Guide
In 2024, the snack industry faces greater challenges than ever.
On the one hand, the change of supply-side channels has triggered a low-price competition war: the snack discount stores represented by Zhao Yiming snacks, snacks are busy, snacks are preferred, and love snacks have triggered a "price reduction tide" in the leisure snack industry through channel changes, and traditional channels have been greatly impacted, and many snack giants have also achieved a "breakthrough" through price reductions; How to accurately understand and meet the needs of consumers has become a common problem for leisure snack companies.
The pursuit of parity and quality at the same time, the coexistence of consumption downgrading and consumption upgrading, and the increasingly fierce competition in the leisure snack track have put forward higher requirements for brands to identify opportunities, clarify strategies, and grasp consumers. Rees will combine the perspective of category strategy to interpret industry trends and innovation directions in detail.
Insight 1
There are many product innovations at the Spring Sugar Fair, but most of them belong to pseudo categories that violate the laws of cognition
There is no shortage of product innovation in the Spring Sugar Association, but a category innovation that follows the laws of mental cognition. In the research report on the snack and beverage category of "How to Innovate for the Tangled Generation Z", Rees Consulting suggested that "in addition to product innovation, young innovation must have mental innovation". Half a year later, this suggestion still applies to this year's sugar and wine party. Many products blindly innovate and fall into the misunderstanding of pseudo-categories, and innovation that fails to conform to the mental foundation is destined to be short-lived and unable to achieve sustainable growth.
- Spicy crayfish with shell, shelled snail meat - different from the spicy fish of Jinzai, foods such as hemp and snail are products with strong social attributes, and the fun of consumption lies in socializing while peeling the shell and picking the meat, and the consumption scene is also highly related to the dinner scene. Making it into a casual snack completely deviates from the cognition of the consumer side and is destined to be difficult to go far.
Image source: Taobao
- Vitamin C spicy strips - spicy strips are obvious hedonic snacks, and the first characteristic is "spicy". Even with the addition of vitamin C nutrition, vitamin C supplementation is difficult to become the demand of consumers when eating spicy strips.
Image source: Photo by Reese Project Team (left), Taobao (right)
"Chinese's own cookies" - the brand tried to create the concept of "Chinese cookies", but did not clearly define the category of "Chinese cookies", resulting in the "soft heart" and the "crisp" taste perception of cookies, which is a rigid label of "Chinese" concept, but does not clarify the "Chinese" standard. Also focusing on the concept of Chinese style, Tustin has established relevant standards in terms of bread, fillings, and production methods in order to implement the category concept of "Chinese burger".
Image source: Photo by Reese Project Team (left), Taobao (right)
Insight two
Although health is a definite trend, most health innovations are going in the wrong direction
The pull of "0 additive" is no longer there, and it has been differentiated into subdivided concepts such as "0 sugar", "0 oil" and "0 pigment". "0 addition" is the hottest health trend in recent years, but at this stage, it is no longer possible to produce an effective addition to the brand by spreading "0 addition" alone. On the one hand, with the abuse of this concept, major brands have redefined "0 additive" according to the actual situation of the product, and the definition of "0 additive" has been blurred, on the other hand, with the improvement of health awareness, the "0 add" in the minds of consumers has been differentiated.
Healthy innovation is difficult to save the declining category. In the report "How to Innovate for the Tangled Gen Z", Reese Consulting said, "Don't try to salvage outdated categories, because each category has its own life cycle. Taking the Lin family shop as an example, over-binding the old category of "canned fruit" to do health innovation will not be able to reverse the downward trend after all. Nearly 9% of the revenue of the Lin family shop is contributed by canned fruits, and small innovations such as "0 fat sugar substitutes" alone cannot reverse the decline of the entire canned fruit category. In order to achieve sustainable growth, the top priority of the Lin Family Store is to lay out trending new categories and bring the second and third growth curves to the group's growth.
Image source network
To grasp the trend of health, you can't rely on a patchwork. For example, dried fruits are in fact "0 fat", and they are also "0 fat" in the minds of consumers, so emphasizing "0 fat" in products is equivalent to repeating a common sense, which is an ineffective communication. The same is true for nuts, which are "0 preservatives" in fact and in mind, so no matter how much they advertise "0 preservatives" on the product, they will not be able to add to the brand.
Image source: Brand Taobao page
The core reason why the health force is used in the wrong direction is that the pain points are not accurately found, and the inappropriate health is done in the places that are not needed. Successful health innovation must first identify the mental pain points. Based on the mental pain points, Rees Consulting assisted Junlebao to create a new category of simple and mellow - 0 sucrose yogurt. In 2018, with the improvement of health awareness, the pain point of "high sugar" of traditional yogurt has become more significant, so sugar-free and low-sugar products on the market have shown signs of rapid growth. Based on this, Rees Consulting suggested that Junlebao create an expert brand of sugar-free yogurt, thus giving birth to a new category of "0 sucrose yogurt". In 2019, China's yogurt market declined as a whole, but Junlebao achieved rapid growth against the trend with simple and mellow 0 sucrose yogurt. After four years of implementation of the strategy, in 2023, Jane Mellow Yogurt will achieve the first market share in the field of low-temperature yogurt, become the first brand in the industry, break the industry oligopoly pattern composed of Yili, Mengniu and Guangming, and successfully rank among the top three yogurts.
