---
title: "Leyuan: Building Channel Brand Power with User-Centrism"
description: "China's FMCG industry is entering a new era, and Leyuan Company, on its 25th anniversary, is implementing a user-centric strategy across its three brands to capture growth in the juice market."
author: "田静"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2023-05-15"
categories: "Brand Marketing, Industry Trends"
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citation: "田静. “Leyuan: Building Channel Brand Power with User-Centrism.” New Distribution, 2023-05-15. https://xinjignxiao.com/en/articles/leyuan-building-channel-brand-power-with-user-centrism-efa19f0d/"
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# Leyuan: Building Channel Brand Power with User-Centrism

> China's FMCG industry is entering a new era, and Leyuan Company, on its 25th anniversary, is implementing a user-centric strategy across its three brands to capture growth in the juice market.

China has a history of five thousand years, with a long and profound culture; the new world of China's FMCG industry faces a long and arduous journey. At the 8th China FMCG Innovation Conference in 2023, New Distribution proposed a powerful theme that attracted great attention from the industry: New World, New FMCG. There is no doubt that China has entered a new era. In this new era, China's economic position in the world has fundamentally changed, the relationship between China and the world has been completely reversed, and China's voice in the world has gradually increased. The national economy has moved from the past era of scarcity to an era of surplus; and from the era of surplus, it has developed into an era of quality. The past operating rules of the consumer goods industry have also been completely broken and rebuilt. So, what era are we in? What are we doing? Where is our future? Based on this, New Distribution visited and researched several major food and beverage brands, and found that this year marks the 25th anniversary of the establishment of Leyuan Company, and its subsidiary brand Zero Fruit Workshop (零度果坊) celebrates its 10th anniversary. On this occasion, Leyuan Company, with "user-centrism" as its core, has made a new market strategic layout and several key implementation actions. In this regard, the relevant person in charge of Leyuan Company said: "Let more Chinese people drink better juice, and use fruit and vegetable juice to help improve the national dietary structure" - this is Leyuan's mission, and it is also standing on the correct side of history, choosing the right thing, and keeping pace with the times.

Three major strategic layouts: strong segmentation, full coverage, high penetration

As we all know, the beverage industry is a very large market and has always maintained rapid growth. Bain & Company's consumer report predicts that in 2022, especially in the third quarter, the food and beverage industry will continue to maintain rapid growth, leading industries such as personal care and household cleaning. Among them, the performance of various sub-categories in the food and beverage industry varies. Red wine, yogurt and other categories performed slightly worse, while juice, beer, ice cream and other categories performed better. It is worth mentioning that from the perspective of category concentration, juice products in beverages have the highest concentration, reaching 34.4%; followed by tea beverages, reaching 35.8%; then plant protein beverages and carbonated beverages; among other categories, the largest sales volume is mineral water, reaching 9.1%. As for the demand for juice, as China officially moves from the "post-pandemic era" to the "after-pandemic era", Chinese consumer psychology has undergone a trend change. Teacher Lu Xiuqiong proposed: the change in epidemic policy, the return of consumption value. What does it mean? From functional pursuit to emotional consumption, from cost-performance ratio to heart-price ratio, consumer demand has entered an era of "value return". This coincides with the view put forward by Jiang Nanchun, chairman of Focus Media, at the 8th FMCG Innovation Conference: consumers' longing for a better life can be summarized in three points: three loves, three fears, and three lacks: love to eat, love to drink, love health; fear of aging, fear of fatigue, fear of loneliness; lack of love, lack of mood, lack of stimulation. In summary: current consumer goods need to meet the "heart-price ratio" of three dimensions: health trend, high-end appearance, and emotional reach.

