It has been two years since the outbreak of the pandemic in early 2020. During these two years, the FMCG channel landscape has been ever-changing. We often hear peers asking: Should we do social e-commerce? How to do O2O? Is community group buying still viable? But we rarely hear discussions about what city managers should do to respond. As frontline commanders who are always in the trenches, smelling the gunpowder, city managers are the most forward combat leaders of every company. How can these frontline commanders, who hear the gunfire, upgrade their entire combat system? Earlier last month, a new book written specifically for city managers, "Omnichannel Management for FMCG Regional/City Managers," was just published. Xu Xiang, currently the Sales Director for Unilever South China, has been in the FMCG daily chemical, dairy, and condiment industries for 20 years, with deep expertise in regional market management and customer marketing. (Left) Ren Wenqing (Right) Xu Xiang A few days ago, I met with Xu Xiang in Shanghai, and we exchanged and discussed many topics. Why did he publish a monograph for city managers? What does omnichannel management mean for city managers? How will channels change in 2022, and how should city managers respond? Next, I will share the content of our exchange with you. Many of Xu Xiang's viewpoints will surely inspire you. Wenqing: "Omnichannel Management for FMCG Regional/City Managers" is a book focused on city managers in FMCG companies. What prompted you to write such a book? Xu Xiang: City managers are the frontline commanders of FMCG companies' business in each city. They open stores, close deals, execute, reconcile accounts, collect payments, manage people, manage customers... The last mile of sales for every company is completed by them. In the past few years, the FMCG industry has changed very rapidly. Compared to the previously fixed channels, it is now completely fragmented. Especially since the pandemic, various new channels and models have emerged. How can city managers grasp these changes? In fact, many city managers are quite confused. During the pandemic, I began publishing articles on the New Distribution official account every Sunday, hoping to bring city managers new thoughts and inspirations from frontline management. After all, no one on the frontline of any company wants to fall behind or be eliminated by the new retail and new channel reforms. Publishing a collection is actually quite meaningful. You know, there are nearly 10 million "frontline city managers" in grassroots sales organizations nationwide. However, facing such a large group, there are almost no channel toolbooks for them; the most recent one was before 2015. Therefore, through weekly accumulation and reflection, the publication of this book is timely. Wenqing: In this book, you mention the keyword "omnichannel management." What exactly is "omnichannel management," and what does it mean for city managers? Xu Xiang: "Omnichannel management" is proposed in response to the state of "channel fragmentation." From the 1990s until 2014, the FMCG chain of raw material suppliers - brand owners - distributors/wholesalers - retailers - consumers remained basically unchanged. However, in recent years, "Internet + capital" has had a huge impact on this chain. Let me show you a picture. This picture is also in my book, but I update it regularly because the industry is still developing rapidly, and we need to maintain an awareness of upgrading. You can intuitively see the current state of "fragmentation" in FMCG channels, behind which is the impact and reconstruction of existing channels by new channels. In the past, people could complete their business within the existing channel mix without actively developing new channels. But now, with the rapid development of new formats like O2O to home and community group buying, even JD.com and Tmall have been defined as traditional e-commerce. So, what is everyone's first reaction to new channels? Rejection. People like to stay in their comfort zones. But now, it is an era where you have to keep running just to stay in place! When I talk about "omnichannel management," I am actually reminding city managers to have a perspective of self-examination. First, do you have the sensitivity to observe industry changes? Second, do you have the action to leave your comfort zone and actively try? Also, do you have the ability to learn quickly and quickly adapt to the operation of new models? Wenqing: The current channel landscape is increasingly fragmented, that's a fact. But is responding to changes more of a company-wide strategy from top to bottom, or is it the responsibility of city managers as grassroots team leaders? Xu Xiang: When the market environment is relatively stable, it is fine to issue and execute orders layer by layer from headquarters to local levels. But now, the market environment is complex and changeable, and FMCG sales have entered an era of city-centric conquest. Overall strategy is certainly a matter for headquarters. But when new channels emerge, for a company, headquarters may not perceive them as quickly; the grassroots perceive them fastest. If you don't react or take action, the entire company's response will be very slow. Wenqing: City managers should have sensitivity and proactively try new things. Does that mean they should pay more attention to incremental growth? Xu Xiang: No! "Omnichannel management" reminds us to be sensitive to new channels, but that does not mean we relax investment in old channels. In this book, besides discussing new channels like O2O and community group buying, most of it covers operational strategies for mainstream core channels such as KA, supermarkets, chain convenience stores, small shops, wholesale, etc. Because even for old channels, under the impact of various new channels and models, your tactics must change accordingly. If traditional core channels are the stock, and new channels are the increment, then "omnichannel management" reminds city managers not to just guard their own turf in the stock, but also learn to seek growth in the increment. But now, we need to re-examine this stock and increment. Why? I judge that 2022 is the year when the FMCG industry channel returns to certainty. What does that mean? In the past few years, the underlying driver of channel fragmentation was "Internet + capital." But since last year, with some policy adjustments, we have seen the impact of capital weaken. The dividends of various online new retail and new channels no longer exist. Everyone will find that mainstream core channels remain the main battlefield for FMCG brands. Online and offline, the entire market is a stock battle. This is what I mean by returning to certainty. Wenqing: From embracing uncertainty to returning to certainty, facing the stock battle in 2022, how should city managers respond? Xu Xiang: First of all, uncertainty still exists. But in 2022, everyone should refocus their energy on mainstream core channels. The entire market is mainly competition for core stock business. So how should city managers respond? Practice the basic skills well! Frankly speaking, many city managers in teams now have some problems. Newcomers may think they have ideas and know new things well, so they look down on old channels. In my mind, if a newcomer hasn't visited 500 terminal stores, don't talk to me about channel management and planning. Store visits are the basic skill that city managers must practice. As for some old salespeople, they think they have been doing this for many years and know everything well. You cannot stay in your comfort zone. Can the basic FMCG skills you were good at before, such as distribution, product placement, stacking, display, and visits, handle the new business of new channels? Under the impact and changes, don't these basic skills need to be iterated? Wenqing: City managers need to practice the basic skills of managing existing channels and also be able to upgrade and iterate their abilities according to environmental changes. What personal traits does this require of city managers? Xu Xiang: They must have the ability to summarize, review, and reflect. I have been in the FMCG industry for 20 years. If there is any special methodology, it is that I like to summarize and reflect. I try to review every day, and I also require this of my team members. Over time, I have accumulated dozens of notebooks of daily reviews. The publication of this book also benefits from my habit of thinking and summarizing. Only by developing the habit of summarizing, reviewing, and reflecting can you discover the shortcomings of yourself and your team, iterate the key skills and capability systems of yourself and your team, and lead your team to conquer territory in the ever-changing competitive environment! But to be honest, not many people really like to ponder. So from a group perspective, excellent city managers are actually those who survive the competition! Because many people are eliminated along the way. Market competition is cruel. In the era of stock battles, as a frontline commander, if you are unwilling to learn and cannot iterate yourself, you will eventually be eliminated.
Final Thoughts:
After the interview, Xu Xiang told me that the reason he could write a book on omnichannel topics is due to his years of frontline market experience and his habit of summarizing and thinking. He is both a participant and an observer of the industry. In 2022, with stock battles, how should frontline commanders respond? Due to time constraints, our exchange could not cover everything. If you are a corporate manager, a city manager, or interested in this topic, reading this book may provide you with more perspectives and inspiration. Focusing on in-depth interviews in the FMCG industry, thinking about the latest changes in the industry. If you want to communicate, you can add WeChat by long-pressing. When adding, please indicate your company, position, and name.