Wen | the weekly "Finance world" weekly weekend
Editor| Yang Jie
Recently, herbal tea brand Wang Laoji launched the "Hundred Family Name Totem Jar", which was on Weibo's hot search. Some netizens joked: "Wang Laoji wants to 'rain and dew evenly dip', no longer spoil Lao Wang alone!" ”
However, Wang Laoji's marketing effect seems to be still good, and after the launch of the Hundred Family Name Can, it quickly landed on the first place in the hot list of plant beverages on the Tmall platform. As of January 4, some canned products with the surname, such as Zeng Laoji and Peng Laoji, have been sold out. Wang Laoji has also been jokingly called "product operation ghost talent" by many netizens.
However, looking at the development process of Wang Laoji in recent years, and Jiaduobao's brand lawsuit, both sides have fallen into a "super long tug-of-war", during which Wang Laoji has almost no new products launched; at the same time, new tea brands have risen. In the end, the lawsuit was over, the two major brands consumed a lot of energy in it, and looking back, the herbal tea market gradually "became cooler" and the market growth slowed down.
Wang Laoji, who wants to regain his might, has to "take pains" in product marketing.
All kinds of milk tea, lemon tea, sparkling water drinks have risen, and now, Wang Laoji, who is more "traditional" in packaging and taste, is no longer the favorite of young people. In order to narrow the distance with the Z generation, Wang Laoji has also launched creative customized products such as blind box cans and jiyun cans before, and has also jointly launched custom cans with the game "Fantasy Journey to the West" mobile game and the fifth personality.
At the same time, Wang Laoji has also diversified, launching sugar-free herbal teas, as well as products such as lemon ji series, raw coconut juice, walnut dew and so on. However, Wang Laoji, who has achieved revenue growth in 2021, can he still "burn" the herbal tea market?
"Hundred family names" came, and Wang Laoji was no longer "Wang Laoji"
Wang Laoji herbal tea is known as the "originator of herbal tea", which has a history of nearly 200 years, and its parent company is Guangzhou Baiyunshan Pharmaceutical Group Co., Ltd. (hereinafter referred to as "Baiyunshan").
"Finance and Economics" Weekly noted that according to the information of Tianyancha, since February 2021, Baiyun Mountain has begun to register more than 100 "Laoji" hundred family name series trademarks, including Li Laoji, Zheng Laoji, Gao Laoji, etc., all classified into "32 categories - beer and beverage series". By October 2021, most of the trademarks with the surname "Laoji" have been approved.
Now it seems that Wang Laoji is deliberately rushing to launch a series of 100 surnames before the Arrival of the Spring Festival in 2022. In the product promotion, Wang Laoji's surname can also played a promotional slogan of "Sending auspicious gifts for the New Year, reunion and drinking auspicious drinks".
Therefore, as soon as the version of Wang Laoji's family name was launched, it was highly popular on the Internet. Some netizens said that in the future, Wang Laoji will be "not unique to the Wang family". On the Tmall list of plant beverage hot sales list, Wang Laoji's surname customized cans ranked first, and the comprehensive hot sales index reached 9.9.
(Source: Taobao screenshot)
However, at the same time, some netizens expressed doubts that Wang Laoji's move was "harvesting IQ tax". Some netizens said that the price of Wang Laojibaijia's surname cans was too expensive, and the price of 12 cans actually reached 99 yuan.
"Finance and Economics" Weekly noted that compared with the ordinary Wang Laoji products launched by Wang Laoji, there is no difference except for the packaging. The Flagship Store of Wang Laoji shows that the price of 12 cans of ordinary Wang Laoji products with a specification of 310ml is 34.9 yuan, which is nearly 3 times the price difference with the price of hundreds of cans with the same specifications.
After the lawsuit, the herbal tea is "cold"
Speaking of Wang Laoji, I have to mention another herbal tea brand, Jdolbao. The feud between the enterprises behind these two brands has been lingering for many years.
The market for herbal tea is mainly in the Liangguang area. Wang Laoji herbal tea originated in Guangzhou, more than 200 years ago, in the process of development, Wang Laoji heirs "separated", one went to Hong Kong, one stayed in Guangzhou. In the 1990s, JDB's parent company, Hung Dao Group, obtained the authorization of herbal tea recipes from the descendants of Hong Kong's Wang Lao Ji Herbal Tea. But at that time, the Wang Laoji brand was operated by Guangzhou Pharmaceutical Group, the controlling shareholder of Baiyun Mountain.
As a result, Hongdao Group signed a contract with Guangzhou Pharmaceutical Group to obtain the right to use the Wang Laoji trademark, and authorized its subsidiary JDB Group to sell red cans of Wang Laoji herbal tea in China.
