Affected by consumption upgrading and epidemic factors, the domestic consumption trend has intensified, and the advantages of the food and beverage track are obvious. As one of the fastest developing tracks for food and beverages, the advantages of energy drinks are more prominent. As the first stock of functional drinks, Dongpeng Beverage can be said to be standing on the "outlet".
Recently, Dongpeng Beverage's third quarter report of 2021 was released, and the main revenue of Q3 single quarter was 1.878 billion yuan, an increase of 19.3% year-on-year; the net profit attributable to the mother in a single quarter was 320 million yuan, an increase of 21.87% year-on-year. Based on the results of the first half of the year, Dongpeng Beverage achieved revenue of 5.56 billion yuan in the first three quarters of 2021, +37.5% year-on-year, and net profit attributable to the mother of 1.00 billion yuan, +41.5% year-on-year.
Behind the dazzling achievements of Dongpeng Beverage is the continuous deepening of the energy beverage track, which is firmly optimistic about the national development.
Figure: Dongpeng Beverage's "2021 Third Quarter Report" main business revenue composition
First, the energy drink track has significant advantages
At present, the prosperity of the energy drink track is very high, and it still maintains a rapid growth of more than 10%, which is the highlight of the soft drink Red Sea. It is predicted that the size of China's soft drink market is expected to reach 1,323 billion yuan in 2024. Among the soft drinks, energy drinks are one of the fastest growing categories in recent years. According to Huachuang Securities, the compound annual growth rate of the energy beverage market in the first five years was 9.2%, second only to coffee drinks.
The energy drink track is hot and attracts many players to enter. According to the survey of relevant institutions, there are currently 14,000 existing "functional beverage" related enterprises in China, and 2020 is the peak period for the registration of functional beverage enterprises, with 4367 enterprises registered throughout the year. In the first five months of 2021, another 1,306 companies were registered.
In the functional beverage market, Red Bull, Dongpeng Special Drink and Lehu have formed a three-legged situation. Recently, following the reignwood group and Tencel Thailand's Red Bull trademark case, the Red Bull decorated in the golden pot is owned by Tencel Thailand, which undoubtedly has an impact on Red Bull's market in China. With Red Bull and the original brand Tencel Thailand involved in the trademark, Dongpeng Beverage also ushered in a broad opportunity for development.
Second, deep ploughing energy drinks, improve product layout
Dongpeng Beverage has been deeply cultivating energy drinks for many years, and its functional beverage Dongpeng Special Drink has become a well-known national brand of functional beverages. The rapid development of Dongpeng Beverage, on the one hand, benefits from the advantages of the track; on the other hand, Dongpeng Beverage firmly grasps the needs of consumers and relies on innovation to continuously inject vitality and vitality into the brand.
Under the current fast-paced life, young people are increasingly stressed, especially young people represented by Generation Z, who have become the main force of energy drink consumption. Energy drinks have always been the core category of Dongpeng beverages, and the scale of the "energy +" product matrix based on Dongpeng special drinks is prominent.
In recent years, Dongpeng Special Drink has won the love of many consumers with its differentiated packaging. The number of consumers and consumption scenarios is also increasing. According to Nielsen's latest data, in 2020, Dongpeng beverage sales increased by 29.2% year-on-year, with a market share of 26.7%, sales increased by 26.7% year-on-year, and the market share reached 20.2%, becoming the fastest growing manufacturer among the top 20 beverage manufacturers. The 500ml Dongpeng special drink has become an important source of Dongpeng beverage increments.
While maintaining the status of the core main product of Dongpeng Special Drink, in recent years, Dongpeng Beverage has been trying to expand its product layout, on the one hand, to improve its anti-risk ability, on the other hand, in order to meet the needs of young consumers.
Dongpeng Beverage innovates and develops "energy +" products of different categories, flavors and drinking scenarios according to the consumption needs of different consumer groups and different consumption scenarios. In 2020, Dongpeng Beverage launched the "Dongpeng Plus Hydrogen" gas-type energy-containing nutrient drink, and Dongpeng Plus Hydrogen added carbonated bubbles to the product, which is also the first gas-containing energy drink under Dongpeng Beverage.
