Original production | "Modern Consumption" under "Entrepreneurship Frontline"
Author | Fu Yancui
Edit | Feng Yu
American Editor | Li Yufei
Audit | Ode
The fresh milk track is getting more and more crowded.
In recent years, a number of emerging brands have been born in the fresh milk track, which emphasize health labels and high prices, and concepts such as "no additives", "nobility in milk" and "high-end milk" have emerged.
Even more and more dairy companies firmly believe that low-temperature milk will become a new track and the second growth curve for dairy companies. As a leading domestic dairy enterprise, Mengniu naturally cannot let go of this outlet.
Because it is classified as a sub-category under liquid milk, Mengniu did not announce the specific performance figures of the fresh milk business in the latest 2023 financial report, but only disclosed that Mengniu's fresh milk business has been profitable for three consecutive years. It's easy to see how much Mengniu places a premium on its high-end fresh milk brand, Daily Xianyu, which is mentioned 10 times in its 49-page annual financial report.
Mengniu founded Daily Xianyu in 2018. Its products themselves have many highlights: creating the industry's first "champagne bottle" appearance, launching the first A2 fresh milk positioned as "baby's first fresh milk", and using 4.0 protein fresh milk as a publicity point.
Mengniu's financial report shows that by 2023, Mengniu will have the largest market share in both high-end fresh milk and basic fresh milk. Previously, the person in charge of the fresh milk business revealed that in the past three years, the growth rate of Mengniu fresh milk has reached three times that of the category, of which the growth rate of daily fresh milk has exceeded 30%.
Recently, relying on the Mengniu supply chain, Daily Xianyu is not satisfied with the mainland market, and has quietly put on the shelves of more than 1,000 convenience stores in Hong Kong, China. Not only Mengniu, but in the past month, Jane Eyre and Kashi have also announced that they have launched low-temperature yogurt and low-temperature fresh milk products in Hong Kong, China.
Domestic dairy enterprises have begun to brew a new round of products and channels to go overseas, while the fresh milk market is experiencing a fierce competition.
1. Go to Hong Kong, China to grab the market
Without swiping the news or seeing any marketing moves, Wang Zi, who works in Hong Kong, China, recently discovered that Daily Xianyu fresh milk was "quietly" placed on the shelves of convenience stores in Hong Kong, China.
"If you hadn't asked me, I really wouldn't have noticed this product, it was inconspicuous to be set aside in a bunch of fresh milk products, but the word 'new' was marked on the price tag. Wang Zi told "Modern Consumption" that because she lives in Hong Kong, China, she does not pay attention to mainland brands, but she was also surprised by the price of Daily Xianyu, "The price is twice as expensive as Wei Kee, and some dissuade me." ”
Wang Zi has observed that the fresh milk sold in Hong Kong, China is basically Nestle Milk, Wei Kee Fresh Milk, Cross Brand Fresh Milk and Vita Fresh Milk in competition, "I asked a few local colleagues in Hong Kong, China, and most of them have the habit of drinking fresh milk, but there is no particularly loyal fresh milk brand. For new products, they all said that they could try the taste, but the price that has been so expensive will definitely affect the repurchase. ”
Wang Zi said that in the past year, she felt that there was also a trend of price war for fresh milk products in the Hong Kong market, "The price of Hong Kong is expensive, a bottle of mineral water costs 8 Hong Kong dollars, and now a lot of fresh milk is about the same price." ”
Speaking of this, she sent a photo of a shelf full of fresh milk to Modern Consumption. The photos show that the new product is priced at HK$18 per day, 2 bottles of Wai Kee fresh milk are only HK$19, and other fresh milk and high-calcium milk are priced at HK$12, HK$15 and HK$16 for two boxes.
(Photo / Daily Fresh Talk on the shelves of convenience stores in Hong Kong, China)
Hong Kong, China, imports 90% of its milk from the mainland because of the lack of pastures, and the current oversupply of raw milk is obviously also transmitted to Hong Kong.
According to data from the National Bureau of Statistics, the Ministry of Agriculture and Rural Affairs, and the Ministry of Commerce, the national milk output in 2023 will be 41.97 million tons, an increase of 6.7%. As of the end of December 2023, the average sales price of raw milk in the 10 major producing provinces in China was 3.66 yuan/kg, down 11.2% year-on-year, and the average price for the whole year of 2023 was 3.83 yuan/kg, down 7.9% year-on-year.
In this context, dairy companies have not only launched price wars, but also used Hong Kong, China as a training ground to expand into new market increments.
In fact, in the past month, not only a low-temperature milk company has entered Hong Kong, China. Jane Eyre and Custard also announced that they have launched low-temperature yogurt and low-temperature fresh milk products on the shelves in Hong Kong, China.