Insight three
The best practice of chasing the wind is not to imitate or do micro-innovation, but to do the opposite
Phoenix claws: With the explosion of Wang Xiaolu's tiger skin phoenix claws, a large number of brands followed up with "copy and paste".
After Wang Xiaolu, tiger skin and phoenix claw products sprung up. Due to the lack of differentiated competitive advantages, brands can only frantically involution: on the one hand, the price of the volume, such as through the dissemination of Wang Xiaolu foundry for the quality endorsement, sold at a lower price, trying to exchange price for volume; on the other hand, the volume flavor, in the flavor research and development, endlessly expand a variety of flavors, such as rattan pepper flavor, marinated flavor, spicy flavor, chopped pepper flavor, spicy flavor, etc.
Image source: Photo by the Rees Project
Meat sausage: all-round involution in terms of raw materials, meat content, shape, scenes, etc
In order to strengthen the competitiveness of products, various brands are crazy to make a fuss about raw materials and meat content - roll raw materials (raw material origin, quality, part), roll meat content, roll form (large intestine, meat date sausage), roll scene (staple food scene, meal replacement scene, snack scene).
Image source: Organized according to Taobao pictures
Konjac Jelly: Caught in an arms race for juice content and juice categories
The homogenization competition of konjac jelly is serious, and various brands are engaged in an arms race in terms of juice content and juice category.
Image source: Organized according to Taobao pictures
In a heavily homogeneous market, staying away from competitors, creating differentiated advantages that competitors cannot follow, and preemptively occupying the minds of consumers will be the only opportunity for brands to break through.
"Three seeds fell in the soil of the forest. Two seeds are close and the other is far away. In the struggle for survival, two seeds that are close together will engage in a very spectacular battle until one seed rules the other. From then on, the first person to survive began. ”
——"The Origin of the Brand"
This law has been proven many times throughout the history of the business world. It is often difficult to grow into a big brand by following the giants, on the contrary, it is necessary to stay away from the giants to achieve great success. For example, the "young" Pepsi Cola is opposed to the "traditional" Coca-Cola, Jinmailang Liangbai Kai uses "cooked water" to oppose "raw water" such as Cestbon and Nongfu Spring, the "0 sugar, 0 fat and 0 calories" Yuanqi Forest is opposed to traditional carbonated drinks such as Coca-Cola, Sprite and Fanta, and Taoli bread uses "short-term protection" to oppose long-term bread such as Dali Garden and Panpan.
Insight four
It is not clear about the value of the category, and it is difficult to bring a real premium even if it is deep processing
The price of raw material snacks represented by nuts and jujubes is limited by raw materials, and the price is relatively transparent, so deep processing is an effective premium method for raw material products. At this year's Spring Sugar Exhibition, raw material snack brands represented by nuts and jujubes have placed deep-processed products in the C position of the booth, trying to find a premium direction in the homogeneous market. For example, I really want you to promote jujube kernel pie and red date sesame balls, Wolong mainly promotes almond milk, Rushui mainly promotes nut crisp and nut egg rolls, and three squirrels mainly promote nut milk at the previous sugar and wine party.
Image source: Photo by the Rees Project
Image source: Taobao
Deep processing is indeed the premium direction of raw material products, but the current practice of major brands has not clarified the category value behind it. Taking nuts as an example, in the last round of growth, daily nuts drove the "volume and price rise" of the nut market, and in the "post-daily nuts" era, many brands invariably chose to focus on deep processing, but the market performance was still less than expected. The reason is that daily nuts give consumers a reason to buy - "a pack of nuts a day to supplement the daily nutrition", which explains the category value behind it, and the deep-processed products such as nut milk and nut crisp that are now being promoted do not give a reason to convince consumers to buy.
Finding a premium requires a return to the category itself. According to research by Reese Consulting, health is the most critical factor driving the growth of the nut category and the core reason why consumers buy nuts, which has been proven in both the Chinese and US markets. Explaining the health value of nuts will be an effective breakthrough to achieve a premium.
epilogue
In 2024, the leisure snack industry will usher in a more involuted situation, with the pressure of price competition on the supply side and the demand for quality upgrades on the demand side, which will bring unprecedented pressure to the leisure snack industry, but it will also bring a large number of possibilities for category innovation. In the era of industry involution, it is better to grasp the trend than to keep the advantage. The key to breaking the game of casual snack brands is to take the lead in gaining insight into industry trends, conforming to consumer cognition, and quickly seizing the minds of users through category innovation.
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—"How to Innovate for the Tangled Generation Z"
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