"I'm sleepy and tired, drink xx!"
When you see this advertising slogan template, which beverage brand comes to mind first?
I think it must be Dongpeng Special Drink.
Thanks to the heavy marketing of Dongpeng Beverage Group in the whole network channel in the past 10 years, the advertising slogan "tired and sleepy, drink Dongpeng special drink" has now gained a high reputation in China.
In 2022, Dongpeng Beverage has completed a feat that shocked the industry, that is, it easily earned a huge revenue of more than 8 billion yuan from the hands of Chinese adult men, who have long been recognized as "people with low consumption desire".
And as of the end of September 2023, Dongpeng Beverage's revenue in the first three quarters has once again exceeded the 8 billion mark, and the situation seems to be very good.
But in fact, the originator of the slogan template at the beginning of the article is actually the former global hegemon of the energy drink track, Red Bull from Austria.
In 1995, Red Bull landed in the Chinese mainland market for the first time, and quickly became popular with the two popular advertising slogans of "your energy is beyond your imagination" and "Drink Red Bull when you are sleepy and tired", and seized the functional drink track that was still blank in the domestic market at that time.
With the gradual increase in sales, Red Bull's directly operated factories could not meet the huge market demand, so they had to select a number of foundries across the country to accelerate the production of Red Bull drinks.
And one of the state-owned foundries, the director is Lin Muqin, who will set up his own door in the future to build Dongpeng Beverage Group.
At that time, the beverage factory where Lin Muqin worked was on the verge of bankruptcy due to outdated products and declining sales, and Red Bull's OEM order seemed to be a life-saving straw, giving Lin Muqin and the workers of the whole factory a chance to breathe.
But neither side probably expected that just 20 years later, Dongpeng Beverage, created by Lin Muqin, would become Red Bull's strongest competitor in the Chinese mainland market.
Touching the Red Bull to cross the river, Dongpeng Beverage turned a loss into a profit
Before receiving the OEM order from Red Bull, the main business of Lin Muqin's beverage factory was the most distinctive drink in Guangdong: Cantonese herbal tea.
The whole territory is located in the subtropical and even tropical Guangdong region, and the temperature often exceeds 40 degrees in summer, so the older generation of Cantonese people love to drink herbal tea, and the huge population base also feeds countless herbal tea shops and processing factories.
However, with the gradual popularity of foreign soda with various flavors in the 90s, the market for old-fashioned herbal teas, which once won the favor of "Lao Guang", began to shrink rapidly.
For a time, many traditional beverage practitioners, including Lin Muqin's beverage factory, suffered a major blow.
As mentioned above, the arrival of the Red Bull OEM order not only brought life-saving funds to the beverage factory, but also sent valuable inspiration to Lin Muqin and helped him open up new ideas for future development.
"Since there is a huge gap in the domestic functional drink market, why don't I make a brand to fill it?"
In 2003, because the state-owned beverage factory could no longer operate, the higher authorities decided to restructure it into a private enterprise and hand it over to the public.
Seeing this, Lin Muqin gritted his teeth and took out all his savings, bought the right to operate the beverage factory for 2.67 million yuan, and renamed it Dongpeng Beverage Factory.
While continuing to produce old-fashioned herbal teas, Dongpeng Beverage Factory also began to research its own functional drinks.
Because he personally undertook the OEM business of Red Bull, Lin Muqin was very clear about the product blending and marketing model of Bull Beverage, so he did not encounter much difficulty in the early production.
What's the recipe for? Learn from Red Bull's ingredient list! Let's add vitamin B and taurine to it!
Red Bull's 250ml golden cans, let's also learn to order a batch!
But when it really came to the market for test marketing, Lin Muqin's "copycat Red Bull" did not become as popular as he imagined.
Obviously, there is not much difference in taste and functional ingredients, but Dongpeng Special Drink can't sell Red Bull at all, what is the problem?
After some research and review, Lin Muqin finally understood that the reason for the poor sales was "differentiated scarcity".
