---
title: "Light Model: Penetration Tactics for Rapid Nationwide Expansion"
description: "This article is a summary of Liu Chunxiong's sharing at the 'Seven Major Communities Study Tour of IPES' on February 17, 2023. Although the content mainly uses the beer and baijiu industries as examples, it also provides reference value for the nationwide penetration of high-end and niche FMCG products. The article introduces the 'light model' and 'penetration warfare' as alternatives to traditional positional warfare, outlining a five-step approach for high-end product promotion."
author: "刘春雄"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2023-02-23"
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# Light Model: Penetration Tactics for Rapid Nationwide Expansion

> This article is a summary of Liu Chunxiong's sharing at the 'Seven Major Communities Study Tour of IPES' on February 17, 2023. Although the content mainly uses the beer and baijiu industries as examples, it also provides reference value for the nationwide penetration of high-end and niche FMCG products. The article introduces the 'light model' and 'penetration warfare' as alternatives to traditional positional warfare, outlining a five-step approach for high-end product promotion.

Editor's note: This article is a summary of Liu Chunxiong's sharing at the 'Seven Major Communities Study Tour of IPES' on February 17, 2023, organized by the author with additions and deletions. Although the content mainly uses the beer and baijiu industries as examples, it also provides reference value for the nationwide penetration of high-end and niche FMCG products.

**Positional Warfare vs. Penetration Warfare**
This is my first time sharing the topic of 'light model' in public. We all know that the leading brands in the beer industry were built through positional warfare (and of course brand warfare). Wherever the flag is planted, that is my market. Now the top five beer brands account for more than 92% of the national market share. As a new entrant, there is no hope in fighting positional warfare because the leading brands are too stable, and even mutual penetration among them is difficult. At the same time, we have noticed that some emerging companies have done well in recent years. Without spending much money or investing many people, they have actually gone nationwide and completed nationalization. Examples include Wusu Beer, Ubrew Craft Beer, Taishan Original Pulp, and Lidu Baijiu. Last June, Teacher Fang Gang and I stayed in Moganshan for a few days. Moganshan is the ceiling of domestic homestays, and we settled down here to discuss this phenomenon. The conclusion was to occupy the market through penetration tactics, no longer fighting positional warfare. Some of the above companies we are familiar with. Summarizing the operational rules of these brands, we gave it a name: **'Light Model, Nationalization.'** At the study tour site, Liu Xiubin, Chief Experience Officer of Lidu, said at the private board meeting that Lidu's first 100 million took 5 years, and from 100 million to 1 billion took 3 years. At the same time, it was found that the market outside the province grew faster than the provincial market. Why? 2020 and 2021 were the two years of major development outside the province for Lidu. It was not because Lidu invested many people or spent much money, but because Lidu's development was a 'light model.' The 'light' in the light model has three meanings: first, low spending; second, few personnel input. Of course, later market maintenance and operation personnel are not few, mainly referring to the few personnel invested in market expansion; third, fast speed. It didn't take much time. Ubrew's development was even faster. In 2018, it appeared in three events: 'New Distribution,' 'China Wine Industry Forum,' and 'New Marketing,' and then quickly exploded at the Spring Sugar Fair. Hundreds of distributors requested agency, catching them off guard. In recent years, due to the pandemic, supply has been unable to meet demand, and the number of specialty stores nationwide has exceeded 2,000. Light model, nationalization, and big growth. That is, quickly recruiting distributors and laying out the market without advertising investment, making high-quality, high-priced products go nationwide. In recent years, total sales of baijiu and beer have been declining. Companies adopting the light model are high-end products, even niche products, but they are growing rapidly. In recent years, many companies have encountered problems in launching new products and pushing high-end products, all using positional warfare methods, which is problematic. Penetration warfare is the main method for launching new and high-end products in the future. Mass products fight positional warfare, while high-end and niche products fight penetration warfare. Recent years are the critical turning point. After sales peak in various industries in 2023, whether to make high-end products will become a sign of whether manufacturers and distributors have a future. All industries are moving towards high-end, which is a major trend.

## **The Five Steps of the Light Model**
The light model for high-end products and penetration tactics have accumulated some experience. Can experience be elevated to methodology and form laws that can be replicated in more industries and companies? This was the core issue discussed by Teacher Fang Gang and me in Moganshan. Our conclusion is that some aspects of the light model and penetration tactics can be replicated, such as Lidu, Ubrew, and Taishan Original Pulp. Some are difficult to replicate, such as Wusu's approach, which has strong particularity. Teacher Fang Gang and I summarized the light model tactics into five steps, as follows: **High-end, ice-breaking product → B-end IP (engine) → experiential marketing → circle density → breaking the circle to become popular** These five steps are interlocking and progressive, with countless pitfalls at each step. But if done well, they indeed save people and money. Otherwise, it could not be called a light model. In the early days, these companies' light models were forced out because they really had no resources. Once methodology is formed and laws are found, the light model can be replicated.

