Inner Mongolia is a region rich in resources, especially in the production of dairy products.
Mengniu and Yili are both well-known dairy manufacturers in China, and both originated from Inner Mongolia, a high-quality milk source base. In the Chinese dairy market, these two brands have a high reputation and market share. These two companies not only have a good performance in the domestic market, but also occupy a place in the international market, and are one of the important representatives of China's dairy industry.
Since the 60s of the 20th century, several dairy factories have been operating in Inner Mongolia, including the predecessor of Mengniu Dairy. After more than 40 years of hard work and development, Mengniu Dairy has become a leading enterprise in China's dairy industry, and its dairy product sales are among the best in the Chinese market.
Mengniu's influence in the dairy industry is self-evident, and its "Mengniu" brand has become synonymous with China's dairy products, and its popularity and influence among consumers can be seen.
Yili Group was formally incorporated in Inner Mongolia Autonomous Region in the early 90s of the 20th century, and after 30 years of continuous development and growth, it has gradually developed into an important force that cannot be ignored in China's dairy industry. In the past 30 years, Yili Group has been committed to the research and development, production and sales of dairy products, and has won the recognition and love of consumers with its high-quality products and first-class service quality.
According to the survey, Yili pure milk has become a leader in the domestic market, and its sales volume has always been among the best. It is also deeply loved by consumers and has become a necessity for many families.
Many years have passed since Mengniu and Yili launched their products in the Chinese market. Although both companies have achieved remarkable results in terms of market share and brand awareness, in the early days they were comparable in strength and the competition was fierce. However, with the passage of time, changes in the market and the adjustment of the company's own development strategy have made the balance of power between the two companies change subtly.
Some investors believe that there may be new changes and developments in the Chinese dairy market in the next few years.
This article will comprehensively analyze the significant differences between the performance and market performance of the two well-known brands in the past five years, find out the deep-seated reasons for this difference, and analyze their future development direction in combination with the industry background and enterprise development trends, so as to show readers a comprehensive picture of the leading dairy enterprises in the process of change and replacement of the old and the new.
Mengniu and Yili have been two high-profile milk brands in China's dairy market, and one of the biggest differences between the two brands is the use of additives in their product formulations. Compared with Yili, Mengniu adds relatively few types of additives to its products, and pays more attention to emphasizing the natural and health characteristics of its products in the process of publicity and promotion.
At the same time, Yili's product formula pays more attention to the use of a variety of additives to improve the taste and nutritional value of the product, so as to meet the needs of different consumersAlthough there are differences in the use of additives in the product formula between Mengniu and Yili, it is important for consumers to choose products that suit their needs and pay attention to the quality and safety of products.
Yili's dairy products insist on using fresh milk as raw material without adding any flavoring or stabilizer, which makes Yili's dairy products have a light taste and natural frankincense, which are deeply loved by consumers. Mengniu dairy products, on the other hand, add various ingredients to fresh milk to adjust the taste, such as protein stabilizers, emulsifiers, thickeners, etc., which makes Mengniu dairy products richer and more layered in taste, and has also been loved by consumers.
However, it is worth noting that different brands of dairy products have different ingredients and different effects on the human body, and consumers should choose the dairy products that suit them according to their needs and tastes.
These additives stabilize the milk fat globules, thus enhancing the creamy taste.
The use of additives has an impact on both product prices and profit margins for both brands. As a natural pure milk, Yili has a high raw material cost, so its gross profit margin is low. Mengniu, on the other hand, reduces costs by adding cheap ingredients, thereby increasing gross profits.
However, additives also increase quality hazards and reduce net profit margins.
In recent years, Yili has been recognized by more consumers for its natural and pure selling points, which is also one of the important reasons for its outstanding performance. Mengniu's over-reliance on additives is gradually losing its market advantage.
In the future, it will be interesting to see whether Yili's bet on the all-natural product strategy can completely change the market position of the two brands. But at least for now, Yili's performance in the mid-to-high-end dairy market is more eye-catching, and it is deeply loved by consumers.
In addition to the differences in formulas, Mengniu and Yili also have their own characteristics in the design of packaging styles and shelf life.
Yili's packaging is mainly in plastic bags, and the price is relatively more affordable. Mengniu, on the other hand, offers consumers both pouch and carton packaging options to cover a wider range of target groups.
Yili's bagged milk can only last for 40-45 days at room temperature, and consumers are advised to drink it as soon as possible to ensure product quality.
