According to New Distribution, Master Kong's beverage business has maintained positive growth for six consecutive years on a scale of tens of billions. In 2022, Master Kong's beverage performance was impressive, achieving revenue of 48.336 billion yuan, a year-on-year increase of 7.89%. Why has Master Kong been able to achieve such remarkable results in an uncertain external environment? A glimpse can be seen from the five new products launched consecutively this year.
Taking a Different Path, Seizing New Consumer Demands
Currently, China's beverage industry maintains growth potential in a trillion-yuan market. On one hand, this is due to continuous product innovation by brands, expanding into segmented markets through diversified channels. On the other hand, diversified consumer demands have also become a source of brand innovation. According to New Distribution, consumer demands are currently evolving from homogeneity to diversity, meaning consumers need products that cater to their various needs.
In the fiercely competitive beverage market, many brands have become representatives of their categories. For example, when consumers think of carbonated drinks, they think of Coca-Cola and Pepsi; when they think of sparkling water, they think of Genki Forest; when they think of herbal tea, they think of JDB. On the surface, being a category representative helps brands gain stronger market share and sales, but on the other hand, it limits consumer choice. Individual consumers choose different beverages in different demand scenarios, but most beverage brands often build a single hero product around one consumer need. After gaining insight into the trend of diverse consumer demands, Master Kong recently launched multiple new products to meet consumer needs in different scenarios. In 2023, Master Kong fully upgraded its sugar-free iced black tea, launched Chuncui Zero Sugar High Mountain Oolong Tea, and after creating the billion-yuan product "Drink Boiled Water," it launched a 2-yuan mineral water product "Drink Mineral Water," as well as fruit-flavored drinks Citrus C Storm and Berry Black Tea. The launch of diversified products not only helps consumers choose products for different needs under the same brand but also brings dealers a more diversified product portfolio, effectively expanding their profit sources.
With the successive launch of the five new products, New Distribution recently randomly interviewed some dealers, and most are full of expectations for the market performance of Master Kong's new products. The owner of a trading company in Hebei is particularly optimistic about Master Kong's "Drink Mineral Water." He believes that the emergence of "Drink Mineral Water," entering the 2-yuan price band, is a major challenge to the 2-yuan water market, almost a surprise attack. However, he is very optimistic about the product's development prospects because, with the quality endorsement of the Master Kong brand, consumers have a better choice at the mainstream price. From a business perspective, this is a powerful dimensionality reduction attack. A dealer in Shandong is optimistic about Master Kong's entry into the sugar-free tea track, because before Master Kong, there were not many major brands in the sugar-free tea track, and Master Kong's entry undoubtedly brings dealers more competitive single products. The launch of Berry Black Tea and Citrus C Storm, for dealers, expands the product matrix, can radiate to more channels, and lays the foundation for dealers to develop new markets.
Consumer Insights Behind the New Products
Currently, healthiness and naturalness have become important factors for consumers when choosing beverages. The five new products launched by Master Kong this year all closely follow consumer demands, striving to bring consumers a product portfolio that is both tasty and healthier. In recent years, sugar-free beverages have been highly sought after by young consumers. Master Kong launched sugar-free iced black tea in 2021 and fully upgraded it in 2023, improving the taste through formula upgrades, and adding dietary fiber on the basis of 0 sugar and 0 calories, providing consumers with a healthier product experience. Under the cultivation of Suntory and Oriental Leaf, many young consumers have accepted the taste of plain tea. The popularity of plain tea drinks actually reflects consumers' increasing demand for healthy beverages.
Master Kong has identified a segmented consumer need: plain water tastes bland, while strong tea is too bitter. Chuncui Zero Sugar plain tea drinks, with their light tea aroma, provide a "daily water substitute" for young people who don't like drinking plain water. Following last year's launch of Cloud Mist Green Tea and Jasmine Tea, this year they introduced a new High Mountain Oolong, offering a new option for young people to "rehydrate and quench thirst" in summer. The most market-attracting move is Master Kong's launch of "Drink Mineral Water." After successfully entering the boiled water market and creating the billion-yuan hero product "Drink Boiled Water," Master Kong has now entered the mineral water track at a 2-yuan price point, bringing consumers a new choice with high quality-price ratio.
