Shulou(Shulou.com)11/24 Report--

When robots degenerate into household appliances, people are reluctant to pay for high premiums.

Author | Xiusong Editor | Yu Kui

"every time the performance is not good, the saddest thing is the professional manager, who is pushed out to fill the bag and then fired."

Wen Kai, an executive in the e-commerce operation of the household floor sweeper company, shook his head and told Leifeng sadly that before him, several heads of e-commerce platforms had been resigned, and he felt very dangerous and would be kicked out of his job one day. So he had to prepare for the bucket to run away.

The root of all this is that after two years of soaring household floor sweepers, growth has slowed sharply this year. Retail sales of floor sweepers rose 9% in the first half of this year compared with the same period last year, but sales fell by 28.3%, according to Oviyun.

Wen Kai told Leifeng.com that the actual data was even worse. We had expected the 618 to be able to rush a wave, but it all ended in dismal results: take the Tmall platform as an example, compared with last year's 618, Kovos and Stone only had an increase of almost 10 points. Cloud whale has almost zero growth, and some manufacturers claim to have increased several times, but they are actually doing the data.

At the same time of poor sales of floor sweepers, the share price of Stone, once known as the "sweeper", has dropped from 1,000 yuan per share last year to more than 200 yuan today, and its market value has dropped by nearly 70 billion yuan. Coworth's market value is also nearly 100 billion yuan lower than the previous year's high.

Wen Kai believes that although the malaise of the floor sweeper market is related to the macro environment, the industry itself also lacks more room for imagination and is facing a structural adjustment.

"the grand occasion of 2019-2021 is gone, and the transformation brought about by spending money on marketing is very difficult to start. Data feedback to the company, the heads of major e-commerce platforms are the first to bear the responsibility, but even if they are replaced, it is difficult to have an immediate effect. This year's Singles Day holiday is also estimated to be hanging."

In fact, the slump in the household floor sweeper market this year is obvious to all. Many operators told Leifeng that the fundamental reason is that household floor sweepers have reached a bottleneck period, and the rapid growth brought about by category innovation and technological dividends in the past few years is no longer sustainable.

Correspondingly, the four little dragons of CR4 (the top four share concentration index in the industry), which account for nearly 90% of the floor sweeper industry, have all begun to adjust their business plans. For example, Coworth cut off the commercial cleaning robot team early, Stone began to touch on the car-building business, and Cloud Whale carried out a structural adjustment to pursue and optimize the commercial team.

At the same time, every business adjustment is accompanied by personnel changes.

Leifeng learned that Gao Qian, CTO Shao Changdong and Tmall, the heads of Covos commercial cleaning robots, have all left; the search for two co-founders, Wu Peng, Wang Shengle and CFO Sun Jing, has also left the team; and CR4 has all started secret layoffs, ranging from dozens to hundreds.

In the tuyere of the past two years, the floor sweeper industry was once born, but now CR4 has successively adjusted its business plan and laid off its staff. Obviously, the household floor sweeper industry is no longer quiet, but has been replaced by a weak market, volume and price fighting.

01 inner roll sweeper: the upper limit of the four little dragons, the lower limit of the white card machine viciously pull the lower limit of the domestic household sweeping robot camp can be divided into two circles, one kind of sweeper represented by CR4 Corworth, stone, cloud whale, pursuit, the market share is close to 90%.

The rest fall into another category, competing for the remaining 10% or so of the market.

These two circles are hierarchical and have different target audiences.

The main audience of CR4 is the urban middle class, and a considerable number of them are young people, who have great demand for sweeping and cleaning, have strong spending power, like new things, are willing to pay for geek technology, and it is normal to spend thousands of yuan to taste fresh; while the brand audience outside CR4, whose spending power is relatively weak, belong to price-sensitive users.

If divided by price, the floor sweeper can be roughly divided into three categories: low-end (3000 yuan). The low-end floor sweeper has a single function and adopts a navigation mode similar to a gyroscope, and the cleaning efficiency is not high; the middle-end machine basically covers the full function, but there are still deficiencies in product power and details; the high-end machine is not only full-function, but also adds AI capabilities, voice interaction, gesture recognition and other intelligent design.

At present, the main model of CR4 is the middle and high end, basically does not touch the low end; the middle end is similar to Haier, Midea and other traditional household appliance brands and some waist enterprises such as Silver Star, Beetle, Yuli and so on; the low end is mostly white products.

