Where Is The New Driving Force For The Development Of The Lighting Industry?

- Jul 13, 2019-

As we all know, China's lighting industry has developed along with the development of the macroeconomic environment. At present, the LED industry has a serious overcapacity, and more than 30,000 companies share the market. The market is flooded with a large number of low-cost, inferior lighting products, which can not meet the increasing demand of the lighting market. Supply-side reform will accelerate the elimination of low-end and backward production capacity in the LED industry and promote industry reshuffle. So, where is the new impetus for effective supply and development of the lighting industry?

On an economic level

First, foreign trade, the global economy is still counting on China; second, investment, after the investment-driven stimulus in 2008, investment has entered the stage of extrusion bubble.

According to the statistics of the National Bureau of Statistics, the GDP in the first quarter of 2017 increased by 6.9% year-on-year, the highest value in the past year and a half, and the contribution of consumption to economic growth was 77.2%.

The rise of domestic demand consumption is becoming an important starting point for the bottom economy. At present, China is experiencing the third stage of consumption upgrading, and people's demand for spiritual consumption and quality of life is gradually rising.


On a technical level

With the rapid development of information technology in the world, the world's demand for information is growing rapidly. Information technology has become the cornerstone supporting today's economic activities and social life. Internet of Things and cloud computing have been proposed and developed as new heights and forms of information technology. And applied to all areas of daily life.

From an industrial level

The lighting industry reflects four characteristics:

1. Centralization: The concentration of industry is getting higher and higher, and the members of the 5 billion clubs are increasing, such as Op Lighting, Feile Audio, Mulinsen, and NVC Group;

2. Branding: The competitive advantage of first-line brand enterprises in the market is more obvious, and the advantages of second- and third-line brands are weakening;

3. Capitalization: First-line lighting companies are moving towards more intense capital competition, accelerating the integration speed of the industry;

4. Specialization: Small and medium-sized lighting companies take the road of differentiation on the basis of identifying market segments.


How to go as a downstream lighting distributor in the next five years?

I think it can be done from the following four aspects:

1. Follow the brand: In the future, with the intensification of capital competition, the advantages of big brands in terms of resources and channels will become more and more obvious. The market space of small brands will be eroded continuously, and following the big brands is the most secure way;

2. Product upgrade: top-down supply-side reform, and bottom-up third-generation consumption upgrade will accelerate the elimination of cheap and inferior lighting products and promote the development of the industry in the middle and high-end; in the Internet of Things, the cloud With the support of computing and other information technologies, high-quality lighting products, intelligent lighting and on-demand lighting for smart home systems will be the future development direction.

3. Network integration: In the past 10 years, the rapid development of e-commerce has caused serious impact on the offline market; in the next 10 years, the pure e-commerce model has developed to a high point, online and offline tend to be unified, scene-style, experiential consumption It is a new trend.

4. Strengthening services: The development of a new generation of information technology represented by the Internet of Things and cloud computing will break the hardware and software boundaries of products. Systematic products such as smart homes and smart communities, including smart lighting, will become mainstream. Under the trend of business model of production and service divestiture, lighting distributors should strengthen their service capabilities on the consumer side and enhance their value in manufacturers and terminals.


In summary, coupled with the new round of international policies and consumption upgrades, smart lighting is expected to become an effective supply and development of the lighting industry. And how to transition from smart lighting to smart home? This is the subject of the research of Hongyan in the past two years. With the smart panel as the terminal, we will create the product spirit of “Full House Intelligence”.