In recent years, the new-style tea drink is in the limelight, becoming a "fragrant feast" that capital is chasing.
On June 30, 2021, Nesher's Tea (02150. HK) landed on the Hong Kong Stock Exchange for listing; on October 1, the official website of the Henan Securities Regulatory Bureau disclosed that Michelle Ice City intends to make an initial public offering and list on the A-share market; in addition, Heytea has also repeatedly reported news that the listing is imminent.
Behind the liveliness of new tea drinking, the traditional brewed milk tea is a bit lonely. XiangPiaopiao, which once relied on the advertisement of "selling X cups in a year, and the cups can be connected to X circles around the earth", is undoubtedly the most representative in this milk tea industry change.
On November 30, 2017, Xiang Piaopiao (603711. SH) successfully went public on the Shanghai Stock Exchange and was known as the "first share of milk tea". On the day of listing, Xiangpiaopiao's stock price rose 44% and was temporarily suspended by the exchange, closing at 20.42 yuan / share.
On October 29, 2021, Xiangpiaopiao announced the third quarter of 2021 financial report, the first three quarters of the increase in revenue but no increase in profit, revenue of 1.974 billion yuan, an increase of 4.29% year-on-year; net profit of 39.3955 million yuan, down 11.45% year-on-year.
From the perspective of secondary market performance, as of November 3, 2021, Xiangpiaopiao's closing price was 16.4 yuan per share, with a total market value of 6.83 billion yuan, a shrinkage of about 9 billion yuan from the highest point two years ago.
The advertising memories of the former milk tea giant, the post-80s and post-90s, have been in full decline from today's financial reports and stock prices. After more than ten years of operation, what has Xiangpiao experienced? What has changed? Red Star Capital Bureau will review the story behind the "first share of milk tea" based on the public information and the financial reports of listed companies.
(i)
The brand's high-frequency exposure is a double-edged sword
For most consumers, even if they have not drunk Xiangpiaopiao milk tea, they must have seen its advertisements.
Jiang Jianqi, founder of Xiangpiaopiao, once said bluntly about the advertisement: "The high-frequency exposure of the brand is necessary." Over the years, Xiangpiaopiao has indeed "risen" due to advertising, but it has also gradually "trapped" in advertising.
(1) The excitement of advertising
In August 2005, Jiang Jianqi officially founded Xiangpiaopiao Food Co., Ltd., taking the lead in creating a cup of milk tea in China.
In 2006, Xiangpiaopiao, which had just been established for one year, took the lead in becoming a "crab eater" in the brewed milk tea industry through advertising. In that year, Xiangpiaopiao spent 30 million yuan in advertising fees to smash into Hunan Satellite TV, with Hunan Satellite TV's popular talent show that year, Xiangpiaopiao also quickly became popular, winning more than 500 million yuan in sales that year, becoming a miracle in the FMCG industry at that time.
The popularity of xiang fluttering has made keen capital smell business opportunities. In the second half of 2006, Yonobu's Yoshima, Lipton's Lipton Milk Tea, and Dahao's Xiangyue Milk Tea successively entered the cup milk tea market, and the "Milk Tea War" was ignited.
Among them, the most fierce fighting is the two milk teas of Xiangpiaopiao and Yolomei. But at that time, Xizhilang's Yosemite, whether it was channel capabilities or the scale of the company, was far superior to Xiangpiaopiao. In 2009, Yollermoy invited the superstar Jay Chou to endorse, which brought a huge impact to Xiangpiaopiao, making Xiangpiaopiao almost lose its leading position in the industry.
Yoramite advertising
At that time, Xiangpiaopiao also began to quickly change advertising tactics, conveying to consumers that Xiangpiaopiao was the pioneer and leader of cup milk tea, and from this dimension occupied the industry's first-mover advantage.
