Yan Na, a trainee reporter of this newspaper, reported from Cheng Peng and Cheng Peng
Recently, the news of adopting a cow to be listed has pulled this "net red" brand back into the public eye. According to the documents disclosed by the China Securities Regulatory Commission, Adopt a Cow Holding Group Co., Ltd. (hereinafter referred to as "Adopt a Cow") has signed a listing counseling agreement with CITIC Securities to be listed on the A-share market.
With the slogan of "if the cow is well raised, the milk will be good", the adopted cow quickly came out of the circle by promoting its high-standard feeding methods and milk source quality to consumers. However, the milk source, adoption model, and channel of adopting a cow have recently been questioned by some media. In this regard, the reporter of China Business Daily sent an interview letter to the company that adopted a cow, but as of press time, there was no reply. In addition, the reporter noted that in recent years, some emerging brands have formed an "Internet celebrity effect" with the help of network marketing, but after that, some brands have fallen into the dilemma of continuous growth.
In this regard, brand marketing expert Lu Shengzhen said that under the new round of growth cycle, giants rely on capital, channels, brand advantages, accelerate development, small and medium-sized "net red" brands in these aspects relatively lack sufficient competitive advantage, so from the milk source, product culture, consumer positioning and other angles of their product positioning, image positioning, brand positioning to subdivide, to create a competitive advantage with their own characteristics.
"For small and medium-sized 'net red' brands, to achieve long-term development, it is necessary to continuously do a good job in product innovation, adapt to new retail channels and develop a good price strategy." Song Liang, a senior analyst at the dairy industry, pointed out.
Starting from the bottom of the "net red" brand "out of the circle" road
According to the WeChat public account of adopting a cow, in 2014, Xu Xiaobo, the founder of adopting a cow, spent 460 million yuan to establish his first modern pasture in Gucheng County, Hebei Province, Kanghong Ranch, supporting the planting of 60,000 mu of grassland, and in 2016, he and financial writer Wu Xiaobo jointly created a cattle adoption.
What really made it popular was the adoption model and the brand story about high-quality milk sources. At a time when consumers are paying more and more attention to health, adopting a cow starts from the milk source and proposes the concept of "allowing consumers to adopt cows and let them produce milk for consumers".
According to financial reports, as early as 2017, adopting a cow launched the "Adopt a cow" community interaction plan, which mainly includes: 2999 yuan per year to obtain the right to adopt cows and spend 10,000 yuan to become a joint rancher and obtain all the rights and interests of adopting a cow.
According to the official introduction, the adoption of a cow was not officially launched until last year. Including real-name adoption and other models, in the real-name adoption model, consumers become real cattle partners, can book milk one year in advance at the exclusive farm.
However, some insiders questioned: "The so-called adoption model is not realistic from the perspective of large-scale production." Wang Dingmian, a senior dairy expert, said, "Now dairy companies are factory operations, in the complete production line, the milk source will be mixed, it is difficult to provide each cattle user with milk produced by the corresponding cow." ”
The official customer service for the adoption of a cow said that the adoption of a cow is only the name of the company's product, not the milk source or product that consumers imagined to obtain from a designated cow.
In the brand story of adopting a cow, the good milk source created by the cow's high-standard feeding model is the core selling point. According to its official article, the company introduced Holstein cows with Australian ancestry, eating imported pasture grass, drinking 380 meters of deep well water, the average daily food cost of each cow was nearly 80 yuan, and each cow was equipped with a smart collar to monitor the health of the cows in real time.
It is worth mentioning that the adoption of a cow has always emphasized the construction of its own milk source, and even claimed that the products are used by its own milk source, but according to the annual report data released by Mutong Technology, a listed dairy company in Shanxi, at the end of March this year, among the top five major customers of Mutong Technology, the adoption of a cow is the first major customer, with a sales amount of more than 45 million yuan, reaching 18% of the company's total annual sales.
In this regard, the adoption of a cow has publicly stated: "At present, most of the company's milk sources come from its own pasture, and some of it comes from the industry's well-known partner farms, but the company is also continuously increasing the proportion of its own milk sources." According to its official information, as of April 2021, the company has 7 modern farms and 1 processing plant. According to the investigation, a cattle adopted cow was recently established in Hulunbuir Animal Husbandry Co., Ltd. to improve upstream resources.
The smooth progress on the road of "net red" has brought relatively considerable operating data for the adoption of a cow. It publicly said that the company's annual sales reach 2 billion yuan and the gross profit margin is 30%. Wang Dingmian told reporters: "In small and medium-sized dairy enterprises, the scale of more than 1 billion yuan is not common, and the level of 2 billion yuan is relatively good. In addition, a gross margin of 30% is higher than the industry-wide average. ”
However, according to the Beijing News, most of the cost of adopting a cow is spent on the traffic costs of the e-commerce platform, the cost of customer acquisition is high, the marketing investment is large, and it has not yet been able to truly achieve profitability.
