-01- ‍ Endgame determines direction; current state determines starting point. The distance between current state and endgame is the path for future work. The current state of channel digitalization: 1. Leading FMCG companies have basically connected B2B, i.e., F2B or F2B2b, with the last link being b2C. During research, I found that some leading companies have even connected township second-tier distributors. Of course, this process has not been without resistance from distributors and sales staff. Companies that first connected B2B generally focus on direct-operated terminals. Of course, there are also companies with particularly strong channel control that have already connected B2B. 2. Small and medium brands have not even connected B2B, let alone B2C. Some have B2B systems, such as SFA systems, but they are basically decorative and no one takes them seriously. The reason for not connecting is mainly due to insufficient channel control. The B2B system, starting from the third-party B2B platform craze in 2014, later entered a winter for third-party B2B, then brand B2B rose, and now the hot topic is the B2B craze among large distributors. The order of B2B heat transmission is: third-party B2B heat → brand B2B heat → large distributor B2B heat. Therefore, the current B2B heat has become a trend, and b2C is the focus of the next stage of digitalization. The endgame pattern of channel digitalization is: 1. Full-link connection, i.e., F2B2b2C. Distributors and terminal stores are all online. Achieving this process is not difficult. 2. Full-scenario reach, users online, i.e., b2C. Leading companies have hundreds of millions of users online, and mid-sized companies achieve user online. This goal has not been achieved by anyone. -02- What is the difference between starting channel digitalization from the B-end versus the C-end? 1. Starting from B is digitalization of existing stock. This is transforming the achievements of deep distribution into digitalization, equivalent to old city renovation. The biggest challenge is resistance from distributors and regional sales teams. 2. Starting from C is digitalization of increment. The difficulty lies in "circle-layer deep distribution" and "online deep distribution." Deep distribution only reaches terminals; three-line deep distribution can reach hundreds of millions of users. In "New Marketing 2.0: Three-Dimensional Connection," we creatively proposed the concept of "dual-line deep distribution", which I remember was proposed by new marketing expert Mr. Fang Gang. A year ago, we only had this feeling; now we find that dual-line deep distribution is not enough; we need three-line deep distribution. Although B-end digitalization is digitalization of existing stock, it is a very good efficiency system. On one hand, online efficiency will be higher; on the other hand, channel modularization helps improve overall channel efficiency. If the channel system remains closed, you cannot enjoy the dividends of channel modularization and platformization. Of course, when a new efficiency system is first tried, efficiency may decrease. This is the cost that must be paid during system transition. C-end digitalization is an increment system. In the situation where industry total volume is capped, being able to create increment is tempting. More importantly, if competitors have increment, your existing stock is actually declining. -03- What are the obstacles to B-end digitalization? Not technical obstacles, but psychological obstacles. It is commonly reported that during the digitalization process, manufacturers encounter passive resistance from distributors and business teams. In the early stage, lack of awareness was the main reason for resistance. This is normal. After 6 years of digitalization acceleration since 2020, it is obviously inappropriate to still talk about awareness. I think the main reason is the fear of digitalization among distributors and business teams. 1. Distributors worry that the digitalization process is a process of de-intermediation. Because past internet history tells distributors that internetization is always accompanied by de-intermediation. 2. During digitalization, distributors transform into operators, warehousing and distribution may be stripped away, and orders become platform-based, leaving distributors without a sense of security. For example, some distributors strongly oppose the stripping of warehousing and distribution, fearing they will lose the qualification to "earn the difference" as distributors. 3. During digitalization, distributors may no longer control channel dominance. For example, manufacturer policies reach terminals directly, logistics reach terminals directly, and reach users directly. Coupled with C-end digitalization, manufacturers have the ability to force the channel. These factors are enough to make distributors fearful, and fear is based on future uncertainty. Currently, large distributors have awakened and are accelerating the digitalization process. But fear and worry about manufacturer digitalization still exist. For business teams, besides needing new skills for digitalization, the main obstacle is the fear of "deprivation of redundant time." To be honest, except for team-based operations, business teams working individually have a lot of redundant time, i.e., time when salespeople are uncontrolled and free to manage. In plain terms, some business teams want to slack off, but that will be difficult in the future. Especially in a dashboard and visualization environment, business teams may truly have no "redundant time." Currently, in digital SFA systems, there is a lot of false data. Because SFA data is entered by salespeople. Data falsification itself indicates that not falsifying would be disadvantageous to them. In the future, most channel data will come from third-party data. For example, terminal data may come from third-party warehousing and distribution data, making falsification difficult. -04- Now look at the difficulties of C-end digitalization: Currently, there are three b2C models: 1. Cooperate with empowering large platforms. For example, Coca-Cola cooperates with Tencent, which is the most efficient model for reaching C-end. However, cooperating with large platforms requires relatively high brand awareness. 2. Reach C-end through the three "super touchpoints" of FMCG channel terminals. This is a long process. Millions of terminals, tens of millions of touchpoints, hundreds of millions of users. Deep distribution has already reached millions of terminals; now we need "tens of millions of touchpoints" to reach hundreds of millions of users. This is not just a long project. 3. For products with high cognitive thresholds, use "circle-layer deep distribution." For example, the digitalization of Lidu Baijiu is essentially circle-layer deep distribution. In summary, the premise of C-end digitalization is terminal deep distribution (reaching b-end), and then reaching C-end through circle-layer deep distribution and tens of millions of touchpoints. This work will not progress quickly, but the effect will definitely be good. Because as long as you reach C-end, it is easy to generate increment. -05- Back to today's main topic: Should digitalization start from the B-end or the C-end? 1. Large brands have strong channel control and must quickly complete B-end digitalization F2B2b at a faster pace. There is no other choice. For large brands to reach C-end, the faster model is to cooperate with Tencent, with large platform empowerment. But stickiness is weak; the slower but necessary work is "tens of millions of touchpoints, hundreds of millions online." This is the main work that distributors will do in the future as operators. In general, large brands first do B-end, then C-end. 2. Small and medium enterprises have weak channel control and no foundation at terminals. Even if they technically complete F2B2b, it is difficult to operate. Therefore, small and medium enterprises should first break through from the C-end, create increment, and activate existing stock. In the process of activating existing stock, completing B-end digitalization will naturally follow. Source: Teacher Liu's Digital New Marketing Reports will be paid 400-2000 yuan once adopted.