In this regard, dairy expert Song Liang once analyzed to the media that research data shows that in some developed regions, including Hong Kong, China, low-temperature milk accounts for more than 70% of liquid milk consumption. Song Liang said that based on the number of population, the frequency of dairy product consumption, and the unit price of consumer customers, the company has done a good job in the low-temperature liquid milk market in Hong Kong, China, and may be close to the scale of Beijing and Shanghai, so Hong Kong, China is an important regional market for dairy products.
Now that mainland low-temperature liquid milk brands have joined the Hong Kong market, they can not only enhance their brand image, but also digest the milk source and use Hong Kong, China as a springboard to enter the international market in the future.
For dairy companies, the local consumer's preference for low-temperature fresh milk has also made the Hong Kong market a must-compete place.
Wen Jing, a post-90s consumer, likes to try fresh milk and is a loyal fan of low-temperature fresh milk, and she has developed the habit of drinking low-temperature fresh milk since the epidemic, "During the epidemic, Academician Zhong Nanshan and Professor Zhang Wenhong both recommended drinking milk to enhance immunity, and the nutritional value of low-temperature fresh milk is better." As more mainland brands enter the Hong Kong market, consumers have more choices. ”
2. Storm the "Snake on the Land"
In fact, in terms of supply chain construction and sales channels, Daily Xianyu has a lot of advantages.
Lu Minfang, the former president of Mengniu, once expressed the idea of "forward-looking layout of domestic and foreign upstream milk sources and dairy raw materials". To this end, it has led the strategic investment in a number of animal husbandry companies, including modern animal husbandry, Fuyuan, Shengmu, etc., and has also signed cooperation agreements with some large foreign ranches. This has laid a solid foundation for Daily Xianyu to go to Hong Kong, China.
According to Mengniu's 2023 financial report, as of December 31, 2023, Mengniu Dairy had a total of 45 production bases across the country, including 2 factories in Indonesia, 2 in Australia, 1 in the Philippines and 1 production base in New Zealand, with an annual production capacity of 14.04 million tons. Backed by Mengniu's supply chain, it is reported that Daily Xianyu is basically transported from the Ma'anshan factory in Anhui Province to Shanghai on the same day.
In terms of sales channels, Daily Xianyu has also actively expanded. Mengniu's 2023 financial report shows that it continues to lead in online and offline advantageous channels, achieving the largest share of Yonghui, Walmart, Sam's and Hema in the country during the year, the largest share of JD.com and Taobao Bucai, and the sales of Tmall and Pupu achieved rapid year-on-year growth.
However, for dairy companies with ambitions to go overseas, expanding the low-temperature milk business in overseas markets means a greater challenge.
"This is mainly determined by the pain point of the short shelf life of low-temperature fresh milk. Xue Tao, a person in the dairy industry, told "Modern Consumption" that the short shelf life of low-temperature fresh milk is the main factor limiting the development of low-temperature milk companies. For example, he said, for example, the "Dr. Xian" of Yuexiu Huishan, a dairy company in Northeast China, has not been able to go out of Northeast China, and even Harbin, not far from Liaoning, rarely has its fresh milk products on the shelves.
(Photo / Photo Network, based on VRF protocol)
A staff member of Wandashan also revealed to "Modern Consumption" that for example, "Milk This Fresh" fresh milk has developed particularly well in the base camp of Harbin in Northeast China, but because of the short shelf life of fresh milk, it is still mainly deployed in the Northeast and North China markets.
In fact, the previous fresh milk sterilization technology was mainly pasteurization, which was sterilized at a temperature of 72-85 °C for 15s, which could eliminate harmful pathogens in raw milk almost without destroying the nutrition of milk, but the shelf life of pasteurized milk was 5-7 days. This makes it limited by the cost conditions of milk source and cold chain, and the sales radius is limited, and it can only be quickly distributed within about 300 kilometers of the milk source, and the cost is relatively reasonable, and if it is far away from the milk source, the cost will increase significantly.
In recent years, many dairy companies have begun to launch the "ultra-pasteurized milk" with a sterilization process between pasteurized milk (commonly known as fresh milk) and ultra-high temperature sterilized milk (commonly known as room temperature milk), and its products have lost some of their active substances, but the shelf life has been extended to 14-20 days, and the sales radius has been expanded to 500 kilometers, providing an opportunity for daily fresh to break through the regional sales bottleneck.
However, the low-temperature milk market has entered the "Warring States Period", and local dairy companies have their own side. For example, Sanyuan Dairy in Beijing, Bright Dairy in Shanghai, Yantang Milk in Guangzhou, Wandashan in the Northeast, and New Dairy in the Southwest Market are all dominating in their own regions.
