LED lighting industry must be alert to the "flock" hazard

The LED industry is like a giant magnet, attracting hundreds of billions of capital in just a few years. So far, there are more than 30 LED-related listed companies, such as Zhejiang Sunshine, BDO Runda, Tsinghua Tongfang, NVC lighting, Foshan Lighting, National Star Optoelectronics, Lehman Optoelectronics, Hongli Optoelectronics, Chau Ming Technology. , Shanghai Yaming and Sanan Optoelectronics etc. Even the just-concluded 16th Guangzhou Guangya Exhibition has become the LED world, and more than 1,400 LED companies have appeared on stage. The flourishing development of the LED industry undoubtedly brought a new vitality to this year's depressed lighting lighting market.

However, the “flock effect” of the LED industry has caused widespread concern among the industry. The so-called "herd effect" is also called herd mentality. It means that because of insufficient information, it is difficult for investors to make reasonable expectations about the future uncertainty of the market, and often it is to extract information by observing the behavior of the surrounding people. In this constant transmission of information, many people’s The information will be roughly the same and reinforce each other, resulting in herd behavior. "Herding" is a non-linear mechanism of collective irrational behavior caused by individual rational behavior. Everyone has a herd mentality. Once shepherd psychology replaces strict logical thinking, it will lead to blind obedience and thus fall into a scam or be defeated. In fact, not only the individual but also the enterprise as an organization must also be vigilant against the possible negative impact of the “herd effect” on the survival and development of the company.

In the lighting and lighting industry, the phenomenon of “flock herding” abounds. For example, after a few years ago, the industry leader, Op Lighting, “same song” in CCTV shines, many lighting lighting companies simply do not consider their own comprehensive strength and actual demand, they are eager to show their faces on CCTV. Taking the signboard of "CCTV on the list" to the flicker dealers and consumers, the actual effect of the advertisement itself is almost negligible; after the success of NVC lighting design contest in the stealth channel, many second and third lines Commercial lighting companies have also followed suit. After Sanxiong & Middot and Aurora created a lighting industry celebrity, the celebrity endorsements in the lighting and lighting industry soon became popular...

Although the "herd effect" is conducive to SMEs to reduce the risk of decision-making, it is conducive to the market cultivation of new industries and new products, ... ... but the various hazards that they may bring can not be ignored. From the point of view of industry development, the "herd effect" will lead to relatively overcapacity in the industry and the industry's profit margins will shrink. This will destroy the ecological environment of the entire industry; from the point of view of enterprise development, the "herd effect" will It will lead to the loss of corporate strategic direction, serious homogenization of products and marketing methods, and ultimately the company will have to struggle in the "Red Sea" market.

In short, whether in market positioning, competitive strategy, or product innovation or brand building, companies can only develop a development strategy that is consistent with the objective reality of the company after they have conducted adequate market research and feasibility studies. Otherwise, blindly follow suit, blindly blindly will inevitably fall into the "herd-effect" misunderstanding, leading to "self-help" in the final exchange of the "self-trapped" consequences.

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