Fierce "war"
The price "war" in the technology retail market started a few months ago when Mobile World (MWG) launched shocking discount programs, along with very strong statements from Chairman Nguyen Duc Tai.
Right before the April 30 holiday, MWG launched a campaign called “So cheap”, in which TVs and home appliances were discounted by up to 50%. Some items were sold at “gift-free” prices such as frying pans and power banks for 10,000 VND each.
This is a rare deep and uniform discount campaign that Mobile World has carried out in recent years. This is contrary to what consumers often see at MWG, which is that the prices of goods are often quite high compared to the general level and the service is good.
The sudden "turnaround" of the number 1 giant in the retail sector of phones, electronics, and household goods shook the market and caused competitors to immediately launch counter-attack discount programs.
Immediately, FPT Shop challenged with the slogan “Wherever it is cheap, it is cheaper here”. Mobile Vietnam attracted attention with the campaign “Cheaper than all the cheap ones”….
In early June, Mobile World continued its price war, launching the program "Upgrade your space - Show your class - Guaranteed price" with the affirmation "Refund if cheaper elsewhere". The program applies to high-end electronic and refrigeration products, with discounts of tens of millions of dong, equivalent to about 20% for many high-end products...
The battle is shifting to another direction when Mobile World launches a new tactic called “special sale” with a series of new smartphone models launched on the market such as Realme C53, vivo Y36, Xiaomi Redmi 12. Most likely, at the end of the month, MWG may join hands with OPPO. In addition, MWG may deploy with some laptop brands such as MSI, Asus, HP and Acer.
The “strategic cooperation and special sales” programs are considered a form of “exclusivity”. These products are only sold at The Gioi Di Dong and Dien May Xanh systems. Other store systems do not mention, do not have prices, product information.
The Gioi Di Dong's low-cost sales campaign helped the company's revenue increase sharply again in April, after falling to a four-year low in March 2023.
Specifically, MWG's April revenue reached VND9,900 billion, up 23% compared to March 2023. MWG's revenue may increase sharply in May and June, when this is the peak of the company's discount campaign.
Comparing the power of retailers
It can be seen that it is rare for big retailers in Vietnam to simultaneously declare a price war like this time. Many types of phones have been greatly reduced in price. Apple fans have never seen this product drop in price like this.
In fact, the price war may affect the quality of service. Other retail chains are under great pressure. However, in the context of low consumer demand and businesses laying off large numbers of employees, this trend may be inevitable.
Previously, at the 2023 Annual General Meeting of Shareholders, Mobile World Chairman Nguyen Duc Tai said that MWG will have a more competitive pricing policy for Apple products, after a long period of being overwhelmed by competitors.
This is also what FPT Retail Chairman Nguyen Bach Diep mentioned at this year's shareholders' meeting. Ms. Diep admitted that in the short term, FPT Shop will also lower prices to sell products.
After many years of growth, the mobile phone market in Vietnam has shown signs of slowing down and declining sharply, especially in the mid-range and low-cost segments. In the first two months of the year, right at the peak of Tet sales, phone sales dropped by tens of percent compared to the same period last year.
In the market, MWG is currently the enterprise with the largest revenue and market share, accounting for over 50%.
In 2022, MWG recorded sales and service revenue (all segments) of more than VND 134,722 billion (more than USD 6 billion) and after-tax profit of more than VND 4,100 billion. Meanwhile, FPT Retail recorded revenue of more than VND 30,276 billion.
Regarding mobile phones, FPT Shop has a system of nearly 1,000 stores nationwide. Meanwhile, MWG also has a similar scale.
Hoang Ha Mobile is also a major retailer of phones, computers, and mobile accessories on the market. This company does not disclose its revenue but is known as a unit with a chain of retail systems in many large cities, small stores but good prices. Hoang Ha Mobile is also an official authorized retailer of Apple in Vietnam. In addition to more than 120 branches nationwide, Hoang Ha also has many other online sales channels such as Website, Facebook, Instagram, Shopee, Lazada, TikTok.
Mobile World has a chain of more than 60 retail stores selling technology products.
There are also a number of other mobile retail businesses on the market such as ShopDunk, CellphoneS...
In terms of distribution, Digiworld Corporation (DGW) and Petrosetco (PET), FPT Shop... are the representatives. These businesses have recently recorded a decrease in revenue and have faced competition from retailers.
Source
Comment (0)