Behind the clear price is the epitome of consumption classification, due to the market differences caused by consumption power, resulting in the current floor sweeper industry is very internal. Moreover, this kind of inner volume also presents different characteristics.

The CR4 in the circle is one circle, and the rest is another circle, and these two circles rarely "cross the border".

CR4 will not cut prices on a large scale to reduce the dimension to crack down on the low-end market; the rest of the floor sweeper companies will also find it difficult to enter the high-end market, both will only compete in their own circles. Even if some companies want to get out of the circle, it is almost impossible at this stage. In the final analysis, each has its own difficulties.

First, at present, the floor sweeper is not a rigid demand, it is a kind of consumer goods that add icing on the cake and increase the luck of life.

Lin Wen, a practitioner of the floor sweeper, told Leifeng that the earliest loyal users of the floor sweeper were front-line white-collar workers and technology enthusiasts, which can be collectively called the urban middle class. These people do not have the economic strength to produce high production, do not have hundreds of flat house, and cannot afford professional cleaners to clean, but they also feel that cleaning is a waste of time, which is far less than the value of work, so buying a floor sweeper can not only solve the problems of life, but also add a sense of science and technology to life.

Take the Covos D9 as an example, which went on sale in the second half of 2013, using LDS to bring the floor sweeper from random cleaning to planned cleaning, which can be said to be an epoch-making product.

But the initial price of D930 is 5980 yuan, while iPhone5 only needs 5288 yuan. At that time, it took both courage and strength to spend 6000 yuan on a floor sweeper.

Urban middle-class people have high requirements for brand, technology, service and function iteration, and the market demand is fed back to the production side, which forces these enterprises to constantly develop new technologies and develop new functions. These R & D costs, channel costs, marketing costs, labor costs and so on are taken into account, the price of floor sweeper is difficult to reduce significantly.

Lin Wen said that at this stage, the cost of the high-end full-function household floor sweeper can be less than 1500 yuan, but enterprises need to maintain a gross profit margin of at least 4050% in order to cover the previous R & D investment, marketing and other expenses. Therefore, the price of high-end models from large head manufacturers, such as Covos and Stone, is basically 3500 yuan, so it is difficult to sink to the second and third tier market.

"Kovos, stone will not do thousands of yuan machine, that is not their basic disk, spending power is not strong, there is not much profit space."

In fact, the real battlefield of CR4 is high-end computers, such as stones, which only do the middle and high end after breaking away from Xiaomi. The products released by various manufacturers this year, such as Stone G10S / PRO, Kovos T10 TURBO, Chase S10 / X10, Cloud Whale J3 and so on, are all high-end products. These high-end products are very functional, such as self-cleaning, AI cameras, voice calls, and so on. As soon as one introduces new features, the other three will immediately follow, but there are differences in algorithm and accuracy.

Lin Wen said bluntly that pursuit is the most popular one in CR4. "if someone else sends one a year, he sends two."

Second, CR4 is difficult to sink, but there are also brands in the second and third tier markets, but these brands cannot enter the high end and can only be rolled in their own circles.

In the words of Chen Yong, an entrepreneur of household floor sweeper, "if you don't have 100 million yuan in the account, don't play in this market."

There are two reasons:

First, the floor sweeper from demo to product listing, research and development, management, manpower, supply chain and other fixed costs, product listing, sales, channels and other expenses, relatively large expenses, only the normal operation of the enterprise circulation, conservative also needs tens of millions of expenses every year.

In addition, even if the products on the market, but also to compete with other brands, the entire sweeper market volume is serious, small brands are more difficult to run, without a certain amount of capital reserves, it is difficult for enterprises to survive.

Second, the household floor sweeper belongs to To C products, re-marketing, through the signing of spokesmen, advertising and other means of transformation, is the basic means.

For example, one of the important reasons why Kovos can start volume quickly is that when the industry did not pay attention to online advertising marketing, it took the lead in advertising promotion in Tmall, and signed the then popular Zhong Hanliang in 2016, while the next spokesmen, like Wu Lei and Xuanbin, are all celebrities.

Not only Kovos, the other three of CR4, Stone signed Xiao Zhan, Yunwhale signed Liu Tao, and Hunting hired Su Bingtian and Zhang Ruoyun as spokesmen.

The endorsements of these stars naturally cost a lot of money, often tens of millions.

According to Coworth's 2021 annual report, its marketing and advertising expenses are 1.868 billion yuan, compared with 640 million yuan for stone, accounting for about 14% and 11% of that year's revenue, respectively.

