Written by Xiao Yue
Editor|Li Kexin
Source|Hydrogen Consumer Products (ID: HQingXiaoFei) Recently, the mutual choking between Thai Tencel Pharmaceutical and Healthcare Co., Ltd. (hereinafter referred to as "Tencel Group") and Red Bull Vitamin Beverage Co., Ltd. (hereinafter referred to as "China Red Bull") once again made the trademark dispute between the two parties the focus of public opinion.
Earlier, on April 23, Tencel Group said that it had received a judgment from the Heilongjiang Higher People's Court, in which the first instance ruled that Red Bull Vitamin Beverage Co., Ltd., a joint venture subsidiary of Reignwood Corporation, immediately stopped producing and selling "Red Bull Vitamin Functional Drink" and compensated Tencel 100 million yuan.
Immediately after the 25th, China Red Bull issued a statement saying that since 2016, Thai Tencel has launched lawsuits against China Red Bull and its industrial chain partners in many places. Like other first-instance judgments, the Heilongjiang High People's Court No. 12 Judgment is not an effective judgment and does not have res judicata or enforcement force. Relevant parties will appeal in accordance with the law to protect their legitimate rights and interests.
At the same time, for the statement that "China Red Bull is prohibited from production and sales", the relevant person in charge of Reignwood Group also gave a response, saying that the relevant news is false information and false remarks, trying to confuse the public and mislead the public, which has seriously constituted a reputation infringement on "China Red Bull", and for illegal acts such as rumor-mongering and malicious smearing, "China Red Bull" will collect evidence in time and resolutely pursue responsibility according to law.
Although the trademark dispute between Tencel Group and Reignwood Group has not yet been settled, according to previous media reports, among the mainstream e-commerce platforms JD.com, Tmall and Wal-Mart, the "Red Bull Vitamin Drink" produced by Reignwood Group has been removed.
(Product detail page of Red Bull JD.com's self-operated flagship store)
(Red Bull Tmall flagship store product display and some products and product detail pages)
Hydrogen consumption noticed that in the self-operated flagship store of Red Bull JD.com and the Tmall Red Bull flagship store, the display and detail pages of the products sold have the prominent Tencel Group (TCPGroup) logo, and the words "Tencel Group Red Bull Brand Founder and Trademark Owner" are also marked in a prominent position on the product detail page.
In this regard, Wang Wenjun, director and partner of the intellectual property department of Beijing DHH Law Firm, told Hydrogen Consumption that the removal of Red Bull Beverage by some distributors mentioned in media reports was an egoistic choice made by weighing various factors.
"The main factors to consider in this choice are: first, to withdraw from the Red Bull trademark dispute in advance, to avoid falling into it and possibly bearing legal liability; The second is to move forward with retreat, and after the final characterization of the Red Bull trademark case, the next business plan will be arranged, leaving a certain amount of flexible operation space; Third, the public opinion triggered by the Red Bull trademark case has a certain degree of uncertainty, and the early removal of Red Bull products is also a normal choice to seek benefits and avoid harm; Fourth, there may be homogenized related alternative products, which is the inevitable result of full market competition. Wang Wenjun said.
In addition, Wang Wenjun also pointed out that there is no need to over-interpret the removal of some dealers, which is a normal phenomenon under the combined effect of legal rules and market rules, and it is also a normal choice for dealers to balance commercial interests.
Specific to the e-commerce platform itself, Zhang Jiangang, president of Sanju Sunshine Intellectual Property Group, said that the removal of China Red Bull products by e-commerce platforms is mainly related to the "safe harbor system" of e-commerce platforms to avoid responsibility.
"According to mainland law, e-commerce platforms have the obligation to 'notice-delete', that is, if the e-commerce platform promptly disconnects and deletes the link of the infringing product after receiving the notice of the alleged infringement complaint from the right holder, even if the infringement is finally determined, the e-commerce platform can be exempted from infringement compensation."
At the same time, Zhang Jiangang pointed out that in this case, although the first-instance judgment has not yet taken effect, the "China Red Bull product" has constituted an "allegedly infringing product", and the e-commerce platform has removed the relevant product at this time, and in the future, it can claim that it has fulfilled the obligation to delete the infringement complaint in a timely manner to defend, so that it is not liable for compensation.
A trademark battle that has gone through several twists and turns
As mentioned in the "Statement on the First Instance Judgment of the Heilongjiang High Court" published by China Red Bull on its WeChat public account on April 25, since 2016, TENCEL Group has initiated lawsuits against China Red Bull and its industrial chain partners in many places.
In this years-long trademark battle, Reignwood Group and Tencel Group have already conducted several rounds of litigation on the ownership and authorization of Red Bull trademarks, and when a new court judgment appears, it will also trigger a new round of public opinion storms between the two sides.
As early as 2016, TENCEL Group announced that the 20-year authorization period of both parties expired and launched a trademark infringement lawsuit against Reignwood Group on the grounds of "infringement of the exclusive right to use a registered trademark" and "unfair competition".
