Xiangpiaopiao, which paid tens of millions in consulting fees, defeated its competitors in the past but now faces growth difficulties. A brand that should have become the absolute king of milk tea should not have blindly followed the consultant's advice to 'occupy the leadership position in cup milk tea,' grabbing a crooked tree while missing the vast forest. This article uses Xiangpiaopiao's rise and subsequent difficulties as a case study to deeply reflect on two major flaws in marketing:
1. There is no eternal mindshare. Consumer perceptions, values, and needs evolve with the times.
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2. Instead of defeating competitors, it's better to manage demand. Companies that focus on rivals may win battles but often lose to the times. -01-
What's more terrifying than innovation is Chinese entrepreneurs' blind obedience to positioning
Why are many traditional giants declining while 'internet-famous brands' like Three Squirrels, Dyson, Heytea, Jane, Wang Congcong, and Genki Forest growing rapidly? Competitors are not scary; what's scary is ignoring the changes in trends. Marketing is about striving to keep pace with the times. This is a parallel line that never intersects; some win at the start but die along the way, some intercept and shine for a while, and some continuously adapt to trends and self-innovate, both outrunning rivals and becoming evergreens. Only companies that firmly grasp trends exist; no brand dominates the times. As early as 2015, Xiangpiaopiao sensed a crisis and realized the urgent need for transformation, but it wasn't until 2017 that it officially entered liquid milk tea. However, this piece of the pie was already claimed by comprehensive beverage giants like Uni-President and Master Kong. Xiangpiaopiao, which believed in positioning and ignored trends, got up early but arrived late. It paid nearly tens of millions in consulting fees to two positioning companies, including four consecutive years for 'leader' and one year for 'Xiangpiaopiao for minor hunger and fatigue,' spending lavishly on positioning. Under the premise of a single product, it also invested a cumulative total of nearly billions in advertising for these two positions. Xiangpiaopiao's net profit over the years ranged from 100 to 300 million yuan, with advertising expenses far exceeding net profit. The company mechanically understood focus, adhering to the positioning company's advice that 'multi-category development has a seesaw effect and will dilute the mindshare of the cup milk tea pioneer.' Xiangpiaopiao's persistence did reach the market peak, but with seasonal limitations, consumption methods, consumer demand, health awareness, and the rise of multi-dimensional competitors, it soon hit the category ceiling. Even later, when it sought another positioning company to reposition as 'Xiangpiaopiao for minor fatigue and hunger,' it failed to achieve significant growth; instead, after heavy promotional spending, it overexerted and incurred losses. Positioning theory is the theory that has helped the most companies succeed to date; the theory and methods are not flawed. The problem lies in certain consulting companies deliberately overemphasizing the importance of 'mindshare' and overgeneralizing! This leads many companies that pay for it to believe that capturing mindshare means capturing the future. Mindshare is important, but superstitious belief in it will inevitably lead companies to adopt a 'carving a mark on the boat to find a lost sword' (rigid, outdated) way of thinking. The times are advancing, and society is progressing. The first strategic high ground for brand marketing is not to manage a mindshare position; the ultimate goal should be to manage a demand! Because consumer mindshare, consumption values, and needs change with social progress. Nokia phones didn't survive to today not because they lacked a place in mindshare, but because they couldn't adapt to trend changes in terms of demand. Every era's category has special opportunities in demand. In a sense, Xiangpiaopiao only used five actions to seize demand in that special era. -02-
Water Can Carry a Boat: The Five Strategic Actions Behind Xiangpiaopiao's Rapid Rise
Marketing is not about creating something from nothing, nor is it about doing things out of thin air. It's about manipulating and utilizing the era's trend-driven demands, user pain points, competitive flaws, value perceptions, and information gaps, then refining, summarizing, and organizing them so that consumers feel your brand is the best choice to meet their needs. The first thought is whether the 'paper cup + tea powder' format can capture the momentum of the times and grow into a future strong single product. Because not every new product has the chance to become a big brand; some products seem promising but are merely declining niche products that leading brands don't want to touch, only following fleeting fashion, with short lifespans, like the once-popular hula hoop. But some new products hide trend-driven consumption momentum, driven by social factors and consumer demand, and can grow rapidly, such as foods that align with health, organic, low-fat, and low-sugar trends. To argue whether the 'paper cup + tea powder' new product has the potential to become a trend-driven strategic single product, we must analyze from the perspectives of social development, human nature, demand, and competition.
