in 2019, the terminal water purification market showed negative growth for the first time. according to zhongyikang’s calculations, the retail volume of terminal water purification in 2019 was 15.32 million yuan, a year-on-year increase of 8.2%, but retail sales were 36.2 billion yuan, a year-on-year decrease of 4%. retail sales in 2020 will continue to grow, with 8.39 million units in the first half of the year, a year-on-year increase of 9.9%, but retail sales declined by 23.4%.
aoweiyun.com gave the same pessimistic analysis for 2020. in the first half of the year, sales of terminal water purifiers were 9.15 billion yuan, a year-on-year decline of 33.8%, and sales of 4.267 million units, a year- on-year decline of 15.1%. however, in the second half of the year, both online and offline services recovered. the market growth rate rebounded from a 43% decline in the first quarter to a 16.2% decline in the third quarter, and the decline was significantly narrowed.
while the market is facing challenges, there is no shortage of positive consumer signals, such as consumer health awareness and awareness of water purification products, the product renewal demand, and an in-depth development of market segments by enterprises. moreover, still not many people posses water purifiers, in china only 21.4%, while only 14.6% posses terminal water purifiers, which means that there is still a lot of room for market growth.
starting from the perspectives of product functions, solutions, services, and online and offline marketing layouts, finding new breakthroughs and increasing market penetration is an urgent task for many companies. so, what will happen to the water purification market in 2021?
taking the market in 2020 as a starting point, it can be roughly deduced that the water purification market in 2021 will develop steadily. the scale of the entire market may be in line with the level of 2019 , and some emerging hot products may achieve greater growth.
take the real estate market as an example. in the first 11 months of 2020, the construction area of real estate enterprises exceeded 9 billion square meters, an increase of 3.2% year-on-year; the sales area of commercial housing exceeded 1.5 billion square meters, an increase of 1.3 year-on-year, maintaining a positive growth, and laying a solid foundation for 2021. a relatively solid foundation also provides strong support for the sales of water purification products.
a trend worth noting is that the delivery ratio of fully furnished houses has increased to more than 32%. some developers have provided water purification products in some buildings. in the first quarter of 2019, the amount of water purifiers in fully furnished houses increased by 25.2% year-on-year, which is a considerable growth. even in the special circumstances of 2020, the situation is relatively optimistic. the matching rate in the first two months was 12.7%, a year-on-year increase of 0.4 %.
looking at the time, the matching rate of water purifiers in fully furnished houses is increasing year by year, and the matching rate in some cities exceeds 20% or 30%. the number of developers supporting water purifiers has also increased, with 9 newly added in the first two months of 2020.
the matching rate of water purifiers in fully equipped houses has steadily increased. this is an opportunity to increase the penetration rate of households. it will not only allow more new users to contact and use the water purifier, but also generate the secondary purchase demand for the replacement of the water purifier. this will further promote the continued expansion of the market in the future. under the above-mentioned market expectations, some water purification companies will invest heavily in the real estate package and make them large-scale.
on the consumer side, users’ awareness of water quality, water purifiers, and water purification technology is constantly improving, and new demands are also undergoing new changes. it is difficult to impress users with ordinary products or simple concepts. products such as health, high performance, diversified functions, and scenarios will win more recognition.
many powerful water purification companies are promoting product innovation and upgrading, exploring new growth in the offline market, and broadening the competitiveness of online channels, making it possible for the retail business in the water purification market to grow rapidly.
according to the analysis of aowei cloud network, from 2021-2023, the retail volume of water purification products will maintain an increase of 14.0%, 11.1% and 8.8%. in particular, the net drinking machine is in a period of rapid expansion, and the growth rate will remain double-digit.
the result of comprehensive analysis is that the main theme of the upgrade of water purification products in 2020 will also focus on six main directions, including greater (large throughput), more complete (integrated sterilization and heat purification), and more convenient (no installation , independent core replacement) etc.), as well as scenario-based, smart, whole-house water purification, etc.
the independent core replacement function may become the standard configuration of the product. some companies focus on the upgrade of the filter and sterilization function when they launch new products. some powerful companies have launched products with better sterilization performance, such as midea, franni, golden eagle, qinyuan, etc.
furthermore, according to zhongyikang’s analysis, in 2019, 500, 600, and 800 gallon water purifiers have increased significantly, with retail shares accounting for 15.6%, 13.5%, and 3.5%, respectively. this is a significant improvement to 2018. in the first half of 2020, the sales of 400, 600, and 800 gallon water purifiers will reach peak again, with retail sales accounting for 36.6%, 17.0%, and 7.5%, respectively.
reverse osmosis products may continue to grow and outperform the overall level of the water purification market. taking the first half of 2020 as an example, the data provided by aowei cloud network is that the sales of water purifiers have declined, but the offline proportion of reverse osmosis products exceeds 90%, and the online proportion exceeds 70%, which shows the market influence is very large, and this will last until 2021.
in the past two years, water purification companies have launched products such as microbubble washing machine, water softener, kitchen water purifier, etc. household water purification has changed from single drinking water to the extension of the model of combining drinking and water use, and this is expected to continue to grow in 2021.
there are also two breakthrough areas worth paying attention to in 2021. one is the intelligentization of water purification products. this is currently still in the initial stage of smart control and has not achieved the level that would meet users’ needs. for example, smart monitoring and display of water quality and smart faucets still have room for progress. the other one is whole-house water purification, which combines water purification products with different functions to provide a complete set of domestic water solutions, so as to provide different quality water sources for the different water needs of the entire house or the entire room. there are currently limitations in market perception, price, decoration, and services. in 2021, some companies will continue to make breakthroughs and further open up the space for the water purification market.
the diversification of products is also worthy of attention, such as younger, mid-range, and small-volume products, as well as drinking machines, tea brewing machines, etc. the online market performs well, and this situation will continue in the next few years.
while online growth space is opening up, offline channels are looking for new opportunities.
in 2020, terminal water purification market was affected by factors such as offline store closures and a sharp drop in store traffic, and offline sales declined significantly, and only began to recover in the second half of the year. however, as a result of the pandemic, consumers’ health awareness has been strengthened, and online sales of terminal water purification products have rebounded sharply, and the proportion has increased rapidly. it is expected that this situation may continue in the future.
in terms of specific data, citing the analysis by zhongyikang, in the first half of 2020, retail sales of terminal water purification products reached 5.72 million yuan, accounting for 68% of the total, but the retail sales of 4.6 billion yuan only accounted for 30% of the total.
according to aowei cloud network, in the first half of 2020, online retail sales of terminal water purifiers accounted for 42.9%, an increase of 8.9% year-on-year; retail sales accounted for 69.2%, an increase of 27.5% year-on-year.
the comparison shows that online prices are mostly focused on low prices for volume trading. offline sales are relatively small , but the focus is on the mid-to-high end, with higher prices and higher retail sales.
in 2021, there is a high probability that online retail sales will maintain high growth. furthermore, the online market is still not saturated. as major water purification companies start their efforts online and e-commerce platforms expand their channels, there is still a lot of room for expansion in the online market.
so, how will offline channels then evolve? judging from the situation in the second half of 2020, it is expected that the offline market will continue to recover in 2021, and the growth rate will far exceed that of the same period in 2020. it will be in line with the situation in 2019, or it may take another step. last but not least, in 2021, the water purification industry will face many challenges and opportunities. as we can deduce from the above cited analysis, the room for expansion is still huge.
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