---
title: "2019 China Marketing Year in Review"
description: "2019 has passed, but its impact on marketing is profound. The core of market competition is clear: branded consumer goods have far more opportunities and better survival rates than unbranded ones. Established brands like Bosideng, Feihe, Luckin Coffee, and Miaokelanduo invested heavily in brand upgrades and activation, while new brands like Perfect Diary, Genki Forest, and HFP continued rapid growth."
author: "星夕"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2020-01-06"
language: "en"
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# 2019 China Marketing Year in Review

> 2019 has passed, but its impact on marketing is profound. The core of market competition is clear: branded consumer goods have far more opportunities and better survival rates than unbranded ones. Established brands like Bosideng, Feihe, Luckin Coffee, and Miaokelanduo invested heavily in brand upgrades and activation, while new brands like Perfect Diary, Genki Forest, and HFP continued rapid growth.

2019 has passed in a hurry, but it left a deep impression, especially in the marketing field.
Everyone is certain of one thing: business is not easy, but you need to understand the market. The core of market competition can be explained in one sentence: branded consumer goods have far more opportunities and survive much better than unbranded ones.
For example, on the brand side, major and established brands such as Bosideng, Feihe, Luckin Coffee, and Miaokelanduo invested heavily in brand upgrades and activation; new brands like Perfect Diary, Genki Forest, and HFP continued rapid growth; live streaming began to combine with e-commerce, enhancing sales-driving capabilities; in terms of consumer demographics, the rise of national trends and trendy toys driven by lower-tier markets, behind which the dividends of new demographics and new demands, will continue to accelerate the evolution of this track.
**-01-** **Trend 1: Full commercialization of short video and live streaming, raising the banner of "planting grass and driving sales"**
During this year's Double 11, live streaming alone drove nearly 20 billion yuan in transaction volume on Taobao.
On Kuaishou, according to statistics from the big data analysis platform Alchemy Furnace, the top 10 sales influencers contributed a total of 700 million yuan to the 116 Shopping Festival, with Xinba topping the list with 260 million yuan in total sales, more than double the second-place Wawa.
Some institutions predict that the total scale of "live streaming sales" in 2019 could reach 440 billion yuan. No wonder some people jokingly call 2019 the "first year of live streaming e-commerce."
Moreover, to strengthen sales-driving capabilities, Taobao, Douyin, and Kuaishou have each strengthened infrastructure construction in relevant areas; knowledge payment courses on "from planting grass to driving sales" have been booming... It seems that "influencer + live streaming + sales" has become the only broad road to sharing new consumption dividends.
However, the author believes that blindly praising its power without in-depth brand analysis of "planting grass and driving sales" is irresponsible.
A little attention reveals that planting grass and driving sales is only the last link in the consumption process. It is a show and a platform. To a large extent, it completes the final blow of the sales loop by inciting consumer impulse. But how does the initial intention to consume arise?
Data shows that planting grass and driving sales only has a significant effect on two types of products:
**The first type is goods that break through cognitive price bottom lines** — they are often called "source goods," "origin brands," or "factory direct," mainly primary agricultural products and daily necessities. Their **core feature is no brand**, relying entirely on the consumption scenarios created by anchors to sell goods, with prices around 100 yuan or below.
**The second type, which actually accounts for the majority, is still branded goods with their own brand capabilities**, whether high-end or low-end, with the common feature of being well-known brands.
Still taking Taobao as an example, people find that the majority of goods sold are still international brands. Estée Lauder, L'Oréal, Shiseido, and other international brands achieved over 30% growth in 2019, occupying the top five spots in Tmall's beauty sales ranking during Double 11.
This tells us that unbranded newcomers relying entirely on spontaneous fragmented communication will find it difficult to profit from the trend, let alone join the ranks of emerging brands. This also proves that "fragmented communication + influencer sales" is not a panacea.
**Remember, it's not bad, but it's not a panacea.**
**-02-** **Trend 2: Media fragmentation and dust-ization, scarcity of centralized activation facilities**
Traditional TV, traditional media, and variety shows seemed somewhat frustrated in 2019.
The author's research found that most TV manufacturers in 2019 only published sales data, but rarely published ecosystem data, user data, or boot rates. Obviously, these data are not good. In fact, the aging audience of TV stations has reduced the effectiveness of TV, which was once the largest centralized communication platform.
