Homearch, which once claimed to create a "Hema" in the home furnishing industry, has closed down. Does this mark a change in the big home furnishing strategy of and Ali ?
Author | Duan Chuanmin (Strategic Marketing Observer)
The home furnishing industry has a market size of trillions, and its huge scene consumption power can even rival the automobile industry. The business opportunities contained here make major manufacturers such as Alibaba, Xiaomi and even Jingdong salivate.
In recent years, major manufacturers have frequently made arrangements in the home furnishing industry. Ali's aggressiveness is particularly fierce: on the one hand, it has launched two of its own platforms: Tmall "Home Decoration e-Station" platform - the first online shopping and offline experience in the country to launch standard design, standard main materials and standard construction One-stop home decoration service trading platform, Taobao's "jiyoujia" platform - a one-stop home O2O platform integrating home decoration design, decoration services and home product purchase; on the other hand, it has strategically invested in two major home furnishing companies at a cost of nearly 10 billion Leading store companies include Easyhome and Red Star Macalline. In addition, it also launched its own home installation brand "Liping", which was later renamed "Every Ping, Every House".
homearch is a selected home furnishing brand directly operated by every square meter and every house.
With continuous growth over the years, Alibaba’s main model in the home furnishing field is new home retail + strategic investment. Alibaba has formed three business lines within Tmall Home Decoration, Taobao Jiyoujia, and Every Square One.
At the 2020 Home Decoration Ecological Strategy Summit, the ambitious Alibaba once announced a goal of 1 trillion in three years. However, from the current point of view, Ali's progress in the home furnishing field seems to be unsatisfactory. The main reason is that the three business lines of operate in parallel, resulting in the dispersion of overall resources and no internal synergy.
It is reported that Chongqing Xingguang 68 Plaza store is Homearch’s first store in the country. It was launched in late December 2021 and has only been open for half a year. Its characteristics are: driven by digital and technology, it creates a new home retail service for local residents, providing consumers with one-stop all-inclusive services from whole-house design, customized decoration, home product purchase, and door-to-door delivery.
In addition to Chongqing, homearch also settled in Nanjing in March 2022, becoming the first store in East China. The direct reason is: Alibaba will begin to implement a cost reduction and efficiency improvement strategy in 2022, and each of its business departments will begin to be responsible for its own profits and losses. The first homearch store in the country may have been closed by Alibaba due to poor management. The deeper reason behind
is: the pan-home furnishing industry is a highly personalized, service-oriented and irregular industry. On the surface, it may not seem advanced or even backward, but it is not easy to quickly conquer the city. Even if e-commerce giants like Alibaba are aggressively attacking, it will be difficult for them to dominate the pan-home furnishing industry.
Ali’s move to close its first directly-operated home furnishing brand marks the end of Ali’s fierce offensive in the home furnishing industry in recent years.
We have seen that Tmall’s “Home Decoration e-Station” platform still falls within the category of traditional e-commerce. It is very difficult to effectively integrate services, integrate offline, and integrate non-standard products. Maybe Alibaba needs to create some ultimate standard products in this industry, and then hit the home furnishing market with speed and intensity, which may be more in line with their genetic characteristics.
For enterprises in the pan-home furnishing industry, this is good news for them on the one hand. The characteristics of the pan-home furnishing industry determine that some industry giants may fail even if they have huge amounts of capital and talents; on the other hand, this may also be the case for many The reason why it is difficult for home furnishing companies to grow quickly. Therefore, the personalized, non-standard and experience-oriented characteristics of the pan-home furnishing industry prevent outsiders and so-called "laymen" from crossing over.
Looking forward to the future, the home furnishing industry, which is huge in scale and has unlimited potential, will usher in attacks from more giants. Alibaba will also continue to keep an eye on it. Pan-home furnishing companies cannot rely on the barriers posed by industry characteristics. They must be strong themselves. The only way to defend themselves is to quickly become bigger and stronger.
