A speck of dust from the times, when it falls on each person, becomes a mountain. During market visits, New Distribution heard many distributors lament: In the past, business was difficult but sustainable, at least not losing money; now, business is so hard that it's truly unsustainable. Why? To achieve growth, most brands increase task targets, shifting pressure onto distributors, leading to a surge in near-expiry products and some distributors' warehouses bursting. Some distributors joke: Losses are the norm now; when we can't afford to lose anymore, we'll have to close down. Though said in jest, it also confirms a fact: The era of linear growth in FMCG is over. Distributors are suffering, and brands keep pressuring them. Liu Chunxiong, a proponent of new marketing and dean of the Marketing Digitalization Research Institute, once said: Replace increment with growth, and replace quantity growth with valuable growth. What does that mean? Brands and manufacturers一味降价、促销,增加下游任务量,治标不治本,长期下去反而适得其反。The problem lies in shrinking volume; the opportunity lies in shifting to big single products. Big single products cure all ills. Enterprises must use big single products to break through the ceiling and carve a new path for distributor growth. High Ground Endorsement, Seizing the Momentum What kind of big single product gives distributors confidence? Distributor Chen from Wuxi said: Only by doing business with young people is there room for growth. New Distribution observed that Lai Yifen, the 'first snack stock,' is pointing the way for the industry by steadily advancing its 'Ten Thousand Lights' strategy and deepening its partner win-win model. On June 27, Lai Yifen held a grand 'Ten Thousand Lights, A Thousand Sails Competing' 7th Partner Conference in Shanghai, where hundreds of outstanding distributors from across the country gathered to discuss future development plans. At the conference, Lai Yifen's chairman, Shi Yonglei, stated: Last year, Lai Yifen changed to a business unit system, which has made internal division of labor clearer and more refined. 'As a service platform, our mission has always been to serve our partners and consumers well, and achieving 'win-win' is our core goal. We must adopt a very pragmatic cooperative attitude and work together with the service side, supply side, and sales side to achieve our common goals. We hope and welcome partners to put forward constructive opinions and suggestions.' Shi Yonglei emphasized that Lai Yifen actively responds to market changes, and through the internal business unit reform, work has become clearer and more focused on the needs of partners and consumers. Indeed, for brand owners, in an involutionary market, the relationship between manufacturers and distributors must be more united and coordinated to seek growth and fight side by side. Brand owners should think more about how to help a group of distributors succeed. The process indicator is to improve distributors' operational capabilities, and the outcome indicator is to increase distributors' profits. The link between distributors and brand owners is the product. At the partner conference, Lai Yifen abandoned traditional promotions and price cuts, starting from the root, and launched its first product brand for special channels—Jicui. In this regard, Chairman Shi Yonglei emphasized: The company will implement the 'one product, one chain' strategy, focusing on the full-chain optimization of each product to create competitive 'champion products.' At the same time, it will integrate brand power, product pricing, production, and raw material capabilities to achieve market leadership for 'Jicui' products. What is a 'champion product'? It is understood that 'Jicui' is expected to be a 'champion product' because this series is developed in close cooperation with top external consulting teams and food R&D institutions, through in-depth consumer market research and big data insights, precisely capturing consumers' real needs. In the future, 'Jicui' will be fully penetrated across multiple channels, and through full-chain optimization, it will become a star product in the market, like 'stars surrounding the moon.' This move not only promotes the implementation of Lai Yifen's high-quality development strategy but also brings great confidence and expectation to distribution partners. Secondly, 'Jicui' is an independent brand name, independent channel, and independent product series, operated by its distribution business unit, offering different packaging specifications for different market channel needs, and achieving optimal cost-performance. Why launch a 'champion product'? As is well known, the market is becoming increasingly competitive. Brands compete on products, distributors compete on channels, and behind this competition is the increasing segmentation of products and channels. At this time, it is crucial for brands and channel partners to cooperate to deliver good products to consumers accurately and effectively. Shou Zhiguo, senior partner at Hejun Consulting and general manager of the New Consumption Division, mentioned at the meeting: Although the involutionary market is challenging, it is also a good opportunity. Lai Yifen started in Shanghai, and Shanghai is one of China's consumption highlands. With high ground endorsement, seizing the momentum, using 'one product, one chain' to create a big single product. Based on Lai Yifen's own stores, and then cooperating with channel partners to deeply cultivate regional markets with refined management and operations, these two legs will make Lai Yifen go further and more sustainably. Using the 