---
title: "Arctic Ocean Soda: How Far Is the Big White Bear from the 10 Billion Yuan Goal?"
description: "As a native of Beijing Yiqing, Li Qi took over Yili Bread in 2002 and achieved a 20-fold increase in bread sales over ten years. In 2010, he took full management of several state-owned enterprises including Yili Food and Arctic Ocean Food, proposing 'Three Musts' to revive the old brands. In 2011, Arctic Ocean soda made a comeback, but despite its nostalgic appeal, it faces challenges in a changing beverage market and modern distribution channels."
author: "小镇青年朱迪"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2016-09-24"
categories: "Brand Marketing, Management & Methods"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/arctic-ocean-soda-how-far-is-the-big-white-bear-from-the-10-billion-yuan-f768b1bb/"
markdown: "https://xinjignxiao.com/en/articles/arctic-ocean-soda-how-far-is-the-big-white-bear-from-the-10-billion-yuan-f768b1bb.md"
original_source: "https://mp.weixin.qq.com/s/U39Y1uC-yAiAaNzSQ_OLnA"
translation: "https://xinjignxiao.com/zh/articles/%E5%8C%97%E5%86%B0%E6%B4%8B%E6%B1%BD%E6%B0%B4-%E5%A4%A7%E7%99%BD%E7%86%8A%E7%A6%BB100%E4%BA%BF%E7%9B%AE%E6%A0%87%E6%9C%89%E5%A4%9A%E8%BF%9C-f768b1bb.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/arctic-ocean-soda-how-far-is-the-big-white-bear-from-the-10-billion-yuan-f768b1bb/"
citation: "小镇青年朱迪. “Arctic Ocean Soda: How Far Is the Big White Bear from the 10 Billion Yuan Goal?.” New Distribution, 2016-09-24. https://xinjignxiao.com/en/articles/arctic-ocean-soda-how-far-is-the-big-white-bear-from-the-10-billion-yuan-f768b1bb/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# Arctic Ocean Soda: How Far Is the Big White Bear from the 10 Billion Yuan Goal?

> As a native of Beijing Yiqing, Li Qi took over Yili Bread in 2002 and achieved a 20-fold increase in bread sales over ten years. In 2010, he took full management of several state-owned enterprises including Yili Food and Arctic Ocean Food, proposing 'Three Musts' to revive the old brands. In 2011, Arctic Ocean soda made a comeback, but despite its nostalgic appeal, it faces challenges in a changing beverage market and modern distribution channels.

30+ industry experts, 100+ B2B platform founders, and 800+ manufacturer friends gathered in Fuzhou to discuss the internet transformation path of the FMCG industry.
As a native 'Yiqing person', in 2002, Li Qi, Chairman and General Manager of Beijing Yiqing Food Group Co., Ltd., took over Yili Bread, achieving a 20-fold increase in bread product sales over ten years and ranking first in the industry in profits. In 2010, Li Qi took full management of several state-owned enterprises with long-standing difficulties, including Yili Food, Arctic Ocean Food, and Jingqing Restaurant. At the start of his tenure, Li Qi proposed 'Three Musts': the image must be both traditional and fashionable, the packaging must be green and environmentally friendly, and the taste must be original but not raw. Since then, the two old brands, Yili and Arctic Ocean, began their journey of return. In 2011, consumers bought the revived Arctic Ocean soda at the century-old Yili chain stores, still in glass bottles, with the trademark polar bear upgraded to a cute big white bear, and even the advertising slogan was full of Beijing flavor and fashion: 'Real orange sincerity, enough orange spirit, still our Arctic Ocean.'
Glass bottle, crown cap, orange sweet water colliding with carbon dioxide to create a joyful taste, in the days without air conditioning, only palm fans, when sweating profusely, drinking this soda with the white polar bear logo became a typical scene of Beijing in the 1980s. Nowadays, if you can't appreciate the deep meaning of this drink, you will definitely be looked down upon: 'You're drinking soda, I'm drinking Arctic Ocean.'