We can see that this year there were repeated orders to restrict TV boot advertisements, which to some extent reflects the growing backlash from audiences against this form of advertising. On the internet video platform side, although there are as many as 700-800 million total users, paid members account for up to 300 million. The core significance of purchasing paid membership is that urban populations with purchasing power are using this method to "de-advertise," which has become a major trend.
This actually brings a problem: when brands need to strongly activate their brand to hundreds of millions of people at once, the platforms truly available for choice are already few.
Here, the author must mention Focus Media. Over the past decade of the mobile internet economy, Focus Media has been a gold standard for brand activation. For a long time, when people evaluated whether a brand was activating or likely to activate, or even discussed which of two competing brands would win, an important observation window was the amount and method of advertising on Focus Media.
It can be said that from 2015 to today, all collective brand memories of Chinese people are basically linked to Focus Media. But why doesn't Focus Media fail like TV? There have been many analyses; the author only repeats two key points:**
**First, its location**, which can affect 30 million core middle-class people who must work and move in cities every day;**
**Second, its communication method**, which makes it the only window for inputting information at a specific time... With these two advantages, plus its continuously enriched methodology, it has become one of the few core activation brands that are still growing in this era.
**-03-** **Trend 3: Brand becomes core competitiveness, new and old brands compete for renewal**
Now the entire economic reform is focused on the supply side, **and one of the cores of supply-side reform is brand renewal and upgrading**.
Bosideng and Feihe, which we are very familiar with and have accompanied us for decades, have begun such attempts.
Among them, Bosideng is a particularly prominent example. From an "old, cheap, decent quality, around a thousand yuan" old brand, it keenly discovered that its brand momentum was insufficient.
A specific phenomenon is that Bosideng's menswear once spent huge sums to establish a large store on Oxford Street in the UK, but due to lack of strong brand endorsement, this solo effort failed... After that, we saw the comprehensive benchmarking against Canada Goose, inviting top international designers to design co-branded items, inviting Hollywood stars to endorse, and making high-end polar clothing worth tens of thousands of yuan... And all these efforts, through Focus Media's brand activation, broke through consumers' minds, causing a wave of customer congestion in many Bosideng offline stores that had not been seen for years.
Why can old brands complete brand upgrades so "easily"? In fact, the most important thing is not what micro brand operations were carried out, but how to distribute the information of brand reshaping. In the current era of increasingly fragmented, dust-ized, greasy, and mutated communication, the core of brand reshaping is definitely not to create more brand fragments, but to knock on the hearts of mainstream people as much as possible in the dust.
Because only by grasping the mainstream population can you grasp influence. The importance of mainstream population cognition lies in the fact that they have strong social influence. Their minds carry and redefine brands, lead trends, and further influence the minds of another part of the mainstream population that is younger and has stronger consumption desires.
On the contrary, if a brand has no major brand events for a long time and cannot enter the minds of core people, even if it has a large stock, it will still face the problem of brand aging and marginalization, because Chinese manufacturing is too powerful. Any brand has countless alternative choices—creating uniqueness is actually creating cognitive uniqueness, which still requires core brand activation facilities.
**-04-** **Trend 4: Stock game, rise of head brands**
While more and more people focus on and pin hopes on the power of the internet, eating up the dividends of incremental growth, the game in the stock field is becoming increasingly fierce.
The game in the stock field is different from the incremental field. Since the stock market is mostly occupied by mid-to-high-end or well-known national brands, the brand competition in these fields is more intense, and brand becomes a more critical factor.
Take the Bosideng down jacket we mentioned earlier as an example. It is a typical case of fighting in the stock market. Almost without guessing, we can know that with the strong rise of Bosideng, becoming China's version of "Canada Goose," we can inevitably think that domestic brands like Yaya, Qianrengang, Elaiyi, and Hongdou, which were previously similar in positioning to Bosideng, and brands with similar prices like Septwolves and Uniqlo, will inevitably be strongly squeezed.
Similar is the high-end liquor market, whose overall scale has been relatively stable. However, except for Moutai, which has a unique mind positioning and is therefore high above, the fight among Wuliangye, Fenjiu, and Langjiu can only be described as brutal.
Of course, we can also see that due to the strong support capacity and manufacturing advantages of the Chinese market, many stock markets are seeing a trend of high-end brands moving to head brands, and domestic brands crossing to the international market. The most representative of these is the domestic mobile phone market.
From this year's data, even with factors such as the trade war, Chinese smartphones have surpassed Apple and Samsung in total volume, becoming the group with the highest global market share.