In contrast, Mengniu carton milk is aseptically filled and can last up to 180 days at room temperature, making it more suitable for long-term storage and long-distance transportation.
The difference in packaging and shelf life has led to the difference in the positioning of the two products. Yili bagged milk is mainly the choice of daily consumption in the family, while Mengniu carton milk can be given as a gift.
In the future, the two brands may make more attempts in packaging innovation to meet the diverse needs of consumers. At present, Yili's people-friendly bagged packaging has had an important impact on the drinking habits of Chinese, thus helping it gain a sales advantage.
Judging from the financial data of the two companies in the last three years, Yili has been significantly ahead of Mengniu, which also shows that Yili has a dominant position in the market.
The chart below shows the annual revenue of the two companies from 2020 to 2022. As can be seen from the figure, Yili's revenue has grown steadily, reaching 123.2 billion yuan in 2022, a year-on-year increase of 11.7%.
Mengniu's revenue has fluctuated greatly in the past three years, with only 92.6 billion yuan in 2022, with a year-on-year growth rate of only about 5%, which is significantly slower than Yili's.
Figure 1 shows the revenue comparison between Mengniu and Yili in the past three years.
Yili has maintained a leading position in net profit margin. In the first half of 2022, Yili's net profit margin was 7.85%, much higher than Mengniu's 4.64%.
Yili has always adhered to the strategy of natural and pure products, and has maintained a net profit margin of more than 7% for a long time, far exceeding the average level of the same industry.
To sum up, Yili has a strong development momentum in recent years, and its profitability has been significantly improved, successfully surpassing the state of being evenly matched with Mengniu in the past, and becoming a new upstart in China's dairy industry, occupying a dominant position in the market.
The right product strategy and branding are key factors in its success.
In addition to the quality of its products, Yili's efforts in brand building are also important factors for it to gradually surpass Mengniu.
Over the years, Yili has continued to invest a lot of brand marketing funds and carried out marketing through various channels such as TV and the Internet. Frequent launch of new products and invitation of celebrity endorsements have further enhanced brand awareness and reputation.
At the same time, Yili is committed to expanding its sales network and has basically achieved nationwide market coverage. In addition, it has also opened up e-commerce channels to seize market share of the online shopping market.
Compared with Mengniu, Yili has shown more significant strength in advertising and promotion.
Yili has put a lot of effort into brand building, which has not only won the recognition of consumers, but also further consolidated its leading position in the dairy market.
The preemptive effect of this brand is significant and cannot be ignored.
Mengniu relies too much on its old brand influence and has certain deficiencies in brand innovation. This is also the main reason why Mengniu's growth has been sluggish in recent years and it has gradually been surpassed by Yili.
In the long-term competition with Mengniu, Yili has gradually become a leader in China's dairy industry, due to Yili's successful transformation from a catch-up to a leader through the right product strategy, strong brand effect and first-mover advantage in marketing.
This change in the regional consumption difference between the two brands is also reflected. In the southern market, Yili milk is more popular, while in the north, Mengniu still dominates.
As Erie's influence increases, the situation may change even more in the future.
Looking forward to the future, Yili needs to continue to strengthen its product and brand power, expand its popularity and reputation nationwide, and strive to make more consumers in northern China choose Yili.
At the same time, we need to guard against the risk of over-inflating brand value.
If Mengniu wants to regain its advantage and reverse its decline, it needs to carry out a comprehensive rethinking and rectification of itself. Measures that can be implemented include optimizing product formulation, reducing the use of additives, strengthening brand building and promotion, broadening sales channels, and innovating in management and cost control.
In any case, the market competition between Yili and Mengniu will continue. We'll have to wait and see who can better adapt to market changes and ultimately succeed.
This paper analyzes the differences between Mengniu and Yili in terms of product strategy, business model, brand building, etc., and reveals the reason for the reversal of their position in China's dairy market, that is, Yili is gradually replacing Mengniu as the new market leader.
Through the analysis of financial data, it can be seen that Yili has gradually surpassed Mengniu by virtue of its additive-free natural pure milk strategy, strong brand effect and the advantages of marketing network.
At the same time, the article also analyzes the differences in consumption preferences of the two brands in different regions, as well as the possible future competition trends, so that readers can have a more comprehensive understanding of the changes in the dairy market.
I hope that this case will help you understand the importance of the competitive strategies of different companies, and the need to grasp consumer psychology and market changes. How to maintain competitiveness in the long term needs to be flexibly adjusted according to the actual situation, which is also the core idea of this article.