This change has actually begun to show signs, such as the popular stove-boiled tea during the Spring Festival, online bars, and medical insurance massage. These are real needs to fight loneliness, relieve soreness, and pursue health. During the visit to Leyuan, New Distribution learned that Leyuan Company was established in 1998, and it has three brands: Leyuan Beverage (乐源饮品), Zero Fruit Workshop (零度果坊), and Fruit & Vegetable Secret (果蔬秘诀). These three brands cover three different sub-categories. Although they all seem to be beverages, a closer look at these three brands reveals that their positioning is different. Leyuan Beverage focuses on juice drinks, positioned as "healthy new trendy drink", advocating "trendy and delicious, drink Leyuan"; Zero Fruit Workshop, the No. 0 player of NFC juice, focuses on NFC freshly squeezed pure juice, advocating "health upgrade, drink Zero"; Fruit & Vegetable Secret aims to create a fruit and vegetable juice with a secret using a more scientific and nutritious method, advocating "nutrition upgrade, drink Fruit & Vegetable". Obviously, these three categories span the entire life cycle, covering X, Y, and Z generation consumer groups. Among them, Leyuan's small lime series products have shown strong pull in the Z generation group. It is understood that Leyuan small lime was officially launched in September 2021, operating through all online and offline channels, and sold nearly 4 million bottles in just 3 months. In fact, the small lime category is not Leyuan's first product, but why did Leyuan small lime quickly explode in the market once it was launched? One is the huge market potential contained in the product, and the other is Leyuan's ability to quickly distribute across all channels. According to Douyin's "massive data", from 2019 to 2022, the average search index for lemon tea and small lime juice in summer showed a trend of high growth year by year. The attention to lemon tea has increased year by year in the past 4 years, with a year-on-year growth of more than 50% this year, and it is in a rising period. As a sub-category, small lime juice is also growing rapidly with the overall market. Behind the rapid growth is the amplification of user demand. Leyuan's "user-centrism" focuses on innovation capability and rapid iteration. According to the relevant person in charge of Leyuan, Leyuan's annual new product iteration speed reaches more than 20 types, continuously meeting and creating consumer needs. In Leyuan's view, the relationship between consumers and brands has become a trinity of cognition, transaction, and relationship. Brands create demand on the C-end, empathize with consumers, innovate and iterate together, and express together; while the B-end performs fulfillment, using the most efficient methods to reach stores, homes, and goods.

Three major strategic implementations: with "user-centrism" as the core

After long-term market visits, New Distribution found that well-performing categories usually do the following four things right: 1. Category education; 2. Scene association, especially deep binding with family scenes; 3. Product innovation; 4. Packaging upgrade.

As mentioned earlier, the juice category in beverages has the highest concentration, obviously consumer education has been popularized. First, look at Leyuan juice drinks. On the occasion of its 25th anniversary, the Leyuan juice series products have been fully upgraded. The golden position of the product packaging greatly highlights the character "乐" (Le), which has two meanings: one is to highlight the brand image, that is, "Leyuan", to strengthen consumers' perception of the brand; the other is to emphasize the brand attitude, that is, "Happy in every moment", to stimulate consumers' emotional needs. The current consumption upgrade not only requires product quality, but also pays more attention to the emotional value brought above the product itself. For example, why does Coca-Cola stand tall as a century-old classic? Even during the worst of Shanghai's epidemic last year, some consumers used Coca-Cola for barter. This is the emotional value beyond the product. Current consumer purchase decisions are driven by emotion. Therefore, with "user-centrism" as the core, Leyuan juice is committed to becoming the "ZARA" of the juice industry, capturing users' psychology of "curiosity" and "trying new things", and advocating the brand tone of "natural, healthy, happy, and fashionable". In addition, Leyuan juice launched the 1-liter Yipin series and small lime series products, deeply integrating with family consumption scenes. The relevant person in charge of Leyuan Company mentioned that the current 80-95 generation has become the young main force among family consumers. As digital natives, they are willing to spend more money through information retrieval to exchange for product added value, such as exquisite packaging, convenience, healthy ingredient lists, etc., so family consumption has produced more advanced and diversified needs. Coupled with the three-year epidemic, the family consumption scene has become increasingly intense.