## **High-end, Featured, Product Ice-breaking**
Why emphasize high-end products? Because mass products must emphasize high-density positional warfare. The reason high-end is high-end is that user density is not high, which meets the conditions for penetration warfare. Of course, high-end is also a trend. China Resources Beer achieved 'the fastest growth in history' during the three years of the pandemic, which was actually the growth of high-end products, with profits quadrupling in three years. High-end and ice-breaking are two concepts. High-end does not necessarily mean ice-breaking, and ice-breaking does not necessarily mean high-end. It is somewhat difficult to have both high-end and ice-breaking. High-end is easy to understand, but ice-breaking is not. Ice-breaking means quickly breaking the deadlock. Love at first sight, interest at first sight, and desire to try at first sight. For example, the product 'Lidu 1955' – the most expensive bottled liquor – has an ice-breaking effect. This is product concept ice-breaking. Later, Lidu's high-end products continued to climb, such as 'Lidu 1308' with a retail price over 2,000 yuan, and Lidu's 'Wanli Tiaoyi' priced at 9,999 yuan, both with ice-breaking effects. Ice-breaking is not just about price; it is a comprehensive effect.
Ubrew's 'Fresh Draft Flash Delivery' is indeed hard not to love at first sight. When Fresh Draft Flash Delivery was imitated by peers, it objectively played a 'lifting the sedan chair' role. A boss known for developing products praised it as a 'genius design' when he saw it. This shows how valuable ice-breaking is. Taishan Original Pulp's '7-Day Fresh' is also an ice-breaking product. From production, delivery, to various parts of the country, until consumption, it does not exceed 7 days, which is a great test of the supply chain. Special note: Ice-breaking products are not necessarily the best-selling products, but they are definitely the 'pioneering' products, the vanguard. Perhaps in the later stage, ice-breaking products may be marginalized, but in the light model, without ice-breaking products, marketing cannot be 'light.'

## **B-end IP is the Engine**
The concept of IP is familiar, but the IPs known to the public are all C-end IPs. The light model nationalization precisely leverages B-end IPs. What is a B-end IP? Experts are B-end IPs, media are B-end IPs, and bosses are B-end IPs. They naturally have IP characteristics, with fans being executives and experts. Take Lidu as an example. Lidu's scale has just exceeded 1 billion, but bosses of domestic companies with billions or tens of billions in scale come to Lidu to learn, some even sending four waves of people to study tours. A batch of bosses go to learn; they are not interested in the product at all, but in Lidu's 'immersive experience' model, and incidentally interested in the product. In recent years, immersive experience has spread across industries, and along the way, it has also spread the Lidu brand. When a leading company boss in an industry talks about immersive experience internally, the internal impact may be thousands of people, not to mention the distributors affected, which is even more. These bosses are the engines of B-end IPs. Our seven major communities have conducted study tours to these companies. The seven major communities cover new marketing, new distribution, new retail, deep fan marketing, circle marketing, new beer, etc., and are a cross-border combination of super B-end IPs. The participants in the study tours are basically media, experts, and company bosses, who are typical B-end IPs. C-end IPs are interested in products, while B-end IPs are interested in business models, and incidentally interested in products. This dual promotion method of business model and product is very effective. C-end IPs create trends, while B-end IPs form high-end, sustained attention. What is the value of B-end? **First, internal dissemination by bosses.** When bosses spread the business model, they inevitably use the brand as an example, influencing internal employees. **Second, expert dissemination.** Good cases are hard to find now, and past cases are outdated. Experts' lectures and books are super communication. **Third, media dissemination.** Industry media spread, penetrating an industry. Cross-industry media spread, forming a circle break. As will be mentioned later, breaking the circle to create trends requires cross-media communication. All B-end IP dissemination is the prelude to creating trends and the premise of penetration tactics. The primary result is that recruiting distributors becomes relatively easy, which is the premise for the light model to achieve nationalization. We say B-end IP is the engine from this perspective. Although Wusu Beer and Ubrew are both penetration tactics, there is a big difference between them. Wusu Beer is a C-end IP, while Ubrew is first a B-end IP and then becomes a C-end IP. The contrast is that not many people study Wusu, but many people study Ubrew. Whether B-end IP dissemination can lead to C-end dissemination depends on whether the product has C-end IP attributes.

