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Jiang Weiwei, Vice President of Dongpeng Beverage: Dongpeng has no reason not to grow, the brand methodology behind the 10 billion
4 Months ago
In 2023, Dongpeng Beverage's revenue entered the 10 billion yuan level for the first time, reaching 11.263 billion yuan, a year-on-year increase of 32.42%; net profit was 2.04 billion yuan, a year-on-year increase of 41.6%. In fact, it is not only in 2023 that revenue and net profit have achieved double-digit growth. Since its listing in 2021, Dongpeng Beverage has always maintained rapid growth. From 2021 to 2023, Dongpeng Special Drink's revenue has achieved a leap from 6.592 billion yuan to 10.336 billion yuan. Nielsen data shows that during the same period, Dongpeng Special Drink ranked first in sales in the Chinese energy drink market for three consecutive years, of which Dongpeng Special Drink's sales accounted for 43.02% in 2023. On the other hand, Dongpeng Special Drink's share of Dongpeng Beverage's revenue continued to decline, from 96.24% in 2022 to 91.87% in 2023. Behind this data change is the emergence of new categories such as electrolyte beverages, ready-to-drink coffee, and sugar-free tea in Dongpeng Beverage. What supports the continued growth of Dongpeng Beverage? Behind the expansion of the product matrix, how does Dongpeng Beverage view the opportunities in the current beverage market? Jiang Weiwei, director and vice president of Dongpeng Beverage, shared Dongpeng's brand strategy layout, implementation path and implementation experience at the Marketing Innovation Forum of the FBIF2024 Food and Beverage Innovation Forum with the theme of "From Traffic to Sales, Dongpeng Beverage's Brand Methodology".
Jiang Weiwei, Director and Vice President of Dongpeng Beverage
[The following is based on the speech, and the content has been deleted] Many people are curious about what Dongpeng Beverage has done right behind its continued growth in recent years? This topic is very big and there are many attributions. I try to share with you some of the explorations that Dongpeng Beverage has made in brand strategy and practice. Product is brand, and brand is product. Other industries may not understand the relationship between the two in this way, but for the beverage industry, the two are inseparable. The key to strategy lies in choice. A few years ago, the biggest choice for Dongpeng Beverage was "to deepen a single category or to expand multiple categories." Abroad, both of these paths can lead to success. Dongpeng has also explored "deepening a single category", and at that time we created "Dongpeng Energy +". Later, we reflected: the domestic energy drink market may not have reached the stage of demand segmentation, and it is not the best time to deepen the category. Therefore, Dongpeng finally chose "to expand multiple categories". There are three main reasons: First, go with the trend. Consumers naturally have diversified demands for beverages, and companies need to use multiple categories to satisfy consumers. Second, maximize channel value. In the past few years, Dongpeng Beverage has nearly 4 million terminal outlets. With the addition of digital empowerment, this channel volume can carry the development of multiple categories and better play the advantages of shelves. Third, in the past few years, we have stockpiled a large number of new products in different categories. In other words, our choice of multi-category development is a natural outcome. In 2022, we clearly developed the second curve. At the beginning of 2023, "Replenish Water" was officially launched. In September 2023, the sales performance of "Replenish Water" gave us great confidence. In 2023, we clarified the "1+6 multi-category strategy". On the basis of energy drinks, electrolyte drinks, ready-to-drink coffee, sugar-free tea, cocktails, coconut water, and large-packaged beverages were launched. These are the 6 most promising categories we have selected. This opportunity includes both external opportunities and internal preparations. In 2024, we have been fully implementing the "1+6 strategy", and I believe this will gradually change everyone's impression that Dongpeng Beverage has only one 10 billion single product-Dongpeng Special Drink. After setting the brand strategy, we faced the second choice internally, which was "Should all new products continue to use the brand name 'Dongpeng'?" In the Chinese market, different choices have successful and excellent cases. In the end, we decided to follow the principle of "looking at the category attributes, using the near and discarding the far". For functional products, we use the brand name "Dongpeng". For example, coffee drinks are refreshing. In some gas stations and service areas, its sales are on par with energy drinks, and its value attributes are similar, so we can continue to use the "Dongpeng" brand assets. Some light-effect products are also classified into the "Dongpeng" camp, but its category characteristics are more prominent, and it is also necessary to highlight the product characteristics. For example, the electrolyte drink "Bu Shui La" is a light functional drink, so we will use a relatively small "Dongpeng" and a conspicuous "Bu Shui La" on the packaging. Cocktails, sugar-free tea, coconut milk products and functional drinks are far apart in categories, so we don’t use “Dongpeng” as the brand name, but in the form of “honored product of Dongpeng Beverage”. We respect consumers’ mental cognition of the “Dongpeng” brand more. Dongpeng Beverage has a saying “there is no reason not to grow”, and we hope that everything we do will eventually enable growth. In terms of brand implementation, we need to “occupy traffic and increase sales”. The “traffic” here is not “Internet traffic” in a narrow sense. The word “traffic” has a long history, and traffic, pedestrian traffic, passenger traffic… do not just refer to a like or an interaction after the development of the Internet today.