The popular phrase "drink Wang Laoji if you are afraid of fire" is the advertising slogan tailored by Hongdao Group for Wang Laoji.
In the following years, Hongdao Group did not hesitate to invest heavily in marketing to promote the Wang Laoji brand. According to media reports, Hongdao Group invested more than 40 million yuan in advertising expenses in just a few months. In 2004, it also spent a huge amount of money to buy CCTV's prime advertising time.
Under the overwhelming advertising campaign, Wang Laoji's "under the fire" function has been deeply rooted in the hearts of the people, from an obscure local brand to a national well-known; Wang Laoji has also quickly become the leader of the herbal tea industry. According to reports, in 2008, Wang Laoji's market coverage rate was as high as 90%, and its revenue exceeded 10 billion yuan; by 2011, its sales doubled to more than 20 billion yuan.
The herbal tea market has also "caught fire", attracting more brand merchants to enter the market. Traditional herbal tea manufacturers in Guangdong, including Pan Gaoshou and Deng Lao herbal tea, have successively entered the market. In 2006, Darley Group launched the herbal tea brand "Heqizheng".
According to the statistics of the Prospective Industry Research Institute, in the years when Jiaduobao operated the "Wang Laoji" trademark, the annual growth rate of the domestic herbal tea market was as high as 16.7%.
In 2010, the lease of the "Wang Laoji" trademark expired. In 2012, Hongdao Group also launched the "Jiaduobao" brand with the same packaging as Wang Laoji and the formula of Wang Laoji.
The "litigation run" between the two sides has also begun. It was not until 2019 that the court ordered JDB to compensate Guangzhou Pharmaceutical Group and Wang Laoji Company for a total of 1 million yuan, and demanded that JDB immediately stop publishing advertisements containing advertising slogans such as "7 cans of Jiaduobao for every 10 cans of herbal tea sold in China", and the protracted lawsuit finally ended.
(Source: Visual China)
The two leaders of the herbal tea industry are not only in court, but also invest a lot of marketing expenses in the market, and fight a price war, constantly compressing the profit margins of the entire herbal tea industry.
The result of this is that both sides are exhausted. Wang Laoji's peak period is no longer there, and sales in 2017 have dropped to 8.574 billion yuan. Jiaduobao experienced 22 defeats during this period, as well as the departure of the company's executives and large-scale layoffs, etc., which were seriously injured.
However, in the past few years, the domestic beverage market has undergone earth-shaking changes. New drinks such as Yuanqi Forest and Xicha have risen one after another, and the domestic herbal tea market has gradually "cooled" down.
According to the report of the Prospective Industry Research Institute, the growth rate of the herbal tea market in 2012-2017 was 16.7%, 15.9%, 15.1%, 15.7% and 9.1%, showing a downward trend year by year; in addition, the consumption of herbal tea in the family scene in 2019 fell by 9% year-on-year.
How does Wang Laoji "go to the fire"?
The golden age of herbal tea has passed, and Wang Laoji began to seek new breakthroughs.
With the development of the times, the "Z generation" consumer group has become the main consumer force now. Compared with herbal teas with sweet and single taste and some aging packaging, they prefer new teas with diverse tastes, innovative categories and novel packaging and personality.
According to the "2020 New Tea White Paper" data, the scale of new tea consumers in 2020 exceeded 340 million, and the volume of consumers continued to grow.
Wang Laoji is also aware of this problem, playing more tricks in marketing, ready to keep up with the "footsteps of young people".
Before the launch of the Hundred Family Name Can, in order to attract young consumer groups, Wang Laoji also cooperated with the "Fantasy Journey to the West" mobile game, as well as "The Fifth Personality" and "Peace Elite" and other games to launch the popular character customization cans that players like. In collaboration with Peace Elite, Wang Laoji also released a limited edition game custom bottle and can under the slogan of "Great Luck, Tonight Wang Laoji".
In terms of marketing and publicity, in order to broaden social communication channels and strengthen interaction with young people, Wang Laoji has also cooperated with two-dimensional videos and social platforms where young people gather, such as B station, Lofter, and quick-look comics. Taking Station B as an example, in 2017, Wang Laoji launched "Ji Ji Cao in the Year of the Rooster" on Station B as a marketing attempt, and in 2019, he jointly opened the "Anthropomorphic Image Collection" with the major up owners of Station B to design a new image for Wang Laoji's red pot herbal tea.
