Channel Efficiency Revolution in China's Tea Industry

Doing everything by yourself is not as good as a group of people. A group of people, it is better to have a group of people around the country to work together.
Take the sales of the tea industry, for example, one person is the husband and wife shop business, a group of people is the sales department, and there are people from all over the country who are interested in working together, which is the national market in-depth distribution. Wahaha's manufacturers are integrated, and they use the "joint sales" model to deeply bind manufacturers and dealers to form a community of interests, thus creating a miracle of deep distribution of Chinese FMCG products.
The tea industry has entered an era of industrial efficiency upgrade. To be a tea company, we must study the efficiency of the industry to steadily grow bigger and stronger. We can summarize some classic routines to improve the efficiency of the tea industry. For example, the joint sales model is one of the most efficient forms of distribution in the tea industry. Retailers in the second era of the hype era formed retail communities and collectors of interests to increase the price of tea in a very short time and form a myth of richness. Also trapped a lot of Pan Xia. If you do n’t speculate, or just a little rational speculation, the joint product of the single product control panel, the e-commerce distribution joint product, the Internet + offline joint product, and the s2b2c joint product are also the mainstream models of normal channels.
Three magical tricks of tea company channel horse race enclosure: joint marketing, franchising chain and e-commerce
The essence of the co-marketing body is a channel governance structure based on long-term and deep-bundled benefits distribution. To deepen the integration of channel resources, it is necessary to study the channel governance structure, build a distribution joint marketing body, or cooperate with major joint ventures or platforms to quickly establish a distribution system through borrowing.
Talking about distribution, let's look at the franchise business of the terminal. In the last golden period of Pu'er tea, that is, from 2011 to 2016, the three magic weapons of tea company channels are horse racing, joint marketing, franchising and e-commerce. The hype relies on joint sales, showing that the brand strength and volume depend on the number of franchise stores, and the traditional dealers who mess with the market are talking about e-commerce. In other words, there are three magic weapons in the market, but the ultimate weapon is to join the chain business. About a hundred tea shops are third-tier brands, several hundred shops are second-tier brands, and thousands of tea shops are first-tier brands.
To join the chain, there are three conditions that must be met. The market is hot and the brand is strong. Dealers rely on manufacturers' policies to eat. Consumers also chase star tea companies and tea products. There are many terminal players and low store opening costs. In the past few years, these three major conditions were met, so the tea industry joined the chain fever.
Since 2016, the market bonus, brand bonus, take-over bonus, low opening cost bonus disappeared, and the rise of the mobile Internet, traditional store owners will not engage in traffic or output values, and will be marketed by mobile content fans overnight. Marginalization has led to a major defeat in the franchise business of the tea industry. There are fewer tea shops, and the tea brand has also been brought back to its original form. The mass consumer market brand has returned to the aggrieved industry brand-that is, the industry knows that when the industry is out, consumers do not know!
Although the tea market has been cold since 2016 and has entered a new normal, I think that opening a chain tea shop is still the best way to build brand mass market awareness and reflect channel efficiency.
In 2017 in Shenzhen, a veteran of marketing told me that there are only three brands in the tea industry-Dayi, Bama and other brands. From the perspective of Shenzhen citizens, this is right. In Shenzhen, there are many Daya and Bama tea shops, especially Bama. Shopping malls must have Bama, which is the standard for mature business districts. Well-known industry and well-known people are two different things. People often see a certain brand of tea shop in the business circle. This tea brand must be a big brand in the people's impression. For example, colorful Yunnan, many consumers know that it is more famous than Zhongcha and Shimonoseki, because it is often a trip to Colorful Yunnan when traveling to Yunnan.
Under the new normal, brand shops open tea shops and fight for management radius
In the new normal state where the market is not good, chain tea shops are pursuing quality, not quantity. In addition to store retail, they also need to reflect the ability of a single store to radiate distribution, engage in drainage, digitalization, interaction and membership management. The branded monopoly tea shop is no longer a shopkeeper, but upgraded to a smart tea shop. This kind of smart tea shop is not so much, but it is refined. A tea company can open a hundred smart tea shops, and its efficiency is equivalent to the previous five to six hundred, and three or four hundred smart tea shops, equivalent to the past hundred cities. Thousands of shops, doing a billion-dollar tea business.
Communicating with peers, I often emphasize that under the new normal, brand shops open a tea shop and fight for a management radius. Why you ca n’t open a few stores is because your management radius is too short and you can only manage the stores around you. Direct stores that are far away from you are likely to lose money, and franchise stores are selling sheep meat for the first time. After receiving the goods, he did not replenish the goods and changed the door one year later.
At present, many brands that can open tea shops have more or less solved the problem of management radius. Large, Bama, Dayi, Tianfu do not say, the second and third line, such as the book sword Pu'er also opened some stores, the trick is to grasp the internal management, second engage partners to open stores. Often are loyal veterans, internal entrepreneurs, and partnerships. Doing hundreds of millions of middle-aged and old-time trading platform Chen Chahui a year, the national branch distribution model it promotes is also for trusted old employees to open Chen Chahui branches in partnership.