In March 2021, Dongpeng Beverage launched Dongpeng 0 Sugar, on the basis of the original functional drinks, the use of a higher price, more natural combination of "erythritol + steviol glycosides" to replace the original white sugar, combined with erythritol fresh and refreshing, steviol to optimize the taste of the characteristics, the product also once again refreshed consumers' taste cognition of traditional functional drinks.
In September 2021, Dongpeng Beverage launched the "Dongpeng Big Coffee", a cross-border ready-to-drink coffee track to further meet the segmentation needs of consumers.
Up to now, Dongpeng Beverage has formed a matrix of energy drink products such as Dongpeng Special Drink, Dongpeng Jiajie, Dongpeng 0 Sugar, Dongpeng Big Coffee, etc., in addition to the effect of supplementing energy, it also caters to the current consumption trend of low sugar and health.
It can be seen that Dongpeng Beverage's positioning of "energy +" is becoming clearer, and energy drinks from January to September 2021 increased by 41.74% year-on-year, which is also the result of continuous innovation and development.
It is worth discussing that from the third quarter report of Dongpeng Beverage, it can be seen that in addition to the steady increase in revenue, Dongpeng Beverage has also achieved significant results in channel expansion. The report shows that in the first three quarters, in addition to the Guangdong region, Dongpeng Beverage's revenue in East China, Central China, Guangxi and direct operation accounted for more than 10% of the operating income. The national region (except Guangdong and directly operated areas) totaled 2.400 billion yuan, an increase of 49.81% year-on-year; the proportion of national regions further increased, up 3.47 to 43.25% year-on-year, of which the fastest growth rate was in the northern region, followed by the east china region and the southwest region.
Figure: Dongpeng Beverage "Announcement of Main Operating Data for the First Three Quarters of 2021"
Third, the development of brand rejuvenation enhances influence
Although Dongpeng Beverage's current revenue and market share have increased, there is competitive pressure from industry giant Red Bull in the past, and then there is the pursuit of Lehu. At the same time, Coca-Cola, Nongfu Spring, Yili and other enterprises have also launched functional drinks, in order to continue to occupy a market position, Dongpeng Beverage still needs continuous progress.
When Generation Z becomes the main force of consumption, Dongpeng Beverage must take on the heavy responsibility of social interaction while meeting consumer demand, and understand the emotions, language and needs of young people. As the leading product of Dongpeng Beverage, Dongpeng Special Beverage is the epitome of the youthful development of Dongpeng Beverage brand.
The brand marketing of Dongpeng Beverage's rejuvenation and entertainment has greatly enhanced its brand influence. In 2013, Dongpeng Beverage invited celebrity Nicholas Tse to endorse it, and began to appear on CCTV and major media platforms across the country. During the 2018 World Cup in Russia, Dongpeng Beverage spent 150 million yuan to grab beach sports marketing. Advertising has enabled Dongpeng Beverage to quickly improve market awareness and increase brand influence.
In recent years, Dongpeng special drink continues to appear in popular dramas, variety shows, film and television, vibrato, B station platform, where there are young people, there is a figure of Dongpeng special drink. As a national brand of functional beverages, Dongpeng Special Drink has opened an innovative marketing strategy in film and television variety shows and interacted with young people.
Nowadays, the development of Dongpeng Beverage benefits from the advantages of the energy drink track and its own development. As the first stock of functional beverages, Dongpeng Beverage has attracted much attention from capital and the market since its listing. Some time ago, Zhang Kun, Fu Youxing, Zhu Shaoxing and other star fund managers investigated Dongpeng Beverage, which made Dongpeng Beverage the focus again, and also made the public full of expectations for the development of Dongpeng Beverage.
With the help of capital, with the continuous improvement of energy drink categories and the continuous expansion of channels, Dongpeng Beverage may have better development in the future.