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-01- Perfectly balanced marketing should integrate BC marketing channels
In traditional FMCG marketing, there are two major driving forces: brand power and channel power. Traditional brand-driven marketing is mass media communication directly targeting consumers. Once brand power is established, it creates 'pull' in the channel. In the past, people had limited access to information through TV, newspapers, etc. Brand owners who controlled prime advertising slots in mass media could control market sales. This is a C-end marketing approach. The other is channel power-driven, based on China's past national conditions, a 'human wave tactic' where brand owners persuade distributors, then wholesalers, then retailers. The difference is the focus: one targets the C-end, the other starts from the B-end. Neither is inherently better or worse; both forces point in the same direction. Brand power is not easy to build; it requires significant investment and continuous maintenance. The human wave tactic is even harder, especially for nationwide channel coverage, requiring at least four levels of internal management and two levels of channel management, totaling at least six levels—a world-class challenge. However, with internet development and media decentralization, no brand can afford full media coverage, or even if they could, it wouldn't be cost-effective. Channel power, represented by deep distribution, is highly valued. In FMCG, deep distribution once represented the limit of channel power. But today, FMCG manufacturers, channel partners, and retailers must recognize: the future channel will be diversified, including social e-commerce, live-stream e-commerce, O2O home delivery, etc. Enterprises must quickly adapt to diversified channel changes to fit the future FMCG market. Brand power solves the consumer's 'willingness to buy' problem, while channel power solves the channel partner's 'willingness to sell' problem. Combining push and pull is the perfect balanced marketing, and excellent companies ultimately achieve this combination, which is what the industry now calls BC marketing channel integration.
-02- Positioning BC integration, directly addressing traditional channel upgrade pain points
BC marketing channel integration means making enterprise marketing possess both B-end push and C-end pull. It is an effective customer acquisition method in an era of fragmented media and channels, but this pull differs from brand-driven pull. Traditional brands, if not formed by historical accumulation, are mostly formed by mass communication. Brand pull must target a large number of uncontrollable C-end consumers, requiring sufficient communication resources, frequency, and time, as well as effective strategies and artistry. Without these, brand power is hard to form. The channel power needed for BC integration requires further investment to strengthen channel push to reach the C-end, based on existing deep distribution reaching terminals. This process remains F2B2b2C. Traditional enterprises have deep distribution foundations, but achieving omni-channel integration and full-scenario user reach requires channel push that poses a challenge in channel transformation planning. Currently, traditional distribution channels have multi-level agency and distribution, with production-driven sales leading to mass production and distribution, causing problems: In sales model, forced sales mask the true market situation; in delivery, long order cycles fail to meet rapid market response needs; in inventory, large finished goods storage areas lead to high rental costs, while long-lead materials restrict production flexibility and cause material stagnation. Taking the FMCG industry with complex channels as an example, if FMCG companies continue with a push supply chain driven by finished goods inventory, they cannot meet new market demands in terms of timeliness, loss, or service. In a push supply chain, distributors and retailers are passive, with low integration and poor response to demand changes. Therefore, to further upgrade channel push based on traditional distribution, resources must be invested to create experiences and continuously connect with the C-end. But these require costs; if costs become too high, the model loses meaning. Supply chain transformation and upgrade enable companies to have sufficient cost space and efficient supply chains to do online user reach and operations, ultimately achieving BC marketing channel integration and activating B-end stock with incremental growth.
-03- Practice proves 'One Inventory' can support FMCG supply chain upgrades
Based on this, Anneng Zhilian has proposed the FMCG 'One Inventory' solution. 'One Inventory' means pulling together production and distribution ends, managing enterprise e-commerce, direct sales, KA, circulation, new retail, and special channel inventory in one system, integrating online and offline channel inventory into 'one inventory' to solve traditional supply chain multi-level distribution and inventory waste, promoting full sharing and rapid turnover of inventory.
This way, the delivery process that originally took five to six stops to reach stores can now be done in at most two; thousands of distributor warehouses can become a hundred, and warehouse areas can gradually shrink. The result is a significant reduction in inventory turnover days, inventory flow speed, and warehouse costs. The entire 'One Inventory' solution is based on Anneng's years of transformation practice. Currently, Anneng has deployed 5 million square meters of warehousing management area nationwide, 136 operation centers, and over 3,000 delivery and installation outlets for last-mile delivery and integrated delivery-installation services, achieving 95.3% coverage of districts and counties nationwide and 100% coverage of townships within their jurisdictions.
This physical network can provide full logistics chain services for home appliances, furniture, FMCG, daily chemicals, etc., including inbound logistics, VMI warehousing, production lean logistics, trunk and branch line transportation, warehousing management, urban delivery, and integrated delivery-installation. Customers can freely combine products and receive solutions based on their needs, and the network is highly flexible. For customers, 'One Inventory' not only allows real-time understanding of inventory data at each node, enabling nearby allocation and coordinated management based on different channel sales, but also connects online and offline, reducing conflicts between channels and creating greater market growth. More importantly, 'One Inventory' helps brand owners and distributors optimize infrastructure costs like warehousing and distribution, improving overall operational efficiency.
Anneng Zhilian has 20 years of experience in the FMCG industry and has served many well-known domestic FMCG brands. For example, in 2020, facing the challenges of the pandemic, Tsingtao Brewery, which had been cooperating with Anneng Zhilian since 2010 in factory-to-distributor trunk transportation and RDC warehousing-distribution integration, was able to quickly launch measures like contactless delivery, distributor plans, and community promotions due to its early supply chain transformation supported by Anneng, successfully achieving counter-trend net profit growth.
Anneng Zhilian's 'One Inventory' FMCG logistics and supply chain solution realizes value at the levels of commerce, logistics, capital, and information. Specifically:
At the commerce level, it liberates distributors and wholesalers from diverse functions like capital advance, warehousing, and marketing, transforming them into operators focused on marketing and store services, so that all distribution networks are directly controlled down to the county level, strengthening store management;
At the logistics level, it manages all inventory of brand owners, distributors, and wholesalers as 'one inventory', with unified warehousing and distribution, integrated warehousing-dry line-distribution, improving unit order fulfillment efficiency, optimizing delivery experience, and enhancing competitiveness;
At the capital flow level, the ownership of goods at each level does not change, satisfying the manufacturer's forced sales model, improving capital utilization for county-level distributors, and accelerating sell-through;
At the information flow level, omni-channel orders are consolidated, all processes and channels are efficiently coordinated, improving overall operational efficiency.
Thus, for brand owners, 'One Inventory' helps optimize infrastructure costs like warehousing and distribution, improving overall operational efficiency. This also means distributors can significantly reduce management costs and resource investment, or invest resources in other operations, and with higher efficiency, income may also increase. It is important to note that in any enterprise's channel reform, resistance from existing distributors is always a major issue. Channel transformation without customer support is very difficult, and Anneng's 'One Inventory' indirectly solves this problem while reducing costs and increasing efficiency for enterprises.
Final note: In today's diversified channels, enterprises seeking digital upgrade, connecting online and offline, and integrating BC ends to build a more efficient and competitive supply chain system should embrace proven service products like Anneng Zhilian's 'One Inventory'. This is an excellent choice for enterprises to build core competitiveness and seize market opportunities in a complex environment.
At the 2021 (6th) China FMCG Channel Innovation Conference and the First China FMCG Community E-commerce Conference held by New Distribution from April 1 to April 3, we have invited Shi Kunliang, Industry Director of Anneng Zhilian, as a guest speaker. He will share more in-depth content on site. Stay tuned.