Alcoholic and non-alcoholic beverages are a collective term. In earlier times, alcohol referred to alcoholic drinks, while water referred to plain beverages. There is a type of beverage called plant-based protein drinks. Are there animal-based protein drinks? Yes, they are called milk, including cow's milk, goat's milk, and mare's milk. The plant-based protein beverage industry presents a pattern of one dominant player and two strong contenders: one is Yangyuan Six Walnuts (making walnut milk), and the other two are Yeshu (making coconut juice) and Lulu (making almond dew). And then, that's it! Therefore, even companies like Wahaha, Mengniu, and Yili, which have one foot in the door, are in a dilemma and quite troubled.

In recent years, countless players from leisure food, dairy, alcohol, pharmaceuticals, and raw materials industries, unwilling to remain distributors, have rushed into the beverage sector to chase dreams. Their approach of "copying a package + fabricating a concept + leveraging existing channels" has led to many ending up with灰头灰脸 (dirty faces), some with black eyes and swollen faces, and some losing everything. Indeed, once you enter the beverage industry, it's as deep as the sea!

What motivates consumers to buy beverages? Why customers buy is the starting point for our research and judgment of marketing.

The first consumption occasion for beverages is quenching thirst. Tracing back, why do people get thirsty? Usually, there are two situations: one is eating too much salt, and the other is sweating too much. The second occasion is replenishment. What to replenish? From a product perspective, it's vitamins, minerals, and various elements; from a demand perspective, it's energy, brain, qi, kidney, blood, and enhanced functions. The third occasion is removing discomfort. Explaining the reasoning is troublesome, so let's use examples. What to do if you stay up late eating hot pot and get上火 (heatiness)? Drink herbal tea. What to do for greasy food? Drink apple cider vinegar. Blueberry drinks promoted for improving eyesight follow the same pattern. The fourth occasion is leisure. When people are idle and have no taste in their mouths, they drink something to pass the time. This is the root of children's beverages.

In summary, from the consumer's perspective, "quenching thirst, replenishing, removing discomfort, and leisure" represent the four major demand points of beverage categories.

Under what circumstances do people drink beverages? Let's explore consumption scenarios.

  1. Fixed dining: Multi-person gatherings usually involve large-format sharing packages; single-person drinking (including entertaining guests) uses small-format immediate consumption packages.
  2. Mobile immediate consumption: In places like tourism, shopping, parks, and gas stations, small-format immediate consumption beverages are definitely consumed.
  3. Passive consumption: Families with elderly often give milk as gifts; families with children give milk-based drinks (almost monopolized by Wahaha and Want Want); young families often give a box of functional drinks like Red Bull. In this case, beverages are defined as gifts, and the purchaser and consumer are separated.

One point must be emphasized: the universal household adoption of refrigerators has greatly promoted the planned purchase of beverages, both for freshness and improved taste. This shows the impact of social trends on category development.

Classification of beverages There are usually two classification methods: one is policy and regulation, the other is consumer perception. The former is like your mother thinking you're cold, while the latter is you yourself feeling cold. Consumer judgment is direct, simple, and straightforward.

  1. Bottled vs. canned: The former is plastic PET, the latter is metal cans. Bottled is for quenching thirst; canned feels heavy in the hand and is drunk with the right hand's tiger's mouth, implying energy, function, and magic. Early on, Cola and Jianlibao, and later Lulu, Red Bull, Six Walnuts, and Want Want, all understood this well.
  2. Flavored vs. plain: It's actually about whether the taste is light or strong. I only have one judgment: consumers' preference for concentration is inversely proportional to age.
  3. With ingredients vs. without: The beverage industry often has farces. Following the naming example of Six Walnuts, "x apples," "x red dates," "xx wolfberries," "xx yam" are still making a fuss. Actually, there is a reference object that has been ignored: Fujian Xiduoduo Coconut King, which puts a few slices of dried ingredients in it. Isn't that having ingredients? Doesn't that solidify the value point?

Seriously, beverage names, brands, packaging, visuals, specifications, forms, claims, tastes, and colors are all interconnected. Therefore, as Nikolai Zhao Si said: "Petrel, just be careful!"

15 Rules for Operating in the Beverage Market

  1. What a company can do is not key; it's consumer demand, and this demand must not yet be occupied by competitors.
  2. At the start of a project, consider whether Kangshifu, Tongyi, Wahaha, or Nongfu will copy you, i.e., the danger of large-scale substitution.
  3. Beverages are standardized FMCG, and each subcategory has entered full competition. Even with differentiated products, it's a narrow escape.
  4. Volume determines status. Brand concentration will intensify. Either you sell big or not at all; there's no third answer.
  5. Beverage consumption upgrading is a trend. For companies below 1 billion in scale, the mission is to survive first.
  6. Breaking the dominance of Kangshifu and Tongyi is not about channels but consumers. Don't fantasize about clever ideas in traditional business models; what you think of, Kangshifu, Tongyi, Wahaha, and Nongfu have already tried.
  7. After Xiao Ming Tong Xue, there are many teachers. When will cute marketing end?
  8. Brand maturity determines the game pattern between manufacturers and distributors.
  9. We've studied the Uber model for a long time, but the undying second-tier distributors in beverages have already proven Uber's logic.
  10. KA hypermarkets have two major significances: one is to prove brand presence, and the other is a unique promotional channel.
  11. Cola, Kangshifu, and Tongyi in CVS freezers display their market dominance.
  12. In terms of weight, operation is greater than brand, and brand is greater than marketing (this sentence needs careful consideration).
  13. The marketing team is the internal driving force. Before 100 million, the boss should also be the frontline commander.
  14. Compared to other FMCG, beverage salespeople work the hardest. The ability to endure hardship is a prerequisite for recruitment.
  15. Whether it sells fast can be known from the production date. Manage inventory in the factory, in transit, and in stores routinely.
  16. The bigger the brand, the more ridiculous and primitive the mistakes. For example, Wahaha's Zong Gongju is being capricious again.
  17. The Chinese market is interesting because it is vast and diverse, and miracles always happen. Look at Six Walnuts in the distance, Dongshen Te Yin in the middle, and Special Forces up close.

[Author] Chen Haichao ※ Founder and Director of Guangzhou Benbang Marketing Consulting Agency ※ FMCG Marketing Competitive Strategy Expert [Services or Participated Cases] Tongwei Fish Products, Jinyi Egg Products, Six Walnuts, Ximai Oatmeal, Fuwa Brown Rice Rolls, Puwang Tomato Sauce, Sanchu Sauce Crispy Radish, Anqi Mooncake/Pastry, Dingji Beverages, Yishu Pharmaceutical Zhihua Instant Powder, Milansi Skincare, Haoran Hotel Supplies

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