Next, look at Zero Fruit Workshop. This year marks the 10th anniversary of Zero Fruit Workshop, focusing on NFC freshly squeezed pure juice. As the No. 0 player of NFC juice, Zero Fruit Workshop is committed to becoming the leader in the NFC juice category, deepening the category and market awareness that "NFC is Zero freshly squeezed", so that natural, healthy, and fresh NFC juice can enter more families. At present, although NFC juice accounts for a small share of the entire juice market, it shows greater growth potential compared to other juice categories. According to Euromonitor International data in 2019, in the past five years, the retail volume of NFC juice increased from about 5.8 million liters to about 46 million liters, and the market sales scale also increased from 300 million yuan to 2.57 billion yuan. It is expected that the market size will reach 4.83 billion yuan in 2023. From this data, NFC juice, as a category that better meets fresh and natural needs, is ushering in development opportunities at present. Therefore, Leyuan Company spares no effort in investing heavily in product technology. It has established five standard production systems: aseptic line, normal temperature juice line, hot filling line, NFC low-temperature cold filling line, and NFC low-temperature ultra-clean line. And the entire cold chain transportation, from production to sales, is maintained at 0-6 degrees Celsius, which helps preserve the fresh flavor and vitamin C of the juice. New Distribution learned that Zero Fruit Workshop currently has launched three series of products, including the classic series with 5 flavors, 100% fresh fruit squeezed, low-temperature process, mellow and natural; the Daily Fresh series VC juice, non-high-temperature pasteurization process + low-temperature cold chain, pure and natural, and it is the first juice brand in China to label the vitamin C content on the bottle; the Early Orange Good series, high-standard aseptic cold filling, stored at room temperature, easy to carry. It is worth mentioning that the Early Orange Good series also launched a 1-liter package, which is one of the few juice products that focus on the family breakfast scene.

Finally, look at Fruit & Vegetable Secret. This brand was incubated in 2020, focusing on creating a bottle of fruit and vegetable juice with a secret. Its incubation background originated from Leyuan's product officer's overseas research, where they found that locals are accustomed to drinking fruit and vegetable juice as a daily drink, but the situation in China is that "more than 80% of the people have insufficient fruit and vegetable intake". According to the "Dietary Guidelines for Chinese Residents", it is encouraged to consume more fruits and vegetables, recommending that children aged 4-5 consume 150-300g of vegetables per day and 150-200g of fruit per day, that is, the ratio of vegetables and fruits to meat and dairy products is 2:1:1. So Leyuan Company came up with the idea of producing a good cup of fruit and vegetable juice: using fruit and vegetable juice to improve the national dietary structure. In this way, the "Fruit & Vegetable Secret" brand was born. Obviously, this sub-track has not yet formed a brand echelon, and its blue ocean space is huge, especially the growing demand for nutrition and health of fruit and vegetable juice in family scenes. And Leyuan Company, with foresight, has recreated this category, approaching the essence of fruit and vegetable nutrition, and is committed to becoming a rigid demand product like milk.

In summary, Leyuan's three major brands fit the growth needs in Maslow's hierarchy of needs. Maslow's hierarchy is divided into a five-level model, from the bottom of the hierarchy upward: physiological (food and clothing), safety (job security), social needs (friendship), esteem, and self-actualization. These five stages can be divided into deficiency needs and growth needs. There is no doubt that we have entered the era of growth needs. Leyuan's three major brands have implemented "user-centrism" one by one, found deterministic capabilities, and have huge potential for long-term growth.

Channel-driven brand: establish strong C-end awareness + efficient B-end channel system

Teacher Liu Chunxiong once proposed: In 2023, white label is a phenomenal trend. What is white label? Teacher Liu Chunxiong interpreted: white label is not a manufacturer's brand, but a channel (platform) brand. The academic name is private label, and white label is a popular term. Therefore, unknown brands produced by small and medium manufacturers cannot be called white labels, nor can non-first- and second-tier brands be called white labels. White labels can also be famous brands. To be precise, white label is the private brand of the channel system. Therefore, the rise of white labels is not the rise of second- and third-tier brands; behind it is the rise of channel brands, the redefinition of the relationship between manufacturers and channels, and the awakening of channel operators' business awareness. Conversely, this "awareness" has also made brands begin to awaken. Leyuan Company, with foresight, invested in expanding ODM business early. At present, it has established deep cooperation with more than 20 KA and CVS systems such as Hema, Yonghui, Metro, and Pangdonglai.