In 2009, the advertising slogan of "selling more than 300 million cups a year, the cups can be connected to circle the earth" came into being, and consumers began to subtly contribute to the "around the earth" cause. Over time, Xiangpiaopiao's advertising slogan is also constantly changing, 700 million, 1 billion, 1.2 billion cups, 2 laps, 3 laps, 4 laps, it seems to be creating new sales records every year.
The final result of the cup-in-cup milk tea war gradually ended with the increasing sales of Xiangpiaopiao, and Yorame was in a slump.
It can be said that Xiangpiaopiao quickly entered the field of vision of consumers through advertising, and also defended its market position through advertising strategies.
(2) Advertising worries
But soon, the effect of Xiangpiaopiao's billboard seemed to be less significant, and then even became a burden that Xiangpiaopiao could not shake off.
Xiangpiaopiao was listed in 2017, and in the prospectus, the tone of Xiangpiaopiao's heavy advertising and light research and development has been more obvious.
From 2014 to 2016, Xiangpiaopiao achieved operating income of 2.093 billion yuan, 1.952 billion yuan and 2.39 billion yuan, and net profit of 185 million yuan, 204 million yuan and 266 million yuan, respectively. In the past three years, Xiangpiaopiao's advertising expenses were 333 million yuan, 253 million yuan and 359 million yuan respectively, with a total amount of about 945 million yuan.
Compared with the large amount of advertising expenses, Xiangpiaopiao is particularly economical in product research and development.
According to public information, from 2012 to 2016, Xiangpiaopiao's research and development expenses were 1.64 million yuan, 3.88 million yuan, 14.77 million yuan, 5.59 million yuan and 6.39 million yuan, accounting for 0.09%, 0.18%, 0.71%, 0.29% and 0.27% of the operating income of the year, respectively, and did not exceed 1%.
As founder Jiang Jianqi said, Xiangpiaopiao did gain high-frequency exposure by smashing advertisements. According to the prospectus, Xiangpiaopiao's market share in 2014 was 57%, and its market share in 2016 was maintained at 59.5%, and Xiangpiaopiao spent nearly 1 billion yuan in advertising expenses in these 3 years. However, too little investment in research and development made the speed of product update iteration not fast enough, and Xiangpiaopiao, who had already secured the hegemony of brewed milk tea, did not realize this at the time.
(ii)
The market has changed, and the fragrance has not changed
Revisiting the milk tea industry, the greater challenge facing Xiangpiaopiao is no longer the traditional brewed milk tea industry, but the new tea drinking that is now all over the streets.
The reason is obvious, with the upgrading of the concept of mass consumption, industrialized milk tea products have gradually lost their attractiveness. According to public information, from 2017 to 2018, the growth rate of China's brewed milk tea market fell to 2.4% and 5% respectively; in 2018, the scale of China's brewed milk tea market was only 4.9 billion yuan.
At the same time, new tea drinks have risen rapidly in recent years, especially with the rapid spread of takeaway business, many consumers are naturally willing to choose new teas with more categories and more convenient operations.
CBNData data shows that the number of new tea stores nationwide was about 250,000 in 2017, and by 2018, this number has increased to 450,000.
The market size of new tea drinks will continue to expand in the future. According to the data of Northeast Securities Research Report, it is expected that the size of the new tea market will exceed 170 billion yuan by 2024, with a CAGR (compound annual growth rate) of 29.4% from 2015 to 2019 and a CAGR of 23.5% from 2019 to 2024. The competition between new tea drinks is also particularly fierce, high-end, mid-end, low-end have many enterprises to carry out card slots, representative brands are Xi Tea, Nai Xue's Tea, Coco, a little bit, Shu yi burned fairy grass, Honey Snow Ice City and so on.
In this battle, xiangpia's punching products have touched the ceiling under the impact of new tea drinks, and have also fallen into a period of consumer fatigue, and it is obviously difficult to retain the user's heart by advertising alone.
(iii)
"Two-wheel drive", can not save the incense fluttering
Xiang Piaopiao may also be aware of her own existential crisis. After 2017, Xiangpiaopiao began to accelerate the road of change, wanting to open a diversified revenue structure and bring a second growth curve to the company.