Although cloud whale pursues no public data, according to industry insiders, cloud whale has invested a lot of money in advertising, has invested nearly 50 million in platforms including focus media, and does not guarantee conversion, and it is also expensive in recommendation platforms such as Little Red Book; on the other hand, it spent hundreds of millions of yuan on advertising marketing and signed Dortmund as a joint signature.

Compared with the lavish spending of CR4, the second and third-tier brands themselves are lack of funds, and they are even less likely to spend 10 million or even hundreds of millions of advertisements, which naturally will not form brand effect. Coupled with the weak technology, the product power is very difficult to meet the needs of the urban middle class. These brands can hardly have a foothold in the front line.

This has resulted in the internal volume of the current floor sweeper: close to 90% of the market, only CR4 volume, while the remaining 10%, there are dozens of enterprises in the volume.

"people sign celebrities, spend money on investment and build brands. You've made a floor sweeper, and no one else has heard of it. How can you place an order?"

Chen Yong tone is quite depressed, but also very helpless, completely unable to compete with CR4, had to roll that 10% of the market.

And this 10%, there are many traditional home appliance players, such as Midea, Haier and other home appliance manufacturers.

However, according to practitioners, Midea, Haier and other brands of floor sweepers, in fact, do OEM, the whole machine by suppliers such as Silver Star, Huaxin, etc., responsible for sales, after-sales service and other links.

However, even if it is to find someone to contract manufacturing, these manufacturers can also rely on the existing brand advantages and channels to occupy a certain market, although less than (CR4), but more than below.

All in all, in Chen Yong's view, the household floor sweeper industry highlights a word: volume.

Price war although the two circles belong to different enterprises in the volume, but the form of the volume is the same: the same function, the price is lower than the competitors; at the same price, the product power is stronger than the competitors.

For CR4, the middle and high-end models are basically full-featured, it is difficult to play new tricks, in the extremely internal market, price reduction is the most direct and effective means.

Take the Tmall platform as an example, the Kovos Dibao T10 Omni has been reduced from 4699 yuan to 3999 yuan, the stone G10 has dropped from 3999 yuan to 3499 yuan, and the search for S10 has also dropped from 4599 yuan to 3799 yuan, with an overall price reduction of 500,800 yuan, plus double 11 booking and platform discounts.

"almost all of these high-end models have been reduced in varying degrees." Another practitioner, Zhang Jun, told Leifeng that this was a last resort. The market for floor sweepers grew slowly in the first half of the year and is already weak. If prices are not cut in the second half of the year, business will become more bleak.

In addition to the price reduction, CR4 offers different discounts in the offline market, such as buying the S10 or W10 pro, as well as giveaways such as umbrellas, water cups and accessories.

Zhang Jun believes that due to the influence of macro factors, consumers in the high-end market obviously have more purchasing power than the low-end market, and the high-end phones themselves have enough room for price reduction, so it is undoubtedly the right choice to drive sales in the high-end market through price reduction.

And CR4 outside the brand, the price war is more fierce, in addition to dozens of low-end brands volume, there are a large number of white-card machines.

On an e-commerce platform, a large number of white-card phones can be seen everywhere, with prices ranging from tens of yuan to hundreds of yuan, and some sales seem to be good.

Zhang Jun said that these white-card machines simply put the "chassis + cleaning module" together to form a whole machine, which can run and move, without paying attention to cleaning efficiency and quality, not to mention AI functions such as voice interaction and gesture recognition, not even toys.

However, the existence of these white-card machines is really a heart problem for middle-and low-end brands.

The so-called middle and low-end brands, although the product strength is not as good as CR4, but also basically to full-function, but the selected parts, such as sensors, navigation modules are cheaper, the overall cost is lower, even if the accuracy is a little lower, it can meet the demand of sweeping the floor.

The emergence of white-card machines makes the middle and low-end brands seem very embarrassed: compared to the above is not enough, compared to the bottom is also insufficient.

If you can afford a thousand-yuan machine, you can buy a Coworth version with a little more money, and the product quality and after-sales service are guaranteed; models below 1000 yuan have home appliance brands such as Midea and Haier, and the lower-end ones can buy white-card machines at a very low price.

Therefore, for these brands of weak medium-and low-end floor sweepers, perhaps the most deadly is not the CR4 sinking to reduce the dimension of the attack, but these white-card machines rely on the price advantage to change their lives from the bottom up.

From the perspective of the entire floor sweeper industry, although there are two different circles, they all face the same problems: weak growth aggravates the inner volume, and brands are racing around and fighting each other in their own circles.