Reignwood said that when the two sides began to cooperate, they signed a "50-year agreement", according to which it was clearly stipulated that China Red Bull had the exclusive right to produce and sell Red Bull beverages in China for 50 years.
However, TENCEL Group said that the agreement is 20 years, so based on this calculation, the license to use the Red Bull series of trademarks expired in October 2016.
In August 2018, China Red Bull filed a lawsuit with the Beijing High Court, seeking confirmation that the company enjoyed the legitimate rights and interests of the owner of the "Red Bull series trademark", and ordered TENCEL Group to pay China Red Bull a total of 3.753 billion yuan in advertising and publicity expenses.
On November 25, 2019, the Beijing Municipal Higher People's Court rendered a first-instance judgment, rejecting all of Red Bull's claims for the court to confirm the legitimate rights and interests of the owners of the 17 "Red Bull series trademarks" and to require Tencel to pay 3.753 billion yuan in advertising and publicity expenses.
On December 21, 2020, the Supreme People's Court rendered a final judgment, rejecting China Red Bull's appeal request and upholding the original judgment of the first instance, clarifying that TENCEL Group Company enjoys the exclusive right to use the registered trademark of the Red Bull series trademark.
With the final judgment of the Supreme People's Court, TENCEL Group has successively taken legal action against Reignwood Group's Red Bull distributors and suppliers in China.
On December 31, 2021, the Zhejiang Provincial Higher People's Court ruled that the three companies under Reignwood Group compensated the plaintiff TENCEL Group for economic losses of 100 million yuan; On May 7, 2022, the Tianhe District People's Court of Guangzhou City, Guangdong Province similarly awarded compensation of 219 million yuan to the plaintiff Tencel Group, and similarly required the three companies under Reignwood Group to immediately stop the production and sale of "Red Bull Vitamin Functional Drink", stop using the enterprise name containing the word "Red Bull" and change the enterprise name within a time limit.
As for the distributors of China Red Bull, the rights protection of Tencel Group is also underway. On December 12, 2022, the Nanchang Intermediate People's Court of Jiangxi Province rendered a first-instance judgment in a trademark infringement dispute between the plaintiff Tencel Group and the defendant China Red Bull and two distributors, Wang Zhongwang Department Store Co., Ltd. and Nanchang Longquan Food Co., Ltd., finding that the two defendants' sale of Red Bull vitamin functional drinks constituted infringement, in which Longquan Food Company was liable for compensation because it was still selling the allegedly infringing products at the time of trial.
According to the previous disclosure to the media by Tencel Group, up to now, the infringing enterprises controlled by Reignwood Group and its infringing enterprises have been awarded about 450 million yuan in damages by courts in many places across the country for trademark infringement.
Reignwood knocks on the Chinese energy drink market
In fact, in addition to the trademark dispute between Reignwood Group and Thai Tencel, it is undeniable that Red Bull has gone from being unknown to being popular all over the country in China, until it has become a high-frequency word when people mention energy drinks, and the cooperation between Yan Bin, founder of Reignwood Group, and Xu Shubiao, founder of Red Bull, and the effective market operation after introducing Red Bull into the country.
According to public information, Xu Shubiao, the founder of Red Bull, started from scratch. After the end of World War II, as Thailand began to vigorously develop its economy, Xu Shubiao opened a small company that mainly engaged in the import of Western medicine from overseas, and this company, then called T.C. Pharma, later became the famous Thai Tencel Group.
As for the emergence of Red Bull, it is said that Xu Shubiao saw that the factory staff often doze off, and he came up with the idea of developing a "health product" to refresh the workers. So under his leadership, TENCEL Group made a drink called Krating Daeng from water, sugar, caffeine, B vitamins and other raw materials, which was launched in Thailand in 1966, and this drink was the predecessor of Red Bull.
Due to its refreshing effect, Krating Daeng became popular in Thailand and was loved by truck drivers and workers, and the drink has maintained a good market share in Thailand since then, but fewer people know about the product outside Thailand.
Until the Austrian Dietrich Matschitz was on a business trip in Thailand, he came into contact with Krating Daeng by chance, was attracted by the drink, and found Xu Shubiao to seek cooperation, and finally in 1984, the two parties established a company with a capital of 500,000 US dollars each, of which each party held 49% of the shares, and the remaining 2% was held by Xu Shuen, the son of Xu Shubiao, and the company was operated by Matsitz.
Since then, outside the Southeast Asian market controlled by Xu Shubiao, Red Bull has further achieved sales throughout Europe from Austria through the hands of Matschitz.
If Matschitz is the key to helping Red Bull open up the European market, then Yan Bin, the founder of Reignwood Group, can be called the key to helping Red Bull open up the Chinese market.
In 1995, Yan Bin and Xu Shubiao established Red Bull Vitamin Beverage Company in Shenzhen, providing technology and formulas through Xu Shubiao, and Yan Bin introduced Red Bull Beverage to China by providing funds, sales and operations.
Hydrogen consumption reviewed public information and found that even behind the Chinese name of the product finally adopting "Red Bull" in China, there was Yan Bin's participation.
