-01- The Definition of E-RTM Regarding this point, I believe it is the underlying business logic and must be taken seriously. If there is a deviation in positioning from the start, it will cause the brand to take many detours. Most people interpret E-RTM as a digital channel or pathway, represented by self-operated or matching platforms such as JD New通路 and Alibaba Retail通. The author believes that the core of a digital channel is the "digital" in front, not the "channel" behind. The author believes that E-RTM is the entire process from the F end (factory) through the B end (distributors at all levels) to the b end (store terminals) using digital means. With the support of digital technology, including eB2B (e-commerce B2B, such as Alibaba Retail通 and JD New通路), F2B2b (ordering through mobile systems, whether using third-party SaaS or self-built software), and F2b (brand direct supply to stores, which may use the same system as F2B2b), all will play important roles in their respective suitable areas. The digitalization process is more importantly about leveraging tools or third parties to achieve the digitalization of existing channels, ultimately achieving a general improvement in efficiency. Resolving the issue of whether E-RTM is positioned as a tool or a channel will solve many problems currently faced by brand owners. For example, whether to focus on existing volume or incremental volume. If it is a channel, this is an important issue and requires avoiding offline conflicts; if it is a tool, this is not a problem at all, as the tool itself upgrades existing volume and achieves incremental growth through efficiency gains. For example, whether to integrate with the offline sales team: if defined as a channel, it can be independent; but if defined as a tool, it must be integrated. Another example: whether to have your own digital system; from a tool perspective, it is undoubtedly necessary. Of course, for brand owners at different stages, the positioning is also different. Generally speaking, from the perspective of existing volume, new brands with small existing volume can first define it as a channel; brands with large existing volume should define it as a tool. From the perspective of distribution, for shallow distribution brands, it is channel + tool; for deep distribution brands, it is tool > channel.

-02- How to Understand E-RTM as a Tool? Tools are used to improve efficiency and are part of one's own capabilities. For brand owners or distributors, from a sales perspective, capability is sales capability, which is the channel power to control channels. Traditional channel power, offline capability, includes three levels: 1. Sales system. The size of the sales team, the scientific nature of sales management and assessment, and the execution capability of the sales team, etc.; 2. Supply chain system. How many vehicles, such as trucks, vans, and minivans, including the use of tricycles by wholesalers in some areas to navigate narrow streets and alleys, are all manifestations of capability; 3. Customer relationship system. The social and government resources accumulated over the years, the trust between salespeople, drivers, and store owners, etc., are all things that new internet B2B cannot replace. However, after years of development, with the rise in labor costs, tax costs, oil prices (although recently fallen), and other costs, the improvement of this offline capability has encountered bottlenecks and has even had to begin shrinking. The author believes that in the future, new channel power will be enhanced through the continuous development of online capabilities on the basis of complete offline capability construction. Why on the basis of offline capability? Because without offline capability support, having only online capability is not the channel power of brand owners or distributors; that is what SaaS players should be doing. Then the question arises: what digital tools are available? Should they be self-built or borrowed? This issue is relatively complex, and the author will introduce it in a dedicated chapter later. Here is a brief introduction:

  1. The most basic digital tools include: mobile ordering systems (for store ordering, wholesaler ordering), salesperson visit systems, terminal/member operation systems, digital supply chain systems, and accessible digital financial systems. The needs will vary depending on the role and scale of the brand owner or distributor.
  2. Whether to self-build? This is like whether a country needs to build its own military industry. Some countries, such as Saudi Arabia, mainly rely on imports. Our country realized the importance of building its own military industry from the early stages of construction, but even in the early stages, it was inevitable to import from abroad and imitate and learn. To add, if we define E-RTM as a tool, should we cooperate with third-party B2B platforms represented by Alibaba Retail通 and JD New通路? The author believes that cooperation is definitely necessary. Because they not only have the most advanced online capabilities currently, but also their strategic thinking and ecosystem perspective from years of online operations are the most advanced business ideas of the present. Not understanding, not familiarizing, not learning, and not digesting will inevitably miss opportunities for major changes. However, after cooperation, specific implementation must consider practical issues such as one's own development positioning, capability strength, and channel overlap.