Happy on the line, stuck on the line
In recent years, Mengniu, Yili, Guangming and other enterprises have also embraced online by naming online variety shows and expanding online communities. In addition to online marketing falling into the inner volume, online traffic fees are also becoming more and more expensive, coupled with the "net red effect" is not long-lasting, therefore, the adoption of a cow chooses to switch to the line, and externally declares that it will be laid out in offline channels such as Hema Fresh.
It is worth noting that the adoption of a cow has previously said that its online channel accounts for 70%. Zhu Danpeng, an analyst in the Chinese food industry, said that online and offline integrated operation is the mainstream trend of the development of the entire Chinese FMCG industry in the future. At present, the e-commerce channel of adopting a cow has certain advantages, and it is necessary to consolidate and improve the offline channel.
The reporter learned that the current dairy industry presents a duopoly pattern, according to Euromonitor data, in 2020, Yili, Mengniu accounted for 26.4%, 21.6% of the market share respectively. This is also related to the continuous expansion of channels between the two enterprises over the years. According to the analysis of Ping An Securities Research Report, since 2017, Yili and Mengniu have increased investment in third- and fourth-tier markets. "At present, the channels of Yili and Mengniu have been extended to the rural market, while many second- and third-tier and even regional dairy enterprises are still staying in prefecture-level cities, and there are still opportunities in the sinking market." An industry insider told reporters.
In Song Liang's view, relying too much on online channels and not deeply cultivating offline channels is a "common disease" of many small and medium-sized "net red" brands. Song Liang pointed out that nowadays, the cost of online customer acquisition is getting higher and higher, and some small and medium-sized enterprises should go deep into third- and fourth-tier cities, or deeply cultivate the local market to reduce costs as much as possible.
"Small and medium-sized 'net red' brands lack extensive product coverage advantages and sales advantages, resulting in a relatively slow shipment speed, making it less attractive to channel providers." In the negotiation with the terminal is at a relative disadvantage. This also leads to the same high-cost competitive level on the terminal display surface. Lu Shengzhen said.
Lu Shengzhen suggested, "For small and medium-sized 'net red' brands, when they see the store, they must see the goods, step by step, increase the accumulation of consumers, and then seek higher visibility of the terminal after stabilization." In addition, the method of joint development is adopted to develop IP products with popular elements, rely on the IP effect brought by product co-branding, continuously create popularity in the terminal, and gradually obtain the recognition of channels. In addition, in the case that the circulation channel cannot dominate, consumers can be directly intercepted in the last 100 meters of the market in the mode of community direct delivery. ”
How does "internet celebrity" grow popular?
There are many dairy brands that rely on traffic passwords to become popular, but some companies have fallen into development dilemmas. For example, Kodi Dairy, which launched the once popular "Little White Milk", is now punished for the company's financial fraud, and its future development is uncertain; Guangxi Baifei's Baifei Cheese and Xinjiang Xiaobai launched by Tianrun Dairy are facing problems such as quality and poor brand response.
Song Liang said, "The audience of small and medium-sized brands of 'net red' is narrow and the pricing is relatively high, which is easily challenged by the price level of traditional dairy enterprises. In addition, the innovation of these enterprises is still lacking compared with leading enterprises. ”
In addition, in recent years, downstream dairy companies have accelerated the layout of upstream milk sources. The reporter noted that when large raw milk enterprises will be divided up, some dairy companies seek the layout of milk sources through mergers and acquisitions of smaller enterprises, such as the recent acquisition of 60% of the equity of Xiaoxi Niu by Bright Dairy. With the continuous emergence of integration, the concentration of the industry has further increased. As a result, there is greater pressure for small and medium-sized brands to survive in the future.
Wang Dingmian said that for small and medium-sized "net red" brands, it is not easy to strive for the advantage of milk sources, and the pasture will also consider the long-term development, management, profitability, etc. of dairy enterprises, and may have more advantages for large brands in these aspects. "In the future, small and medium-sized 'net reds' can cooperate with enterprises with a certain market share and milk source guarantee capabilities, including strategic cooperation or equity participation, complementing their own advantages."
In addition, from the perspective of products, the products laid out by dairy companies belonging to some "net red" brands are mainly ambient milk. However, Holstein data shows that at present, in China's normal temperature milk market, Yili and Mengniu occupy the main market share, and it may be difficult to break through in the normal temperature milk track.
Wang Dingmian said that small and medium-sized "net red" brands can consider the layout of low-temperature milk products, such as the production of high-quality low-temperature pasteurized milk or layout yogurt, research and development and production of healthy products, functional products, etc.
Many respondents believe that small and medium-sized "net red" brands lack competitive advantages in terms of funds, channels, supply chains, etc., and should break through from the aspects of cost performance, differentiation and specialization. "'Net red' brands should have perseverance, patience, confidence, and sink their hearts to improve the supply chain, improve quality, do a good job in brand activation, service system improvement, scene innovation, and customer stickiness." Zhu Danpeng said.