Efficiency often comes from reducing costs. Costs include production costs and transaction costs. To open a tea shop in the new era, one is to reduce product production costs through supply chain optimization, and the other is to reduce transaction costs and expand effective management radius through institutional innovation.
The joint marketing body of the manufacturer platform integration is the first industrial efficiency model I talked about, and the smart tea shop of the partner in the new era is the second industrial efficiency model. I will talk about more industrial models when I have time.
This world is unequal, so we pursue equality in an unequal world. For more than 40 years of China's reform and opening up, the trend of equalization is: equality of results → equal opportunity → equal ability. In the past, eating socialist cauldrons had equal results. Later, reform and opening up released huge opportunities for ordinary people to change their lives, and society entered a stage of equal opportunities. Now it is the new normal. There are opportunities, but it is not inclusive. It is for those who have the ability to capture.
As a result, the tea industry has entered the era of competence and professionalism from a blank market and opportunism. Only tea companies that build learning organizations will seize business opportunities. In the future, learning organizations will become the standard for tea companies, so we can talk about equality of capabilities ...
The key to the transformation of business-oriented tea shops in the past to today's digital smart tea shops: First, the management radius previously emphasized, which is the difference between opportunistic guerrillas and the highly professional and systematic Jade Corps; Radiation radius.
Traditional business tea shops have high opening costs and a short market radiation radius. They must rely on a few old acquaintances to take care of the business. They must not be profitable. Many shops have closed because of losses. And digital tea shops, online and offline integration, invoicing, logistics and distribution, customer management, marketing tools, etc. are all digitalized and unified and shared, focusing on integrating into surrounding consumption scenarios, turning offline consumers into online members and using online Up-tools are used for offline experience drainage and active distribution business. A smart tea shop, because of the breadth and depth of market radiation, can sell equivalent to five or six traditional shops, so it can offset the cost of opening a shop and live a moisturizing life.
The convergence of market segment brands and channel brands in the new era
The following will enter the most critical point of China's tea terminal marketing-the convergence of market segment brands and channel brands in the new era, and the emergence of multi-category + primary and secondary market brand collection stores.
The logic of the brand does not match the logic of the terminal stores (big stores and small stores). The new brand is based on category cognition. Tea companies often use market segmentation to cut a vertical category for deep cultivation and make it a representative symbol of the category. This is the classic way to create a brand-occupying consumers' minds is actually "category recognition, brand expression (representation)".
Tea companies can also promote multi-category brands, but this is a test of the supply chain for the new brand, and early miscellaneous, it is not conducive to professionalism, it is also not conducive to focus on publicity and promotion, and establish a professional image. Professionalism and a high degree of brand focus have resulted in new brands often focusing on one vertical category while taking care of the rest.
However, such a high vertical play will face a problem, which is not conducive to opening a specialty store at the terminal. Because the needs of the terminal are diversified, and a single category of vertical brand is dominated by one type of tea, taking into account other types of tea, it is difficult to meet diversified consumption. Of course, its brand can also engage in multi-category strategies, but it will seriously affect the professional image established in the segmented field, that is, diversification is like water injection, which will often dilute the brand's core assets.
In the face of the mismatch between the segmentation of vertical brands and the diversification of terminal consumption, tea companies have two choices. If they are not like Tianfu and Bama, they started from Tieguanyin to six major teas and tea foods. What is the market? It ’s easy to sell, I just organize the source of supply. I produce a part of the tea products myself, and more of them are foundries. That is, from subdividing vertical brands into terminal channel brands.
The second is to take a multi-category vertical multi-brand line. For example, some brands that have started as Pu'er tea have become larger. They often lay out white tea, citrus tea, black tea, and middle-aged tea. Based on the Pu'er tea brand , Newly established white tea brand, mandarin tea brand, black tea brand and middle-aged and old-aged tea storage and trading platform, which includes vertical categories and primary and secondary market transactions. The branded goods trade before leaving the factory is the primary market, and the middle-aged and old tea trade is the secondary market. The secondary market can make tea for other tea companies, that is, a wider supply, greater consumer demand, and easier sales volume. This is why Pu'er tea companies have set foot in middle-aged and old-time tea warehousing and trading platforms-not only selling their own goods, but also selling goods that others sell well!
Multi-category multi-brand + secondary market transactions, thus taking into account the professional focus of vertical segmented brands and terminal consumer diversification, it can be said that the combination of vertical segmented brands and terminal channel brands, that is, vertical multi-brand + terminal stores (Dadianxiaodian). In other words, this is the tea company's own multi-brand collection store.
