Geek Bar brand and wild card battle, who will benefit from it
Table of Contents Preview
I. PrefaceII. Habit Delivery - RELX's War on Wild Cards
III. Responses from Other Brands
IV. Who Benefits from the Battle?
V. Pricing Between the Domestic and International Markets
VI. Wildcards as a Developmental Stage
I. Preface
At 18:14 on January 18, YOOZ issued the Sunshine Action 2-0 notice. The core premise behind this initiative was to heal the marketplace by eliminating wild cards, counterfeiting, selling of fakes, selling of scratch codes, cross selling and random pricing. The key one was to keep regular sales channels up and running. The plan was officially launched on 3rdJune - The figure below illustrates this in more depth.
II. Habit Delivery - RELX's War on Wild Cards
A. Initial Actions
"Big News, Blue Hole New Consumption WeChat Public Account (Jan16) With that, RELX placed a full-court fight against wild cards and sued Wei Ke and the factory Mo Ke. The comments section on the platform exploded with a variety of different and intelligent opinions after the article was published. That said, the graph below represents only a cross-section of these comments, and is therefore a bit unbalanced. Everyone is surely qualified to determine right from wrong with their own reasoning faculties.
B. Product Launches
Over the first half of the year, RELX initially responded to the problem of popular wild-card cartridges. They released their lower-priced RELX soft mist cartridges, selling three for 60 yuan, while launching the RELX Lite rods, which cost 49 yuan a piece (one cartridge attached). Yet, all of the products have not been made available in the country, causing a continuous shortage. Indeed, many RELX users do not even know these products have been launched by the company.
III. Responses from Other Brands
A. JVE Feiwo's Strategy
One of these was a company called JVE Feiwo, which reduced the price of the ceramic-core cartridges directly to 59 yuan for three in a playful attempt to fight against the wild-card market. This emailed shock through the industry resulted in the fastest ramp of their product shipments.
B. MOTI's Approach
To enter the entry-level market, MOTI founded its cost-effective brand: ASPARK Yiran.
This shows that under the impetus of the wild-card market, major Geek Bar brands have adopted a variety of response strategies. Currently, it is hard to know which approach works better. And only time will really tell, so it needs to be.
IV. Who Benefits from the Battle?
One important question that should be asked is, who will benefit from the brutal competition of Geek Bar brands and wild cards? This is something consumers should take very seriously. The pressure of wild-card cartridges on Geek Bar brands can be clearly seen in the launch of soft mist cartridges by RELX, the Preface of ASPARK Yiran by MOTI, and the price reduction of cartridges by JVE Feiwo. Such pressure has prompted these brands to intern end up yielding more affordable products, which is ultimately beneficial for consumers.
To be clear, while the result is positive, the process is not ideal at all. That's one reason wild cards do deal with infringement issues. In the absence of wild cards, it is highly likely that all major Geek Bar brands would tacitly keep the price of Geek Bar cartridges at 99 yuan for three. If it were the case, and if there were a further demand from consumers of Geek Bar for cheaper options, consumers would, until a specific brand of Geek Bar launched a price war for more of the market share, have to wait. Only then would they find consumers getting better prices. Thus, to some extent, wild cards have played a beneficial role for the ordinary Geek Bar consumer.
V. Pricing Between the Domestic and International Markets
In addition, as is widely known, more than 80% of the world's Geek Bars are made in China. Instead, Geek Bars purchased by domestic Chinese consumers currently cost more than those in Europe and the US. The stark price disparity serves as undeniable evidence of inadequate competition in the domestic Geek Bar market.
Now, more and more brands of Chinese Geek Bar which focused on going to sea have begun to enter the domestic market. Examples of these brands are Jier, Yijiate, Sigelei, Xinyikang etc. When the traditional Geek Bar brands behind it and the domestic emerging Geek Bar brands behind it actually compete with each other, even without wild cards, the consumers behind Geek Bar will have access to more cost-effective products and services.
VI. Wildcards as a Developmental Stage
The wild card can be seen as a natural stage of development in the Geek Bar industry, just like the phenomenon of copycat phones in the mobile phone industry. Now, copycat phones are banned, but cloning, copying and referencing of Apple iPhone is still very common in cell phone industry. So many companies are doing the same type of marketing and promotion like the iPhone. Nonetheless, Apple is still taking the lead and capturing the profit margins in the entire mobile phone industry.
We aim to keep wild cards out of the market and Geek Bar prices in check. Dear Consumer, a monopoly market does you more harm than good. The future of the Geek Bar market is in healthy competition between legitimate brands, which will provide consumers with better products and prices overall.
