---
title: "How Can New Consumer Brands Survive the Winter?"
description: "In August, the number of consumer investment projects began to decline, down 17% month-on-month from July, as institutions became more cautious. With traffic peaking and customer acquisition costs rising, the online environment is no longer fertile ground for new consumer brands that have grown wildly. Winter is coming, and more brands are becoming \"traffic workers.\" For example, Perfect Diary once listed its core competitiveness in its prospectus as leveraging public-domain influencer content marketing to acquire users, then funneling them into WeChat private traffic pools, and using high-frequency community maintenance to boost repurchase rates. However, this traffic playbook has quickly become a required course in the FMCG industry, with tactics being copied rapidly and KOL and traffic prices soaring. High traffic costs mean that while influencers and platforms profit, brands lose money just to gain attention—a dilemma not unique to Perfect Diary."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2021-12-04"
language: "en"
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# How Can New Consumer Brands Survive the Winter?

> In August, the number of consumer investment projects began to decline, down 17% month-on-month from July, as institutions became more cautious. With traffic peaking and customer acquisition costs rising, the online environment is no longer fertile ground for new consumer brands that have grown wildly. Winter is coming, and more brands are becoming "traffic workers." For example, Perfect Diary once listed its core competitiveness in its prospectus as leveraging public-domain influencer content marketing to acquire users, then funneling them into WeChat private traffic pools, and using high-frequency community maintenance to boost repurchase rates. However, this traffic playbook has quickly become a required course in the FMCG industry, with tactics being copied rapidly and KOL and traffic prices soaring. High traffic costs mean that while influencers and platforms profit, brands lose money just to gain attention—a dilemma not unique to Perfect Diary.

