Home Categories political economy Very Marketing Wahaha: Practical Lessons from China’s Success

Chapter 59 1. Big changes in the industry

Around 2002, China's beverage industry was like a "besieged city". People outside wanted to enter, but people inside were full of sorrow and joy. Here is a scene of prosperity and danger intertwined: after more than 20 years of market expansion, the consumption space is expanding day by day.It is estimated that the national beverage consumption will grow at an average annual rate of 12%-14% from 2001 to 2005, reaching 22.6 million tons in 2005 and 37 million tons in 2015.Such an attractive figure makes all investors salivate. At the same time, we heard the loud sound of the collapse of the building again and again.

In December 2001, just a few days after He Boquan and other entrepreneurial teams collectively withdrew from Robust, another shocking news came out from Sanshui City, Guangdong: Guangdong Jianlibao Group, which had been the standard bearer of China’s beverage industry, also suffered a sudden change. The major shareholder, the Sanshui Municipal Government, insisted on selling the shares. For a while, multinational giants competed for mergers and acquisitions, and were finally snatched by Zhang Haihu, a 30-year-old capital speculator. Jianlibao is the pride of Chinese beverages. For a long time, it was the only carbonated beverage brand in China that could compete with Coca-Cola and Pepsi. In the past, "Two Les" and "Watering the Seventh Army", only Jianlibao refused to be acquired and has stood up to this day.However, with the passage of time, Jianlibao finally stepped into the dusk.At the signing meeting for the acquisition by Zhang Hai, general manager Li Jingwei

Li Jingwei finally became a "late hero" Looking up and asking the sky, tears flickering, the reporter captured this photo, which fully revealed the tragic and heroic "Jianlibao", the former "Oriental Magic Water" and today's "twilight hero". Of course, there are various reasons for the failure of Jianlibao, but the lack of progress in marketing is the most embarrassing. When Jianlibao rose, like Wahaha in the early days, it relied on the traditional state-owned sugar and wine company and supply and marketing cooperative system.It is said that when Jianlibao was at its peak in the early 1990s, only one wholesale market in Tengzhou, Shandong could handle 300 million yuan of goods a year.However, after the mid-1990s, the pattern of China's commercial channels changed drastically, but this established company showed no sign of change, and finally lost all its advantages, and its channels were shrinking day by day.

Since its establishment, Jianlibao has been implementing a consignment sales system, relying on direct contact between the headquarters and agents for everything, not only wasting a lot of manpower, material and financial resources, but also the sales system is extremely chaotic, "competition at low prices in the same market" and " The phenomenon of "mutual flushing" in different regional markets occurs from time to time.However, Jianlibao's headquarters is completely indifferent to these. They think that everything will be fine if they hand over the products to the agents, and then let the agents distribute the products to the retailers.But the result is often that the products are only stagnant in the agent's warehouse, and consumers have no chance to meet them.

Obviously, this kind of "marketing" marketing model cannot adapt to the ever-changing consumer market.The early successful experience of relying on advertising and news operations has become a "reef" that hinders Jianlibao's innovation. Market personnel are indifferent to the placement and display of products in retail stores, and the posting of POP advertisements, but they still spend a lot of money for advertising. .Although Jianlibao has been in a downturn in the market in recent years, and the terminal distribution rate is quite low, you can still see Jianlibao's large billboard advertisements in major cities.From "If you want to be healthy, please drink Jianlibao" to "Move and be more exciting", all the advertisements of Jianlibao make the same mistake, that is, they only carry out brand promotion or tell consumers that there is a new product. It is not known what is special about the product.

The popularity of Jianlibao should have been known to everyone a few years ago, and now it is tantamount to punching in the air to promote the brand image to increase its popularity. There is a line in Procter & Gamble's sales training manual: "The best products in the world, even with the best advertising support, cannot be sold unless consumers can buy them at the point of sale." The key to modern marketing is In terms of how to find out a set of scientific channel management methods suitable for the regional market in actual combat, through the service and monitoring of agents, distributors, retailers and other links, so that products can be timely and accurately passed through various Channels, quickly reach the retail terminal.At the same time, the company itself also needs to conduct regular surveys and visits to retailers to collect feedback from retailers on various aspects of the product.In this way, on the one hand, it has multiple effects of assisting sales for agents and distributors, and on the other hand, it can improve product quality and service levels according to the information provided by retailers, which can serve multiple purposes.In these respects, Jianlibao, which has always regarded itself as the leader in beverages, disdains to do anything, and always holds on to the "three axes" of "bombing advertisements to open the way, consignment sales by large market players, and achieving inertial sales".