In the fresh milk market in Hong Kong, China, in addition to international brands such as Nestlé Milk, the rest of the common Wei Kee, Cross and Vita Fresh Milk are all local brands in Hong Kong, China.
However, obviously, as low-temperature milk brands aim at the whole country and even to the international stage, the competition pattern of national dairy enterprises and regional dairy products is expected to be broken, and a new round of competition has begun.
3. Compete for "head soup"
In fact, China's low-temperature fresh milk accounts for less than 30% of white milk consumption, which is lower than the 90%+ of countries such as the United States, Japan, South Korea, and the United Kingdom, and 60%+ of Russia. However, with "more nutritious" and "healthier" becoming the "labels" of low-temperature milk, China's dairy market is transitioning from room temperature milk to low-temperature milk.
"In the past, there were only a few kinds of low-temperature milk, such as Guangming, Sanyuan, Wandashan, etc., but now the fresh milk showcase is obviously getting bigger and bigger, and there are more and more brands. The promoter of the liquid milk area of a supermarket in Gu'an, Hebei Province told "Modern Consumption" that at present, although the sales of room temperature milk still account for a large proportion, the proportion of low-temperature milk sales is significantly higher than before.
The reason for this is that since the epidemic, consumers have paid more attention to healthy eating. Compared with room temperature milk, low temperature milk has obvious advantages in terms of nutrients and "freshness" feeling. Therefore, dairy companies firmly believe that low-temperature milk will become a new track and the second growth curve for dairy enterprises.
According to the data of Bank of Communications International, the compound annual growth rate of low-temperature fresh milk will reach 12% from 2022 to 2027, and it is expected that white milk will experience a high-end trend and shift from room temperature milk to fresh milk. The investment of the Agricultural Development Fund also predicts that the scale of the low-temperature dairy industry is expected to reach 160 billion yuan in 2025.
At present, there are no tens of billions of single products in low-temperature milk, which also means that the space and imagination are unlimited. In the future, whichever dairy company is the first to grab the "first soup" will have the best chance to grab this big cake.
In the face of temptation, since 2018, the strategic focus of dairy companies has also shifted from room temperature business to low temperature business.
Mengniu Fresh Milk Division launched "Daily Fresh Talk" and "Modern Ranch", with sales reaching 3 billion yuan in 2022. At the end of 2019, Yili launched "Yili", "Jindian" and "Ranch Morning" fresh milk, with sales of more than 1 billion yuan in 2022. Bright Dairy and New Hope Dairy have established a five-year strategic plan with "freshness" as the core.
Xi Gang, chairman of New Hope Dairy, said in an interview with the media, "It is expected that in about 5 years, the proportion of low-temperature milk in China will exceed 50%. ”
For a time, practitioners accelerated into the fresh milk track, and the industry became extremely crowded. According to the data of enterprise inspection, there are 68,500 fresh milk-related enterprises in China.
There are many practitioners, and the homogenization of low-temperature milk is becoming more and more serious, in this context, marketing is particularly important.
Brands are constantly flocking to the advertising and marketing camp, striving to play the most impressive advertising slogans, naming popular TV series, variety shows, etc., hoping to get the attention of the audience through the influence of the program, in order to strengthen the awareness of the product in the minds of consumers, strengthen people's impression of the product, so as to expand the market.
For example, Daily Fresh has cooperated with Nai Xue's Tea, Bear Sleepy, Disney Theme Park, etc., to launch innovative drinks and packaging, in order to attract the attention of more young consumers. In addition, it also tries to strengthen the emotional connection between brands and consumers by signing spokespersons and naming variety shows.
But frequent spat doesn't seem to keep consumers loyal to their brands – they're more inclined to make purchasing decisions based on price and quality.
For example, Wen Jing will consider multiple factors when choosing low-temperature fresh milk: when she doesn't want to drink too expensive, she buys the cost-effective Hong Kong Wei Kee, but this fresh milk has a light taste; she has also tried Meiji low-temperature milk when she has a little money, and the taste is a little amazing, but she always feels that the opening is not well designed, and there are concerns that bacteria will run into the refrigerator if she doesn't finish drinking......
In addition, Wen Jing is also tempted by more choices - room temperature milk, flavored milk, flavored white milk, flavored milk with ingredients (grains, fruits), milk-containing beverages, formula milk powder, low-temperature yogurt, and more and more choices on the shelves of terminal channels.
In the face of the chaotic and fully competitive fresh milk market, how to win this fierce battle and obtain the unwavering choice of consumers is obviously a complex science.
*Wang Zi is a pseudonym in the article, and the title picture in the article is from the photo network, based on the VRF protocol.