As 2020 is about to pass its halfway point, the COVID-19 pandemic has delayed new product launches this year, but companies have not stopped innovating. A variety of new faces are active in the market, attracting consumers' attention. Behind these products lie evolving consumption trends and brand attitudes, as continuous innovation is the lifeblood of any enterprise, and there is no room for slack.

In this environment of diversified consumer segments, innovation increasingly tests a company's ability to capture market information, understand consumers, and build a product with solid strength. Whether for big or small brands, we encourage companies to incubate excellent products to boost market morale, especially those that dare to be different and distinctive.

Recently, I have discovered some fun and novel products. Although they are not the traditional mass-market bestsellers and may seem niche or "quirky," they embody some current popular elements, market trends, and brand innovation attitudes that are worth affirming.

Next, I will take you through some eye-catching "quirky" new products to see which ones can impress you in 2020 and what market trends they reveal.

-01- Trend 1: Sparkling Water and Non-Alcoholic Beverages

The sparkling water arena, which has been booming since last year, has truly exploded this year. We see big brands like Yili entering the fray, old names like Jianlibao and Hankou No.2 Factory joining, and countless third- and fourth-tier brands scattered across the country.

I have long been bullish on the sparkling water category, but turning these products into a perfect substitute for carbonated drinks still requires a lot of innovative products and market education, which the industry needs to push forward together.

Recently, Yili launched a beer-flavored sparkling water, the Yiran Milk Mineral Sparkling Water.

Yiran is Yili's milk mineral light beverage brand. Last year, Yiran's milk mineral light beverage was a decent product in terms of appearance and quality, but unfortunately it did not become a special hit. The concept of light water is considered to have originated from Uni-President's "Hai Zhi Yan" product, and when it became popular, many companies were also making similar products.

However, this year, light water may have to step aside; sparkling water is in the spotlight. Yili's beer-flavored sparkling water is an innovative addition to its two previously released fruit-flavored sparkling waters. Apart from the sparkling water focus, another point worth noting is the "non-alcoholic beverage" aspect.

As consumer demand for non-alcoholic beverages grows, beverage giants have begun to lay out the non-alcoholic beverage market. Coca-Cola launched its new Bar Nøne non-alcoholic cocktail-flavored concept drink; Asahi's acquired Peroni launched a non-alcoholic beer in the UK; Heineken also introduced 0.0 non-alcoholic beer, removing alcohol but bringing back fruit aromas. Among Chinese brands, Qingdao, Snow, and Zhujiang have all dabbled in the non-alcoholic beer market.

For young people, stopping or reducing alcohol consumption has become an increasingly popular trend.

Yili's beer-flavored sparkling water recreates the refreshing experience of drinking beer but without alcohol. If you're interested, you can try it to see how it tastes.

-02- Trend 2: Coffee

How did coffee become popular? We have to mention Luckin Coffee. Nestlé and Starbucks, which have been deeply rooted in China for many years, probably never expected that competition in the coffee business would come from an internet company's provocation. Luckin sparked a nationwide coffee craze with its sophisticated internet tactics. Although the final outcome doesn't look so good, Luckin's disruption has indeed brought coffee more attention than ever before.

There's no need to elaborate on how hot coffee is. Yili, Mengniu, Nongfu Spring, and the two cola giants have all entered the market one after another. Recently, Want Want also joined the fun, launching a "quirky" coffee new product, which is quite interesting.

This is a coffee that you soak in your mouth. Using saliva to brew coffee—think about it, it's indeed novel and bold, fitting Want Want's usual style.

Of course, Want Want's product is not a traditional ready-to-drink or freshly brewed beverage; it falls into the snack category and can be considered a distinctive product innovation. Although this type of lozenge-style coffee product might make many refined coffee enthusiasts cringe, its novelty and uniqueness will still attract many people.

Want Want has actually been continuously innovating. This Taiwanese company is not limited to its once-proud rice crackers and Want Want milk; it has been testing diversification for years, even making headlines for opening the Want Want Hospital in Hunan. But in fact, it is precisely because of its constant tinkering that Want Want, often laughed at for not sticking to its core business, has maintained its vitality.

