The author | Li Xiaowei
Editor| Wu Shuyi
The public is already too familiar with the context of consumption upgrading.
From new-style tea drinks to aesthetic home furnishing, from independent tide brands to Internet celebrity exhibitions, the era of consumption upgrade 1.0 directly brings product and model innovation.
Take the drink market to disassemble. Product innovation is that sugar-free sparkling water, light milk tea, milk lid tea, and fruit tea begin to enter the mandatory menu of consumers. The model update refers to the replacement of ready-made tea squeezed out of the brewing powder to become the standard in street stores, and the retail channels began to expand in all directions in addition to the convenience of supermarkets.
In my personal observation, the beverage market is far from saturated, and it is still in the stage of "large development space, product standards, and subdivision categories have the opportunity to give birth to brands covering the whole country", and the era of consumption upgrading 2.0 has just begun.
The main feature of this stage is that new entrants and traditional giants will carry out close hand-to-hand combat around products, channels and brands, and rapidly evolve in the direction of digitalization, trend and branding.
Combined with the China Chain Store Association, Sullivan Consulting and a number of industry reports, this article will use some of the new consumer brands in the field of tea and beauty to talk about the effective way of playing cutting-edge beverage brands in the era of consumption upgrading 2.0.
01
Can the product still make a new trick?
There are definitely opportunities for the breakthrough of single products in the market segment.
Even if the most crowded new tea market in the public perception, it feels that xi tea and Nai xue's tea together occupy most of China, in fact, it has run out of many other categories.
Half-sen Doufu and Pu Tea revolve around soy milk tea, Fushimi Momoyama focuses on fruit pulp and fruit puree innovation, and even the lemon product has landed in a lemon specialty store in Shanghai.
In the beverage market, sugar-free tea and sparkling water that began last year have become an absolute trend, and 0 sugar, 0 fat and 0 calories have been popularized from a fresh concept to the main theme of the public. Players are crowded in, this time to do product innovation, how to play the new brand?
From the point of view of the raw material composition, cutting with sugar is no longer the optimal solution. After Yuanqi Forest brought erythritol to the fire, the upstream sugar supplier Jinhe Industry and so on have increased their investment, this sweetener is much more expensive than aspartame and the like, and it is basically difficult to reduce the cost and large price.
Adding some fruity elements is also a path of choice. However, the taste of drinks on the market is mainly based on fruits and plants, lemon, orange, mango, etc. are also more popular, how to make different tastes, is also a problem.
Take a look at how new brands such as Hankou No.2 Factory and Bestinme are doing.
The more brilliant place of Hankou Second Factory is to do taste innovation, take their more famous salted pineapple, the taste is sweet and salty. This is much the same as the way the two Generations of families eat bale, splitting and sprinkling a little plum powder in the middle, all of which use salty, sour and other flavors to highlight the sweetness of the fruit.
Bestinme is characterized by the innovation of taste + ingredients. Take, for example, the Cherry Blossom Green Apple Flavored Sparkling Water in its light steam series, which is supplemented with acerola cherry powder and apple powder. Apple powder is usually used in the production of apple juice, and is rarely used directly in beverage beverages, and this type of fruit and vegetable powder also has health benefits. The apple powder extracted from the product can play a functional role in antioxidants.
This kind of borrowing raw materials from other industries and migrating to their own innovative products is currently relatively rare in beverages.
There is a white strawberry lactic acid bacteria sparkling water that also adopts this "high recognition and scarcity" approach. Strawberry-flavored drinks and foods are common on the market, but they are rarer from pale snow-white strawberries. On the one hand, the price of this ingredient itself is also expensive, and the general manufacturer is reluctant to use it, on the other hand, the extraction rate is not high after layer by layer process. In terms of taste, white strawberries and lactic acid bacteria are combined, and prebiotics can also promote the health of the intestinal flora, which has been improved in terms of function and taste.
In fact, sports and fitness, skin care and makeup and diet health, these new consumption areas are born from the basic needs of eating, drinking, living and traveling, so the consumer's cognitive basis, the acceptance of new concepts and new products is relatively high, and consumers in first- and second-tier cities are more common. If there is a taste innovation, it is still necessary to find the entry point of differentiation.
Of course, when conveying these concepts, we must also consider that it is easy to understand, take a bottle of light milk tea, the brand tells consumers how many calories, in fact, everyone has no actual concept, but if you print on the outer packaging, I have less fat than a red-skinned egg, then others can get it immediately.
From this point of view, the communication method of innovative thinking + grounded gas is quite important.
02
Channel revolution, first up and then down or first down and then up
At the beginning of the year, when Ne xue IPO, the industry took out the earliest new tea brands such as Heytea, and cutting-edge brands such as Yuanqi Forest and Bestinme, as well as traditional beverage giants.
A common problem is that although we see that these somewhat famous brands are doing very well, brands with lower unit prices such as Michelle Ice City are still living well, and they have not lost their vitality because of the strong rise of new brands.
