When marketing becomes mediocre, a company's fate is to muddle along, or to have its survival and death out of its own control. What does this mean? It does not mean that mediocre marketing leads to immediate death. On the contrary, for companies that have achieved industry scale, the mediocrity of marketing first manifests as a decline in revenue (annual sales revenue) growth rate or an absolute decline. For the former, consider a behemoth like Starbucks, which could even be called the absolute monopolist in the coffee market. After consecutive declines in revenue and profit growth, it began to take action: cutting its long-stagnant tea retail business by closing Teavana stores, laying off staff (with a focus on market operations department employees), and the next step may be replacing the CEO. For the latter, take China's beverage king Wahaha as an example. Wahaha's revenue fell from its peak of 78.3 billion yuan (2013) to 46.5 billion yuan (2017), a decline so large that it shook the beverage industry. But this does not mean Wahaha will die; on the contrary, it can still be said that Wahaha is a profitable company. However, whether Wahaha is still a valuable company is hard to say. If even the "King of Hell" is struggling, the "little ghosts" will inevitably have a harder time. Why do giants have headaches? This question does not seem to have been fully researched or deeply analyzed. People say all sorts of things, but shouldn't a company with declining sales first look for the "key crux" from the marketing perspective? In fact, discussions about the above phenomena often "talk about everything but the point": When the Chinese marketing community talks about Starbucks, it focuses more on the impact of competitors like Luckin Coffee and new tea drinks, but ignores that Starbucks' data in the Chinese market is actually growing, both in store count and sales. Moreover, despite being attacked and impacted, Starbucks' expansion in China is actually accelerating. Starbucks' decline and adjustment are in its core mature markets. As for Wahaha, some say the reason for the decline is that the old generation is aging and the second generation has not fully taken over. In fact, the sales data tells the story: Wahaha's decline is due to the sharp drop in sales of its core products, especially Nutri Express. Wahaha's response has been to launch an upgraded version of Nutri Express, reportedly with a new packaging focused on fashion and e-commerce, a new product led by the second generation. If Wahaha continues to perceive products and markets this way, the decline is unlikely to see an end. This article cannot fully analyze the process of declining sales growth or sales decline for giants like Starbucks (referring to markets outside China) and Wahaha, but I can directly state my view: the fundamental reason for their decline is the mediocrity of marketing. This issue is also clearly visible in famous marketing benchmarks like P&G and JDB. What is marketing mediocrity? Originally, this is a self-evident question. If one precisely understands what marketing is, it is naturally easy to see the difference between mediocre and excellent marketing. However, in the context of the Chinese marketing community, the proliferation of concepts and myths has led to confusion in common sense and normal logical thinking, and the ambiguity of the marketing concept is one of them. The most clumsy but still a method is to diagnose from the 4P (Product, Price, Place, Promotion) perspective, to see the factors causing the decline and the weight of each factor in the 4P links. This was the first lesson in marketing consulting for companies in the past: marketing research and diagnosis, which can be partly seen as the "marketing audit" mentioned in Kotler's classic "Marketing Management." The second simple but always effective method is to focus on the company's users (or customers, consumers, i.e., people/enterprises who pay for the company's products and services), and study why past users no longer buy or have reduced the frequency and quantity of purchases of the brand's products. Study how many users have purchased competitors' products, why users switched brands, and measure and estimate the number of switchers, distribution patterns, and reasons for switching. This is not a groundbreaking move, but it is always effective. One of the core principles in Ren Zhengfei's management philosophy is customer-centricity. This is also the essence of marketing; everything else is means, processes, and tools. The third advanced but not easily executed method is "strategic marketing insight," which is an issue at the BOSS (boss, shareholder, investor, or board of directors) level. It requires informing the company of its situation from more macro yet life-and-death perspectives such as industry selection, category selection, business model, and environmental structure, and providing demonstrated feasible opinions on future choices. Take Starbucks as an example. The decision to close 379 Teavana stores in North America, from a strategic marketing perspective, especially in a highly mature coffee market like North America, is a historic mistake to exit the "tea" category market after six years of effort (Starbucks acquired Teavana for $620 million in 2012). In Chinese, this decision is like "casting nine provinces of iron cannot make such a big mistake." By abandoning the tea beverage market that should and could have grown rapidly, how can Starbucks not decline in North America? Similarly, looking at Wahaha, it is not hard to understand why the so-called fashion-packaged, e-commerce-channeled Nutri Express upgrade is not promising. So, in the past five or ten years, when large enterprises in various Chinese industries encountered declining growth or sales, what methods did they adopt to understand the problem? The answer may be unexpected yet reasonable: most Chinese companies with problems are increasingly unwilling to adopt any of the above three methods! Observing the development of Chinese enterprises in the past five years, fewer and fewer companies are professionally and seriously using one of the above three methods to diagnose marketing mediocrity and excellence, so that management can understand which aspects are mediocre and which are excellent, thereby solving the direction and even the methods, and results can gradually emerge. More and more phenomena show that media (including emerging self-media) violence, traffic violence, and big V (internet celebrity) violence are replacing the power of creativity, design, and quality. Companies are increasingly unwilling to invest sufficiently in creativity, design, and quality (including management and consulting), but instead chase the so-called influence of media, traffic, and internet celebrities. The myths in the micro-business, internet celebrity, and self-media circles are constantly changing, with a new script every year. Anyone with common sense can see that the sales myths they promote are sugar-coated poison. So far, all myths have only "fattened" the individuals or institutions telling the myths, and almost no brand has risen from the myth