Chapter 4 4. The value of marketing

To study Wahaha is actually to study the growth history of marketing in China. Since the 1980s, marketing has become a discipline with a complete system and a rigorous academic structure.In the past ten years, most of the success of Chinese enterprises has benefited from the success of marketing.However, with the sudden rise and fall of some well-known brands, the value of marketing for corporate growth has been vaguely questioned. The interpretation of Wahaha seems to help people find their confidence.Wahaha is a very typical marketing organization. All its departments are set up closely around marketing, and its compactness and efficiency are very rare.And what it implements is a "centralized" marketing model, and billions of billions of dollars in commodities are systematically and uniformly allocated and sold every year.A fact that has to be admitted is that its ability to quickly form an equal competition with multinational companies such as Coca-Cola in a short period of time depends to a large extent on the victory of marketing ideas.

In the course of more than ten years of growth, Wahaha has formed many highly personalized marketing concepts. Wahaha has cleverly and economically established a brand-new benefit distribution system through joint marketing, which has solved the biggest bottleneck problem in marketing in the Chinese market. Wahaha firmly rooted itself in the vast urban and rural market with a population of one billion with the concept of "encircling the city from the countryside" and its unique brand management method. In this regard, there has been no successful precedent so far. In the past ten years, Wahaha's production, sales and production scale have maintained an astonishing double-digit growth, but it has been able to control risks well, and has never gained so-called market share at the expense of losses.

The capital marriage between Wahaha and French Danone is also a very unique case.It not only guarantees the long-term interests of investors, but also enables operators to have sufficient room for growth. And its battles with many well-known brands in the past ten years have constituted classic battles in the Chinese market and have been talked about. Don Schultz, an advocate of integrated marketing communication and an American marketing expert, once found that in the past 50 years, there have been three different forms of marketing organizations in the corporate world: The first is the product-driven business.They invent or develop new products and then bring them to market for sale.Such companies focus on the consumption value of the product itself, and regard marketing or communication as a cost rather than an investment.They believe that as long as the product is good enough, there will be consumers to buy it, so as long as the efficiency is continuously improved to provide the product.Schultz believes that Microsoft is the most typical example.

The second type is the distribution-driven enterprise.They pay attention to channels, logistics, logistics, network, they have a large sales force, and they are very particular about distribution, location and sales skills.Such companies basically make money on a quick turnaround, so short-term returns on marketing communications are their primary concern.McDonald's is a typical example of this form. The third type is the customer-driven enterprise.Their focus is on customers and brands, and the goal is to identify a value proposition.The approach taken by such companies is to establish a dialogue relationship with their customers, and through communication, discover the future growth direction of the company from the large number of needs of customers.They constantly change themselves and innovate models to meet the ever-changing needs of customers.American Express was chosen by Schultz as a model for such a company.

Using Schulz's classification to interpret Wahaha's marketing model and Zong Qinghou's marketing philosophy, we will find that although Wahaha is a company that produces mass consumer goods, its marketing focus seems to be on the distribution system.It puts the focus of market operation on the point-to-point service between enterprises and dealers (customers), and through such communication and services, it can achieve the goal of continuously launching sales.According to Zong Qinghou, the terminal is the "head" and the channel is the "waist". In marketing activities, if the "waist" does not exert force and the "head" swings wildly, it will be difficult to make a big difference.

During the research, we also found an unexpected discovery, that is, the essence of Wahaha's marketing strategy is actually very similar to that of the world's retail giant Wal-Mart. Founded after the Second World War, Wal-Mart expanded into the world's largest retailer and the number one company in the Global 500 in just over 50 years.Its well-known operating secrets are: emphasizing low gross profit, low price and high sales volume, emphasizing the high turnover rate of funds, and reducing the cost of circulation by establishing an efficient logistics distribution system and reaching long-term strategic partnerships with suppliers. profit loss.

In Wahaha's marketing practice, the above items are undoubtedly the secret of its success.It establishes its competitive advantage in the industry with low cost, low profit and astonishingly high sales, and reduces the risk of market sales through the joint sales relationship with dealers. At the same time, with the support of computer information systems, it can use unified marketing, The method of unified allocation and unified supply reduces the profit loss in the sales process.In a sense, Wahaha is more like a "distributor". This is indeed an amazing business.In this book, we will describe in detail what we have learned from following this business for 12 years.We did not examine exclusive companies in a closed way. In the following narratives, you will also see many companies and entrepreneurs of the same generation as Wahaha. Their different successes and failures and their rise and fall constitute an unforgettable journey.

This is a story of corporate growth with the Chinese market as the background and marketing topics as the core. In 1982, Tom Peters, a young researcher of McKinsey Consulting Company, and his collaborators visited 4,000 American companies and published their new book "The Pursuit of Excellence".In this classic management book that has topped the best-seller list in the United States for many years and created a miracle of sales of 6 million copies, Peters selected 43 large companies that he considered to be "excellent", and praised and reviewed them one by one. commentary.In his eyes, these companies are undoubtedly global role models.

However, just ten years later, 17 of these 43 great companies have died, much to the surprise of Peters.In a new book "On Innovation", he, who has become the world's top management guru, has to say frankly and with a bit of self-deprecation: "Someone once asked us, how do we know that the corporate culture we describe as contains innovative elements? of the companies will continue to grow, our answer is, we don’t know.” If someone asks us now, how do you know that Wahaha, which you describe as "the most successful marketing lesson plan in China", will continue to grow?

Our answer will be the same as Tom Peters, don't know. We don’t know whether Wahaha’s existing marketing model will definitely adapt to future market competition. We don’t know how long Wahaha’s “industry champion leader” can last. We don’t know whether Wahaha’s output will still surpass Coca-Cola next year. We know whether Wahaha will still be a beverage-based company ten years later. All we know is that Wahaha has achieved unparalleled brilliant performance in the past 15 years and created the most successful and lasting marketing miracle in the Chinese market so far.Behind such achievements and miracles, there must be some DNA that can inspire people and enable Wahaha to constantly break through itself and achieve innovation.

Let us start here and describe the marketing legend of Wahaha——