History will soon come to be littered with retailers who failed to make the switch to the internet age, and instead declined to the point where their shelves gathered more dust than fingerprints, and cash registers fell silent. But China’s Suning (SHE:002024) is making it clear that it wants as significant a presence on the country’s e-commerce scene as on its city streets, starting a promotional price war aimed at its rival etailers of gadgets and home electronics.
Next week, on April 18th to 20th, Suning plans a sale on every item on its website – a promotional price battle that will put the pressure especially on Dangdang (NYSE:DANG) and 360Buy. To succeed in e-commerce, Suning is aiming to topple such internet upstarts, and put its bricks-and-mortar retailing skills to full use in the digital age. There’s no significance to those dates next week – it seems that Suning is just spoiling for a fight and some free publicity.
Suning this weekend tweeted on the social network Sina Weibo the orders of its chairman, Zhang Jindong, saying – in curiously militaristic language – that he had ordered an e-commerce “general offensive” by the company that would “not be just a marketing campaign,” but an all-out effort to gain market share from the B2C e-commerce elite. Suning exec Min Juanqing delivered the head honcho’s words on his own microblog [1]:
According to chairman Zhang’s instructions, for this full year it would not be a problem to achieve 20 billion RMB in sold items, but we implore the team to sprint towards 30 billion RMB.
That presumably includes High Street shops as well as its web retailing efforts, but that growth is being marked out as coming from its online store.
The CEO of rival Dangdang, Li Guojing, was unimpressed – yes, Weibo is a fun way to get some quality business bitchin’ – saying [2] that this “is 360Buy’s problem” – with the implication being because that site relies more on sales of electronics.
360Buy’s CEO and founder, Liu Qiangdong has cut back on his tweeting of late, and didn’t weigh in on the debate.
So, while bricks-and-mortar retailers are struggling in the UK and the US – with Comet, Circuit City, and Borders going down in recent years – Suning is determined to make the leap from mere commerce, to future-grabbing e-commerce. But of course, in China’s already mature and cut-throat industry, three days of price-cutting means nothing – the war will be won over years of ruinously expensive ad campaigns and major investments in logistics.
[A part of the top image was sourced from the Cat Fights Tumblr]