However, even though Wang Laoji has made a lot of effort to strengthen his interaction with young people, the effect is more general. Wang Laoji is more in the product packaging to narrow the distance with young people, but there is not much change in the taste of the product. "Finance and Economics" Weekly found that in Taobao, wang Laoji dream westward mobile game canned beverage monthly sales of only 12 pieces, the fifth personality joint can sales of 64 pieces per month.
In 2018 and 2019, Wang Laoji's revenue growth rate did not change much, and the operating income of its Baiyun Mountain Health Sector was 9.487 billion yuan and 10.479 billion yuan, respectively, an increase of 10.66% and 10.45% year-on-year; by 2020, its revenue fell by 2.6 billion yuan to 7.859 billion yuan.
Wang Laoji is not limited to herbal tea products and began to expand more categories.
When the "0 sugar sparkling water" of Yuanqi Forest came out of the circle, Wang Laoji also launched a new sugar-free herbal tea product, focusing on "0 sugar, 0 fat, 0 calories", in terms of appearance, it also broke through the traditional red can design in the past and chose a simple and fresh style. In Wang Laoji's official flagship store, the sales of such products have also reached a monthly sales of more than 600 pieces.
When young people pay more and more attention to health and wellness concepts, and plant drinks are becoming more and more popular, Wang Laoji has also launched products such as lemon ji series, raw squeezed coconut water, walnut dew and so on.
In 2017, Wang Laoji also got involved in the offline tea market, launching the "1828 Wang Laoji Brewed Herbal Tea" offline tea brand, focusing on health tea, and said at that time that he would open 3,000 offline concept stores within 4 years. But a few years later, according to the content released by its official WeChat in June 2021, the number of Wang Laoji stores in 1828 is only more than 80.
In August 2021, 1828 Wang Laoji was "besieged" by some franchisees. Franchisees complained that Wang Laojifang falsely publicized, refused to fulfill its commitments to franchisees product development and brand promotion support, and the store was a long-term loss, which was far from the "70% profit margin" officially advertised by Wang Laoji.
In addition, Wang Laoji also entered the hot pot catering track. In October 2020, the hot pot barbecue ingredient brand "1828 Wang Lao Ji Xiao Ji Pot Pie" was launched. It is understood that this is a brand jointly initiated by Wang Laoji Catering Company and Xiaoji Pot Pie Food Co., Ltd., which is a platform for consumers to provide consumers with one-stop hot pot barbecue ingredient procurement.
Although wang laoji has entered the game on every track is already a "red sea" of competition, and there are already head brands, Wang Laoji's diversification strategy is still rewarding.
In the first half of 2021, Wanglaojida Health Company, a wholly-owned subsidiary of Baiyun Mountain, achieved revenue of 6.006 billion yuan and operating profit of 2.854 billion yuan; net profit of 1.17 billion yuan, accounting for 44% of the total proportion of Baiyun Mountain. Baiyun Mountain's big health sector with Wang Laoji as the core achieved revenue of 6.604 billion yuan, an increase of 46.71% year-on-year.
However, although Wang Laoji's performance has improved, the entire herbal tea market is still not "hot".
According to data from Ou Rui and Zhongtai Securities Research Institute, at present, brands such as Master Kong and Unity have occupied half of the tea beverage market, while Wang Laoji and Jiaduobao, the two leaders of the herbal tea market, together account for only 25.6% of the tea market share.
At the same time, herbal tea beverages are somewhat "outdated" in the face of emerging tea beverages, such as fresh milk tea and sparkling water, fruity water and other beverages. According to the "2021 Generation Z Food and Beverage Consumption Insight Report", among the types of beverages that Gen Z surveyed have drunk in the last three times, herbal tea accounts for only 10%, ranking behind carbonated drinks, freshly made milk tea tea drinks, sparkling water \ fruity water \ soda water and fruit juice.
Another herbal tea brand and its positive development are also poor. In The 2020 financial report of Dali Foods, it did not disclose its positive revenue, but the revenue of the ready-to-drink beverage segment, including hezheng, fell by 13.5% to 7.142 billion yuan; in the first half of 2021, its positive sales revenue was only 1.045 billion yuan, a slight increase of 1.2% year-on-year, accounting for only 9.26% of The total revenue of Dali Foods.
In the domestic beverage market, there are still changes. The specialty coffee track stands on the wind outlet, the Yuanqi Forest is developing rapidly, the main functional beverage Dongpeng beverage and the new tea brand Naixue's tea have landed on the capital market, including Bingfeng, Xicha and so on also reported the news of preparing to go public. Wang Laoji and Jiaduobao want to regain the position of leading position in the beverage industry, which is not an easy task.
This article is originally produced by AI Finance and Economics, an account of Caijing Tianxia Weekly, without permission, please do not reprint it on any channel or platform. Violators will be prosecuted.