In 2017, Xiangpiaopiao launched the ready-to-drink milk tea brand Lanfangyuan for the first time; in 2018, the company once again launched the "MECO" juice tea, etc., in order to create a new category of "cup juice tea".
In addition, the company even extended its tentacles to the light food track to plan new changes. In 2019, Xiangpiaopiao launched the "Joyko" meal replacement cereal; in 2020, the company launched the "One Meal Light" meal replacement shake product again.
From ready-to-drink milk tea to juice tea to light food track, in this short period of less than 5 years, Xiangpiaopiao's innovation speed is far more than that of more than ten years, which shows the anxiety and urgency of Xiangpiaopiao's urgent breakthrough now.
However, from the latest financial report data, in the first three quarters of this year, Xiangpiaopiao's brewing product revenue was 1.412 billion yuan, an increase of 9.05% year-on-year, accounting for 71.53% of the total revenue; the instant beverage revenue was 531 million yuan, a year-on-year decrease of 7.56%, accounting for 26.9% of the total revenue. The "two-wheel drive" effect of Xiangpiaopiao is not obvious.
Source: Company earnings
Judging from the annual reports after the listing, the revenue growth rate of Xiangpiaopiao in 2018 has begun to slow down, and the growth rate of net profit in 2019 has begun to decline sharply. In 2020, Xiangpiaopiao's performance has fallen off a cliff, especially in the first half of 2020, Xiangpiaopiao only achieved operating income of 991 million yuan, compared with 1.377 billion yuan in the same period of the previous year, a decrease of nearly 400 million yuan, down 28% year-on-year; net profit attributable to shareholders of the parent company also showed a loss, from 0.24 billion yuan in the first half of 2019 to -0.64 billion yuan, a year-on-year decline of 371.5%.
Judging from the recent new trends of Xiangpiaopiao, in September this year, Xiangpiaopiao's new products of Zhen Milk Tea and Milk Milk Tea were launched. Zhen Milk Tea takes "preferential natural pasture imported milk powder and pure flavor condensed milk" as the selling point, and The milk tea of the Cow Milk Is "to achieve real 0 vegetable fat powder and 0 trans fatty acids" as the selling point. Obviously, Xiangpiaopiao has set its sights on the "health" and "fat loss" cards that have been loved and sought after by young people and capital in recent years.
Fragrant Piao Piao Zhen Milk Tea, Milk Tea
In addition, Xiangpiaopiao recently opened a test in the market of healthy nutritional supplements and functional foods and beverages. On the eve of the release of the third quarterly report this year, Xiangpiaopiao issued an announcement that it had jointly invested in the establishment of two joint venture companies with Jindawei and Ningbo Xuanying Yunhao to carry out the research and development, production and sales of LEAN BODY products in the Chinese market, and jointly develop the market for health and nutritional supplements and related functional foods and functional drinks in China
However, these tracks are also full of powerful competitors, and a number of new and old brands such as Nongfu Spring and Yuanqi Forest have focused on health drinks in recent years.
Although we continue to try to innovate, the road to "change" is still difficult and dangerous. Perhaps the fundamental reason is that Xiangpiaopiao's own brand aging problem has not been fundamentally solved.
(iv)
brief summary
For Xiangpiaopiao, the embarrassing situation today is that the original business has peaked, and the feedback from the new business market is less than expected. For enterprises, there is no revenue baton, and there is no room for imagination.
Nowadays, the new tea drink is menacing, and it is difficult for Xiangpiaopiao to win back a round, and then fight the soft drink market, the market has been dominated by giants. The market is not that xiangpiaopiao has not been given time, but perhaps the speed of change is too fast, and xiangpia is not well undertaken.
Red Star News reporter Yu Yao Liu Mi
Responsible editor Ren Zhijiang Editor Yu Dongmei
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