After the reform and opening up, the mainland's economy has developed rapidly, and not only has the people's wealth continued to grow, but also a large number of wealthy people have emerged in the country.
What is surprising is that China's richest people are not Internet up-and-comers like Jack Ma and Ma Huateng, nor are they real industry bigwigs like Wang Jianlin.
To the surprise of many people, the richest man in China is actually the founder of Nongfu Spring Group. There is no other reason. Bottled mineral water, although not expensive, benefits from its low cost and high sales.
So far, once he occupies a certain share of the market, he will soon be able to continue to bring high returns, and Zhong Sui will become the richest man in China.
Evergrande Group also noticed the bottled water market, and did not hesitate to invest in a large amount of publicity and distribution fees, but ended in a fiasco, what is going on?
The rapid expansion of real estate, the rapid expansion of Evergrande Group
Evergrande Group was founded in 1996 in Guangzhou, and at that time, the group's main business was of course real estate. With a small area and low price sales method, the first real estate developed by Evergrande Group was sold out quickly in just a few hours.
There is no doubt that the first pot of gold is earned, which means that the group's strategy in the real estate industry has achieved great results. After the reform and opening up, a large number of people from the rural areas of the mainland have poured into the cities, and the original urban housing cannot meet the needs of the migrant workers in the cities.
Then, new real estate is an urgent need of the whole country and society. However, due to the difference in productivity between rural and urban areas, the rate at which farmers accumulate wealth is much lower than that of urban residents, so Evergrande Group seized the emerging real estate market that just needed to buy houses but lacked financial resources in the early stage of development with a strategy of small area and low total price.
Since then, Evergrande Group has been making great progress, and has continued to start construction of new projects by absorbing funds from all over the country and even around the world, and the overall development momentum is thriving.
In 2009, Evergrande Group was officially listed in Hong Kong, once becoming the mainland real estate company with the highest market value in Hong Kong, and Evergrande already had tens of billions of yuan in assets at this time.
After the 08 Olympic Games, the economic development of the mainland accelerated sharply, and at the same time, the national housing prices rose rapidly, which further drove the enthusiasm for buying houses.
And real estate companies such as Evergrande and Country Garden have also caught up with such a tuyere and become more and more huge. After having sufficient assets, Evergrande Group did not choose to be trapped in the real estate industry, but set its sights on the automobile, sports, and even drinking water industries.
Evergrande Ice Spring also came into being, and Evergrande Group has placed quite high expectations on Evergrande Ice Spring.
The biggest cost in the drinking water production industry is not the water used to consume the body, but the bottles used to store the water and the factory lines that produce the bottled water.
Evergrande Group, which entered the bottled drinking water industry from scratch, has established its own production line almost at any cost, and in the face of a sales network starting from scratch, Evergrande Group has chosen to use money to open the way, but this has not achieved good results.
The reason is also very simple, it is difficult for consumers to accept a sudden pop-up of drinking bottled water produced and sold by real estate companies.
In the face of this situation, Evergrande did not back down, but increased the investment in publicity, even as many as billions.
Behind the creation of differentiated, "high-quality" mineral water is a huge cost of publicity
In the era of economic development, it was very common to boil tap water or use well water directly. However, with the development of the economy, the people have higher requirements for the health standards of drinking water.
Purified drinking water that has been filtered by the factory is significantly healthier than tap water. At the same time, there are about two types of purified water sold in the market.
The first is natural mineral water represented by Nongfu Spring, and the second is pure drinking water represented by Cestbon.
Natural mineral water is mainly obtained from natural and pure water sources, and after purification, it can be bottled and sold. The water intake standards for pure drinking water such as Cestbon are not so strict, but the purification process meets the standards to ensure that the products meet the national standards.
In order to be a blockbuster in the bottled drinking water market, Evergrande was very strict in the selection of water sources for Evergrande Ice Spring, and finally chose the deep natural mineral water in the Changbai Mountain area of Jilin Province.
The Changbai Mountain area is rarely polluted by people, so it is rarely polluted by industry, and the mineral water in the Changbai Mountain area is a typical volcanic rock cold spring, and the water is rich in a variety of minerals, which is beneficial to the human body.
It can be said that the water quality of Changbai Mountain is the best quality natural mineral water in China, and internationally, the natural mineral water quality of the lower Changbai Mountain and the Alpine region and the Caucasus Mountain region is very good, and these three regions are also recognized as the world's three high-quality water sources.
At least in terms of birth, the water quality of Evergrande Ice Spring is high-end and healthy compared to other mineral waters, and it is really high-quality mineral water.
At the same time, Evergrande Group has spared no effort in the promotion of Evergrande Ice Spring, and has invested a lot of money, manpower and material resources. Under the multi-way attack of Evergrande Group's wealth, in terms of sports, the famous Guangzhou Evergrande team wore a jersey printed with the logo of Evergrande Ice Spring.
For a long time, Chinese football has often been teased by domestic fans, and British football players not only enjoy high salaries, but also repeatedly disappoint fans with their repeated defeats.
However, on November 8, 2013, after a 3-3 draw in the football match at Guangzhou Tianhe Stadium, Guangzhou Evergrande from China narrowly defeated the then Asian powerhouse South Korean football team by virtue of home advantage.