On the surface, the slow growth of the floor sweeper market is related to the macro environment, but this is not the main factor. The deeper reason is that the household floor sweeper robot has broken away from the robot category and become a "big household appliance" in the new era. Home appliances are cyclical. Therefore, it is not difficult to understand that after the boom of 2019-2021, the floor sweeper entered a trough.

02 robot setting, has been reduced to a "non-rigid demand for large household appliances" in the era when household floor sweepers are still using gyroscopes for navigation, its biggest feature is not sweeping the floor, but robots.

For the first time, people have found that the simple and boring job of sweeping the floor can be replaced by robots.

It is the label of robots that has accumulated the earliest customers for home floor sweepers, engineers who are interested in technology, geeks curious about new technologies, and urban middle-class people who like to taste fresh.

But with the maturity of SLAM technology, lidar and even dToF, the home floor sweeper industry has expanded from the earliest geek circle to a broader consumer circle and become a new household appliance, while removing the label of "robot".

Investor Fang Yun believes that this is not a simple "de-tagging", but means the abdication of the status of the household floor sweeper: from a high-tech robot to an ordinary household appliance that can replace manpower.

The characteristic of this change reflected in the consumer side is that people can tolerate all kinds of failures of robots, even if they stumble and can't clean up, but they can't stand the failure of a mature tool. Consumers are not willing to pay for the high premium of the floor sweeper.

Similar consumer psychology: floor sweeper, as a household appliance, should have a longer service life, rather than a change every year.

"consumers can't all generate electricity for love. How can household appliances take years to use?"

Fang Yun said that this change in role means that floor sweepers are going through a process of "disenchantment". Both cutting-edge technology geeks and ordinary consumers no longer regard floor sweepers as robots but intelligent household appliances.

There are periodic adjustments in all household appliances.

In the past few years, household floor sweepers have experienced a technology cycle (Corvus and stone have risen one after another), product cycle (2019 cloud whale with sweeping and dragging as a whole, self-cleaning rag function to break out), and consumption cycle (the sweeper industry is mature and the market has exploded). A complete development cycle of "technology-product-consumption" has been completed.

As a result, the growth of household floor sweepers is slow and happens to be in the downward cycle.

Wang Tao, another investor, believes that even as a new household appliance, compared with traditional white electricity, household floor sweepers are in an awkward position.

"the traditional three major pieces, refrigerator, air-conditioned washing machine, refrigerator air-conditioning can be refrigerated and irreplaceable; washing machine can liberate people's hands and save a lot of time, and the functions of dehydration and drying are very practical; but floor sweepers solve simple labor and non-rigid needs."

Wang Tao said that the difference between the floor sweeper and the white electricity is also shown in another aspect: the white electricity takes the front installation route, the present stage floor sweeper obviously does not have this condition.

"when designing household models, real estate companies will reserve sockets for refrigerators, space for external air conditioners and water outlets for washing machines, but they have never reserved pedestal space and water outlets for floor sweepers."

This means that users do not plug and play after buying the floor sweeper, but need to find space for the floor sweeper separately, arrange charging jacks, water pipes and so on. Many households are very troublesome to install pipes, which undoubtedly increases the cost of use.

Although some brands of floor sweepers have begun to do front outfits, Wang Tao believes that it is not realistic in the short term, because the market acceptance of floor sweepers is not as popular as the three major white electricity, and the penetration rate is very low. It is difficult for the brand of floor sweeper to surpass the mountain of real estate.

The current household floor sweeper belongs to improved consumption-even if it does not, it has little impact on work and life. Moreover, more and more people realize that the floor sweeper is just a tool, and the cleaning effect and efficiency are the real core. At present, CR4 loads various sensors on the floor sweeper and integrates AI functions, which undoubtedly adds a lot of cost, and some consumers are not willing to pay for it.

However, low penetration means that there is much room for development, and floor sweepers will "degenerate" from robots to new household appliances, and will also follow the path of traditional white electricity, that is, they will experience periodic fluctuations and gradually enter the family with the upgrading of consumption. it will become one of the new "big things" in the future.

03 four Little Dragons for change: car building, To B, tuned organization can't beat the cold.

This is a true portrayal of the listed Kovos and Stone, with a market capitalization ranging from hundreds of billions to 10 billion, and share prices from "sweeping grass" to "leek grass". The every move of the two head companies has attracted much attention from the market.

The biggest news in the floor sweeper market in the past two years is that cars are made of stone.