After 2000, Li Jingwei suddenly realized the importance of a modern marketing system. Jianlibao began to imitate Coca-Cola's model, recruiting salesmen in various places and building sales offices.However, due to the single product, there is not much profit space that can be shared with dealers, and the credit system is fragile, so it is difficult to reach a consensus on interests overnight, while personnel and marketing costs are doubled.Over the past year, the company has invested heavily, but the sales volume has not increased but decreased. In 2001, when the company was committed to reform, it was more than half of that of the previous year.Jianlibao finally reached the point where he was at the end of his rope and unable to return to heaven.

Compared with Jianlibao, Rising Sun can be regarded as a "beverage upstart" that emerged in the late 1990s.However, after its great reputation, it quickly fell to the bottom, leaving another thought-provoking marketing lesson plan. Rising Sun Group made its fortune in Jizhou, Hebei Province, a county-level city without railway access.Its predecessor was a supply and marketing cooperative in Jizhou. In the mid-1990s, Rising Sun caught the opportunity when the Chinese tea beverage market was in the ascendant, and made a sudden effort to sell it all over China with "Rising Sun Iced Tea".There is no secret to its marketing. It is nothing more than carrying out "high-altitude" bombardment of advertisements regardless of cost, and then sending thousands of salesmen to travel all over the country to find dealers, and then to distribute goods and collect payments.Extensive marketing methods seem to be very suitable for the extensive Chinese market. By 1998, Rising Sun's sales reached 2 billion yuan, unexpectedly becoming a big winner in the beverage market.Also in this year, beverage giants such as Wahaha and Master Kong also aimed at the tea beverage market and launched iced tea series one after another.Rising Sun launched a counterattack immediately, and finally, three years later, the State Administration for Industry and Commerce clarified that the word "ice tea" was a unique name for well-known products of Rising Sun Group, and other companies were not allowed to use it. The market prospect of Rising Sun seemed to be bright.

But soon, the hidden dangers of extensive marketing began to emerge.Rising Sun has set up 23 branches across the country, with more than 5,000 sales staff at its peak, and most of the middle-level cadres are from Jizhou.Under the pressure of this kind of marketing strategy, in order to cooperate with the company's assessment, the salesman reached an agreement with the dealer: as long as you agree to my request for refund, I can agree to your rebate terms; The group company asks for policies for you.In this way, different rebate and sales deduction policies in various places have created a natural soil for the market to rush goods.The headquarters has always been indifferent to the maintenance of market order.

Some media once disclosed such an incident: One time, the Rising Sun Group held a large-scale promotional activity and launched a promotional policy: "Every 30 pieces of iced tea will be accompanied by a bicycle worth 180 yuan, and every 50 pieces will be accompanied by a manpower worth 300 yuan. Tricycles, if there are less than 30 pieces, a shopping card will be given.”The free items vary from region to region, but in principle, there is an average promotion fee of 6 yuan per piece of iced tea.As soon as this policy was promulgated, it immediately received unprecedented results. A dealer in a county in Baoding alone purchased 10,000 pieces, and quickly sold 10,000 pieces in a very short period of time, and wanted to buy again.However, where can the county digest these 10,000 pieces of iced tea?As a result, it soon hit other county and city markets.

If there are short-sighted manufacturers, there will naturally be short-sighted dealers.Rising Sun's sales quickly slipped into an inescapable vicious circle: the faster the sales volume increases, the greater the pressure to recover the payment; the wider the product spread, the less controllable the management will be.Every time a large-scale promotional event is held, the sales will jump up sharply, but after that, there will be a sharp decline and even frequent outbreaks of rushing goods in various places.This kind of marketing model is actually taking the credit of the company as a bet. When all the dealers start to doubt the credit of the company, the company will come to an end. At this time, no matter how much advertising is used to bombard , No matter how big the promotion is, it will not help.In the later stage, Rising Sun has already fallen into a dilemma: no advertising or promotion, dealers will not buy at all; but once promotion is carried out, there will be a large-scale rush to sell goods and lower prices, which is tantamount to quenching thirst with poison.At this point in the marketing work, there is no way to advance or retreat, and the expansion and contraction are exhausted. Rising Sun: Will the "Sun" Still Rise Tomorrow? According to the January 2002 issue of "Think Tank" magazine, according to internal information, the total liabilities of Rising Sun Health Care Company have reached 530 million to 560 million yuan, of which 230 million yuan is owed to customers, and there are also a large number of employees. Fundraising was not paid off. In the past two years, Robust has been completely reshuffled, Nongfu Spring’s moves have been weak, Jianlibao has been acquired tragically, the rising sun is hard to come by, and the decline of Hainan coconut wind is “unstoppable”. Chinese beverage brands seem to have entered the collective downturn.The market ups and downs of these companies reflect the fact that the extensive marketing model is no longer suitable for the increasingly mature Chinese consumer market, and marketing without management, planning and long-term strategies is doomed. Can't go far.
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