Many dealers believe that in the highly competitive bottled water market, the emergence of "Drink Mineral Water" can effectively help them develop lower-tier markets and expand into more segmented channels. The boss of the Hebei trading company said bluntly, "This 2-yuan 'Drink Mineral Water' shows Master Kong's determination! At the same price, giving consumers a better choice, the success of 'Drink Boiled Water' has already verified this logic."
In recent years, the fruit juice beverage track has continued to grow, with fruit-flavored drinks becoming one of the categories that young consumers pay more attention to. Under the trend of low-sugar drinks, why are fruit-flavored drinks with higher sugar content still accepted by consumers? In New Distribution's view, this is precisely a manifestation of individual consumers' diverse needs in different scenarios. For example, in gatherings and holiday scenarios, the emotional value and healthiness brought by fruit-flavored drinks are still welcomed by consumers. Master Kong's newly launched Citrus C Storm caters to the new trend of "early C late A" among young consumer groups. Unlike traditional fruit-flavored drinks, Citrus C Storm uses five types of citrus juice as raw materials, including orange juice, lemon juice, red grapefruit juice, pomelo juice, and kumquat juice, providing consumers with a richer vitamin C taste and allowing them to experience different levels of sweet and sour refreshment. In terms of packaging design, it adopts a bright, colorful illustration style, younger and more interesting, attracting consumers' attention on the shelf.
Along with fruit-flavored drinks, fruit tea is also growing. It is worth noting that fruit tea is becoming a fashionable drink favored by young consumers. The combination of fruit juice and tea not only complements each other in taste but also brings consumers a more novel experience. Master Kong's Berry Black Tea is a super fruit tea hit created for Generation Z. Four types of berries—strawberry, raspberry, blueberry, and cranberry—are blended into Ceylon black tea. The collision between tea and fruit stimulates a lively taste, and the eye-catching berry pink packaging is pleasing to the eyes.
Currently, consumer choices are diverse, and beverages especially need to cater to different consumption scenarios. If "Drink Mineral Water" meets consumers' daily hydration needs, then the upgraded sugar-free iced black tea releases the vitality of young people. Chuncui Zero Sugar High Mountain Oolong Tea, as a water substitute product, brings consumers a new thirst-quenching experience. The emergence of Citrus C Storm brings consumers a healthier fruit-flavored drink, while Berry Black Tea shows a gentle side, allowing consumers to slow down and enjoy a better life. These five products can meet consumers' needs in diverse scenarios such as work, life, socializing, and gatherings, providing an answer sample for the core proposition of the beverage industry: "how to balance good taste and health." The diversified products also bring dealers a rich selection combination, meeting the product selection needs of dealers in different channels. It can be said that these new products are expected to bring new increments to dealers in 2023.
Multidimensional Innovation of the Head Player
With economic recovery in 2023, China's beverage market continues to maintain growth momentum, but market competition is also becoming increasingly fierce. Although diversified consumer demands give brands more opportunities, they also pose challenges. As a leading beverage brand in China, Master Kong always adheres to consumer demand orientation, continuously bringing new vitality to the industry through product innovation, packaging innovation, and marketing innovation. How to maintain brand freshness? Relying solely on youthful packaging is not enough; it is more important to stay close to consumer needs, integrate beverages into consumers' lives, and become a part of their daily scenarios. Therefore, brand, marketing, and product need to complement each other and be integrated, through diversified channels, digital communication, and strong terminal exposure, making products visible everywhere and available for purchase at a glance. Product innovation is also very important. Category innovation demonstrates Master Kong's strong confidence in its own strength, while closely following consumer needs and grasping consumption trends allows Master Kong to lead the industry forward. Through multidimensional innovation, Master Kong has always been a bright landscape in the beverage market, bringing consumers delicious, healthy, and youthful products, and providing dealers with richer profit combinations.