We know that brands have "three degrees" - popularity, loyalty, and reputation. But today I want to replace "reputation" with "visibility", an important underlying foundation of the beverage industry. Product display solves visibility, mass communication solves popularity, and scene crowd solves loyalty. In these three dimensions, Dongpeng Beverage is thinking about "how to convert traffic into real sales." "Display is the biggest advertisement", this is a sentence often said within Dongpeng, and I would like to add "product is the best medium". The decision-making model of beverage consumption is different from other products. Consumers will not buy after a long period of understanding, trial and comparison. The decision to buy is the moment they walk into the store. Even if you are a loyal fan of Dongpeng Special Drink, if you don't find our products in this store, it is difficult for you to go to the store at the next intersection to buy them. "Visibility" is to solve the problem of "visible everywhere and readily available" for products. What is the basis of display? For beverage brands, it is channel outlets. We have developed merchant members with the help of digitalization since 2020, and there are currently nearly 4 million active merchant outlets. The development of retail terminals is a long-term project. Behind Dongpeng's nearly 4 million terminals are the joint efforts of more than 3,000 distributors and over 60,000 channel merchants. On the basis of channels, we use digitalization to screen out the most valuable and potential outlets, that is, "high potential outlets", and form a strong display through freezers, piles, and ice stations, so that "high potential outlets" can achieve high conversion. Good names and good packaging can bring traffic to products on the shelves. Since the beginning of last year, electrolyte drinks have been very popular. The name is a very important reason why "Replenishing Water" can stand out. What is a good name? I think it must be the one with the lowest education cost, which can represent the category and have brand uniqueness. Similarly, what is a good packaging? It is still around a good name to make the education cost of information as low as possible and maximize the reach of consumers. Popularity and loyalty solve the problem of "priority choice on the shelf". "Mass fast-moving consumer goods must establish mass popularity", this is the creed and original intention of fast-moving consumer brands. Times have changed. It is no longer the era of centralized platforms 20 years ago, but centralized content still exists. For example, we have sponsored the KPL King of Glory Professional League for three consecutive years, and have done quality TV series such as "The Story of Rose" and "Ink Rain and Clouds" implanted + big drama patches. The reason is that they are strong content in the hearts of young people, and behind them is the large traffic required by mass fast-moving consumer goods. I don’t know if you have noticed a data. In the past few years, the traffic of outdoor media such as elevator media, buses, and subway advertisements has been growing slightly. Their characteristics are that they are not attached to content and can be seen everywhere, which also means that they can bring stable traffic. Therefore, outdoor advertising is also a media form that Dongpeng has a stable investment every year. Regarding the strong algorithm media that has been very popular in recent years, I think it is a refined operation of traffic, which can bring accurate traffic, but it is difficult to bring premium space like strong content.
Large traffic, stable traffic, and precise traffic each have their own advantages, and brands should combine them according to demand. For example, "Replenishing Water" is a new product. In the initial stage, we need to find the original crowd, so we will choose to do grass-growing dissemination on Douyin and Xiaohongshu. Finally, I would like to focus on the scene crowd. In this regard, Dongpeng has formed its own unique approach. People are multifaceted and have different roles in different scenes. When we reach the crowd, we will first consider which scene he is in, and then cultivate the loyalty of the crowd in a specific scene. Take the driver crowd that we have cultivated for seven years as an example. Drivers are divided into two types, one is self-driving car owners and the other is professional drivers. When facing the large driving crowd, we pioneered the voice navigation advertising of Gaode Map. At the same time, during the high-traffic nodes such as the Spring Festival and summer vacation, we have been doing high-speed big-name storms for many years; when reaching professional drivers, the media we put out will be transformed into the driver side of Manbang, Huolala, Didi, etc. Consumers may not have heard of some of Dongpeng's advertisements because the scenes it wants to enter and the crowds it reaches have a specific range. For drivers, we cover gas stations, service areas, logistics parks, professional markets, and driving schools offline at the same time. The overall model is a joint effort between online and offline, and sales promotion linkage, to penetrate key groups. Dongpeng has 12 such crowd scene projects. In addition, Dongpeng Beverage has an innovation called "tool media". Starting from Amap, we found that when some tool applications gather a wide enough range of precise groups, it has the attributes of a medium, so we also copied this innovation to sports apps such as Yuedongquan and Yuepaoquan. When you are running, you will be prompted to "replenish water" when you open the app. To summarize Dongpeng's brand communication and promotion growth methods: outlet coverage, product display, screening high-potential outlets to achieve high conversion and solve visibility; using a combination of large flow, stable flow, and refined flow to establish and continuously improve visibility; creating crowd projects, continuously penetrating key groups, driving repeat purchases, and establishing loyalty. It is not easy to create a single product worth tens of billions of yuan. Dongpeng was able to achieve it because of the combination of timing and long-termism. Behind it is the integration of the company's seven forces, including product strength, brand strength, channel strength, supply strength, digital strength, organizational strength and cultural strength. This is also the driving force that has supported our growth in the past and in the future.
Dongpeng Beverage has always been on the entrepreneurial road with the belief that "there is no reason not to grow".
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