There is always a lot of demand in lower-tier cities, which is also mentioned in Nesher's prospectus. Whether it is Xicha or Naixue, their sinking channel penetration is not as good as Starbucks in the public perception of the benchmark business group.
According to the Sullivan Consulting report, as of December 2020, the number of Starbucks stores in China has exceeded 4,700, covering more than 180 cities, with an average of 26 stores in the city, and even if it seems that The total number of stores has not exceeded 700.
Therefore, there are brands that do offline retail space, and now the channel problem considered is to go to first- and second-tier cities, more core locations, more intensively rolled out, or in third- and fourth-tier cities to begin to penetrate.
The question of whether to go up or down is the same for the bottled beverage market.
In a previous analysis of the sugar-free sparkling water track, we have already mentioned that channels are particularly important for fast moving consumer goods such as food and beverages. The newly richest man, Nongfu Spring, is a typical example, with more than 11,000 sales staff, accounting for 59.7% of the total number of employees, covering 247 direct customers and 4454 dealers.
Due to the refinement of channels and regional differences, the early domestic soda brands can take geographical location as the boundary and form a geographical monopoly market with obvious segmentation, which is also the reason why foreign giants PepsiCo and Coca-Cola wanted to acquire local brands on a large scale when they first entered China.
In this way, they no longer have to spend a lot of effort to establish relationships with local distributors from scratch, such joint ventures or acquisitions, and what they win is the point, channel and production line.
The traditional supermarket convenience channels have flowed down layer by layer, and the brand side's money is actually very limited. Entrance fees, logistics warehousing fees, ice fees, listing fees, and seasonal marketing fees, the number of points for large supermarkets may be less, 10%-20%, but the convenience store commission can sometimes even reach 30%.
The reason why convenience stores have high prices is closely related to the penetration of the grid. Especially in the core location of first-tier cities, the self-made bartending fever of young people on the Little Red Book has begun, and how can brands not seize the freezer.
If we look at these cutting-edge brands, we will find that the way their channels are rolled out is worth studying.
Yuanqi Forest is headquartered in Beijing, and around 2018, they first entered the Beijing hypermarket, which is a KA channel, but because the price is more expensive than similar products, the sales volume is not good. Then they reacted that this "Japanese" packaging should start from an audience that can accept high unit prices, and convenience stores in East China have become the preferred choice.
It is not too difficult for drinks with a unit price of 5-6 yuan to do market access, if it is 8-9 yuan per unit? From the beginning, the inspirational soda of Hankou No. 2 Factory bypassed the traditional supermarkets and chose Hema Fresh, Ole's boutiques, and convenience store channels with higher unit prices. In addition, young people can see it in some bar menus in Xintiandi and Tianzifang, Shanghai.
The idea of both of these is to run to young people and high-consumer customers, but after more Internet celebrity brands run out, how can new brands play on the channel when they enter the game.
Bestinme is an example of having to grab both hands. On the one hand, in order to reach students, white-collar workers, and high-end people, they are focusing on the first and second lines for coverage, while targeting 234-tier cities for radiation, and prefecture-level cities have also covered 71.
The way of playing without aiming all the firepower at the north, Shanghai and Guangzhou is a bit like the feeling of two wings enveloping in the art of war. When I was traveling in Beijing on business, I also saw them doing activities with fresh food at the 711 convenience store in Jiuxianqiao, which is a place where stars are haunted, and naturally grasps high-end, young customers.
However, when they first stepped up their efforts, they also stepped up the infiltration of the northwest and southwest, south China, and the middle of the unconventional new product blasting area.
A consumer analyst who has lived in Xi'an for many years told me that the southwest and northwest areas rely on single-point cities to pull, Chengdu, Xi'an of course, needless to say, but consumers in Kunming, Guizhou and other cities, the scope of activity is mostly in the province, a core city can radiate the entire province, so these are the key points of the sinking area.
Like Hunan, a consumer culture distribution center that is keen on night markets and travel, the entry of Changsha, Xiangtan, Changde and Zhuzhou is the best way to accelerate brand recognition and penetration.
Because the consumer groups in these cities are not only touched by local residents, but also by young travelers from first- and second-tier cities. If consumers drink good drinks in the local area, it is easy to form a talking point, and form a word-of-mouth effect and a large number of spreads on social media.
In hubei, a key province in central China, not only Wuhan, but also Enshi has also been included in the scope of bestinme.
Don't underestimate these locations, and don't underestimate these channels. Wuhan along the Yangtze River gave birth to China's first high-end snack shop, and Changsha is also the base camp for the second round of new tea drinking seed players.
For example, the Nongfu Spring i mentioned earlier has 2.43 million outlets across the country, of which 1.88 million are in third-, fourth- and fifth-tier cities. New brands like Betinme, the first year or two after entering the market, is also to do this thing of channels. In only half a year, the coverage of 23 provinces and cities, 4 municipalities directly under the central government and 71 prefecture-level cities has been completed, and the number of terminal outlets is estimated to be more than 150,000. This is also relatively rare in the FMCG industry.
