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Recently, Dong Mingzhu announced that Gree officially launched a beauty instrument.

Recently, Lei Jun's live streaming has become very popular, and Dong Mingzhu has also launched a beauty instrument worth nearly 10,000 yuan. Although this is not Gree's first cross-border venture, it still attracted widespread attention. In particular, Dong Mingzhu's slogan "Use it in a week to become beautiful" has aroused doubts about whether it violates the Advertising Law and exaggerates the publicity.

According to the report "'You can become beautiful in one week', Dong Mingzhu launches a new 9,800 yuan beauty instrument" in China News Weekly on August 6, Dong Mingzhu personally attended the 2024 Gree refrigerator and washing machine life appliance strategy conference held in Shijiazhuang, Hebei, and shared Gree's latest strategic layout in the fields of refrigerators, washing machines and life appliances. At the conference, Dong Mingzhu also revealed that Gree will officially launch the beauty instrument it has developed. Dong Mingzhu praised Gree's beauty instrument and declared: "As long as you use it for a week, you will find that you have become more beautiful."

Like Gree mobile phones, Dong Mingzhu personally endorsed the product this time. The 70-year-old Dong Mingzhu was full of confidence in the Gree beauty instrument. She encouraged Gree Hebei dealers on site to place orders and mobilized dealers to place orders for their wives and daughters, as well as for themselves - the main point was that regardless of gender, everyone can enjoy beauty together. It is understood that the beauty instrument launched by Gree is positioned as a microcurrent beauty instrument, with the main anti-aging function, priced at 9,800 yuan. Currently, it can only be pre-ordered, and will be shipped on August 25.

Unexpectedly, the slogan "You can become beautiful in one week" caused controversy online. According to a report in the Jinan Times on August 7, this sentence triggered a discussion on "whether it violates the Advertising Law". Gree responded quickly, "This is just a personal feeling. For example, my condition has improved. I have been running for a week and my breathing has become smoother. It is not an advertisement." At the same time, the Advertising Supervision and Management Section of the Shijiazhuang Market Supervision Administration also responded to this: "From the definition point of view, it is not easy to be classified as an advertisement. Generally, live events like this are not easy to be defined as advertisements. They lack some characteristics of advertisements, such as being disseminated through specific media." The regulatory level characterized Dong Mingzhu's publicity as not violating the Advertising Law.

Dong Mingzhu's personal endorsement of the beauty device may not have brought a dividend to Gree's stock price. Since August 2, Gree's stock price has fallen by 1.5% during this period. However, Gree's stock price has performed well overall in 2024, with an overall increase of 24.6% since entering 2024. Although it has fallen from the high point of 61.79 yuan in 2021, it is difficult to conceal the strong improvement in 2024.

Who is the king of selling goods between Dong Mingzhu and Lei Jun?

From the current perspective, Dong Mingzhu's ability to bring goods is obviously far inferior to that of the top-tier Lei Jun. The number of fans of the Douyin Gree Dong Mingzhu store is 696,000, which is less than a fraction of Lei Jun's nearly 30 million fans.

After Dong Mingzhu officially launched Gree's micro-current beauty instrument on August 2, according to the data displayed by the store, the beauty instrument was pre-sold for more than 360 units in two days. Dong Mingzhu claimed that she sold 365 units. Calculated at a unit price of 9,800 yuan, the sales volume in two days was about 3.58 million yuan. As of 12:00 on August 13, the cumulative sales volume of the product was more than 1,050 units, and the sales volume in 12 days was about 10 million yuan. The average daily sales volume was less than 1 million yuan.

The microcurrent beauty device endorsed and promoted by Dong Mingzhu personally this time marks the beginning of Gree's involvement in the field of beauty technology, further reflecting Gree's diversified layout.According to an announcement from the State Intellectual Property Office in December 2023, Gree applied for and disclosed a patent called "Beauty Mask and Control Method of Beauty Mask" (publication number CN117771554A). According to the announcement, the patent is an innovative beauty mask that integrates beauty and nasal massage functions.

In recent years, my country's small beauty appliance industry has developed rapidly and the market size has continued to expand.According to the forecast of the Prospective Industry Research Institute, by 2025, the scale of China's home beauty instrument market will reach 25.1 billion to 37.4 billion yuan, showing the huge potential of the industry. The compound annual growth rate of sales of beauty and body instruments in traditional e-commerce channels from 2019 to 2022 reached 16.35%. According to the report of consulting agency Gfk Zhongyikang, in the first three quarters of 2023, the sales of China's personal care small appliances market has reached 40.3 billion yuan, among which the sales growth rate of beauty instrument products is as high as 159.3%, far exceeding other categories, showing the important position of beauty instruments in the personal care small appliances market. The home beauty instrument market not only occupies a leading position in the home appliance industry, but also its commercial value prospects are widely optimistic.

In Gree Dong Mingzhu's e-commerce store, many products of air conditioners, which are the main business, have sales of 0, but the inverter heating and cooling air conditioners priced at 2,469 yuan have sales of more than 2,000, and there are also cabinet air conditioners with sales of more than 12,000. This air conditioner is priced at 6,399 yuan. Overall, the average sales volume of products in Gree Dong Mingzhu's store is about 1,000 units.

BT Finance checked similar products and found that the unit price of micro-current beauty devices from well-known brands such as Panasonic is between 500 yuan and 2,000 yuan, and even similar products from some small brands are as low as more than 100 yuan or even dozens of yuan. Gree's micro-current beauty device is in the pre-sale stage, and its price is as high as 9,800 yuan.

