With the summer temperatures also warming, there is also a demand for bottled water.
Recently, bottled mineral water companies have quietly set off a new round of price wars, and many brands have launched preferential promotions. Nongfu Spring took the lead in firing the first shot of price involution, forming price pressure on other brands with a large discount as low as about 0.8 yuan for a single bottle, while brands such as Cestbon and Wahaha also sold at reduced prices, and the prices fell below the 1 yuan area. The price war in online channels has become more intense, and the popularity of water purchase on major e-commerce platforms and live broadcast rooms has not decreased.
The price is involuted, and the price of bottled water has returned to 10 years ago
About 10 years ago, with the upgrading of consumption and the rise in upstream costs such as raw materials, bottled water began to break through the price of 1 yuan per bottle, rising towards 1.5 or even 2 yuan. In recent years, it has been difficult to find 1 yuan of water in major shopping malls, and 2 yuan / bottle has become the main price of industry competition.
In this context, "bottled water is about to be unaffordable" has become the resonance of consumers in Tiannan and Haibei, entering the hot summer, the market is calling for a big price reduction of bottled water. As a leader in China's bottled water industry, Nongfu Spring was the first to respond by launching the largest price reduction measure for bottled water in recent years.
In many supermarkets, Nongfu Spring has played the banner of 9.8 yuan/package, and the price of a single bottle has dropped to 0.82 yuan/bottle, and in some cities and online mall channels, the price has further dropped to 8.8 yuan/package, which is converted to only 0.74 yuan per bottle. If you buy it at Nongfu Spring's "Send Water to the House" store, you can also deliver it to your home with free shipping, no limit to floors, no restrictions on stairs, elevators, freight elevators, and no climbing fees.
Under the influence of the price reduction of the "big brother" in the industry, other bottled water brands have also been forced to switch to low-price competition mode, and product prices have dropped to the 1 yuan price band. 12 bottles of 555ml C'estbon mass-sold purified water began to drop to 11.9 yuan per pack, equivalent to less than 1 yuan per bottle; 12 bottles of 596ml Wahaha purified water are 9.9 yuan/pack, which is equivalent to about 0.83 yuan/bottle.
In addition to the price is generally lower than that of offline channels, many brands have also issued a large number of coupons in order to grab more traffic and popularity in this war. In the relevant live broadcast room of the Douyin platform, many bottled water superimposed coupons only cost 0.01 yuan/package, and at the same time, free shipping is delivered to your home
Low-cost involution is not a good solution
Speaking of the origin of this price war, we have to think of Nongfu Spring's business difficulties since the beginning of this year. The founder Zhong Sui's inappropriate social media remarks and the "mountain spring water" that has been used as a selling point to promote were revealed to be reservoir water...... All kinds of negative news have plunged Nongfu Spring into the waves of public opinion, and sales have been declining, forcing this leader in the mineral water industry to take various measures to save itself, and there are traces to ignite a price war.
However, as the big brother of the industry, every price adjustment of Nongfu Spring will undoubtedly trigger a butterfly effect. For a number of "veteran powerhouses" such as Nongfu Spring and Wahaha, relying on their own strong financial strength and extensive market popularity, it may be difficult to hurt the vitality of a temporary profit loss, but for those small, medium and micro enterprises involved in the price war, it is a sudden and unwarranted disaster.
If the price drops to 1 yuan, it is still in the mainstream range of product competition for small and medium-sized enterprises, and all brands can have the opportunity to compete hard in the market, then it will drop to a few cents, or even preferential promotions to 1 cent, which is really zero profit, and it is a loss to make money. Small brands, which already lack a market foundation, can only be killed in this war without gunpowder once they lose their only remaining price advantage.
The market is profitable, and even though there is still a lot of criticism about Nongfu Spring, it is not surprising that a rush to buy Nongfu Spring has been swept up under the attraction of attractive prices. For Nongfu Spring, it is naturally worthwhile to exchange a period of concessions for the opportunity to regain market share and social reputation, not to mention the collateral benefits: once small, medium and micro enterprises withdraw from the market one after another in the price war, then the giants have the opportunity to seize more market share and quickly earn back double their profits.
In fact, for the initiators of the price war, this is also a "big gamble", if the increase in sales does not compensate for the impact of the price decline, then it may affect the company's cash flow. However, judging from the market reaction, the price war set off by Nongfu Spring has generally achieved its own strategic goals, and there is no sign of ending this "war" at present. After the smoke is over, it remains to be seen what will happen to the bottled mineral water market.