At that time, through the cooperation with the NBA League, Red Bull's logo and advertising films were exposed in the five sets of CCTV, and it also successfully left a deep impression of "good physical supplies" in the hearts of the majority of fans, and was in the limelight in the same industry.
As a "copycat" product that highly imitates Red Bull, since all attributes are not much different from Red Bull, why don't consumers choose brand-name products with more guaranteed quality?
Thinking of this, Lin Muqin made a difficult decision, that is, to reduce the price.
As an internationally renowned brand, Red Bull's products have a high degree of market recognition and sufficient marketing funds.
The only weakness of Red Bull is its pricing of 6 yuan for 250 ml.
At the beginning of the 21st century, this price was only accessible to mid-to-high-end people, and not everyone could afford to consume Red Bull drinks.
So, in addition to the sports-loving white-collar workers in big cities, who are the potential demanders for functional drinks?
It is an assembly line blue-collar worker who often works night shifts;
It is a long-haul truck driver who needs to stay awake 24 hours a day;
It is a vegetable vendor who has to go to the suburbs before dawn in the morning to buy goods, and only closes his stall at 9 o'clock at night and goes home.
……
In the sinking market, which is beyond the public's sight, there are also huge potential consumers of functional drinks.
After determining the new breakthrough direction, Dongpeng Beverage has successively launched a variety of new functional drinks, and the raw materials are almost the same as those of Red Bull, but the price is only half of that of Red Bull.
In addition, Dongpeng Beverage has also made significant changes to the existing packaging design of the product.
Since the working environment of blue-collar workers is generally messy and dusty, if they continue to use metal cans similar to Red Bull, the drinks in the bottles are very easy to contaminate, and the packaging cost is relatively high.
Therefore, Dongpeng Beverage chose to use plastic bottles, and also made a double-layer lid design at the bottle mouth, which can effectively isolate dust, and the outer cover can also be used as a cup and ashtray, which is very ingenious.
In order to test the results, Lin Muqin selected the first city for comprehensive distribution of goods is Dongguan, which is located near Dongpeng's headquarters, which is full of processing factories in various industries and has an extremely large group of migrant workers.
As Lin Muqin expected, once the fully upgraded Dongpeng Beverage was listed in Dongguan, it gained great recognition from the blue-collar group, and there was an endless stream of retailers who came to Dongpeng Beverage Factory to purchase goods.
In the following three years, Dongpeng Beverage began to distribute goods nationwide, and in 2012, it achieved the goal of exceeding 100 million yuan in revenue for the first time.
After 8 years of tossing in the functional drink track, Lin Muqin and Dongpeng Beverage finally saw the back of the head of their big brother Red Bull for the first time.
If Dongpeng Beverage was just a follower before 2015, since 2015, Dongpeng Beverage has begun to have the strength to compete with Red Bull.
The key to narrowing the gap between the two sides is not how much Dongpeng Beverage has made, but more from Red Bull's internal turmoil.
That year, Red Bull's distributor in Chinese mainland, Reignwood Group, was hit hard by a dispute over trademark ownership with its headquarters in Austria, and was restricted from any form of advertising for the next two years, plummeting its market share by nearly 20 percent.
As the most competitive competitor of Red Bull in the domestic market, Dongpeng Special Drink also took advantage of the situation to accept this part of the lost market share, and by 2019, it has firmly ranked second in the industry.
In addition to the profits, Dongpeng Special Drink's performance leap in the past 8 years is also due to the company's marketing department to open up the youth market.
The reason why Dongpeng Beverage was able to seize the huge blue-collar group at first was because middle-aged manual workers had a rigid need for refreshing functional drinks, but this was not the case for young people other than sports enthusiasts.
Moreover, compared with functional drinks, carbonated drinks and various milk teas seem to be more popular among teenagers, how should Dongpeng Beverage break the game?