However, without confidence and ambition, daring to invest heavily in brands and repeatedly knock on consumer minds, those players in the head track may even bear greater competitive pressure than the mid-to-low players with relatively differentiated positioning. If they do not seize the major time window of rapidly increasing brand concentration, they will either succeed and become the head brand in the segmented market, or fail and exit the market amid price and volume declines, with no middle path.
**-05-** **Trend 5: Does "visible effects" really have "effects"?**
Why are marketing budgets increasing at a higher rate, and companies like BAT, Toutiao, Douyin, and Kuaishou becoming more profitable, but more and more brand owners feel that these traffic ads occasionally have the effect of Viagra, but not only can't stop taking the medicine, costs are rising, prices are harder to maintain above the profit line, and business is getting harder?
Surprisingly, it was an international brand that found the answer for us. This brand is the famous Adidas.
Adidas' Global Media Director Simon Peel said that in the past years, Adidas over-invested in digital and performance channels, sacrificing brand building. The article also provided extremely precise numbers: 77% of the budget on performance, 23% on brand.
The word "over-investment" sounds not too serious. But you should know that Adidas spends nearly 2 billion euros annually on marketing, and even if only 20% is misallocated, that is a lesson Adidas bought for 3 billion yuan.
The answer Adidas found for itself is that the money was spent, but not on places that can truly build brand power and accumulate long-term value.
There are methodological issues here. For example, in Adidas' case analysis, senior practitioners put forward an important point: most digital media evaluate effects based on "last click," that is, the click that leads to purchase—but deeper research shows that before this crucial click, a user needs at least 20 or more contacts with the brand to produce the final key result, and many interactions are not digital but traditional.
But at a deeper level, it is caused by people's insufficient understanding of traffic ads. Under the influence of stereotypes such as "new is good," "internet thinking," and "fragmentation is king," people begin to pursue the pleasure of short-term effects, but forget that the more they pursue short-term effects, the easier it is to give up long-term brand building.
The difference here is like Chinese medicine and Western medicine. More and more people abandon the systematic advantages of Chinese medicine in "treating the root" and "preventing disease," pursuing "quick effect" and "headache cure head," and thereby deny Chinese medicine's higher-level thinking and profound wisdom about the entire human immune system. This scene occurs not only in the medical circle and advertising circle, but also in every aspect of our lives.
Pursuing certainty is a byproduct of a society flooded with fragmented confusion. It is like when the market is sluggish, people pursue short-term ROI and reduce long-term brand investment. The final result is that price wars and promotion wars create sales but defeat gross margins, and traffic ad investment increases, ultimately working for traffic platforms while neglecting long-term brand building.
**-06-** **Trend 6: New brands urgently need activators**
Brands, creating new brands, seems to have become a rigid demand of the times.
Because brands determine premium capability. Reports point out that under the general trend of "national trend rise," in terms of price, new domestic brand prices are still concentrated at the mid-to-low end, targeting younger consumers (post-90s and post-95s).
After years of education by giants, the high-end price market is still firmly in the hands of international brands; although young people as an incremental market have potential, the speed of brand iteration and consumers' low loyalty to brands are also problems that new brands must solve.
On the other hand, lower-tier markets and new markets require more new brands with outstanding cost performance.
Juhuasuan launched a new strategy this year—strategic focus on incubating 1,000 global industrial belts, activating 30,000 brands, and bringing quality and affordable lifestyles to 200 lower-tier cities, rather than just providing "9.9 yuan free shipping" products to meet the inherent consumption patterns of "small town youth."
Objectively speaking, the author is not optimistic about Alibaba's plan to "activate" 30,000 brands in one strategy. The path is certainly correct, but whether our society can accept so many brands is one thing; whether our society has so many activation facilities is a more serious problem.
As mentioned earlier, due to the proliferation of fragmentation and the failure of traditional media, only a few platforms like Focus Media can truly activate brands among hundreds of millions of mainstream groups nationwide based on their product system characteristics.
Even though we have seen Focus Media expand its basic activation facilities at an unimaginable speed in 2018 and 2019, regardless of financial report pressure, we still have to doubt whether the efficiency and service capabilities of a few activation facilities like Focus Media can keep up with market demand under the wave of nationwide brand creation.
**The activation path is complex, and brands need a combination of long-term building and timely activation, making activation capability a scarce resource.**
In contrast, relying on the power of internet communication, social media's ability to create influencers is over-amplified. The faster the process from ordinary person to influencer to rise, the faster the reverse process from influencer to fall to ordinary person.
