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Consumption is declining, but where have consumers gone? The amount consumed hasn't decreased, and the consumption cycle hasn't shortened (though simultaneous shifts among consumers in the same year are possible, the probability is very low). So, where have consumers gone? Clearly, if the amount of food consumed hasn't decreased but the demand for food products has, then consumer demand must have shifted. We can summarize four directions of this shift:

  1. Brand Switching: Switching between brands, i.e., consumers move from Brand A to Brand B, but total consumption remains unchanged. There are many factors behind brand switching.
  2. Channel Switching: The brand remains the same, but consumers switch between channels where the brand is distributed, such as modern trade channels.
  3. Category Switching: For example, moving from higher-priced categories to lower-priced ones, or from formula milk to complementary foods.
  4. Upward Migration: (1) Switching to homemade food: As babies grow, parents realize they can prepare food at home to meet their baby's developmental needs, so they switch to homemade food. (2) Abandoning powdered formula in favor of liquid milk.

Let's analyze each direction in depth, study it, and find solutions to increase sales.

1. Brand Switching: From brand loyalty to brand wavering to brand switching, this is a psychological path of consumer loss. What factors cause consumers to lose confidence in a brand and choose to switch?

Internal Brand Factors: Consumer loss due to the brand's own shortcomings:

  • Lack of consumer education leading to decreased brand loyalty.
  • Consumers lack confidence in the brand!
  • Consumers hope switching brands will give their baby a sense of security.
  • Decreased satisfaction with terminal services.
  • Consumers are not interested in terminal promotional services.
  • Consumers are willing to try more options.
  • Dissatisfaction with brand services leads to switching. This includes unprofessional staff, unkempt attire, unclean product appearance, poor hygiene, and bad attitudes!

External Brand Factors:

  • Communication pull: For example, recent heavy advertising by a brand with long cycles prompts consumers to see or hear about the product on TV or other media and want to try it, leading to switching.
  • Ground communication: Such as vehicle wraps or point-of-sale packaging, POSM, etc., creating an impact that motivates brand switching.
  • Word-of-mouth: If friends and others are consuming a particular brand, consumers follow suit due to herd mentality.
  • Terminal promotions: For instance, a high-priced brand currently offering discounts or other promotions that align with consumers' purchasing power.
  • Product innovation: New brands add features, and consumers are willing to try new things, abandoning their original brand for the new one.

2. Channel Switching: This is also about loss between channels, due to reasons such as:

  • Different promotional intensity across channels; new channels offer comprehensive services, one-stop shopping, and convenient parking.
  • Switching between channels: But within the brand's distribution channels, such as modern trade.

Between physical stores:

  • KA to convenience stores: KA channels offer a good shopping environment, convenience, one-stop shopping, after-sales support, and more loyalty points. First purchases may occur there, but later consumers may shift to convenience stores for convenience.
  • KA to baby product stores: These stores are warm, have flexible pricing, and allow more interaction and answering of consumer questions. Consumers feel respected.

From physical stores to online stores:

  • Consumers experience products in physical stores but purchase online. This trend is strengthening. To what extent?

Promotion-driven channel switching: A brand may increase promotional investment in baby product channels for a period, attracting consumers to that channel. Stores also run their own promotions to attract foot traffic.

Cross-channel switching: Consumers purchase across different channels to compare prices, services, and value for money, eventually settling on one channel for long-term purchases.

3. Category Switching: For example, moving from higher-priced categories to lower-priced ones, or from formula milk to complementary foods.

Stage switching: As consumers grow, the product stage increases. For example, loss of Stage 1 consumers may lead to brand switching; Stage 2 consumers may switch categories or brands; Stage 3 consumers may upgrade to higher-tier products.

Price point switching: From high to low price. For example, in the formula category, newborns' purchasing power is reflected in higher-priced products, but later it gradually declines to lower-priced options.

Packaging switching: From bags to boxes to cans. For example, in formula, bagged products are constrained by shelf life and are generally smaller than cans, allowing consumers to try them. Then they may switch to convenient boxed packaging, and finally to cans with longer shelf life. This is a process, not an absolute one.

Parallel switching: From formula to complementary foods. The growth cycle of infants and the continuity of Chinese thinking make consumers believe that children who eat solid food grow faster. Parents see that babies eating more solid food feel fuller than with liquid food, which helps healthy growth. So consumers are willing to introduce complementary foods earlier, and indeed, complementary foods are more economical for parents.

Upward migration: From complementary foods to homemade food.

4. Consumption Shift: Consumers shift to handmade food.

Consumer growth brings consumption upgrades, such as from formula to complementary foods, and from complementary foods to homemade family meals. This consumer shift is an irreversible trend. Either adapt or extend the product line to keep consumers loyal to a brand and thus increase sales. This is a strategic issue at another level.

Where have consumers gone? As salespeople, we must understand the root causes. Don't blame the weather; trust science and the power of marketing!