'People, Goods, Scene' Model Deconstructing Jicui's Brand Competitiveness Luo Zhenyu mentioned in his 2024 New Year's speech: There are thousands of ways to break through the 'involution,' but in the end, it's just one: each does its own test paper. The Chinese market is large enough, deep and diverse enough; no one dominates forever. Let's deconstruct the competitiveness of the 'Jicui' brand from the 'People, Goods, Scene' model to see how Lai Yifen shifts from channel thinking to operational thinking and refines product operations. The Young Consumer Group Passed Down from Generation to Generation First is people, i.e., a customer acquisition mindset centered on 'people,' emphasizing telling user stories well, including experience, emotion, and psychological value. Zhou Yini from Lai Yifen's distribution business unit emphasized: Current consumption trends all talk about 'health.' What is health? Physical health is one aspect, and mental health is another. 'Jicui' is a product that addresses emotional value, and puffed food is a remedy for releasing psychological issues. When you're depressed, unhappy, or lonely, you can eat puffed food. The 'crunchy' sound itself is very stress-relieving. We often hear young people say 'destroy it all.' What do they mean by destruction? They hope bad things are destroyed and good things remain. So we say 'Jicui shatters all the bad things,' which carries the same meaning. Therefore, the core consumer group of 'Jicui' is Gen Z aged 15-25. According to Qingshan Capital statistics, 'Gen Z' in China totals 240 million people, accounting for 18.1% of the total population, of which 33.35% are adults, 23.4% are teenagers over 14, with 139 million males and 117 million females. Over time, Gen Z will gradually leave campus and become the backbone of society and the main consumer force. Their lifestyle and thinking patterns will have a profound impact on society as a whole, even becoming representatives of mainstream culture. So what labels do Gen Z have? They are a generation that grew up in a new era of national prosperity and accessible everything. They tend to engage in 'persona-driven consumption' and 'social consumption,' paying more attention to the spiritual experience behind consumption. Clearly, entering the new generation's cultural circle and resonating deeply with young people is a long-term strategy for the Jicui brand to stay young. As the Hedgehog Band sings, 'A generation will eventually grow old, but there are always people who are young.' There has never been a new demographic; there are only young people. As long as you grasp the common needs of the young group, brand value will be passed down from generation to generation. Products with Addictive Social Attributes Second is goods. A successful product must meet four consumer needs: emotion, addiction, social, and health. 'Jicui' has four product series: potato chips, rice crackers, cuttlefish crisps, and shrimp sticks with squid rolls. Its brand positioning: a bold but not alternative, unique but not niche, creative, playful, trend-leading entertainment snack brand. The ultra-crispy texture of puffed food is irresistible, and with various spicy and savory flavors, it creates addiction. Among them, cuttlefish crisps stand out in the category, with innovative Sichuan pepper and truffle flavors, leading distributors at the scene to say that cuttlefish crisps have great sales potential. It can be seen that the 'Jicui' series breaks through the traditional limitation of only making single categories like corn or potatoes, and also has internet-famous attributes in taste and design. This positioning also invisibly establishes a sales model centered on 'young consumer groups.' 'Young, that's Jicui' was also the most mentioned slogan at the partner conference. Diversified Growth Consumption Scenes Data shows that in the past year, the online snack market has shown a good growth trend, with sales reaching 16.51 billion yuan, a year-on-year increase of 8.6%, and sales volume up 26.8% year-on-year. Among them, puffed food, as the third largest category, has exceeded 130 billion yuan in scale. Yang Shang, CBO of Lai Yifen's Brand Development Center, said that if Lai Yifen captures 1% of this 130 billion yuan market share, that would be a 1.3 billion yuan business scale. So a big track and high momentum equal big opportunities. In this big track and high momentum opportunity, snacks themselves have many scenes: outdoor travel, work breaks, afternoon tea, including crispy textures, heavy salt, and heavy spice, all are sought after by consumers. This shows that emotional value and addiction are very suitable for puffed food series, and that's why everyone likes them. According to Kantar Consumer Index monitoring, in 2023, the out-of-home consumption market recovered rapidly, with outdoor scenes such as travel, shopping, and sports significantly warming up quarter by quarter. Last year, ready-to-drink beverages like functional drinks, ready-to-drink tea, juice, and coffee achieved good growth both at home and out of home. Among them, ice cream, puffed food, and biscuits showed obvious recovery in out-of-home scenes. From this perspective, scenes create unlimited growth space. The cleverness of this growth lies in: Jicui, as a more proactive brand, involves users, sharing the brand tone of 'passionate, lively, fun, and young and fashionable' with consumers, and its value proposition is fully released. Thus, products, scenes, and people are strongly linked, bringing strong consumption experience awareness. Under such a sales logic, rapid breakthroughs in core