JDB Takes Its Advertising Slogan Battle All the Way to the Supreme Court...

Many things have happened in the past few days: Huang Guangyu's return, Huang Zheng's net worth surpassing Ma Yun's, Tencent's market value exceeding Alibaba's, and so on.
These hot topics are indeed worth discussing in detail, but today, on this festive day when many people are visiting relatives and gathering together, I want to talk about something related to food and drink.
What is it? Let's talk about the Supreme People's Court's ruling that JDB can continue using the advertising slogan "怕上火喝加多宝" (Drink JDB to prevent getting heaty).
Some friends may not know what this is about. Let me briefly explain. On June 23, JDB Herbal Tea released information stating that the company had received a civil ruling from the Supreme People's Court, which rejected GPHL's retrial application. This means JDB can continue using the slogan "怕上火喝加多宝" (Drink JDB to prevent getting heaty). (Source: Xuangubao)
At this point, some friends might say, "Really? They took a lawsuit all the way to the Supreme Court just for an advertising slogan?"
Behind every event, there is a business logic. To understand this, you need to understand the unique business model of the beverage industry.
What does that mean? Let's first talk about the beverage industry. Simply put, it is an industry with high frequency, low production costs, and high repurchase rates.
High frequency means that as a beverage, people drink it often; low production costs because the main ingredient in all beverages is water; and high repurchase rates because once people get used to a taste, they don't easily change.
For example, Warren Buffett still drinks several cans of Coca-Cola every day, and he has been drinking it since childhood. Think about how much profit he has contributed to Coca-Cola over these decades. (Of course, Coca-Cola's stock has brought Buffett even greater returns.)
What happens when you combine high frequency, low production costs, and high repurchase rates? It means that a significant part of the competition in this industry becomes advertising competition—a battle for consumer mindshare.
What does that mean? Faced with a dazzling array of beverages, what will consumers buy?
They will definitely buy what they are familiar with, what has captured their mind.
Coca-Cola founder John Pemberton once said: "If I had $25,000, I would spend $24,000 on advertising Coca-Cola and use the remaining $1,000 for production." This is the special business model of the beverage industry: the important competition is advertising and capturing consumer mindshare.
So how do you capture consumer mindshare and advertise?
There are many marketing methods in the market. Today, I'll use the "Positioning Theory" as an example to introduce how to capture consumer mindshare.
What is Positioning Theory? It means if you can't be the first in a category, create a new category. For example, if I ask you, what is the highest mountain in the world? You definitely know it's Mount Everest. Then I ask, what's the second highest? You might not know. Most people can only remember the first, at most the second. This is determined by the human mind's pattern. So to capture consumer mindshare, you need to be the first in a category, or create a new category. This is Positioning Theory.
How to apply Positioning Theory well? I'll give you three suggestions.
First, start from the consumer, not from the product. What does that mean? For example, if you make a beverage, consumers don't care about what high-tech applications your beverage has; they care about what it does for them and how it's different from other beverages. That's what you should care about: the consumer's buying point, not the product's selling point.
Second, if you can't be the first in a category, create a new one. After 2002, JDB transformed Wanglaoji from a "herbal medicinal drink" into a "beverage to prevent getting heaty," successfully creating a new category: herbal tea.
Third, advertising slogans that capture consumer mindshare should be extremely simple. Consumers like simplicity and hate complexity. For example, "今年过年不收礼，收礼只收脑白金" (This New Year, don't accept gifts; if you do, only accept Naobaijin), "恒源祥，羊羊羊" (Hengyuanxiang, sheep sheep sheep), and so on.
After discussing how to apply Positioning Theory, let's return to the slogan "怕上火，就喝XXX" (If you're afraid of getting heaty, drink XXX). Is it a good slogan?
Of course it is. This slogan is very simple and catchy. Many consumers, when eating hotpot or barbecue, hear this slogan and feel it hits the spot—they think they are indeed prone to getting heaty, so they drink it.
Moreover, this slogan is very easy to spread. When someone asks you, "Why do you drink Wanglaoji?" you blurt out, "Because I'm afraid of getting heaty, so I drink Wanglaoji."
After deciding on this slogan, JDB Group began large-scale promotion with it. In 2003, they invested over 40 million yuan in advertising, and then JDB Group purchased prime advertising slots on CCTV for 2004. As the ads spread, "怕上火，喝王老吉" (If you're afraid of getting heaty, drink Wanglaoji) became a household phrase in China. By 2012, JDB Group's annual sales exceeded 20 billion yuan, capturing 80% of the canned herbal tea market, surpassing Coca-Cola, Pepsi, Sprite, etc., to become the top seller in the national canned beverage market.
The subsequent story is the well-known "Wanglaoji" trademark dispute, with continuous lawsuits between the two parties. The slogan lawsuit we're discussing today is one of those cases.
As observers, reviewing this classic business case, I think it offers a great inspiration to many entrepreneurs.
JDB successfully created the herbal tea category, created the classic and catchy slogan "怕上火，就喝XXX" (If you're afraid of getting heaty, drink XXX), and deeply understood the special business model of the beverage industry, advertising aggressively to repeatedly expose consumers to the slogan and capture their mindshare. What a classic marketing lesson!
But JDB ultimately "lost" the Wanglaoji brand. If JDB in 2002 had known that the "Wanglaoji" brand would become so popular in the future, I believe they would have tried to obtain ownership of the brand from the beginning, rather than just a license. But history cannot be assumed. However, this gives us a very important reminder. That is, if you have a grand dream and want to create something great, never lay your first foundation on sand. Because a small mistake you make at the start of your business may become your biggest stumbling block in the future when you grow bigger.
Of course, in the end, we still congratulate JDB for being able to continue using the classic slogan it has worked so hard to build over the years. Wishing JDB all the best.
At the same time, I hope many companies can learn from this case some marketing methods, positioning theory, and the business model of the beverage industry. Of course, the most important thing is to learn from the lesson. When you have a great dream, no matter how difficult it is to lay the first foundation, never lay it on sand; instead, firmly lay it in rock. Only then can you build a skyscraper on that foundation and realize your dreams. Source: Liu Run (ID: runliu-pub), Author: Liu Run, Compiled by: Cheng Zhi Tips will be paid 400-2000 yuan upon adoption.