In August, the number of consumer investment projects began to decline, down 17% month-on-month from July, as institutions became more cautious.
Following this, voices about traffic peaking and high customer acquisition costs grew louder. For new consumer brands that have grown wildly, the online soil is no longer rich in nutrients.
Winter is coming
More and more brands are being "reduced" to traffic workers.
For example, Perfect Diary, which once had tens of thousands of bloggers and UP主 across Xiaohongshu, Douyin, and Bilibili, listed these as core competitiveness in its prospectus: acquiring product users through public-domain influencer content marketing, then funneling them into WeChat private traffic pools, and using high-frequency community maintenance to increase repurchase rates, thereby extending product life cycles.
But this traffic playbook quickly became a required course in the FMCG industry. On one hand, tactics are rapidly copied; on the other, KOL and traffic prices rise. High traffic costs mean that while influencers and platforms profit, brands lose money just to gain attention—a dilemma not unique to Perfect Diary.
Many new brands are still counting on influencer-driven traffic, but end up being outsmarted by influencers and losing even their principal.
Against the backdrop of industrialized mass production and competitors following traffic acquisition strategies and hit products, homogenization and the ensuing brutal competition in the FMCG industry are hard to avoid.
Precise, efficient, closed-loop... Why has the once-beautiful traffic playbook lost its appeal?
**Failure and Differentiation**
Pioneers in every era enjoy huge dividends, but when too many people walk the same path, there is no path left.
Under fierce competition, traffic costs rise, and originally effective tactics become mediocre and inefficient as more imitators enter the fray.
Internet-derived marketing tactics emerge endlessly. New consumer brands may operate vigorously, but once traffic peaks, prices rise, and competition lowers conversion rates, their ROI-centric tactics fail. Meanwhile, "traditional brands" stand firm through the ups and downs.
New consumer brands lack the moat of traditional brands—broad and deeply ingrained brand awareness. The traffic playbook of new consumption suffers from the backlash of "precision": the audience reached is too narrow, information is often drowned in the ocean of internet content, and the frequency of consumer touchpoints is low, making it hard to form deep brand awareness.
While some brands remain trapped in the depleted traffic war, some pioneers in new consumption have started to build anew.
In May 2019, an advertising song adapted from "Two Tigers" with the slogan "Cheese, choose Milkground" began playing frequently on elevator ads.
With repeated ad playback, the impression of cheese in consumers' minds shifted from an imported product to a healthy children's snack. Milkground successfully seized the blank period in consumer awareness.
Through dual efforts in product strength and promotional power, Milkground's cheese business revenue reached 921 million yuan in 2019, a year-on-year increase of 102.2%; in 2020, this figure exceeded 2.07 billion yuan, up 125.15% year-on-year, making it the number one in China's cheese industry.
By breaking free from the audience limitations of traffic playbooks, Milkground successfully equated itself with the cheese category in broad consumer awareness, and its market value surged from 2 billion to 30 billion in just over two years.
Another example is Ulike, a new home hair removal device brand that became the top seller in the beauty instrument category on Tmall 618, also successfully "breaking the circle." Ulike's CEO, Pan Yuping, admitted that internet traffic costs are rising; these traffic ads only generate sales when invested, and without investment, there are no sales—it's always "goods looking for people."
Traffic ads only made a small group of consumers "know" Ulike, but through Focus Media elevator ads, Ulike made more consumers "remember" Ulike hair removal devices. Even if they don't buy today, when they remember and need a hair removal device later, they will think of Ulike.
Pan Yuping said: Previously, people searched for "hair removal device," but later we found that the first search term was "hair removal device," but the second became "Ulike hair removal device," and also "sapphire hair removal device," "Ulike ice-point hair removal device," and other search terms linked to Ulike have been continuously rising. This is the power of brand advertising.
Pan Yuping stated that Ulike's brand ads bring more sales conversions. Compared to consumers who haven't seen elevator ads, the active search rate increased by 2-3 times, and the transaction conversion rate also significantly improved. This year's 618 sales reached 460 million, more than double last year, with market share rising from 38% to 54%.
Genki Forest is an even more worthy case study among new consumer brands. They spent two to three years developing many products and testing them on e-commerce platforms, then focused on the most promising products based on consumer feedback, iterating repeatedly. By 2019, they began offline distribution and online seeding, cultivating a fan base, with sales exceeding 260 million.
By May 2020, Genki Forest decided to break the circle. On one hand, they increased the placement of refrigerators in ground-level outlets; on the other, they launched a four-month brand storm on Focus Media elevator screens, entering consumer minds. As the brand gained widespread recognition, 2020 sales exceeded 2.7 billion, and 2021 is expected to exceed 7 billion.
Genki Forest successfully equated 0-calorie, 0-fat, 0-sugar sparkling water with Genki Forest, building a strong moat. In the first half of 2021, Genki Forest's market share in the sparkling water segment exceeded the sum of the 2nd to 10th place combined.
Successful new consumer brands are building their own brand moats, becoming the preferred brand for a category or need in customer minds.
**Brand Breakout is the Way Out**
The glory days of the traffic era are past. Today, not only brands are anxious about traffic, but even internet platforms are struggling to compete for it.
Brands need an answer—what to do in the post-traffic era?
For new consumer brands born on the internet, the answer may lie offline. Not only Milkground, Ulike, and Genki Forest, but also Florasis, Biohyalux, and many other new consumer brands are heavily investing in offline advertising, and from the results, they have all successfully achieved "breakout" growth.
Large-scale, effective, high-frequency brand ignition and breakout capability is precisely what most consumer brands need.
On internet advertising platforms, "precision" often limits the audience reach, failing to touch all potential influencers of the product. Once a category of FMCG brands increases, all increase spending to compete for precise target traffic, traffic prices immediately rise, making sales costs unbearable.
At this point, using brand ignition to "break the circle" and successfully enter consumer minds, like Ulike, increases the platform's own traffic, and users actively search for the brand, shifting from "goods looking for people" to "people looking for goods," significantly reducing traffic costs while increasing conversion rates.
A few years ago, Biohyalux became a hit with the new concept product "hyaluronic acid disposable essence," enjoying a wave of traffic dividends. But at that time, skincare was still dominated by international brands. Biohyalux was not strong in consumer minds, and "seeding" content was easily drowned out.
Later, Biohyalux began using Focus Media elevator ads to ignite the brand. Through saturated placement in high-frequency scenes of white-collar women in first- and second-tier cities, Biohyalux's sales continued to double.
Another example is Florasis, which deeply cooperates with Li Jiaqi. This year, it launched a combination of brand and traffic. First, on Valentine's Day, it ran an elevator ad with the slogan "Sending flowers is not as good as sending Florasis." Then on 520, it launched a lipstick with a lock, called "Love of a Lifetime, United as One."
On Qixi, it promoted a "Heaven-Made Box" gift set, successfully creating new scenarios and customer groups, "selling" makeup to men, who pay for their loved ones.
At the same time, Florasis initiated data from Focus Media elevator ads to be fed back into Tmall's data bank, helping the brand accumulate digital assets. While "breaking the circle," it also better achieves a sales loop through online secondary touchpoints.
In today's marketing environment, the complete value chain of awareness, cognition, recognition, and purchase is indispensable. For sustainable development, it has become unrealistic to rely solely on traffic to drive sales without brand seeding.
For example, Focus Media elevator ads build broad brand awareness and differentiated value recognition; content platforms like Weibo, Douyin, and Xiaohongshu build product reputation and gain brand recognition; online and offline channels like Alibaba, JD.com, and supermarkets complete collection, following, purchase, and repurchase. All aspects—platform traffic, brand building, and channel depth—need to be perfected.
**Epilogue**
In the past few years, "performance advertising" driven by traffic as the core strategy has gradually made brands addicted to the pleasure of large-scale traffic and effect-based marketing methods such as seeding numbers, exposure counts, live-stream sales, and purchase conversions, briefly forgetting the essence of sustained success—building a brand.
From the history of the consumer industry, without a brand, no matter how surging the traffic, it is only a short-term effect. "Buying" without love cannot last; "love" without buying is not true love. For new consumer brands familiar with various marketing rules, understanding these principles is not complicated.
Which new consumer brands will embrace a new future? Transforming from traffic-driven to long-term brand-driven will be the necessary path to survive the traffic winter.
**Are you "watching" me?**


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