At the beginning of 2022, it was revealed that Luo Ke received US $100 million in financing at the end of last year, and soon after that, it was reported that Luo Ke received US $200 million in D-round financing.

Xiaomi in front and stone in the back all choose to enter areas that they are not good at when they are almost in the Red Sea of car building.

Many people are skeptical about whether stone can build a car. after all, the cost of building a car is much higher than that of a floor sweeper, and it is completely "burning money" in the early stage. Stone has no technical genes, no capital strength of Xiaomi, and no experience in building cars, so it is very difficult to enter the automobile industry.

But in Zhang Jun's view, building a car made of stone is a certainty. Changjing is a very good product manager. This kind of people understand products and cost control. On the technical side, stone dug up Weimar's CTO Yan Feng to make up for the technical deficiency, so it is not a problem to build the car, but it is not known whether the quantity can be increased.

Zhang Jun believes that whether it is successful or not, the car-building itself sends a signal that Stone wants to create a second growth curve, and will even readjust its focus in the future.

There is no other reason: the floor sweeper is enough to make it difficult for the market to have another big explosion in a short period of time. Even if in the long run, the market for floor sweepers will expand further with mature technology, falling costs and rising consumption, stone now needs another "engine".

In fact, Stone has also tried to make commercial cleaning robots on the road to creating a second growth curve, and launched the first commercial cleaning robot in June 2021, focusing on scenes such as Shang Chao and hospitals. Coincidentally, Kovos also formed a team to enter the commercial cleaning robot, and released the commercial cleaning product "Cheng Xie" in May 2021.

Left: stone; right: Coworth "Cheng rhinoceros", but the commercial cleaning business of the two giants has just started and has been strangled in its infancy.

According to industry insiders, the commercial cleaning operations of Stone and Corvos have been cut, and the relevant teams have either been laid off or broken up. The commercial cleaning team in Corvos has also been withdrawn and the person in charge has left.

Lei Hai, a commercial cleaning practitioner, told Leifeng that it is also in the field of cleaning. Corworth and Stone are longer than to C, but commercial cleaning is to B. there is a big difference between the two.

For example, to C floor sweeper can reach consumers through marketing and advertising, so as to increase the quantity quickly; but commercial cleaning is not suitable for marketing mode, because customers are enterprises and have to calculate detailed accounts; and the decision chain of B-end customers is so long that even many enterprises that do commercial cleaning do not know who their real customers are at the beginning, so it takes a long time to understand the market, not to mention to C enterprises suddenly do to B.

Lei Hai believes that Covos and Stone do commercial cleaning, the purpose is to do to B products, accumulate technical experience, and further feed back to C-end products, not really want to do to B market. And the current commercial cleaning is not profitable, for Corworth, stone, can only dabble.

In addition to the two giants, there is also news of commercial cleaning, but according to practitioners, Wang Liang, the head of its business team, has resigned, the team has been laid off, and no product has been launched.

Cloud Whale, although there is no news of business adjustment, but has made a lot of adjustments in the organizational structure.

Lei Hai believes that the current dilemma of cloud whale is that the window period for the once talented invention and the first sweeping and dragging product function has passed, and the other several companies have caught up with the pace, from J1 to J3, the iterative speed of the product is slower, and there are no more new tricks. In addition, cloud whale's product matrix is very single, only J series, and are high-end computers, and do not do the mid-market, so this year's growth is very weak.

From the various "changes" of CR4, it is not difficult to see that the current household floor sweeper has indeed entered a bottleneck period, and various brands are looking for ways to break the situation, some of which are not effective, while others still need time to verify.

04 conclusion: "at present, the price of middle and high-end household floor sweepers is still very expensive, if the full-function products of CR4 can be reduced to less than 2000 yuan, the market will be inspired, but it is basically impossible."

Chen Yong said that CR4 invests a lot of R & D in the early stage, various costs are added up, and it has to maintain a certain profit, which will eventually be digested through products, which cannot be achieved at this stage, which may depend on the decline of the entire supply chain and technology costs.

Just like mobile phones, there were countless brands competing in the early days, but only a few remained in the end, while full-featured mobile phones can also be less than 1000 yuan, thus forming a low, medium and high product price matrix, and each price has a corresponding brand.

But this process will be very fierce, perhaps some enterprises, can not wait for that day.

Remarks: Wen Kai, Lin Wen, Chen Yong, Zhang Jun, Fang Yun, Wang Tao and Lei Hai are all aliases.

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