Back to what I said earlier, don't look at the new brand marketing led by Yuanqi Forest, which is very bullish, ignore the essence of this industry, and the future industry competition absolutely depends on the speed of their channel rollout, the degree of penetration and the fine management level of the channel.
03
Mass marketing or circle marketing?
Specifically, to go deep into the terminal scene of the sale of these cutting-edge brand products, in fact, it will reach a deeper level.
I've felt that some brands are looking for special channels to sell with consumers, such as gyms, movie theaters and schools full of young people, which is a very clever way.
That's because the biggest disruption in the scene revolution is to create and meet the needs of consumers before they realize it.
That is, in a specific scenario, a consumer demand that has never appeared before begins to be activated. Once consumers accept this demand and form a trend, the next stage is the influx of players, the rapid iteration of the product, and the activation of the industry.
Walking through the streets of Beijing and Shanghai, where are the young people? School, mall, bar or music festival? Where are their most frequent consumption places and scenarios?
Let's take a look at music festivals and comic exhibitions, which are high-density gathering places.
Last year, the Beizhan Theater outside Xizhimen in Beijing hosted the Beijing International Pop Music Week. At that time, The Band Click #15, the Lu Xiansen Band, the singer Wang Shengjiao and Hua Congee all went. Beijing in November is already quite cold, but young people wrapped in down jackets in the cold wind still shake their heads and dance to the rhythm of Funk.
Tianjin's guitarist Xiao Bao tasted a bottle of light vapor sparkling water on the theater's Boost, "the feeling of carbon dioxide exploding on the tip of the tongue, with the music, very strong."
Counting the strawberry, midi, Zhangbei music festivals, the audience age group is almost within 15-34 years old, no matter how big the hi does not move, no matter how small a person can not come out. My throat was hoarse, I always felt "not cool enough" when I drank white water, and I still felt that I was on top of the trend when I took a sip of sugar-free soda. In the words of Xiao Bao, you can drink soda and shout at the music festival, all of which are soul atmosphere groups.
Folk circle, funk circle everyone drink another circle, the new product will naturally become popular. For the marketing of niche circles, as long as they can combine the content characteristics they are interested in, the effect is still quite immediate.
Because the "explicit label" icon of drinks and clothing is easy to make people in a circle quickly accept you, what to drink and what to use is to represent your attitude and aesthetics. Of course, this is also the process of establishing and communicating the brand image within the circle, and the sense of trend and brand has it.
That's why I think light steam is quite suitable for music weeks or music festivals, and it's this popular music category. If you are a symphony orchestra of classical music, you may have to drink some champagne and wine. Bestinme's approach, the product temperament and audience preferences are enough to match, and the strategy is consistent with the method of only putting vibrato, little red book and games in the early days of Yuanqi Forest. So after Xiao Bao said that after returning to Tianjin, he began to buy boxes on Taobao.
Mass marketing or circle marketing, cutting-edge new brands still have to think clearly. The strength is used on the blade to break the game.
04
The birth of the next Chinese", "Suntory"
Since the iteration of the beverage market so far, since the Yuanqi Forest has made a name for itself with explosive products, the traditional giants have found that the cutting-edge brands cannot be underestimated, and now, every player is waiting to stare at the trenches, while looking at the backyard of other people's homes.
China's beverage industry space is still very large, Japan's concentration is higher than 80%, like Suntory Suntory has become a public favorite, in the sparkling wine, pure tea, dairy products, fruity tea, coffee and other fields, can have a place.
Genki Forest has this ambition, and so do other cutting-edge brands. They started from their respective base camps, and now they have built a not-so-large but also quite rich product matrix.
Heytea made milk cover tea and fruit tea to the extreme, and then added Xixiao tea sparkling water to enrich the category; Hankou Second Factory jumped from the best soda line to the field of flavor prepared wine, followed by oat milk tea; Bestinme with healthy incisions, from vitamin water and sparkling water, to achieve light milk tea and light vapor flower series, and now has also formed a differentiated product line.
These category selections and product matrix construction have benefited from the continuous growth of China's beverage market. According to the Frost & Sullivan report, the size of China's soft drink market in 2019 was 991.4 billion yuan, and it is expected to reach 1,323 billion yuan by 2021, breaking through the trillion mark.
Divided by category, vitamin functional drinks, fruit juice drinks, protein drinks or carbonated, tea drinks, and bottled water, the market share of these six categories is close to 80%. Choosing the subdivision track in these six categories to break through, it is always wrong. It seems that Bettinme's product line construction has also been weighed repeatedly.
But compared with Suntory, a brand with high sales in both the Asia-Pacific and European and American markets, I often think that these cutting-edge beverage brands have a lighter, more standardized advantage than traditional Chinese food, and they may have more possibilities for global expansion.
With the development of sparkling water, milk tea and other categories in the new tea market, the future is not only the battle between new brands and local giants is quite good, they are going global with new retail thinking and trendy attitude, and the process of playing with overseas brands may also be very exciting.