Indeed, Arctic Ocean is not just a soda; the glory of the big white bear has settled into a shared memory of a generation. Of course, this memory also brought real financial benefits to Arctic Ocean. From 1985 to 1988, Arctic Ocean Company's output value exceeded 100 million yuan, with profits reaching over 13 million yuan. It's no exaggeration to say it was the 'big brother' of Beijing's cold drinks and soda industry.
After experiencing the glory of a national soda, the brand was once shelved, then re-launched. Through several stages, time has left a nostalgic mark on Arctic Ocean. Unfortunately, the child who once held it to drink now has children who have switched to NFC, or at least Xiaoming Tongxue. Children rarely even drink cola; there are too many beverage options.
Rebirth: Emerging from Shelving but Facing the Beverage Industry's Deep Winter
Let's first review Arctic Ocean's return journey.
In 2011, Arctic Ocean soda resumed production. In November of that year, without much publicity, the first batch of 100,000 boxes of glass-bottled soda sold out easily in the off-season, and the Beijing market affirmed Arctic Ocean's 'low-key comeback' with its enthusiasm.
On August 8, 2013, Yiqing Holding Company integrated and restructured subsidiaries including Beijing Yili Food Company and Beijing Arctic Ocean Food Company to establish Yiqing Food Group, which owns the two famous brands 'Yili' and 'Arctic Ocean'.
The restructured Yiqing Food Group was valued as a model of state-owned enterprise reform and development. On one hand, it expanded the century-old Yili specialty stores; on the other, it promoted the comprehensive revival of Arctic Ocean's products.
However, Judy believes that for the Arctic Ocean big white bear to return to the 'big brother' position and occupy a corner of the beverage market, even a small one, is difficult!
In 2015, Arctic Ocean sold over 5 million boxes, exceeding the total sales of Pepsi and Coca-Cola in the same packaging in the Beijing region. But the big white bear emerging from shelving faces a market structure that is no longer the same as 14 years ago.
According to public reports, major brands have seen price reductions, and since 2013, the beverage industry has entered a deep winter. In the first half of 2016, Master Kong experienced negative growth, with profit margins dropping from around 30% to 20%. Master Kong's first quarter of 2015 saw a year-on-year decline of 16.56%, with beverage revenue down 49.15%; Uni-President's first half of 2015 fell 2.9% year-on-year; Coca-Cola declined 3% in 2015; the carbonated beverage market has seen weak growth in recent years.
In terms of channels, the former sugar and wine system sales structure could fully achieve sales implementation, but now, from channel scale to channel function, it is more segmented. Excluding high channel costs, even selling in the exclusive century-old Yili chain stores faces already changed consumption trends.
In this scenario, Arctic Ocean, despite its 'yellow jacket' (privileged status), shouldn't be too warm.
Glass Bottle: Restoring the Original Taste but Blocked by Modern Distribution Channels
Glass bottles and carbon dioxide are a perfect pair. The airtightness of glass bottles perfectly presents the refreshing feeling of carbon dioxide, and the familiar taste lets consumers drink the past from their memories. According to reports, Arctic Ocean soda's main product is fruit juice carbonated beverage, with each bottle's fruit juice purity close to 4%. To ensure consistent taste, Arctic Ocean selected Chongqing Wanzhou red tangerines, certified as a national geographical indication protected product, as raw material, rather than flavoring. Arctic Ocean has its own juice extraction plant in Wanzhou, and the juice with a concentration exceeding 60% is transported back to Beijing in low-temperature trucks at minus 18 degrees Celsius. For flavor blending, tangerines at three different maturity stages are mixed in a certain proportion to achieve the best aroma. To lock in 'good taste', even for carbon dioxide content alone, Arctic Ocean can ensure that after opening the bottle, a large amount of gas remains dissolved in the water for 12 hours. This is partly related to the glass material; Arctic Ocean's glass bottles can fall vertically from a height of 1 meter and not break on first impact. At the same time, the carbon dioxide content is fine-tuned according to different seasons and weather.