Hema co-creation: In fact, since 2019, Zero Fruit Workshop has carried out deep co-creation cooperation with Hema. As an NFC juice series product with Hema's original label, it has gradually penetrated more Hema consumers, maintaining an annual sales growth rate of over 25%. Providing healthy and delicious NFC juice for Hema consumers, not only with basic flavors such as NFC orange juice, NFC grape juice, NFC mango juice that meet various daily scenes, but also seasonal limited products such as NFC lychee juice and NFC peach juice.

Yonghui cooperation: In 2019, Leyuan reached a deep strategic cooperation with Yonghui. Targeting Yonghui's core customer groups, it provided explosive small lime juice beverage products for Yonghui's Chandaishi brand. Through the introduction of explosive products and deep cooperation with the Chandaishi brand, it enhanced the loyalty of Yonghui's core customers.

Metro: In November 2022, Leyuan Company began cooperation with Metro warehouse-style supermarkets. According to Metro's family consumption and corporate group purchase scenes, Leyuan customized 2L2 series juice for Metro Group, with extremely cost-effective prices and high-quality products, improving the stickiness of Metro members.

Pangdonglai: In April 2020, Leyuan Company launched a 50% juice series and 100% NFC juice series customized for Pangdonglai, deeply fitting Pangdonglai's product tone of "safe, practical, real, and fashionable". Leyuan's customized juice series has also repeatedly entered the "must-buy list" of Pangdonglai consumers.

While deeply co-creating products with major systems, Leyuan also provides a series of personalized customization services, including public relations communication, vivid display, design and activity support, etc.

Product landing capability: systematic five major service mechanism closed loop

One cannot help but wonder: most brand owners are focusing on dealer channels, why is Leyuan Company obsessed with ODM business? Teacher Liu Chunxiong mentioned that in the past, Chinese marketing was brand-driven + channel-driven, but now it is "channel brand-driven". As the name implies, it uses channels to build brands. Brands use channel advantages to occupy terminal retailers and platform traffic, doing both brand awareness and delivery. This is a typical trinity of cognition, transaction, and relationship. This maximizes brand value creation, value communication, and value delivery. The most critical thing is to reduce terminal link costs, regulate terminal prices reasonably, and build a benign price system. It can ensure product quality, allow channels to have profits, and allow consumers to get a product with the highest "heart-price ratio", ultimately generating higher brand premium. It should be emphasized that this is Leyuan's most critical action to implement "user-centrism".

So, what is Leyuan's confidence in doing ODM?

Production system: It has five self-owned high-end production lines, covering all items of normal and low temperature products. The strong supply chain system can carry out flexible customization according to needs.

Formula R&D: It has two major application R&D systems, namely NFC juice R&D and juice beverage R&D groups, providing strong professional raw material formula foundations.

Product development: On the basis of consumer insights, a product development group has been established, focusing on taste strategy innovation, product content development, and marketing operations.

Brand design: It has its own professional design team, multi-specification and special bottle shape packaging design, and product promotion visual design.

Logistics system: It has a nationwide logistics system, normal/low temperature transportation, and emergency plans to ensure distribution capability and timeliness under special circumstances.

These five systematic service mechanisms form a virtuous cycle mechanism, providing strong support for the ODM business segment.

Final words: Adam Brandenburger and Barry Nalebuff once said: "Success comes from the right way of competing." From an industry perspective, the future development direction of Chinese juice is pure juice and pure fruit and vegetable juice with higher nutritional value. The growth of China's economy will also bring high growth across the board for pure juice and pure fruit and vegetable juice. From a channel perspective, Leyuan's 25-year history has built strong brand power, and its ability to continuously incubate good products also gives channels dual guarantees and higher channel profits. From a product perspective, Leyuan's strong production and supply chain capabilities, with a pure product value concept, deliver a good bottle of juice to every consumer, always pursuing consumers. This way of competing keeps Leyuan Company full of continuous competitive vitality.


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## Citation metadata

- Publisher: New Distribution
- Author: 田静
- Published: 2023-05-15
- Canonical: https://xinjignxiao.com/en/articles/leyuan-building-channel-brand-power-with-user-centrism-efa19f0d/
- Original source: https://mp.weixin.qq.com/s/OiXBPBJI8GQWPSa3rrt_Iw

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