional lighting to LED lighting has increased, LED lighting companies have begun to build large channels, and LED lighting brands have gradually emerged. In the next three years, the domestic lighting market The competition became fierce and the top 10 rankings were determined within four years, said Dr. Zhang Xiaofei.