The advantage of this model is that it does not affect brand focus, and the supply chain does not need to be foundry, and has its own production base. For pure channel brands, or multi-category single brands, many products have to be contracted due to limited management radius. And multi-category and multi-brand, the implementation of sub-sector operation, each sector corresponds to a vertical category, a sub-brand and a professional team, which can do things more finely, more accurately meet consumer demand, in response to the rise of boutique consumption ...
Traffic Thinking and Base Thinking
In the era of traffic, tea companies do branding and industrial chain layout, and especially pay attention to the construction of base areas. This is the foundation of a century-old brand.
Many people advocate how traffic can create development miracles. It seems that everyone can fly up and down in the current era. In the past, the classic style of play failed, social traffic marketing is flying around, and they cannot understand the heavy body of traditional tea companies. This is actually an illusion given to people by the times. The essence of business has not changed, but the appearance has changed.
Many smart people chase very hot spots on the surface, but ignore the understanding of the underlying logic of the industry. To put it simply, flow is like water, like wind, and has no roots. Therefore, while the flow is realizing, you must do more foundational things, so that the water can be stored in the warehouse, and the wind can blow leaves to the roots. You know, the past peasant uprisings had no bases, no matter how powerful they were at the moment, but they could easily become rogues!
In the end, the world has no clever things, just as China started its foreign trade export base by light industry, and will eventually enter the heavy industry stage and the service industry stage. The same is true for tea companies as brands. From asset-light operations that focus on the realization of value promotion flows, they will eventually be forced to invest heavily in the supply chain and channel construction. The more they become heavier, the stronger they become. The lightness of the traffic and the importance of the foundation, tea companies must understand that the two will complement each other to achieve great development ...
Why channel efficiency is the ultimate thinking of tea companies becoming bigger and stronger? This is because the ambitious tea companies have invested too much, and they have to realize them through final sales. Otherwise, if the input is large and the output is small, the enterprise is very dangerous. And sales fight is channel efficiency. Tea companies that efficiently innovate their channels not only have benign inputs and outputs, but also can break the intestinal obstruction of the tea industry channel, and quickly increase the size of the company, thereby creating a miracle of development.
As far as channels are concerned, social and circle marketing is a show, and companies need to do shows and be fierce, but it must be clear that shows and hot spots have timeliness. When chasing you, you are the goddess of tea and do not chase you. When it ’s time for your branding to fart! Channel efficiency, that is, the ability of an enterprise to distribute in depth, has established an effective terminal distribution channel. It is like an enterprise has established a base in the terminal. It is easy to make a show. I have ordinary people in the base. There is no shortage of audiences. Show, welcome all kinds of entrepreneurs to play social content marketing. The channels of tea companies have become public infrastructure, and everyone is welcome to come and sell!
Terminal three-level distribution system-tea supermarket (large store), brand collection store (small store), counter
Next, let's talk about the three-level terminal distribution model of subdividing vertical brand clusters-tea supermarkets (large stores), brand collection stores (small stores), and counters. This three-level system is the in-depth distribution solution for the multi-brand cluster model of tea enterprises.
The multi-brand cluster channel system is a combination of market segment brands and terminal channel brands, and is the most mainstream tea company's multi-sector layout model. That is, a tea company is a brand in several sub-sectors. These brands share the supply chain and channels, and jointly disseminate them, and they are finally gathered in the counters of large stores and small shops in the terminal for exhibition. It is also called the brand collection model. From the perspective of the industrial chain, it is called brand cluster, and from the terminal, it is a collection of brands that are different from brand monopoly.
The biggest efficiency of its channel is that not only its own multi-brand tea collection, but also through the establishment of middle-aged and old-time tea warehousing and trading platform, selling products that others sell well, that is, the amount of single products in Shanghai can be optimized and integrated Easily organize thousands of items to meet the diverse needs of mass consumers. In other words, the channel efficiency of the terminal is actually a three-stage jump, from a narrow monopoly to a broader collection, and finally to a large number of recommended boutique tea sales platforms.
Three-level distribution of brand clusters, large stores can be platformized, tea supermarkets. The small shop can be a brand collection shop. One counter can hold a single brand product, or multiple brand products. Product selection and combination counters can be placed in tea supermarkets, private label collection stores, or integrated into other people's consumption scenarios. For example, the counter can be placed in someone's tea shop, in a hotel, in the afternoon tea scene of a group company, in a smoke hotel, and in various effective consumption scenes.
Tea enterprises operate a three-tier distribution system for terminals, which can focus on key cities for in-depth distribution. For example, ten key cities can be selected nationwide. Each city is equipped with a tea supermarket that distributes the whole city, relying on the tea supermarket to develop brand collection stores and counters. Tea supermarket manufacturers are directly operated, brand collection stores are partnered, and counters are directly operated or joined.
A key city opens a tea supermarket, ten brand collection stores, a hundred tea counters, and about 30 million yuan a year. In ten cities, 300 million yuan can be sold. It can also further build in-depth distribution capabilities, pushing 50 million yuan sales cities, 100 million yuan cities ...
Editor-in- chief : yunhong
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