dividends. On the contrary, the cases used to fabricate myths, besides BAT (Baidu, Alibaba, Tencent) to TMD (Toutiao, Meituan, Didi), or manufacturing brands like Huawei and Xiaomi, the super species, super IP, big data, and new marketing representatives touted by the myths are all small fry (new enterprises without scale), born and dying quickly, with new faces changing every year or two, and the myth stories continue. Ma Yun invested 300 million yuan, with annual revenue of 1 billion yuan, and a big V about to go public, but in the end, it only increased her follower count and made you buy a piece of clothing; the master who talks about trillion market value, hundred-billion scale, and ten-billion operations ultimately just promotes a book or a paid knowledge course; the internet celebrity on Douyin with over 100 million traffic, 10 million followers, and a single live-stream tip that can buy a villa in Hangzhou, apart from becoming more famous himself, has not made any brand famous. So what sales value and communication value do big Vs, masters, and internet celebrities really have? In the face of these "internet clamors" of the hot new stars, not only do ordinary people not know where their traffic comes from or whether it is real, but companies are also confused, thinking that these new internet aristocrats who talk about money can at least bring some traffic even if they cannot bring sales. Corporate wishes are all illusions; there is no such good thing in the world: using the internet's boundless connectivity to harvest followers like cutting leeks is essentially using the "halo effect" of the masses to deceive audiences into taking action (following, liking, tipping, buying). But this is not sales, even if it claims how many tips or goods were sold in a live stream; nor is it communication, even if the online viewers or new followers are in the millions or tens of millions. These internet clamors (or even just platform clamors) are merely entertainment phenomena and have no marketing investment value for corporate marketing. In recent years, companies trapped in internet or platform clamors are more confused than those before 2013 who were puzzled about whether to go online or not (e-commerce). Especially in marketing direction, it can be said they are in disarray and a mess. Companies are in a bizarre situation: water is everywhere, but not a drop to drink! Of course, they cannot drink good water because the water (traffic) in the internet world, even if real, is illusory. If a company finds the right battlefield, even without nuclear weapons, it can gain something; but once it chooses the wrong battlefield and wrong weapons, it is just a futile effort (the so-called internet clamor). In the traditional media era, advertisers did not know whether half of their media investment was effective; in the late e-commerce era, the success rate was said to be only 10%; and in the internet clamor environment, 99.99% of investment is wasted. It is this completely wasted 99.99% of real money that fuels the noisy and prosperous internet clamor. What I want to say is: In the internet clamor, most Chinese enterprises are losing their understanding of marketing common sense and the essence of marketing. They are swept up by the internet clamor, with a fluke mentality, becoming the 99.99% of firewood burned to ashes. It is necessary to talk about what constitutes marketing common sense. Common sense is the following three points:
Any behavior that cannot bring sales is wrong;
Communication investment must either increase awareness or bring sales conversion, otherwise it is also wrong;
Only fans that can enter SCRM (Social Customer Relationship Management system) are valuable; the number of followers (increasing fans, traffic) itself does not yet have marketing significance.
According to these three criteria, 90% of existing companies' internet investments are wasted, i.e., money down the drain. I strongly oppose the internet clamor, but I am a faithful believer in the "internet world." From the new generation of brands born in the internet world in the past five (or ten) years, what can be seen is precisely the true new marketing genes: Xiaomi's case is already well-known and need not be repeated; it is undoubtedly a representative of new internet species. Three Squirrels, similar to Xiaomi's model, is a new internet species in the snack food industry, with 16 billion yuan in five years (90% of sales from online retail), completely defeating the traditional leader in the snack food industry, Qiaqia Food (3.6 billion yuan revenue in 2017), demonstrating the real power of the internet world. The rise of Xiaoguan Tea, Heytea, Naixue Tea, and Luckin Coffee in the past three years all prove that creativity, design, and quality are the real drivers of sales. Huawei phones, vivo/OPPO phones, compared with the rise and fall of Gionee, which was keen on marketing gimmicks, further highlight the value of marketing common sense. In the face of these true "Chinese-style marketing" best practices, Chinese enterprises should seriously study, learn, and practice innovation, and find new tactics and new marketing systems to win in the current Chinese market environment (the new business landscape of three worlds), rather than losing direction and judgment in the internet clamor. In the past, people understood marketing mediocrity as a lack of advertising creativity, or a lack of precise strategy and scientific media placement when launching advertising (including promotion) campaigns. Today's era may add a meaning to "marketing mediocrity," not only referring to lackluster performance (creativity, advertising), but also including cognitive mediocrity, whose manifestation is what this article repeatedly emphasizes: losing the understanding of the essence of marketing, losing the judgment of marketing common sense, and thus getting lost in the maze of internet clamor. I also want to mention that from the "internet thinking" term popularized by the Xiaomi phenomenon in 2013, to "Internet+" in 2015, and even today's mainstream keywords like "industrial internet" and "new retail," all have value, but they are not the most needed for the marketing upgrade of current Chinese enterprises. The keyword that Chinese enterprise marketing most needs to deeply understand, study, and grasp is: internet genes. Giving enterprise marketing internet genes parallel to the ever-changing internet world, that is, marketing strategies, operating systems, tactical tools, and new marketing teams based on the "three worlds" of the internet, is the foundation of Chinese-style new marketing: "internet genes." A batch of new brands with internet genes has emerged or even shown promise. Just as Xiaomi, Three Squirrels, Heytea, Didi, Pinduoduo, and Hema Fresh have brought new momentum to their respective industries, the industry practices of the new generation of brands with internet genes will also bring changes to the existing industry landscape, reflected in real changes in industry share, not fake changes—the noise of internet clamor, a fireworks show that wastes resources and time. Source: Food Headlines (ID: fbc180) -END-