Three problems that white elephants can't avoid

Image source @ Visual China

Wen | Whale Research Brand Laboratory

The story of white elephant instant noodles being consumed by wilds does not need me to repeat it.

On the internet media, I often see articles about white elephants, the pass rate is 100%, 1/3 of the employees are disabled, and Japanese capital is rejected...

But no one dug deeper, why did the white elephant that aroused the pride of the people not be paid attention to before this? Will the future sink in the "Internet without memory"?

White elephants don't lose at the corporate level

I talked about it in the circle of friends, and the white elephant did not lose from the corporate level, and did not win from the brand level.

This is a passage in the imitation of the "Attack Wave Finance" article: In the Chinese business context, there are two paths to large-scale growth, one is to become a large enterprise, the other is to become a large brand, the former corresponding to the exogenous force, through capital expansion, to achieve rapid expansion in volume; the latter corresponds to the endogenous force, is the brand that grows up, it not only needs "scale effect", but also needs sustained profitability.

As a business, white elephants did not lose. In China's nearly 100 billion instant noodle market, white elephants have gained 7% of the market share. For Master Kang, Unity, and Imabari Lang, the data of the white elephant is lamentable. But it didn't lose in a white elephant that refused foreign investment, had a 100 percent pass rate, and had 1/3 employees who were disabled.

The data given by the China Commercial Industry Research Institute is that there are 5,032 instant noodle-related enterprises in the mainland, and Baixiang is the fourth of them, and the revenue is also in the billions.

This is just like the current crowd of squeezed vegetables industry, there is only one Fuling squeezed vegetables in the country. But few people know that in Wanzhou, Chongqing, in the next district and county of Fuling, Chongqing, there is also a vegetable squeezing enterprise - Yuquan Juice. This enterprise has a market share of more than 10% in China, ranking second in the industry, in addition to his exports ranking first in the same industry in the country for 20 consecutive years, from the perspective of enterprises, Yuquan squeezed vegetables may be more moist than Fuling.

On the other hand, Baixiang has laid out 12 high-quality noodle product production bases in 10 provinces such as Henan, Hebei, Shandong, Sichuan, Jilin and Shanxi, with more than 90 instant noodle production lines and nearly 1.2 million sales terminals. It has more than 20 subsidiary companies. Products cover 30 provinces, autonomous regions and municipalities directly under the Central Government, and are exported overseas.

What does this mean? The company has already crossed the breaking point in the first curve of the life cycle, and it can be self-growing in a positive cycle. There is a very narrow view here that can support the long-term survival of white elephants at the enterprise level, that is, the upstream high-quality supply chain that will become a rare asset in the entire consumer goods sector. No matter how e-commerce platforms, social e-commerce, content e-commerce, etc. develop, high-quality supply chains must always be one of the core competitiveness of the bottom.

For example, one day, Tmall, Pinduoduo, Wal-Mart, MUJI and other channel brands launched their own instant noodle brands, and its brand and culture may not be so important. Everything is endorsed by channel influence and is more acceptable to consumers. So, what should the white elephants win? Raise your own supply chain, let this channel of instant noodles, is produced in its own production base, even wheat is grown in its own field.

This is the foundation of the industry, it can make your business continue to make steady money, just like the founder of White Elephant Yao Zhongliang said, low profits are fine, insist on doing the right thing. If I had to come up with a case, it would be that most people thought that Jianlibao had been dead for many years, and suddenly one day his name lay on the list of foundries in the Yuanqi Forest. Of course, these things are put in the brand marketing circle, it is bullshit.

The loss to the foreign camp is still brand positioning

The boss of the national tide sports brand Li Ning said, "In my past experience, it is not very difficult to be a company that can make money, but it is really difficult to make a brand." ”

White Elephant has not won at the brand level. Many people attributed the fall of the white elephant brand and used horizontal interpretation, that is, Master Kang, Unification, and Immai Lang all accepted foreign ownership, while white elephant refused. The consequence of the refusal is that the Japanese-invested instant noodle brands have launched targeted price wars, and even put pressure on the sales platform to force them to "choose one of the two".

The white elephant without strong capital had no choice but to withdraw from the major supermarkets and could only struggle in the small local stores and fade out of the public eye. Good business war story, but it seems that the plot is a little too familiar. Is this link very similar to the story of Coca-Cola and Pepsi Cola playing the Yuanqi Forest? Like the story between Rui Ao and Ice Sharp? You see, this is actually normal, the business war initiated by interest groups is not like the injustice encountered by a brand.

