Zhang Zihan

This summer, the Shaanxi market has become a battleground for soda brands. Chinese food industry analyst Zhu Danpeng commented, "Xi'an, as the starting point of the Belt and Road and a key logistics hub for Asia, Africa, and Europe, will take on more Belt and Road and internationalization missions in the future, which is conducive to overall capacity expansion and more importantly, future international layout." Therefore, brands choosing to advance into the Shaanxi region have deeper significance. Indeed, domestic soda brand Dayao and international brand Pepsi have both come to Shaanxi to invest and build factories. Upon hearing this news, Bingfeng, the time-honored soda brand that has long dominated Shaanxi dining tables, is feeling the pressure. Just a couple of days ago, Bingfeng's official account announced a major event: the launch of a taller and larger "460ml large bottle sharing pack" soda product. The notice stated that after nearly two months of pilot sales at terminals, the price was set at 4.5 yuan per bottle. This inevitably raises suspicion: is Bingfeng panicking?

Image source: Bingfeng official subscription account

It is reported that Dayao plans to expand into the national market this year, making investments across the country, including Shaanxi, Shandong, and Inner Mongolia. Among these, the Baoji Dayao Beverage Industry Cluster Project in Shaanxi is Dayao's largest investment, with a planned investment of 1.26 billion yuan, showcasing Dayao's strong ambition for the Shaanxi market. Currently, Dayao's smart beverage factory in Baoji has begun production. Once all projects are completed, the annual output value is expected to reach 600 million yuan. This figure is indeed not to be underestimated.

Against the backdrop of the revival of national trends, a large number of domestic sodas have gradually gained widespread consumer attention. Brands such as Beibingyang, Bingfeng, Tianfu, and Hankou No. 2 Factory have returned to the public eye, and Dayao is arguably the brand with the strongest momentum.

Dayao Soda, a well-known brand under Inner Mongolia Dayao Beverage Co., Ltd., has continuously reformed and innovated in recent years to achieve broad coverage and deep penetration in the national market. To achieve its nationalization strategy, Dayao Soda has adopted multiple strategies to enhance brand awareness and reputation, including signing highly recognized actor Wu Jing as brand ambassador to leverage his influence for in-depth marketing. Additionally, Dayao Soda has launched large-scale advertising on CCTV, landmark business districts, subways, and community media to further boost brand exposure.

Dayao Soda has also taken multiple measures in sales channel expansion. On one hand, through cooperation with catering, supermarkets, retail, and online channels, it has established over one million retail terminals across 31 provinces, autonomous regions, and municipalities directly under the central government. This extensive channel layout provides strong support for increasing its national market share. On the other hand, Dayao Beverage has actively implemented the "North Merchants Support South" plan, promoting northern distributors to enter the South China market in batches and stages, accelerating brand penetration in the southern market.

Moreover, to meet consumers' diverse needs, Dayao Beverage continues to innovate its products. Based on four major categories—carbonated drinks, fruit and vegetable juices, plant protein beverages, and functional drinks—it has launched products such as Qusong soda water, Xiaoyao Guoqi, Chayuanxiang juice sparkling tea, and Youlovehoney honey grapefruit sparkling tea. Currently, in the sugary soda category, Dayao Beverage has risen to third place in market share, second only to Coca-Cola and Pepsi. Data shows that in 2022, Dayao Soda's sales reached 3.2 billion yuan, ten times that of Bingfeng and three times that of Beibingyang. This data further proves Dayao Soda's strong competitiveness in the market.

So, facing such a formidable opponent, can Bingfeng, which has been developing in the Shaanxi region for over seventy years, still hold its ground?

Bingfeng Soda was born in 1948 and is a leading local beverage brand in Shaanxi. It is hailed as the soul of the "Sanqin set meal" and an indispensable part of Shaanxi dining culture. As a shining city card of Shaanxi, Bingfeng is almost household name in the region and deeply loved by local consumers. On Shaanxi dining tables, Bingfeng is a regular. In the deeply cultivated Shaanxi region, Bingfeng's sales network and channels are already well-established. Bingfeng has over 100 first-level distributors, over 400 second-level distributors, and 10,000 to 20,000 terminal dealers, which competitors cannot match. In its home base of Shaanxi, Bingfeng's revenue occupies a significant position, demonstrating its strong competitiveness in the local market.

Despite Bingfeng's deep market and consumer foundation in Shaanxi, with intensifying market competition, Bingfeng cannot afford to rest on its laurels. Therefore, in expanding its market, Bingfeng uses Shaanxi and surrounding provinces as its base, continuously expanding its sales market through the business approach of "creating models, deepening cultivation, expanding regions, and building brand." It intensively cultivates sales areas in Yulin, Yan'an, Tongchuan, Baoji, Hanzhong, and Ankang within Shaanxi Province, and radiates outward to the national market with the Shaanxi market as the core.

In terms of product innovation, Bingfeng responds to consumer needs. While adhering to the classic orange soda, it continuously enriches its product series according to market demand, such as launching the 75th anniversary commemorative can, Bingfeng sugar-free orange glass bottle soda, and Bingfeng orange SLEEK can soda. These new products deeply replicate the taste and quality of the classic orange soda, better meeting consumers' pursuit of sugar-free and low-fat consumption concepts in the era of great health.

In marketing, Bingfeng continuously innovates its promotional measures, leveraging hotspots like the Tang Dynasty Never Night City and the Twelve Hours to increase brand awareness, striving to make Bingfeng not just limited to the Shaanxi region. But currently, Bingfeng's main battlefield remains the Shaanxi region. Data shows that over the years, sales in Shaanxi have consistently accounted for more than 80% of Bingfeng's total sales.

Now, with Dayao's large-scale investment in Shaanxi, the first to feel the crisis is the regional hegemon—Bingfeng. Therefore, Bingfeng has also made a series of countermeasures. Previously, in March, a price adjustment notice from Bingfeng's sales department circulated online. The notice read:

"To fully respond to the call of governments at all levels to 'prioritize expanding consumption,' cater to consumption trends in the new market environment, stimulate consumption vitality, promote consumption growth, and boost terminal consumer confidence through small profits and quick turnover, as the tourism peak season approaches, please guide all catering and retail stores in the Xi'an region to implement a suggested retail price of 2 yuan per bottle for the following four products: Bingfeng 200ml glass bottle orange soda, apple soda, sour plum soup, and sugar-free orange soda, effective immediately."

This notice sparked considerable discussion in the industry. Some believe Bingfeng's move is a good thing to reward customers, but more think it is merely a necessary response after feeling market pressure. With consumption downgrading, consumers prefer products with higher cost performance. Obviously, the cost performance of 3 yuan for 200ml Bingfeng cannot compare with 5 yuan for 520ml Dayao. So in my view, the value of this price reduction notice is actually not high, because it is only a suggestion, not mandatory. The final selling price at terminals is not something the brand can control.

Following this line of thought, the launch of the 460ml large bottle by Bingfeng should also be a follow-up measure to counter the "invasion crisis" and defend the Shaanxi stronghold. After all, further improving cost performance is indeed a good choice for Bingfeng, which has an absolute home advantage. For Dayao, which aims at the national market, if Bingfeng can hold its ground, that would already be a success.

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