"Further focus on the precise crowd, and then take the money to smash. ”
Although there are few manual laborers among today's young people, there are still many night owls who stay up late and have a strong demand for energy drinks.
After identifying the new target group, Dongpeng Special Drink began to actively sell goods to Internet cafes, discotheques and convenience stores downstairs of Internet companies with serious overtime, and the effect of "circle fans" was remarkable.
Not only that, Dongpeng Special Drink also combined with the novel and interesting WeChat red envelopes at that time, and expanded a wave of popularity.
After consumers buy back Dongpeng Special Drink, as long as they scan the QR code in the bottle cap, they have more than 30% chance to receive cash red envelopes, a few small yuan, up to 888 yuan, much more attractive than "another bottle"!
In 2021, relying on a series of effective marketing methods of its brand department for a long time, Dongpeng Beverage surpassed Red Bull in sales for the first time, ranking first in the industry with a market share of more than 30%.
It was also in this year that Dongpeng Beverage was successfully listed on the Shanghai Stock Exchange, with a total market value of up to 114 billion yuan, ranking first in the A-share "functional beverage stock", and it was in the limelight for a while.
But to everyone's surprise, the "prosperity" of Dongpeng Beverage has only lasted for a year, and it has begun to decline.
In 2022, on the occasion of the first anniversary of Dongpeng Beverage's listing, many major shareholders chose to reduce their holdings and sell as soon as the stock ban was lifted, cashing out nearly 6 billion, and the situation is the same this year.
Affected by this for two consecutive years, the total market value of Dongpeng Beverage has also dropped from 114 billion yuan at its peak to 76 billion yuan, a decrease of nearly 35%.
The retreat of investors represents that they have lost confidence in Dongpeng Beverage and even the entire functional beverage market.
As for the reason, it is actually easy to understand, that is, the blue-collar people, who used to be the main audience group for functional drinks, are not only aging, but also decreasing in number.
According to statistics, since 2015, the number of registered truck drivers in mainland China has fallen by more than 40%, leaving only 15 million people, and the same must be true for other jobs.
At the same time, another obvious shortcoming of Dongpeng Beverage is also a key factor that causes investors to be worried, that is, the profitable product is too single.
Looking at Dongpeng Beverage's 2022 annual financial report, the sales of "Dongpeng Special Drink", a popular product, accounted for more than 90% of Dongpeng Beverage's total annual revenue.
And this also means that once Dongpeng Special Drink can't be sold, the benefits of the entire group company will also fall off a cliff, and the second-echelon products such as pure water and various herbal teas do not have the ability to share risks.
Moreover, according to Dongpeng Beverage's latest Q3 2023 quarterly financial report, although the group's total revenue is still showing an upward trend, expenses are also increasing significantly.
The total amount of marketing expenses in the first three quarters of this year has reached 1.421 billion yuan, almost matching the total expenditure in 2022.
At the same time, the cost of a series of flavorings and raw materials for internal and external packaging in addition to white sugar is rising, and as the social structure tends to age, labor costs will continue to rise in the foreseeable future.
It is worth mentioning that compared with the marketing expenditure of nearly 2 billion, the total amount of Dongpeng Beverage's investment in product research and development this year is less than 50 million, and this seems to be one of the reasons why Dongpeng Beverage's "second hit" has not appeared for a long time.
As an industrial company that started by "imitation", the biggest constraint of Dongpeng Beverage at present may be the lack of innovation ability.
We have to admit that the success of Dongpeng Special Drink is largely due to the fact that Red Bull has replaced the latecomers in the functional drink track in the first ten years of its landing in the Chinese market.
However, with the exhaustion of the "experience dividend", Dongpeng Special Drink, which has replaced Red Bull at the forefront of the track, will face unknown challenges alone in the future.
New growth points have not yet emerged, but they must appear as soon as possible.
Because the truck drivers who once brought huge revenue to Lin Muqin may be difficult to feed Dongpeng in the future.
-END-
Author: Lu Yao
Editor: Ichiyigi
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