Let's look at another story. Around 2010, raw materials in the food industry rose. The Japanese-owned Imabari gave up the 1 yuan retail price band of instant noodles and increased the number of grams to make about 1.5 yuan. Unfortunately, this product is aimed at Master Kong, the first in the market, and the instant noodles at the same price are placed on the shelves, do you want Master Kang or Jin Mai Lang? The answer is obvious, Imabari is not selling well.

White elephant is very responsible, despite the rise in raw materials, its own products are still the main 1 yuan, occupying a certain share in the low-end market, and even once ranked second in the country. But later, seeing that everyone was walking in the middle and high-end white elephants, they also began to follow the price increase, and the instant noodles that were originally 1.5 yuan were mainly turned to 2.5 yuan, breaking through the average price band of the industry at that time.

In contrast, at this time, Imairo is still promoting 1.5 yuan / bag of Ō imano. The high-end of the white elephant has attracted the dissatisfaction of dealers, dealers no longer buy goods, the major KA channels gradually have no white elephant, those high-end bone broth noodles are pressed in the warehouse of the white elephant, and the brand market share has fallen. White Elephant has problems with brand positioning.

How to let wild consumption escape the short-lived?

The white elephant has now harvested wild consumption, which is the short-term atmosphere brought about by the hot event, which is basically a non-recurring business income, and it is impossible to support the sales growth of the white elephant for a month, a year or even the next decade. At present, the supply side of white elephants actually has enough competitiveness.

In the 100 billion-level instant noodle market, if white elephants want to take advantage of the rise of wild consumption and achieve steady growth, they must start from the demand side and reconstruct the "white elephant" brand mentality. This cannot avoid three problems:

First, repositioning, which we talked about before, is actually a rather competitive concept. First of all, the premise it proposes is that in order to make our brand gain a greater competitive advantage, the positioning is that the competitors do not have and you have, and the competitors have and yours are more cattle. Second, it is also the key to consumer communication. Because positioning means identifying your unique presence in the consumer's mind, your positioning has a huge attraction to him. Finally, this is an organic combination of a business management system.

The so-called positioning is actually commodity positioning, crowd positioning, price positioning, regional positioning, format positioning, scale positioning, and even promotion positioning. For any brand, positioning is difficult to do once and for all, and repositioning is more common in reality than the first positioning. White elephants need to be repositioned.

At present, the most recognized positioning of white elephants in the instant noodle market is actually pure domestic products. Most of the target groups for this positioning "cold" are actually post-00s. Don't stretch the target population too widely, saying that instant noodles can be eaten by children to the elderly. Consumer goods should know how to focus on a narrow enough group of people to break through this group, and then the brand will naturally form a spillover effect.

Personally, I believe that white elephants should be based on fresh college graduates around the age of 22 as a companion for their lives when they have just entered a busy job.

After doing this in this crowd, 18-year-old students will see what their seniors eat; 25- and 30-year-olds will see what the younger generation eats – and this is the overflow of the brand. Of course, this is our advice from the outside, based on the obvious changes in a single element of the industry. The real repositioning also needs to consider the internal organizational system of the white elephant enterprise.

Second, re-comb the product line At present, the layout of the product line of white elephant is actually slightly chaotic. In 2018, Yao Zhongliang proposed a plan to start a second business, and then developed a variety of flavors of soup noodles "soup delicious" series, large bone noodles series, as well as regional characteristics of Sichuan spicy hot pot noodles and Korean-style turkey noodles and other series of products. In addition, Baixiang has also cooperated with the Internet celebrity brand "Single Food" to develop products such as noodles, plate noodles and rock giant sour chili powder; launched chinese-style instant noodles "Fresh Noodles", as well as quick-frozen noodle foods such as Fuxi Old Noodle Steamed Buns and Buns.

With so many lines, white elephants have signs of youthfulness. But in general, in fact, some greedy for fast, in the dispersion of company resources, just at a low level of inefficient copy and paste. Any enterprise has limited resources, if the core and most important strategic direction is determined, then it is necessary to transfer all elite soldiers and resources, saturate the attack, focus on one point, and now make a breakthrough at this point.

This is not what I said, it is Ren Zhengfei who said, find the smallest cut, saturation attack, and achieve a single point to break the game. White Elephant enterprises do not need to expand the product line to make the scale bigger, but to be strong, to take root at a certain point, to create a strong brand in this incision. Reposition according to the brand, and then concentrate resources on one or two products, so that we can quickly achieve product line breaking and quickly seize the minds of consumers.