## **Experiential Marketing**
The characteristic of penetration tactics is to first do point-like layout, then penetrate circles through experiential marketing. Take Lidu as an example. Lidu is immersive experience, and its organizational system is three-level experience: general helm, branch helm, and small helm. The headquarters does general helm experience, distributors do branch helm experience, and retailers do small helm experience. The three-level experience forms an experience funnel. The general helm has tens of thousands of people experiencing each year, meaning the branch helm has hundreds of thousands or millions of people participating in experience, and the small helm has millions or tens of millions of people participating. People experiencing at the branch helm are screened from the small helm, and people experiencing at the general helm are screened from the branch helm, forming an experience funnel. Experiential marketing is the main method for promoting high-end products, and experience has been accumulated, including three aspects: **First, 2C organization, reaching C-end (users) through b-end (retail end).** This is organizational support. 2C organizations, sometimes called flying teams or mobile teams, are different from deep distribution organizations (deep distribution is a 2B organization). **Second, scenario-based.** From past vividness to current scenario-based, scenario is the premise of experience. **Third, experience actions.** Some people call experience tasting, which is incorrect. The subject of tasting is the product, but in experiential marketing, the product is just one of the props in the scenario. Users gain not only product satisfaction but also scenario satisfaction. The above experiential marketing is called bC integration. First do offline bC integration, then incidentally complete online bC integration. bC integration is to operate the b-end (retail end) and C-end (user end) as a group of marketing objects. Reach C-end through b-end, and activate b-end through C-end. Experiential marketing has spread across industries and is particularly suitable for launching new products and high-end products.

## **Circle Density**
High-end products have circle characteristics. In the early stage, they may not be suitable for large-scale channel distribution, but they are particularly suitable for promotion around circles. Circle promotion uses connections and relationships as bonds, reducing cognitive costs through strong ties. This is a typical trinity of cognition, transaction, and relationship. However, connections are always limited. If the circle experience does not form sufficient density, the heat generated by B-end IPs will quickly dissipate. Therefore, circle density is very important. Without density, penetration tactics cannot take root. Experiential marketing must form a marketing model, and relying solely on b-end connections is not enough. A person can influence about 250 people. To form circle density, first, fully utilize personal first-level circles, and also need professional means to expand second-level circles; second, combine circles with channels. Circles are the expansion of points, taking root, but channels are lines or surfaces. From point to line or surface, there is both penetration and expansion. First-level circles form natural density, and the density formed by second-level circles far exceeds that of first-level circles. Penetrating second-level circles is one of the factors for cross-border trends.

## **Breaking the Circle to Become Popular**
Niche forms preferences, and mass forms trends. Trends are niche breaking the circle to become mass. Niche natural penetration relies on natural penetration power. Most trends are the result of natural penetration. In our experience, cross-border trends need to penetrate [1+3] industry circles in communication. The first circle is the industry circle. The industry circle is the hardest to penetrate in the early stage because insiders are either experts or connoisseurs, and the industry has strong resistance to experiential marketing. If the industry circle is thoroughly penetrated, and then three non-industry circles are penetrated, then at the consumption level, cross-coverage will form, and cross-coverage is also cross-validation of brand influence. As long as cross-coverage is formed, cross-border trends are not far away. The joint study tours of the seven major communities have been quite effective because the seven major communities themselves are cross-border.

## **Marketing Turning Point**
I have seen some future trends in recent marketing practices. There are three aspects: First, promoting high-end products is a trend. After all, sales have peaked, so we can only adjust the product structure. Second, the transformation from deep distribution to bC integration is a trend. Mass products are basically done when deeply distributed to the b-end. High-end products need to reach the C-end continuously, and bC integration must be a scenario-based experiential marketing model. Therefore, 2C organization, scenario-based, and experiential marketing become the three basic means of bC integration. Third, dual online and offline bC integration is a trend. Digitalization inevitably requires obtaining real-time C-end data, but traditional deep distribution can only reach the b-end, far from the C-end. This is a hard flaw in FMCG digitalization. With offline bC integration of high-end products, on the basis of already reaching the C-end, as long as the C-end is connected, it is easy to complete online bC integration.

Liu Chunxiong, advocate of new marketing, dean of the Marketing Digitalization Research Institute. Currently an associate professor at Zhengzhou University, author of the new marketing trilogy: 'New Marketing,' 'New Marketing 2.0: From Deep Distribution to Three-dimensional Connection,' and 'New Marketing 3.0: bC Integrated Digital Transformation.'


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