The author still wants to repeat the previous point: fragmented social media can easily create short-term sales, but it is not easy to create brands.
In the early days of a certain social platform, tens of thousands of fans could achieve millions in sales, but now influencers with millions of fans may only achieve tens of thousands in sales. Besides the bubble attribute of the influencer economy, this also proves the physics law that "what heats up quickly cools down quickly." The traffic economy quickly creates influencers but also quickly devours them. Only a very few influencers who step onto the centralized stage can advance, but what after advancement?
For example, Li Jiaqi's cooperation with Estée Lauder sold international brands in large quantities at the lowest prices across the network. But we rarely see a brand finding Li Jiaqi to endorse a brand, thereby achieving a phenomenal case of completely activating a brand. Which brand has Li Jiaqi made? It seems none yet. Li Jiaqi is good at harvesting sales with famous brands plus the lowest prices across the network.
In short, the typical characteristics of the influencer economy are short-term effects and fast forgetting, making it unsuitable for brand building.
**-07-** **Trend 7: Activation is the path to brand rise**
As mentioned earlier, the influencer economy is not the best activator for brands, but this does not prevent some brands in our era from rising rapidly; the analysis of the influencer economy also does not mean that the author believes brand building must be slow.
On the contrary, high-quality brand building should be as fast as possible. For example, Luckin Coffee achieved a breakthrough from zero to $8 billion in a few years, with store numbers surpassing Starbucks. What did it rely on? It relied on precise assessment and activation of the coffee consumption capability of the existing office building population. Some may say it relied on Focus Media, but the author wants to say that the accurate statement should be: it relied on Focus Media for scene activation first, then combined with social fission, that is, "WeChat sharing to get one free," allowing the Luckin brand to quickly become the new mainstream.
The core of this trend is that no brand can rise by taking one medicine. It must be the result of precise mind design, core activation, establishment of user stickiness and trust, plus down-to-earth product work. Focus Media is not a magic tool, nor is WeChat. Only the mind that combines their characteristics is the most remarkable "magic tool" in the world.
**-08-** **Trend 8: Thunderous means, water-polishing effort**
Perhaps after reading the Luckin rise case, people feel an impulse to try, but for the vast majority of brands, "thunderous means" plus "water-polishing effort" is the right path.
Making the decision to advertise the brand is not difficult, but persistence is difficult. The secret here is that brand advertising has a qualitative turning point. Before reaching the turning point, there is an increase in awareness but no obvious sales effect, but after reaching the turning point, there is an obvious sales spillover effect.
So, as the old saying goes, brand building is not a day's work.
If you want to make quick money, whether it is pure e-commerce or social distribution like WeChat business or cloud business, you can try. Today sell bird's nest, tomorrow sell socks. Anyway, ups and downs are fleeting; as long as you make money, it's fine. But one reminder: what you see, others also see. So, everyone goes to fragmentation, everyone buys traffic, eventually making traffic more expensive, and the model of driving performance growth through traffic growth has ended. The bad consequence is that traffic dividends disappear and traffic costs rise.
So, a good career is one where you see it, others also see it, but your persistence makes you achieve it, such as brand building.
Some people think brand building is an industry that relies on "ideas" and "one-sentence slogans." In fact, Hua Yuhua, who has deep research in this field, once said a lot. He said: "We don't like to make those 'wonderful' ads because they are too wonderful to repeat.
And the essence of brand publicity is not the brilliance of that moment, but repetition, because the essence of the audience is forgetting. Therefore, good brand building cannot be separated from simple and direct repetition, and the subconscious implantation of super symbols and super slogans. Everything else is minor skill."
So, let's finally look at a formula: **GMV = conversion rate x unit price x repurchase rate**
Many people know this formula, but you should know that each multiplier here is connected to the brand. **Conversion rate depends on brand awareness and recognition; unit price depends on brand premium; repurchase rate depends on product experience, brand stickiness, and the frequency of knocking on user minds.**
This formula actually tells us that most variables for increasing GMV are related to brand power, and only traffic has a lower correlation with brand.
Wu Xiaobo just finished his 2019 New Year's speech. He said that tomorrow's economy will be good, consumption will rise, but only brand rise can get consumption dividends. This formula also tells us that in the upcoming 2020, the simplest truth is to do a good job with the brand and persist, which is the premise of everything.
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