-03- Trend 3: Plant-Based Meat

Plant-based meat, also known as plant meat, plant-based, or plant-derived meat, has quietly completed its transformation to the future—from initial aversion to the emergence of companies producing raw materials, to finished products appearing in supermarkets and restaurants.

Plant-based meat has actually been around for over a decade abroad, but it has become popular in China this year. In April, KFC and Starbucks both launched plant-based meat products in China for the first time. KFC began selling "Plant-based Golden Chicken Nuggets," and soon after, Starbucks launched "plant-based meals." Additionally, not long ago, domestic plant-based meat brand "STARFIELD" partnered with pizza brand Papa John's to launch plant-based meatball pizza.

Plant-based meat can be divided into two categories: plant meat and cultured meat. Currently, the mature manufacturing technology in the market is plant meat. Besides the entry of these well-known food and beverage brands, many Chinese companies have also tried their hand.

It is understood that domestic companies such as Shuangta Food, Shuanghui, Be & Cheery, STARFIELD, Nayuki Tea, and Lamian Talk have also launched plant-based meat-related products.

However, most of these brand products are launched as small-scale trial experiences. The product that truly triggered widespread publicity and gave people the opportunity to taste and compare plant-based meat with real meat is KFC's plant-based chicken nuggets, which turned from red to green.

KFC's "Plant-based Golden Chicken Nuggets" were sold at a price of 1.99 yuan for 5 pieces, which is basically a free tasting opportunity compared to other plant-based meat products with less friendly prices. KFC has shown great sincerity.

Nevertheless, the main issues plaguing plant-based meat products are still taste and texture. After tasting, most people's impressions focus on two aspects: in terms of taste, the meat flavor is relatively weak; in terms of texture, it lacks the chewiness of real meat, being soft and non-elastic.

Therefore, these issues remain the key focus for technical breakthroughs in the near future. The cost of plant-based meat is currently high, about twice that of ordinary meat, making it somewhat unrealistic to truly open up the Chinese market. However, even so, it does not prevent many companies from investing in this area, because the market is large enough with ample imagination space. For them, securing a position early might be beneficial.

It is understood that on May 7, Shuanghui Development announced a plan to acquire partial equity in six companies for 730 million yuan, and two of these companies are primarily engaged in soybean product production. Industry insiders speculate that this may be Shuanghui preparing to enter the plant-based meat market.

-04- Are Niche Products the Breakthrough for Corporate New Product Launches?

In recent years, the entry point for big brands to launch new products has actually started with imitating products from innovative small brands.

For example, sparkling water, which major brands are rushing to enter, was popularized by the niche brand Genki Forest. Sparkling water has actually been on a continuous rise in European and American markets in recent years, and products like Perrier and San Pellegrino were introduced to the Chinese market early on. So why did innovative small brands like Genki Forest seize the opportunity first? Is it because our big brands didn't see its market potential? Not at all. The innovator's dilemma of big brands is vividly demonstrated here. (I have written an article before about why big brands fail to do well with niche products; interested readers can check the extended reading at the end.)

Similarly, the coffee market and the plant-based meat market are categories with huge potential in the Chinese market, but due to the uniqueness of our consumer market, these products have not yet reached the point of explosion. The Chinese market has severe consumption stratification, and consumer education for many categories is very limited. When encountering such products, big brands are often reluctant to try new launches because there are countless cases of new products dying shortly after launch. Everyone is afraid to move, and the institutional barriers within enterprises make innovation particularly difficult for big brands, so following trends becomes more common.

Here, I have to praise Coca-Cola. It is said that Coca-Cola kills over 100 new products each year, but that doesn't stop it from continuing to innovate and surprise. A 134-year-old brand that never stops innovating...

The nature of FMCG determines that the prosperity of the consumer market requires constant fresh products to stimulate the market. Only by daring to innovate and launch new products, coupled with brand investment in marketing, can a seemingly niche category gradually grow.

Teacher Liu Chunxiong once shared this saying: Originating from niche, ignited by communication, popularized among the masses. This is the law of fashion and trends. All niche products eventually become mainstream. Popularity is actually the masses following the niche.

So, whether big or small brands, don't be afraid to be the first to try something new, and be confident in launching your products to the market. To turn niche into mainstream is not luck but strength.

Extended Reading:

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