Of course, the product mentioned here is not just a certain instant noodle, but the requirements behind it are commodity grade positioning, commodity combination positioning, price positioning, and promotional positioning according to brand repositioning. That is to say, if the small incision of our previous positioning of fresh graduates is correct, then we should reshape our comprehensive positioning around them, and even lean towards this aspect in marketing.

Third, the biggest problem facing the rebuilding of the internal organizational support system white elephant is that the original product line is still the main part of the benefits, but this part has entered the stall point from the trend point of view. There is a need for innovative things inside, and this innovative thing is bound to erode the original interests of the white elephant. This is the biggest problem when the first curve of the enterprise migrates to the second curve - from the perspective of finance, talent and other aspects, they will unconsciously favor the business that is making money, rather than the business that is not decisive in the future and is not currently profitable.

This requires, first, the strategic determination of decision makers, and second, the need to rebuild the internal organizational guarantee system. First of all, the organizational system of the market sector should be perfected. If we have made up our minds to concentrate our resources on a single-point breakthrough, then we must do a good job in incentivizing the channels and opening up the upper and lower channels; we must now explore a set of effective marketing models in the base market; we must first firmly concentrate resources on a channel and consider the omni-channel layout.

Secondly, the organizational system of the marketing sector should be improved. After our main products run through a closed loop, we need to enter the mainstream market through marketing and detonate the consumer trend. The traditional practice is HBG large penetration, marketing communication + fill in the blank + support customers + leading brand concept guidance, which is placed on new media marketing, and the young talent team is inseparable.

Finally, the optimization and even reshaping of the overall internal operating system. Stress testing of internal operating systems. A product to quickly spread to the market, in fact, is a test of production capacity, channels, brands and other aspects. We start with the end, using the financial model to measure how long a product is laid out to how many channels affect how many consumers generate how many repurchases... Then, with this calculation, coordinate the various departments within the company on a small scale, and see that those links require more time and resources to tilt.

Then give a period of adjustment, and after the various links are deployed, they will start running together. In this way, the market operation system, the internal operation management system of the enterprise, the vertical value chain system of the single product, the brand management organization platform system, etc., can achieve real-time synchronization and concentrate the power on a little saturation attack.

Construction of product lifecycle management and user lifecycle management system. The management of the whole life cycle of goods mainly focuses on the polishing of individual products and the insight of needs.

On the one hand, the life cycle of the goods is extended as much as possible, so that the so-called Internet celebrity explosion becomes a large single product that continues to generate profits; on the other hand, it constantly explores new large items to achieve one new product explosion superposition after another, spanning the discontinuity of brand growth. In addition, it is to reserve the second echelon of a single category behind the big items, just like the reserve can replace the temporary brand single product effect brought about by the black swan at any time.

The management of the whole life cycle of the user is actually the guarantee of the life cycle management of the goods, after all, the length of the popularity of the goods lies in the continuity of user consumption. Brands' lifecycle management of individual users is mainly focused on the AIPL model, that is, awareness, interest, purchase and loyalty.

These links are placed on brand marketing, which is the homework of product polishing, content planting, community interaction, fission and repurchase. And these are basically the things that the new generation of consumer brands after 2016 are good at, which contains not only the thinking transformation of the decision-making level, but also the cultivation of front-line talents for more specific things.

Write at the end

Finally, recommend a few reference cases for white elephants: the repositioning of the brand can go to see Li Ning. In 2002, Li Ning positioned "everything is possible" in the mass market; in 2010, he was positioned to enter the high-end market under the afterglow of the Olympic Games, but after the price was close to Nike Adi, the product was not very good, so the market did not buy it.

In 2012, Li Ning shrank the front, but he has been weak. Until 2017, with the national tide into the fashion show, the combination of sports + trend, to create the current results. Several in-depth repositioning of the brand may be able to give the white elephant some references.

The re-combing of the product line can be seen in Wahaha. At that time, Wahaha concentrated on making nutrition express lines, which became the iconic finished product of Wahaha's "capture of big cities". This single product has sold more than 50 billion bottles in 15 years, with an output value of more than 160 billion yuan.

Internal organizational remodeling can be seen in pot circles. It's a very new brand, but it quickly opened stores to more than 8,000. Wei Zhe, an investor in the pot circle, mentioned that they had held retreats inside the pot circle and done similar stress tests, requiring that the previous 50 stores opened every month be increased to 300.

In this way, all the problems of the company's organizational system are exposed at once. In response to these problems, the pot circle gave all departments six months and a given resource to solve the bottleneck problem of opening three hundred stores. Today, the overall organizational capacity of the pot circle stands firmly at three hundred stores a month, and it will only rise and not fall.