1. The Source of Category Opportunity Momentum: Discovering Opportunities from the Milk Tea Queue Phenomenon
From phenomenon to essence, judge the source of momentum: Starting around 2000, with China's successful entry into the WTO, milk tea shops from Taiwan and Hong Kong gradually appeared on city streets. Through the guidance of fashionable commercial districts, milk tea gradually became a trendy drink pursued by teenagers. Customers had already widely accepted this new form of beverage. The essence of how people accept information is to use familiar things from memory as references; if a new thing has attributes and value associations in memory that are familiar or perceived as familiar, consumption behavior can occur. This shows that the demand prototype for 'cup + milk tea powder' is the 'street-side milk tea shop.' The rise of the milk tea trend, with milk tea shops playing a key pioneering role, means consumers won't feel unfamiliar or reject cup milk tea. Finding the source of category momentum is like finding the headwaters of demand. But whether a new product can successfully draw from the large water source depends on whether its 'differentiated value' can effectively carry the trend-driven demand! Especially, it's important to study whether the 'parent category' has significant shortcomings. A meticulous study is needed on whether 'milk tea + paper cup' can capture the differentiated value of trend-driven key demands.
2. Key Pain Point Dimension: Convenience is a Low-Ignition-Point Demand
Wherever there's a long queue, there's a supply-demand imbalance, and there's an opportunity to quickly capture the market by solving the key pain point. After 2-3 years of development, milk tea was mainly sold in shops in female-oriented shopping centers. A storefront with three or four employees would prepare drinks on the spot. But schools and residential areas away from shopping centers couldn't conveniently buy milk tea nearby. Many middle and high school students, and young men and women, had to take transportation to shopping centers to buy it. From 2003 to 2004, milk tea shops expanded slowly, and many stores experienced several queue peaks daily, making a fortune. On one hand, there was a rapidly expanding consumer base; on the other, milk tea shops grew slowly. When the supply side of a trend-driven large demand cannot fully meet demand, market hunger will form enormous consumption momentum in the short term. Milk tea development spread like wildfire, but shopping center milk tea shops expanded slowly due to scarce store resources, high investment costs, and geographical limitations. Obviously, the 'convenience' of milk tea became the 'low-ignition-point demand' in the milk tea industry in 2005 that was easy to ignite; solving the key pain point made demand easy to trigger. After demonstrating the 'trend-driven low-ignition-point demand,' it doesn't mean the single product will definitely succeed. Finding a real and feasible differentiated demand isn't enough; the market must have a certain scale. Therefore, only by finding a consumer group highly matched with 'convenient cup milk tea' can market value find an outlet. Ensure that future milk tea has lasting and stable vitality in competition with various beverages, avoiding being vulgarized or trendified.
3. Competition Dimension: Discovering Price Gaps
Having demand doesn't mean capturing the market; brands must consider from a competitive dimension whether there's a market opportunity. Has it been fully satisfied by competitors? What are the competitors' unassailable strategic weaknesses? Looking at the market at that time, no competitor had developed similar products; all competition came from milk tea shops. At that time, milk tea shops not only hadn't developed cup formats, but their store numbers weren't saturated either. Therefore, all competition focused on price. After months of observing milk tea shops in commercial centers, it was found that in an era when the average monthly wage was generally less than 1,000 yuan, milk tea at 5-8 yuan per cup was indeed a bit luxurious. If the price were halved from the high end, it could capture a larger consumer base. For the company, such a pricing strategy not only maintained profit margins but also boosted terminal sales enthusiasm. The industrially produced 'cup + tea powder' format provided purchase channels and the convenience of drink-and-throw-away, reducing the travel cost to shopping centers and the time cost of queuing, plus the halved pricing, could deliver a dimensionality-reduction strike on milk tea shops and ignite the market. Finally, a price of 3.5 yuan was set to cut into the 5-8 yuan price gap of milk tea shops, highlighting the advantages of industrial mass production. In subsequent competition, Youlemei and Xiangyue priced lower than Xiangpiaopiao, but Xiangpiaopiao fully leveraged the leader's pricing power. The pricing at that time was similar to Lao Gan Ma's, cutting off the path for latecomers. However, this price has remained unchanged for over a decade, becoming a major obstacle to Xiangpiaopiao's development—but that's a later story.
