Before 2022, when discussing channel changes and trends, fragmentation, diversification, and segmentation were almost industry consensus. Looking back over the past three to five years, new channel types such as community group buying, short-video live streaming, O2O same-city retail, private domain e-commerce, and content e-commerce have emerged, with both online and offline channels flourishing. Of course, this also kept brand owners and distributors busy: when a new channel emerged, they had to follow it to seize category market share. Just as they became familiar with the operations of new channels, the rules of the channels and platforms changed again. After a while, another variant channel appeared... In 2022, a new year, how will the channel retail landscape evolve? Will it continue to be as exciting as in the past? I think the answer is no, as the title suggests: In 2022, channels will return to certainty. Cooling Down, Anti-Monopoly, Common Prosperity First, from a macro perspective. In the second half of 2021, we clearly felt a change: internet giants were no longer in the spotlight. Under the introduction of anti-monopoly and a series of regulatory policies, the giants seemed much more low-key. Both market orientation and public opinion guidance have shifted more toward supporting agriculture, technology, and employment. Looking back at the past few years, business under the internet ecosystem was basically about financing, burning money, attacking cities, fighting, and subsidizing. A typical example is the community group buying track, which was hot in the past two years. Eventually, under national regulation, it gradually cooled down. The few remaining small platforms of the giants are now focusing on local operations, returning to real business, and doing differentiated operations under the traditional mainstream retail format. Apart from the giants' own business formats, let's look at the "head" businesses supported by the giants. On December 20, top live-streamer Viya was officially reported for tax evasion and fined a huge amount of 1.314 billion yuan. Many industry insiders judge that after the Viya incident, the live-streaming ecosystem will no longer be dominated by "head" streamers, and the value of the long-tail market will begin to emerge. In short, live-streaming e-commerce is saying goodbye to barbaric growth and becoming more standardized and healthier. Whether it's the cooling of community group buying, the introduction of the anti-monopoly law, or the Viya incident, they all point to: the internet industry is no longer a winner-takes-all game, and the goal of internet companies is not to dominate. Returning to the national level, the concept of "common prosperity" was proposed in early 2021 and has been repeatedly mentioned in various policies throughout the year. From the business logic behind "common prosperity," it also aligns with the current trends of internet cooling, shifting from virtual to real, and returning to the real economy. Previously, due to the pandemic, various new channels disguised as internet emerged, and within just one or two years, the market size grew a hundredfold or thousandfold. Behind these new channels, capital was inevitably present. Now, we can clearly see that capital is cooling down and shifting toward hard technology and new technologies, as represented by the rise of new car-making forces against the trend. As the pandemic has shifted from an accidental black swan to a white swan, and now to normalization, the objective social environment is gradually stabilizing. Internet giants and capital are becoming low-key and restrained, and the state's "invisible hand" is intervening toward the goal of common prosperity. Therefore, from multiple perspectives, the evolution of channels in 2022 will tend to stabilize, bidding farewell to the previous barbaric development. Certain Channels: Settle Down and Hone Skills The return of channels to certainty is actually a good thing for leading brands that deeply cultivate their own fields. Of course, it is a blow to brands that have been opportunistic in the past. No longer need to be exhausted from chasing hot spots; you can settle down, hone your skills, and continuously upgrade and optimize to achieve good business growth. For example, the O2O home delivery format has become a relatively mainstream channel. The landscape of the five major platforms is clear, and it's just about category share and corresponding investment ratios. In addition, the O2O business extended by mainstream chain retail stores represented by Walmart, Yonghui, and Carrefour has already accounted for nearly 20%-30%. How brand owners effectively adjust strategies and measures from headquarters to regions involves everything from headquarters strategy formulation to the upgrading of tools and methods for in-store promoters and salespeople at individual stores. Community group buying has cooled down significantly. Apart from maintaining regular cooperation with mainstream giant platforms, brand owners can appropriately follow up on regional community group buying formats as a supplement to sales, implemented at the regional level. For offline KA formats, such as national chains like Walmart, Yonghui, and RT-Mart, the focus should be on O2O business growth; For local KA formats, due to the sluggish business in recent years and the shift of consumption online, the format is gradually transforming toward community-based and small-scale retail. Brand owners should also appropriately synchronize their transformation and update marketing strategies in response to the upgrading direction of local KA. For traditional GT channels, based on their own category characteristics, they should pay differentiated attention, as different categories show significant differences in GT channel monetization. There are two directions here: First, distributors, channel partners. In GT channels, the core of business comes from distributors. The key is to reduce costs and increase efficiency, and to work with distributors to improve channel efficiency. Second, the reach of stores and consumption around stores, which is what we often call BC integration. How to use digital tools and methods to improve business efficiency and rebuild brand value. Short-video live-streaming e-commerce: Undoubtedly, the previous traffic tactics of relying on top streamers are gradually becoming less effective. How to turn self-broadcasting into a normalized marketing method and sales channel, ultimately achieving the transformation from platform public domain to brand private domain, will be a key topic. With the stabilization of channel formats, the focus for brands is to conduct in-depth research and exploration of each channel to find a marketing and business logic that suits themselves. No longer pursue explosive, speculative growth in "quantity," but instead pursue growth in "quality" in terms of efficiency and consumer value. Where Will Business Growth Come from in 2022? After discussing channels, let's return to the practical topic: where will business growth come from in 2022? From the perspective of the FMCG industry, the core is two dimensions: 1. Product portfolio; 2. Channel competition. Regarding product portfolio, it includes category (brand) extension and product innovation (including packaging, specifications, flavors, etc.). The core logic of category (brand) extension is to sell more! The core logic of product innovation is to sell at a higher price! Regarding channel competition, the core is three sentences: Management brings benefits, execution brings efficiency, and investment brings returns. Since channels are certain and the same for everyone, the test now is the basic skills of brand owners and distributors. How to further proactively segment the certain channels and achieve competitive advantages at individual points through different strategies and tactics. The curtain for 2022 has already risen. When channels return to certainty, have we honed our basic skills?

March 18-20, 2022, the 7th China FMCG Channel Innovation Conference, with the theme "Return to the Fundamentals," aims to lead FMCG industry partners to look at our fundamentals from a channel perspective. From the perspective of fundamentals, what are our corresponding basic skills? Friends from all walks of life are welcome to register and discuss the logic of business growth under certain channels.

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