Millet TV raises prices twice in two months Why can't internet brands keep selling low prices?

After the annual price increase in 2017 caused discussion outside, Xiaomi once again raised prices due to panel price increases. Millet TV said that on February 8th, millet TV 3s48-inch and 55-inch products, prices were raised to 2599 yuan and 3999 yuan (excluding freight), respectively, compared with previous rose by 300 yuan.

Prior to this, millet TV had raised the price of some products at the beginning of this year, and the price increase ranged from 200 yuan to 300 yuan. It is understood that the 3S series is a high-end flagship product launched by Xiaomi in 2016. At the time of release, the 48-inch price was RMB 1999 and the 55-inch price was RMB 3,499. In early January, the prices of the two products were increased to RMB 2,299 and RMB 3,699 respectively. . At the same time, the China Business Daily reporter found that the millet TV price of 4,999 yuan was listed at 3s65 inches at the time of listing. The current price at Xiaomi Mall was 5,999 yuan and the price rose by 1,000 yuan.
For this price increase, Xiaomi TV still attributed the increase in component procurement costs and exchange rate fluctuations. Xiaomi said that on the occasion of the launch, the retail price of the two models was originally lower than the current cost. Up until now, the rise in the cost of purchasing upstream core components and components has remained irreducible. Coupled with the constant fluctuations in the exchange rate, the retail price of Xiaomi TV's 3S series products is far below the current cost.
In addition to millet, LeTV had previously raised prices due to panel price increases. Last November, LeTV raised the price of some products from $100 to $300.
However, it is worth noting that although panel price increases have affected many TV manufacturers, the most affected are the Internet brands such as Storm, Xiaomi, LeTV, and Micro-whale, which are related to their profit model. Some Internet TV practitioners told the China Daily News that although they claim to be eco-profitable and profitable, low-cost is a selling point for many Internet brands, and the price of their equivalent models is lower than that of traditional brands. . However, the low price means that when the price of raw materials rises, it will face greater pressure on profits, especially the storm, and its product price is even lower than 1,000 yuan.
Earlier, the performance forecast released by Stormwind Group showed that although revenues rose sharply (increase in the range of 140% to 165%) in 2016, its net profit fell sharply from the same period last year, with a range of 89% to 60%. According to the storm, the sharp rise in raw material prices is one of the reasons for its sharp decline in net profit.
At the same time, Internet brands have a shorter development time, rely more on OEMs, have smaller scales, have insufficient bargaining power for upstream panel makers, and have little ability to cope with risks such as rising raw material prices. These factors make Internet TV face a rising cost. It is difficult to attract people with low prices as always, and only keep increasing prices to ease the cost pressure.

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