Current situation of Shenzhen vape market amid COVID 19 pandemic
A few days ago, ECCOM’s “Electronic Cigarette Business” column team visited Shenzhen Huaqiang North, which was titled “China’s First Street of Electronics”. There are more than 50,000 business merchants here, with as many as 200,000 employees, and the average daily transaction volume exceeds 1 billion. Data show that the average daily traffic is close to 400,000 person-times, and even 800,000 person-times during the holidays. This is also the distribution center of offline physical stores in the Shenzhen e-cigarette offline channel.
Entering Huaqiangbei Commercial Pedestrian Street, a red tent and the crowd came into view. The shop facing the street has been opened for business. Many merchants in Huaqiang North Main Street are already picking up and delivering goods. The couriers are busy packing and receiving, which seems extra busy.
From the scene of the bustling crowd and the express delivery of the courier man, we can see that the Huaqiangbei market has initially resumed operation.
It is reported that Huaqiangbei officially opened the market on March 1 after formulating strict prevention and control measures. The market will be carried out in an orderly manner by region. It is expected that the full resumption of work will be completed in April.
In communication with Mr. Zhang, the person in charge of the IVC International Electronic Cigarette Marketing Center in Rongda Communication Market, we learned that the center’s stores have been fully disinfected, employees have returned to work one after another, and gradually resume normal operations. Products delivered to customers are normally shipped. At present, the IVC Exhibition Center has settled 21 brand companies, many of which include RELX, MOTI, Boulder, yooz, SNOWPLUS, vvild, Flow, Bailun, gippro and other brand companies. There are 13 brands in negotiation.
After walking around, I found that there are also Thinkr, Jigan and other brands have also opened specialty stores.
Looking at the current situation of Huaqiangbei, the mobile 3C digital physical store business is becoming more and more difficult to do business, the price is transparent, the profit is getting lower and lower, but the cost of labor and rent is still increasing. As a fast-consuming product, e-cigarettes consume quickly, have a high repurchase rate, and have large market demand, so the profit margins will also go up.
Indeed, Huaqiangbei has already shown a clear trend of urgently seeking “transformation”, which has also given the mobile phone 3C digital store merchants who have always been poorly priced a chance to choose a transformation. Of course, this is also a good choice for manufacturers and brands test.
With the development and continuous expansion of offline channels of manufacturers and brands, Huaqiangbei currently has more than 30 stores and sales outlets, involving more than 80 brands, and it is still expanding.
At present, Huaqiangbei has also established a high-quality purchase channel for wholesalers and agents, as well as a channel and platform for consumers to experience products before buying.
During the epidemic, many dealers experienced stockouts to varying degrees. Replenishment and relocation were everywhere, and cartridges/pods became a rigid demand. One after another, they were looking for replenishment channels, which also showed the demand of consumers and the market.
As manufacturers resume work, workers gradually return to work, and the supply chain is fully integrated. It is believed that the supply of goods will gradually stabilize and the electronic cigarette market is back on track.
After the blank period of the Spring Festival and the epidemic, brands with weak anti-risk capabilities will be quickly eliminated. Brands with stronger strength, improved supply chain channels, better policy support, will survive. They will seize the opportunity and continue to fight steadily, move forward, expand the market and increase brand influence.
This will also be another round of reshuffle of the electronic cigarette industry, but also a test of the development and growth of the electronic cigarette industry.
With the passage of time, it is believed that the elders of the 70s and 80s of traditional cigarettes will also adapt to the development trend of the times, and the changes in the consumption concepts of the younger generations of 90s and 00s, the continuous updating and iteration of products, and the pursuit of quality will defining e-cigarettes again, the future development of the e-cigarette industry will see explosive growth.
In the near future, e-cigarettes will become another powerful choice for a new generation of consumers to pursue harm reduction consumer goods. There will be a large number of loyal consumer groups, which are highly sticky and have considerable development prospects.