“Pioneer” Haier: Launching a “Scene Revolution” in the Age of Internet of Things

At the Pioneer Conference convened by world-famous management scholars, Haier, the global household appliance manufacturing giant, was defined. “It is a global manufacturing enterprise with 70,000 persons, including 4,000 small and micro enterprises, but with out levels of management”. Zhang Ruimin, chairman of Haier Group’s board of directors, participated in the conference. This was held on the 9th in California, USA. The “scene innovation under the Internet of Things ecology” led by him is bringing changes to the global manufacturing industry. Such scene innovation may give us an answer: where is the new traffic entrance in the Internet of Things era.

Recently, in Shanghai, China’s most important economic center, Haier Smart Home 001 Experience Center, an experiential exhibition hall showing Haier’s achievements in intelligent families, officially opened.

This experience center with a cost of nearly 100 million Yuan is built in Shanghai’s oldest commercial district. It has two different business logics with its neighbor, the traditional home store Red Star Macalline: within half a month after its opening, the average price of a customer order exceeds 250,000 Yuan, and the largest order is 700,000 units.

However, what excites the head of Hall 001 is not the large order, but Haier has been a smart home since 2000, and now finally sees the turning point.

What is this turning point?  The person in charge of the experience center said that more than 1,000 partners came to Haier in the first half month of the opening and asked to be Haier’s resource provider. Now partners are more interested in the industrial chain, ecological circle and the resources linked to it behind the enterprise.

Haier’s greatest reliance is the Internet of Things (IoT) ecology established over ten years. This tropical rainforest-type IoT ecology is constantly innovating scenes and reconstructing the industrial chain and value chain.

At present, Haier is not selling a single piece of household appliances, but providing complete solutions such as smart living room, smart kitchen and smart bathroom based on scenes.

Manufacturing used to rely on additional investment, expand production lines, reduce costs and increase efficiency by scale.  In the digital age, the underlying logic has changed, new technologies emerge in endlessly, and the time window for competing for users has become smaller. President Zhou Yunjie of Haier Group said that product innovation alone is not enough. Enterprises must maintain their dynamic innovation capability and the innovation capability of the overall structure. Haier’s smart home solutions not only have technological innovations in the Internet of Things, but also combine with users’ dynamic needs, bringing a package of innovations from products to life scenarios.

In Haier’s scene ecology, household appliances such as refrigerators and washing machines are installed with sensors, which become “net devices” for collecting various kinds of life scene data and become access ports for the Internet of Things.  The demand of users in the scene has become a new business opportunity. In the in-depth interaction with users, Haier has linked multiple industries with network devices as a medium and has continuously formed a new scene ecosystem. For example, the refrigerator-mediated food network links more than 400 ecological resources in eight categories, including fresh food, recipe resources and kitchen utensils, with a cumulative network of 532,800 users and an ecological income of 1.016 billion Yuan as of August 31.

“The manufacturing industry must change. Products in the future will become more and more worthless. The scene is the most valuable.”  Zhang Ruimin has revealed the transformation code of manufacturing industry in the Internet of Things era. Facing the changes of the times, Haier, striving to cross the “second curve”, did not stay away from the household appliance business on which it started. Instead, it used the thinking of “intelligence + ecology” to catalyze mutation and evolve into a brand-new species, becoming the “Internet of Things Ecological Brand” certified by BrandZ, an international authoritative brand organization, and creating a “no ceiling” pioneer business model in the Internet of Things era.