Economic Observer Reporter Chen Bai "If you regard the consumer goods market as a battlefield, the smoke of the battlefield will never go out. The renewal of consumer brands is like pop music never stops."
From Yuanqi Forest to Wang Baobao and then to Ubras, Perfect Diary ... In the past two years, a batch of new consumer brands have appeared in our field of vision in batches and quickly become popular products. When we tried to ask Li Yang about this wave of new consumer brands, he used such a simple analogy to explain the logic.
Li Yang is an associate professor of marketing at the Changjiang Business School and an academic executive director of senior management education programs and MBA programs. He has long been concerned about research on corporate brand shaping and marketing data modeling, and has also provided research consultations for institutions such as Tmall , Tencent , Yonghui Supermarket , Haier and other institutions.
In Li Yang's view, this rapid change itself is the uniqueness of the consumer goods track. Due to the continuous changes in people's preferences and age, most products and even most brands may not have a long life cycle of . "But this is not a bad thing, but an objective law." Li Yang believes that China's rapid economic development only takes 34 years. Now we need to slowly learn to accept the process of continuous innovation of consumer brands. This is our first step in understanding this phenomenon.
Z generation is rising as a new consumer group, but it is increasingly showing personalized and diversified characteristics. Li Yang chose to use "circle-based" to explain this change in demand. "The second dimension, e-sports, trendy toys, figures, national style... The increasingly popular new consumption phenomena such as circle culture and national trends are all manifestations of this logic of change in demand."
As a professor at the business school, Li Yang observed another "circle-based" that is the formation of the "generation gap" among entrepreneurs. Many new generation entrepreneurs have shown traits that are completely different from the previous generation of entrepreneurs: the traditional corporate governance pyramid is being inverted, and the entrepreneurs who were once at the top of the pyramid are now playing the role of supporters.
In Li Yang's view, behind the rapid changes in products and brands, the real underlying changes will be more worthy of attention. "Management style, corporate culture, product logic, and the underlying elements of business are all changing." Li Yang said, "At a time when consumers and entrepreneurs are in circle formation, the business of consumer goods is naturally different."
At the same time, Li Yang also believes that after the rapid iteration and reshuffle of the brand, we are likely to witness the birth of Coca-Cola and Nestle , which belong to Chinese brands.
, based on this, believes that it is necessary to make suggestions to decision makers and investors of consumer companies: we should find such a balance - what kind of input-output ratio is the best; the phenomenon of Internet celebrities is similar to a 100-meter sprint, while brand building is more like an extended version of a marathon. You cannot overhype or overcapitalize a certain phenomenon just because it is particularly popular now. "In the consumer goods track, Chinese companies are transitioning from an opportunity-based growth stage to a systematic growth stage. We are entering a watershed moment: a group of consumer goods giants may be born among them." This is Li Yang's judgment on the consumer goods market in the next ten years.
|Dialogue|
Moat
Economic Observer: A group of new consumer brands have chosen IPOs recently. How do you view this trend?
Li Yang: For some specific new consumption phenomena, its life cycle will not be that long; many people will understand it as a problem, but I personally don’t think so.
Because I think it's like pop music, is pop music blind? It quickly became popular and disappeared quickly. Is this a problem? I don't think this is its natural characteristic. Popular attributes determine that its ups and downs must be more frequent; especially in a highly competitive market, the life cycle of popularity often becomes shorter.
Therefore, from the perspective of the product, we need to constantly innovate, constantly adapt to the needs of new people, and continuously iterate and optimize marketing methods and communication methods.
From the perspective of corporate decision makers and investors, we need to find a balance: what kind of input-output ratio is the best; we cannot overcapitalize a certain phenomenon just because it is particularly popular; we can see that many new consumer brands have experienced a significant decline in the secondary market after IPO; this may not be a problem with the consumer goods themselves, but a problem with this capitalization model.
Economic Observer: The current rise of new brands is increasingly relying on the power of community sharing and traffic. How do you view this brand building model?
Li Yang: The current logic of hot products can be summarized in one sentence: use a small group of people to attract a large group of people to watch.
Looking back at consumer goods companies that have been considered successful in recent years, we will find that they all have some common marketing logic.
In the early days, the brand would not do too much traffic because it had no money and the traffic was very expensive. At this stage, the lack of data traffic investment may not necessarily have particularly good results; it is more about forming rapid influence among pioneers or heavy users in the circle through unique products and unique cultures. Through the fanatical pursuit of these origin users, it attracts more users' attention. After the rise of
from 0 to 1, many companies have not achieved continuous growth in brands like Heytea , which may be a problem in the leap from the opportunity growth stage to the system growth stage. The systematic growth of
includes many aspects, far exceeding the consumer product itself. For example, from the capital level, are there any investment institutions that introduce good capital and provide strategic collaboration? There is also team building and upgrading. Can we break out of the early entrepreneurial model and transition to professional manager management, and then achieve refined and digital management? The comprehensive effects formed by changes in many aspects have caused huge differences in brand results.
Economic Observer: How to build your own moat for these new consumer goods companies?
Li Yang: The moat of the brand can have many levels of connotation.
When it comes to brands, everyone will talk about the user's mind, and everyone's inner recognition of the brand. Only with mental recognition can there be a brand premium and brand repurchase. But the mind itself is also a result, and there are many causes behind it. Taking Coca-Cola as an example, its channel coverage has reached the extreme, which has greatly helped everyone to build the user minds of Coke. In the early stage of the brand, the core moat should be product strength, and it is equipped with appropriate content, advertising, grass planting and other marketing methods; when the brand reaches a certain scale, the moat will present more dimensions, such as user circle operation, supply chain improvement, and wide coverage of channels. The brand's moat is closely related to the development stage of the brand.
Watershed
Economic Observer: What is the difference between entrepreneurs of new consumer brands and traditional entrepreneurs?
Li Yang: consumption is becoming more and more circled; of course, it is not just consumption that is scattered, but the supply side is also scattered. If entrepreneurs in new consumer brands and Internet industries sit with entrepreneurs in traditional manufacturing and real estate, they often cannot talk together. Although they are both doing business, these two groups of people lack a "common language". Due to differences in the three views and differences in business understanding, the entrepreneurial group is also constantly tying.
Economic Observer: Why are there no century-old companies like Coca-Cola available in China’s consumer goods companies?
Li Yang: As for consumer goods, our market-oriented environment has only begun for thirty or forty years. In developed Western countries, the marketization of consumer goods has lasted for a hundred years, and consumer goods companies have experienced many rounds of life and death elimination. On the carbonated beverage track, after Coca-Cola was successful, many companies have imitated it; up to now, there are still some small and medium-sized carbonated beverage brands in the United States.They may only sell in certain regional markets in the United States, so most consumers do not know their existence; these are also brands that survived after market competition is eliminated.
From this perspective, a century-old brand is a result, not a reason. As long as this consumer track can continue, we believe that in the end, a group of top brands with long-term success will be born. I often emphasize one point of view when I was in class. Many people think that the dividend era has receded, such as land dividends and demographic dividends. But I insist that the next wave of dividends is the branding dividend of Chinese companies and Chinese products. In the past, most local companies lacked attention to branding and invested very little. In the past many years, although we have been a big manufacturing country, we are also a small brand country. The market development in recent years is exciting, especially from the rise of new consumer goods, many emerging companies are focusing on building brands, and many traditional companies are also constantly working hard in the direction of brand rejuvenation.