The taste restoration is indeed good, but the glass bottle brings two fatal weaknesses to the big white bear.
First, it is fragile. This makes modern distribution channels reluctant to sell bottled beverages. Second, recycling. The reuse of glass bottles requires sales points to be responsible for recycling and replacement, and clearly no channel merchant would 'get up early' to return bottles.
However, a somewhat unexpected reason is the lack of money.
Li Qi, Chairman of Yiqing Food Group, once publicly stated to the media that Arctic Ocean, with registered capital of 30 million yuan, simply couldn't afford to enter supermarkets. The minimum entry fee for supermarket channels was quoted at 800,000 yuan. For an old state-owned enterprise, it must ensure a balance of income and expenditure as much as possible, and besides normal operations, it also has to bear subsidies and various expenses for 6,000 retired old employees, nearly 10 million yuan annually. 'We can't afford to enter supermarkets at high prices, nor can we invest heavily in advertising.'
To solve the channel problem, Li Qi discovered a channel more important than supermarkets during an inspection trip to Germany. Li Qi found that community convenience stores are more down-to-earth than supermarkets. If focusing on such sales channels as convenience stores, not only are costs low, but it also helps the team directly grasp market conditions.
Therefore, in the first five years after Arctic Ocean's comeback, the Beijing market served as the base market, radiating to Beijing-Tianjin-Hebei. Meanwhile, external markets targeted cities like Shanxi, Hainan, Xinjiang, Heilongjiang, Suzhou, Baoding, and Chongqing, developing local markets through distributors. In terms of channel types, 95% of sales came from Beijing's grocery stores and catering channels.
Currently, a production base has been established in Dingzhou. Beijing Yiqing Food Group Co., Ltd. has established a physical company in Zhengding County, planning to invest 200 million yuan over five years to build the 'Yili' and 'Arctic Ocean' dual brands, covering beverages, bread, cold foods, and commercial multi-industries, becoming a central factory serving North China.
In August this year, Arctic Ocean attacked Chongqing. Chongqing people, whether eating hotpot, chuanchuan, barbecue, or noodles, will order a bottle of beverage. Therefore, Chongqing's beverage market is very active, especially in summer. Let's do the math: a bottle of Arctic Ocean sold in Chongqing, with a retail price of 5 to 6 yuan in the catering channel, probably costs more than that in transportation. Similarly, the revived brand Tianfu Cola sells for 4 yuan in supermarkets. The big white bear hasn't even stabilized in the northern market, yet it runs to Chongqing to open a remote battlefield. If a factory is established in Chongqing in the future, it could output products at the raw material supply site, shorten the logistics supply chain, and control the southwest market.
Between the Big White Bear and the 10 Billion Yuan Goal, There's a 'Playful Heart'
Despite the support of the Beijing State-owned Assets Supervision and Administration Commission and the exclusive channels of the century-old Yili specialty stores, Arctic Ocean remains conservative in sales and lacks effective breakthroughs. As an FMCG, the big white bear hasn't fully 'started running'.
Beverages are inherently low-involvement products, with a high probability of random purchase. Especially in an era pursuing health, personalization, and convenience, consumer expectations for beverages have surpassed the basic function of quenching thirst. For Arctic Ocean to stand out, besides using 'nostalgia' to lock in the 35+ age group, it must also use a 'playful heart' to bring the post-90s and post-00s along to joke around and 'get high'. Speaking of this, one can't help but think of Japan's Ramune soda. In its century-long development, the marble bottle shape has become its gene, and the bottle label is designed according to the hot topics of different eras, almost becoming a display window for pop culture. For Arctic Ocean to cultivate a new generation of consumers, it must first establish a dialogue mechanism. The anti-slip orange peel texture, Braille markings, and undulating curves can all become triggers for the big white bear to become a fashionable topic. That's not enough; as a spokesperson for young life, the big white bear must also expand a world for 'ice fans' through personalized channels, just as Arctic Ocean advocates: 'You're drinking soda, I'm drinking Arctic Ocean.'