4. Key Audience: A Huge Inflammable Population Exists
'Cars need fuel, I need Red Bull' once became a boast among drivers, spreading casually among them. With economic development, private cars gradually entered ordinary households, and Red Bull went from the wealthy who could afford cars to the general public. 'Easiest to accept' and 'rigid demand' are the two criteria for selecting the inflammable population. Who were the first core consumers of cup milk tea? Is 'convenience' truly the 'rigid demand' they care about? Why are they the easiest to accept? Observation of the main consumer group at milk tea shops revealed that teenagers aged 13-18 were the main consumers. Students are more likely to accept trendy drinks than other groups; the campus culture of conspicuous consumption and social gifting means new products can ignite demand in a very short time, and the high purchase cost leaves significant room for adjustment. Therefore, middle and high school students are the most likely rigid-demand mainstream group for cup milk tea. Halving the price from the high end of 5-8 yuan, pricing at 2.5-3.5 yuan per cup, captured the mainstream consumers with limited budgets. For the company, this pricing strategy was already a premium strategy with good profit margins, which could in turn boost terminal sales enthusiasm and drive sales. Using campus stores and convenience stores around schools as the main promotional channels, gradually expanding to other groups. Having found tens of millions of young men and women most susceptible to trends in China, there's no fear that the differentiated value won't be safely converted. Therefore, the judgment was: Using convenience and halved prices to target the market's pent-up hunger demand would create enormous appeal and ignite the market. 5. Launching the Strategic Single Product: Cup Milk Tea Xiangpiaopiao Through systematic and in-depth analysis in the early stage, it was clear: Xiangpiaopiao should become the first brand to 'create cup milk tea' in the market. By occupying the essential attribute of cup milk tea—'fragrance'—and leveraging the pioneering education of street-side milk tea shops, Xiangpiaopiao used mindshare to drive the development and growth of the cup milk tea category. Xiangpiaopiao became the category leader in the development of cup milk tea. Now, we see many products like grains, soy milk, milk, and fruits put into paper cups, but these bizarre mixtures don't leverage mindshare at all, and customers' minds find it hard to accept new, different 'milk teas'; those who follow this path have no possibility of breakthrough. Xiangpiaopiao was the first to use industrial production, with advantages of safety, health, and convenience, giving it ample reason to capture the mainstream market beyond street-side milk tea shops. From the first year of the single product's implementation, sales broke through the 100 million yuan mark, and the milk tea storm quickly swept from campuses to larger consumer groups. By 2010, Xiangpiaopiao had become the de facto leader. The root of Xiangpiaopiao's success was reaping the category dividend from the milk tea craze of that era. However, there are no lasting dividends, only constantly changing social trends. Companies must remain vigilant to external changes and adapt to the times to ensure that the single product doesn't become a flash in the pan. Success is a double-edged sword; Xiangpiaopiao, which succeeded by leveraging trends, forgot its origins and walked down a path of blindly following 'positioning,' planting a seed of hidden danger as early as 2010. -03-
It Can Also Overturn the Boat: Stubbornly Defending Cup Milk Tea, Ignoring Market Upheaval
In 2010, the milk tea market reached an unprecedented peak, and major food manufacturers across the country smelled the business opportunity and joined the fray to divide the milk tea market. The surface bustle couldn't hide the fundamental flaws of the milk tea category. Those who don't plan for the future will have immediate worries. The essence of milk tea as a leisure drink determines the market size. The milk tea craze originated in the early days of China's WTO entry, when people had great enthusiasm for all foreign trends. With the rapid improvement of social economy, information, and culture, all impulse items will eventually return to the origin of rational consumption. Starting in 2010, the media began to repeatedly question the nutritional value and safety of milk tea. Media skepticism fully exposed the shortcomings of the milk tea consumption craze; it is ultimately a flavored beverage. Insight into the essence of flavored beverages revealed that 'cup milk tea' had huge strategic hidden dangers: The seemingly hot milk tea market competition was just simple, crude