It can be said that the strength of the Guangzhou Evergrande team has long surpassed that of the national football team, so fans across the country are greatly excited. And the Evergrande Ice Spring on the jersey of the Guangzhou Evergrande team has also become famous throughout the country with the fame of the Evergrande team.
Evergrande Ice Spring's sky-high advertising cost of up to 6 billion yuan is of course not only the title of Guangzhou Evergrande, a football team. In order to make Evergrande Ice Spring, a mineral water brand, deeply rooted in the hearts of the people, Evergrande Ice Spring's advertisements can not only be seen everywhere offline, but also on the Internet, Evergrande Ice Spring has invited many famous stars to serve as spokespersons.
In order to correspond to the elderly group, Evergrande Ice Spring invited Jackie Chan as a spokesperson, implying health and longevity. Promote that when making tea and cooking, using Evergrande Ice Spring is healthier.
In order to correspond to the young and beauty-loving female group, Evergrande Ice Spring invited Fan BB as the spokesperson, implying that drinking Evergrande Ice Spring during sports and fitness will make the body healthier.
What's even more ironic is that perhaps in order to expand its international influence, or perhaps at that time, Korean dramas were popular in the world, Evergrande Ice Spring even invited South Korea's Kim so-hyun and Jun Ji-hyun as spokespersons.
You must know that these spokespersons are all well-known without exception, so the endorsement fee is expensive. Under the overwhelming publicity, at the first press conference of Evergrande Ice Spring, its person in charge even declared that the sales of Evergrande Ice Spring would exceed 10 billion yuan within three years. However, will reality really be as rosy as he expected?
The feedback of the market, Evergrande Ice Spring, which suffered heavy losses and failed miserably
At the beginning of 2014, Evergrande Ice Spring officially opened the agency authority, and in a short period of time, the contract amount exceeded 5 billion yuan.
At the same time, Evergrande Ice Spring is also actively expanding overseas markets, relying on the advantages of high-quality water sources in Changbai Mountain, Evergrande Ice Spring has been exported to the United States, Japan and other overseas countries.
Such a limelight is even more prosperous than the domestic drinking water giant Nongfu Spring, as if Evergrande Ice Spring is the next Nongfu Spring.
However, to everyone's surprise, the failure of Evergrande Ice Spring came soon. In 2013, the sales of Evergrande Ice Spring were only more than 2 billion, and such achievements were supported by the cost of 6 billion sky-high publicity expenses.
Considering that sales are not equal to actual profits, the amount of Evergrande Group's loss in Evergrande's ice spring business is actually much greater than 4 billion.
In fact, the reason for all this is very simple, the pricing of Evergrande Ice Spring is far beyond the actual situation that he can control.
While domestic drinking water giants Nongfu Spring and Cestbon are both priced at two yuan, Nongfu Spring is priced at five yuan per 350ml bottle.
It can be said that the failure of Evergrande Ice Spring is largely due to overpricing. As a purified drinking water for the general public, the price of Evergrande Ice Spring has long exceeded the generally accepted price in the market.
For consumers, there is no actual huge taste gap between Nongfu Spring, which is two yuan for drinking pure water, and Evergrande Ice Spring, which is five yuan, and the excellent water quality of Evergrande Ice Spring is not worth paying for its high price.
Admittedly, the mainland market is not without high-end drinking mineral water, but they are often priced much higher than Evergrande Ice Spring, and they do not rely on supermarkets and small shops for sales. It can be said that the main reason for the failure of Evergrande Ice Spring is the failure of product positioning.
It is hoped that the product premium will be increased and more profits will be obtained by having better water quality than other mineral waters. It is also hoped that like other evaluation of mineral water, it will be sold in large and small supermarkets and achieve huge sales.
However, the reality is that Evergrande Ice Springs are too expensive compared to affordable mineral water. Compared with high-end drinking water, Evergrande Ice Spring is slightly cheaper.
Therefore, even if Evergrande Ice Spring tries to regain the market by cutting prices, it is still not accepted by consumers. The stereotype about the high price of Evergrande Ice Spring, once it is cultivated, then the failure of Evergrande Ice Spring is also doomed.
epilogue
There are many reasons for the failure of Evergrande Ice Spring.
The first is the lack of brand image. As a giant in the real estate industry, Evergrande's name has no appeal in the drinking water market.
The second point is the failure of product pricing, the pricing that is not up or down, coupled with the means of price reduction and promotion in the later stage, can be described as a loss of popularity.
The third point is the high marketing cost and very low marketing income, Evergrande Group has not achieved the corresponding national recognition for Evergrande Ice Spring after paying a sky-high publicity fee of up to 6 billion.
The reason is also very simple, the drinking water market needs not to be short-lived and enthusiastic, but to be a long-term stream of water for decades.
Finally, and most importantly, the Evergrande Ice Spring product itself does not have enough sincerity and patience.
Resources:
Evergrande Ice Spring joins hands with Bayern to become the team's official designated water.People's Daily Online [Citation date: 2019-09-14
Evergrande Ice Spring.官网 [Citation date: 2021-01-26.]
The secret of making Evergrande Ice Spring earn back 4 billion Source: China Advertising Network News Center | 2016/5/25