Then, in terms of channels, although it has developed well in the catering channel, in terms of community channels alone, Arctic Ocean's development of community convenience stores is still weak. Currently, Beijing's largest communities—Huilongguan, Tiantongyuan, Wangjing, Fangzhuang, Shijicheng, Jinsong, etc.—contain a lot of business opportunities. These communities include three types of consumers: large families with three generations, small families with three members, and single-person households. Correspondingly, currently in convenience stores, the main purchase mode is boxed single bottles, which clearly isn't enough to meet family consumption needs. If corresponding 8-pack or 4-pack small and medium-sized packaging is launched, then on the way home from work, consumers can easily pick up a pack, which won't burden consumers and will facilitate the return of empty bottles. At the same time, for single-person households, designing multi-flavor combination sets, and additionally offering convenient and affordable combinations like Yili cooked food, can get closer to consumers in terms of lifestyle. Products that subtly meet consumer needs—how could they not gain consumer support?
Of course, if the channel design is further planned, controlling terminal prices and channel prices, then combined with the exclusive characteristics of the century-old Yili, using real market data for management, controlling production and sales coordination, and using specialty stores spread across all districts of Beijing as bases to expand outward to Tianjin and Hebei, it will inevitably create a new consumption trend.
**Source: Sales A**
New Food Era · New Distribution
—— 2016 China 'FMCG + Internet' Summit Forum ——
**This is a grand event focused on how the FMCG industry channels will transform under the trend of internet + transformation**
**Conference Agenda**
09:00-09:30 Registration
09:30-09:35 Host opening
09:35-10:05 2016 China FMCG Industry Trend Analysis Report - Zhao Bo
10:05-10:25 FMCG Enterprise Transformation Strategy and Path - Liu Chunxiong
10:25-10:45 Opportunities and Challenges Brought by FMCG Channel Reform - Liu Zhao, CEO of Waiqin 365
10:45-11:25 Alibaba Retail Link Full Empowerment - Guo Kunkun, Alibaba Retail Link
11:25-12:00 Roundtable Forum - Brand Transformation: Improvement vs. Reconstruction? (Guests TBD)
12:00-13:30 Lunch
13:30-14:00 Distributor Transformation: City Distribution Trends - Wang Qi, CEO of Weijie City Distribution
14:00-14:30 Roundtable Forum - Why Should Distributors Do Logistics in Transformation?
14:30-15:00 Detailed Explanation of Zhongshang Huimin's 'One Machine, Two Wings' Strategy - Su Xiaoxin, Vice President of Zhongshang Huimin
15:00-15:30 Detailed Explanation of Zhanghe Cloud Factory Strategy - Yang Lixiang, Zhanghe Tianxia (Speech content TBD)
15:30-16:00 Supply Chain Finance as a Lubricant for B2B to Drive Traditional Business - Chen Xian, CEO of 51 Order
16:00-16:30 2B Investment Principles and Ideas - Xu Xiaoping, Founder of ZhenFund (Guest TBD)
16:30-17:00 Small Retail, Big Business Opportunities: Transformation and Upgrading of China's Retail - Wang Jianfeng, General Manager of E-commerce Department, Yurun Group
17:00-17:30 Roundtable Forum - Who Is the King of FMCG B2B Models? (Guests TBD)
18:00-20:00 Dinner
For manufacturers and friends who want to transform, this grand event is not to be missed. Interested friends can long-press the QR code below or click 'Read Original' to register.
**Registration: Long-press the QR code below or click 'Read Original'**
↓↓↓ Click 'Read Original' [Register]


---

## Citation metadata

- Publisher: New Distribution
- Author: 小镇青年朱迪
- Published: 2016-09-24
- Canonical: https://xinjignxiao.com/en/articles/arctic-ocean-soda-how-far-is-the-big-white-bear-from-the-10-billion-yuan-f768b1bb/
- Original source: https://mp.weixin.qq.com/s/U39Y1uC-yAiAaNzSQ_OLnA

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671