channels can be achieved. At the same time, the partner conference also held the global launch ceremony of Lai Yifen's 2024 Mid-Autumn Festival new products, showcasing the fusion of tradition and innovation—the 2024 Mid-Autumn new product 'Hey, Happy to the Moon' series, inspired by aerospace elements, demonstrating the brand's innovation and market acumen. The newly launched 'Hey, Happy to the Moon' series includes four different style gift boxes: Moon Exploration, Full Moon, Moon Landing, and Planet Crisp. The design is inspired by aerospace elements, expressing Lai Yifen's tribute to Chinese tradition and reflecting the fusion and innovation of modern elements. Three-Party Win-Win Achieving an Efficient Fulfillment Model The book 'Understanding Management' once said: The secret to crossing cycles is to choose the right track 'yesterday,' build individual differentiation advantages down-to-earth 'today,' and prepare for 'tomorrow' in advance. At the end of last year, Lai Yifen made organizational adjustments and established a distribution business unit to provide professional services to distribution partners. In June this year, Lai Yifen launched its first brand customized for special channels, 'Jicui.' In the trillion-yuan snack track, Lai Yifen is fully prepared. In this regard, several distributors of Lai Yifen also expressed their views. At the partner conference, distributor Ji from Shanghai, with 13 years of deep cooperation and contribution with Lai Yifen, was awarded the 'Collaboration Award.' As a veteran in special channels, Ji's business focuses on the gift and group channel, with annual sales of up to 120 million yuan, of which Lai Yifen accounts for about 40%, and it's relatively stable each year.
Ji said: My channel customers are mostly state-owned enterprises and listed companies. They value product quality very much. I started cooperating with Lai Yifen 13 years ago because of product quality. After years of cooperation, Lai Yifen's consistent quality assurance has earned deep trust.
The newly launched Jicui brand further confirms Lai Yifen's precise grasp of distributor needs and supply chain R&D capabilities. By providing high-quality, cost-effective products, it effectively reduces consumers' choice burden, so Lai Yifen has always been our company's preferred brand. Distributor Cheng from Hangzhou, with an annual scale of 300-400 million yuan, has cooperated with Lai Yifen for over a year.
Cheng said: His product selection logic looks at three dimensions: first, brand power, which requires a certain level of awareness and influence in the industry; second, the category must have a large capacity in the market, with high consumer awareness and great room for growth; third, product quality must be good enough. Lai Yifen meets all these criteria.
Regarding the launch of Jicui, he said he is quite confident. In the next month, he will select 50% of high-quality stores from 1,000 stores for key distribution and see how the market responds. Distributor Chen from Wuxi, with an annual business of over 100 million yuan, has been an agent for Lai Yifen for 2-3 years, mainly covering fruit chain stores, boutique stores, and mom-and-pop stores.
Chen said that after the pandemic, he adjusted his product line, cutting out instant and filling foods and replacing them with a large number of puffed foods. Chen admitted that his target group is mostly young people, who prefer products with a sense of pleasure. Puffed products now account for a high proportion of sales and sell well all year round.
Most importantly, quality puffed products determine repurchase rates. That's why he chose Lai Yifen. The Jicui brand, with Lai Yifen's brand endorsement, has a significant advantage. Distributor Pan from Hefei, a B2B distributor with annual sales of over 100 million yuan and over 17,000 SKUs.
Regarding Jicui, Pan said that puffed food is a big market in the snack field. Jicui's pricing is quite competitive, and cuttlefish crisps are a blank in the puffed food category. This selling point will bring some sales space and also balance the decline in sales of other first-tier puffed food brands he represents. Sichuan pepper and truffle flavors are favored by young consumer groups, and these two points will help him counter some competitors. Undoubtedly, Lai Yifen, through its C-end demand creation and B-end fulfillment model of store, home, and delivery, truly forms the most efficient fulfillment model among brand owners, channel ends, and consumers. Top-down, Lai Yifen is beginning to empower downstream and more precisely activate the terminal market. Final Thoughts The road is long, but with action, it will be reached. The task is difficult, but with effort, it will be accomplished. Within Lai Yifen, a phrase is frequently mentioned—'Work with heart.' It is the process of Lai Yifen people continuously interpreting and elevating the concept of 'user first,' and it is also Lai Yifen's reflection on how to meet users' real needs in a changing era. How to achieve this systematic long-term project? The Jicui brand will be a strategic layout to continue practicing. For a brand to continuously cross cycles, it needs this top-down empowerment and precise activation of the terminal market. This not only brings new development opportunities for Lai Yifen itself but also provides new value insights for the entire snack industry. While anchoring and meeting users' real needs, continuously self-innovating, keeping pace with the times, and racing against time, Lai Yifen is becoming the creator, practitioner, and leader of China's leisure food chain business model.