A better deal than air conditioning

In the Gree Dong Mingzhu store, there are 34 models of Gree high-end air conditioners with a unit price of over 10,000 yuan, and most of the air conditioner products are priced between 2,000 yuan and 6,000 yuan. The micro-current beauty instrument that Dong Mingzhu personally endorses now sells for 9,800 yuan, which is almost as expensive as Gree's high-end air conditioners.

The product introduction of this beauty instrument reads: "It uses EMS microcurrent technology, and its main effect is to tighten and lift the skin, and promote blood circulation in the face through ion pulse introduction and mechanical vibration massage." The more detailed product details page further introduces the product, saying that daily care can "improve forehead wrinkles, nasolabial folds, and create new muscle memory", and weekly care can "deeply improve facial wrinkles, rough and dull skin." From the two introductions, it can be seen that there is no promise of "becoming beautiful in a week" as Dong Mingzhu said.

Tianyancha shows that Zhuhai Gree Medical Devices Co., Ltd. was established on April 22 this year with a registered capital of 10 million yuan. Its business scope includes medical services, medical beauty services, and the production of Class II and Class III medical devices. Through equity penetration, Gree Electric is its major shareholder, which means that the company invested in Gree Electric.

In 2023, Gree Electric Appliances' revenue and net profit margin both achieved the best results since its establishment. Dong Mingzhu began to set its sights on the medical beauty industry. Gree launched beauty instrument products, reflecting Gree Electric Appliances' determination to expand into other home appliance categories while maintaining its traditional business advantages.

Investor Shi Baogang analyzed that: "At present, the cosmetics industry is in a weak recovery market, and consumers' consumption desire has also been restrained. It is not easy to convince consumers of the efficacy of their nearly 10,000 yuan beauty instrument. At the same time, when faced with high-priced products, consumers will inevitably be more cautious in evaluating their actual effects and cost-effectiveness. Gree needs to invest more energy to build product trust. This will be a relatively long process."

Shi Baogang also believes that judging from Lei Jun's recent performance in selling products, Dong Mingzhu's sales volume is still some distance away from Lei Jun's, but Gree's evolution from a single-product air-conditioning strategy to a diversified product strategy is undoubtedly worthy of recognition.

Will Wang Ziru influence Gree’s new strategy?

Just as Gree launched new products, a legal document on August 9th pushed Wang Ziru and Gree to the top of the hot searches.

According to the report "Wang Ziru has been restricted from high consumption, and was previously forced to pay 33.83 million yuan" by Jiemian News on August 12, the legal document was issued by the Nanshan District People's Court of Shenzhen. The legal document stated that Wang Ziru was restricted from high consumption because he failed to perform the payment obligations determined by the effective legal document within the period specified in the execution notice. Wang Ziru officially became a dishonest person.

According to Jiemian News, since January this year, Wang Ziru has been forced to pay more than 33.83 million yuan for this case, and his 1.5 million shares in Shenzhen Yuechen Auto Beauty Co., Ltd. have been frozen. Tianyancha information shows that Wang Ziru is currently associated with 4 companies, 2 of which are in the deregistration status, and the other two companies, Shenzhen Yuechen Auto Beauty Co., Ltd. and Ruzi Toy Store in Huicheng District, Huizhou City, are still in existence.

Wang Ziru was previously the founder and CEO of technology media Zealer and a digital technology commentator. In July 2021, Wang Ziru joined Gree and is currently the head of Gree Electric's channel reform project, becoming a senior executive at Gree.

As the first generation of digital product reviewers, Wang Ziru once had nearly 2 million fans and has been a hot topic since joining Gree. In 2020, before Wang Ziru joined Gree, he and Dong Mingzhu completed their first show together. At that time, it was Gree's tenth anniversary. In the live broadcast cooperation between the two, the amount of goods sold reached 703 million yuan, setting a new record for home appliance live broadcast sales at that time.

After Wang Ziru joined Gree, some controversy also arose. According to the article "Where did Wang Ziru, a Gree employee, come from?" published in Beijing Business Daily on November 16, 2023, Wang Ziru and Dong Mingzhu jointly participated in a talk show on Guangdong Satellite TV. In the show, Wang Ziru said: "I have never seen the salary slip given to me by Gree. The only request I made when I joined the company was that I wanted an office closer to Dong Mingzhu so that I could report to her at any time. I felt that other things were not important." This topic quickly fermented and became a hot search, which also triggered heated discussions among netizens.

How much impact will the restriction on Wang Ziru's high consumption have on him and Gree? It remains to be seen how the situation develops. However, as a senior executive of Gree, being caught up in such negative public opinion may not be conducive to Gree's new product promotion.

Gree's launch of the beauty instrument is an important exploration in its full-category strategy. The launch of the beauty instrument indicates that while Gree maintains its leading position in the home appliance field, it is brave enough to try cross-border attempts and seek new growth points.

From a more macro perspective, Gree's move is also a microcosm of the transformation and upgrading of the home appliance industry, indicating that in the future, home appliance companies will pay more attention to technological innovation and cross-border integration to meet the increasingly diverse needs of consumers. Therefore, Gree's launch of beauty devices is not only a deepening of its own full-category strategy, but also a positive contribution to the transformation and upgrading of the entire home appliance industry.

Author|Meng Xiao