-03- Where is the Value of E-RTM? The author believes that E-RTM has four direct values:

  1. 7x24 digital experience; 2) Improved channel visibility and investment efficiency; 3) Big data-driven products and strategies; 4) AI improves sales efficiency. One potential value: ecosystem connectivity. Let me explain these four direct values in detail: 1. Digital Experience Ordering experience: customers can place orders 24/7, see all SKUs, promotions, inventory, and product introductions in real time, which is more efficient than traditional phone calls and on-site order taking. Furthermore, pushing marketing information through brand/distributor official accounts and synchronizing delivery information in real time are also important means to improve customer experience. Based on previous practical experience, the self-ordering rate of stores exceeds 50%, and in some channels can reach 100%. By combining visit tools with the ordering system, sales personnel can shift from traditional route visits to targeted customer visits and maintenance, increasing store coverage and efficiency by about 3 times. Online payment is fast and convenient, and also allows owners to check historical orders and accumulate data. However, the handling fees for online payments may cause concerns for small-scale distributors, and this part needs to be resolved by brand owners with appropriate methods. 2. Channel Visibility One is the real-time visibility of sales data, presented with high quality through data dashboards. Another is the visibility and control of all channel sales, prices, and investments, solving the pain points of brand channel investment. Of course, this will affect the interests of some vested interests, which is one of the reasons why the digital transformation process is difficult and slow. Furthermore, through data accumulation, customer tagging and systematization can be achieved, enabling precise targeting and greatly improving investment efficiency. 3. Big Data-Driven Through data accumulation and rapid online validation, it is possible to move away from the previous top-down product launch strategy and achieve a bottom-up strategy. But broader and more comprehensive data is in large platform companies. From this perspective, it is also more necessary to cooperate with large platform companies on big data, even if we cannot get their source data. Currently, whether on the C-end or B-end, Alibaba and JD have become the preferred channels for brand owners' new product launches. This not only gives them higher distribution efficiency, but more importantly, the launch distribution data and repurchase situation are important indicators of a new product's future competitiveness. 4. AI Improves Efficiency The author believes that AI intelligent recommendation will be an opportunity for the second leap in FMCG channel sales. For example, based on merchant purchase behavior, intelligently recommending new products or packages in the shopping cart or other exposure positions will significantly increase sales. In the author's previous practical work, 100 sample stores were selected from each of A, B, and C categories. A had no recommendations, B had random recommendations, and C had intelligent recommendations based on past purchase behavior. C improved by 30% compared to A and 20% compared to B. This shows that in the future, after achieving widespread online channelization, AI recommendations will bring high-quality improvements with low investment and high output. This capability may be difficult for small and medium-sized enterprises, and they need to rely on external third-party capabilities. This is also the necessity of the potential value mentioned below: ecosystem connectivity. Whether it is B2C or B2B, they all use digital means to achieve efficient information exchange, and this exchange is single-point digital exchange. In the context of rapid cloud technology advancement, the future can achieve digital exchange of connections between single points. Specifically, in the future, within a brand's own digital channel, one-stop ordering can be achieved by adding third-party B2B product connections, and one's own digital channel can also be grafted onto third-party platforms, leveraging third-party traffic to develop one's own digital channel. In the era where data is king, either you parasitize under large data giants, but you will suffer from increasingly high commissions and increasingly expensive traffic; or you make yourself possess irreplaceable data resources, have the bargaining power to negotiate with giants in niche areas, and thereby ensure the stability of your own channels and traffic. Finally, the so-called E-RTM, or digital channel, is just one part of FMCG digitalization, and it is also a part that is urgently needed and can bring visible results. All digitalization is the construction and improvement of one's own capabilities. For some brand owners and distributors, E-RTM can be defined as a channel in the short term, but in the long run, all brand owners and distributors need to build their own digital tools! How to build them? See you next time.

Author Introduction: Pen name, Sun Dashi. Since 2016, he has built cooperation with eB2B customers from scratch at two Fortune 500 companies, covering categories such as snacks, beverages, and alcohol. The operation models include company direct supply, distributor supply, physical warehouses, and cloud warehouses. He was also responsible for the construction and implementation of self-built B2B systems. Through exchanges with eB2B customers and advanced distributors nationwide, he has summarized his own knowledge system. Currently working in the internet industry, he continues to deeply study digitalization across industries.