15 Mar Purify the water from our well
It’s common for urban residents in China to install water purifiers in their kitchens. Now the trend is moving out to the rural areas. A higher growth rate is shown in purifiers of water from rural wells, instead of city water.
If we plot the tmall.com online sales revenue of water purifiers in 2018 and year-to-date 2019, we can see the year-on-year growth of 33%. In the first two months of 2019，tmall sold about 1 million units of water purifier with an average price of ~CNY500/unit (~$75/unit).
The top 5 sellers are the established brands including Midea, Haier, Qinyuan, Joyoung, and Xiaomi.
Except for Qinyuan that specializes in water purifiers, the other four are diversification examples of appliance players expanding products from their core. Midea started from residential cooling fans and air-conditioners, Haier from refrigerators, Joyoung from soy-milk makers, and Xiaomi from mobile phones. These brands are the witnesses and beneficiaries of China’s improving standards of living with increasingly sophisticated home appliances in the last 30 years. Each of these brands grabbed an opportunity, built a stronghold, and expanded from it.
How can the smaller brands compete with these giants?
Look for the unmet needs, such as water purification in rural China.
By comparing sales revenue of specific keywords appeared in the product description, we have discovered two hot words in the category of water purifiers: “rural” and “well”.
In contrast to the 33% category year-on-year growth, products with the keyword “rural” have seen a growth rate of 113%. The top performers are all brands specialized in water purifiers.
As China’s industrial growth has been achieved at the cost of air and water pollution, as more consumers are conscious about health, and as the young children of elderly farmers bring back the lifestyle from the cities, the need for cleaner drinking water is growing in the countryside.
Traditionally, many rural consumers drink water boiled directly from their local well. As underground water source is getting more contaminated by industrial and agricultural pollutants, the color, smell, and taste worry the families. They need a solution to at least improve the quality of drinking water.
(Before-and-after illustration of a water purifier made by Shanzhiquan. Source: tmall product description page. )
This is just one of the examples in China’s upgrading consumer market, with companies searching for unmet needs in the rural segment.
Please email me at zhangrong[at]yimian[dot]com[dot]cn if you would like to pick up some interesting insights about a specific category in China’s online market. We are adding more categories into our online trend discovery tool YiDrone.
(Charts generated by Yimian’s YiDrone tool. Title image from Upspash @onevibe.)