At that time, the Thai side intended to use the transliteration of "Red Bull" "RedBull" as the trademark of the product in the Chinese market, but Yan Bin believed that the localized "Red Bull" was more acceptable to domestic consumers, and at his insistence, he finally used "Red Bull" as a trademark, and since then, with the insight into the aesthetics and experience of Chinese consumers, the iconic "Golden Can" has been finalized after more than 40 tests and is loved by domestic consumers.
If easy-to-remember trademarks and highly recognizable packaging make consumers remember Red Bull products faster in the early stage, then through the catchy advertising slogan of "drink Red Bull when you are thirsty, drink Red Bull even more when you are sleepy", Yan Bin and his team have completely left a mark on Red Bull products in the minds of consumers.
In 1996, through hundreds of millions of yuan of advertising investment, Red Bull appeared on the stage of the Spring Festival Gala, further opening up Red Bull's popularity in China. In addition, Red Bull China has further deepened the brand by sponsoring a variety of sports events with Chinese characteristics, such as the China-Thailand football match in 1996 and becoming the first partner of the NBA in China in November 2003.
In addition to marketing, Yan Bin is a pioneer in deeply cultivating the domestic functional beverage market and promoting Red Bull. According to previous media reports, in order to promote Red Bull, Yan Bin personally led the team to Chang'an Avenue in winter to give Red Bull to his brother for free, and even at that time he put forward the slogan "No blind spots in the market, every store must enter".
In addition, unlike other brands in the market at the time, which pushed products to downstream distributors from the top down, Red Bull adopted a bottom-up approach to expansion.
Ji Yuhong, head of China Red Bull Guangxi Branch, mentioned in a previous interface interview that considering the forced push of products to downstream distributors, dealers may not necessarily take the initiative to promote, so they first spread goods in places where direct consumers are densely populated at roadside gas stations and grocery stores, and slowly through consumers' active inquiries, mobilize distributors to take the initiative to sell Red Bull.
It is based on the investment of Yan Bin and his team in marketing, marketing and other aspects, after many years, Red Bull has become the head brand of well-known functional drinks in China.
New brands enter the game, but no one can hold the "cow" ears
At the same time as the relationship with Sino-Thai Red Bull, it is the charge of the new brand in China's domestic market.
Alien energy drink in Genki Forest, Lehu under Dali Food Group, Dongpeng Special Drink, a product of Dongpeng Beverage... The functional drinks market is bustling.
Last year, Genki Forest disclosed that the sales of aliens in Q1 2022 exceeded 100 million yuan, and according to media reports at the time, the annual sales target of aliens in Genki Forest was set at 2.2 billion yuan.
Although Q1 sales are far from the full-year target, what has attracted attention from the outside world is that alien products can achieve a year-on-year growth of nearly 300% in Q1, which is still in the off-season, which not only confirms the product strength, but also allows the outside world to see the broad market space of functional drinks.
As a functional drink under Dali Group, Lehu has also continued to attack the market in the functional drink market since its products were launched in 2013, and Xu Shihui, as the chairman of Dali Group, clearly proposed at the 2019 Dali Food Results Conference, "By 2025, we will have 4 brands exceeding 10 billion, namely Dali Garden, Douben Bean, Meibakchen and Lehu." ”
Relying on the resource advantages of Dali Group, Lehu's sales revenue reached 3.222 billion yuan in 2021, and even in 2022, which was affected by the epidemic, it still achieved sales revenue of 2.823 billion yuan.
With the success of its Dongpeng Special Beverage products, Dongpeng Beverage Group, which won the "first share of functional drinks", has made the industry see the potential of the functional beverage track.
From the public information and the prospectus released by Dongpeng Beverage before listing, it can be seen that between 2018 and 2020, its revenue has increased year by year, from 3.038 billion yuan in 2018 to 4.959 billion yuan in 2020, while the net profit has also increased year by year, from 216 million yuan in 2018 to 812 million yuan in 2020.
In 2021 and 2022, after listing in May 2021, the growth in revenue and net profit continued, of which the annual revenue in 2021 was 6.978 billion yuan and the net profit was 1.193 billion yuan, and the revenue in 2022 was 8.505 billion yuan and the net profit was 1.441 billion yuan.
Although the above functional drink brands have launched a fierce impact on the market, it is an indisputable fact that at least so far, no brand has been able to shake the market position of Chinese Red Bull.
Taking 2021 as an example, China Red Bull's orders were locked in 21.8 billion yuan and deliveries were 22.1 billion yuan.
It should be known that according to the data released by Euromonitor in 2021, the market size of energy drinks in mainland China this year was 51.314 billion yuan, which also means that despite frequent waves, China Red Bull still firmly occupies nearly half of the market share of the domestic energy drink market.
And China Red Bull, after this round of public opinion storm, will trigger what changes in the domestic functional drink market, quite exciting.
Resources
[1] 26 years of entrepreneurial history: how did the Chinese Red Bull brand come about, interface Hainan
[2] 25 Years of Boiling: A Brief History of the Evolution of Red Bull in China, China Entrepreneur Magazine
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