price wars, channel wars, and advertising wars; no company fundamentally enhanced the consumption value of milk tea. In layman's terms, milk tea demand was stimulated by fashion trends, without the rational consumption value that Red Bull promoted by starting with drivers and advocating 'cars need fuel, I need Red Bull.' For FMCG products that value practical value, this is like a tree without roots; the surface lushness can't hide the crisis at the root. Flavored beverages still have a huge market space. Xiangpiaopiao should have 'seized the first brand of milk tea' rather than 'the leader of cup milk tea,' using the brand's strong momentum to monopolize the category, then gradually enhance category value, expand product lines, and develop multi-dimensionally online and offline, to achieve long-term brand stability and growth. At this stage, stubbornly defending the 'cup milk tea pioneer' positioning was a strategic error of premature segmentation. Later, it adopted the advice of a domestic positioning consulting company to 'stubbornly defend cup milk tea,' launching a so-called 'leader' advertising campaign on CCTV and national satellite channels for three consecutive years. Once the root of disaster is planted, it's hard to pull out. Like any FMCG category, milk tea will face constant tests of trends. While growing, Xiangpiaopiao inevitably faced the tests of the times; every step on this thorny path could sting. Today's problems for Xiangpiaopiao are not the result of a single day's frost.
1. Stubbornly Defending 'Cup Milk Tea,' Premature Segmentation, Missing Development Opportunities
From 2009 to 2016, Xiangpiaopiao conducted seven years of 'cup milk tea pioneer' brand communication, from initially claiming 'pioneer' to later 'leader.' Seven years of persistence did defeat strong market followers like Xiangyue and Youlemei. This simple, crude defensive war, on one hand, built an unbreakable moat for Xiangpiaopiao, but on the other hand, dug a chasm disconnected from the needs of the times; persistence meant abandonment. Any brand that first enters the customer's mind is naturally seen as the category's synonym. In the early stages of milk tea's fast-consumption, brand competition within the category wasn't yet fierce. During the window period of the milk tea market, prematurely fixing on the 'cup milk tea pioneer' positioning meant giving up opportunities for diversified development of other milk tea subcategories. Before 2014, all milk tea brands only provided 'convenience' to consumers, far from encountering the development bottlenecks of quality upgrades and multi-category expansion. At that time, Xiangpiaopiao should have taken the lead in launching PET bottled milk tea, laying out offline milk tea shops, and using the brand's strong momentum to monopolize the category, building its own 'milk tea kingdom.' The erroneous strategy of premature segmentation wasted production resources, channel resources, and customer mindshare resources. In 2010, Uni-President first entered the milk tea industry, launching the PET bottled milk tea brand 'Assam.' From 2012 to 2015, Assam milk tea captured a market size no less than Xiangpiaopiao's. This fruit that Xiangpiaopiao could have easily picked was effortlessly taken by others.
2. Failure to Upgrade Milk Tea Quality in Time; Single Product Price Only Increased by 2 Yuan in 13 Years
Starting in 2013, the milk tea market began to flourish: countless new categories like additive-free milk tea, fruit-flavored milk tea, coffee milk tea, and whipped milk began to challenge people's consumption habits of 'tea powder + cup = instant hot drink,' gradually moving toward healthier directions in packaging, flavors, raw materials, and preparation methods. At this time, Xiangpiaopiao was still focused on defending against other cup milk tea competitors, ignoring the trend of consumers pursuing higher quality. Since pioneering milk tea, Xiangpiaopiao has rarely made eye-catching moves in products; flavors and packaging remain as they were in the early years, and prices haven't improved either—after 13 years, the average increase is only 1-2 yuan. The early price advantage had long become a stumbling block to brand development. Meanwhile, milk tea shops had already raised single-cup prices to over 30 yuan, and other forms of milk tea FMCG brands reached unit prices of over 10 yuan.
3. Late Liquid Milk Tea Layout and the Wrong 'Minor Hunger and Fatigue'
As early as 2012, Xiangpiaopiao had become the milk tea leader from both mindshare and factual perspectives. Before it could enjoy the fruits of victory, its revenue growth began to slow. In 2014 and 2015, it even saw negative growth. When it went back to seek advice from a positioning consulting company, the answer was still 'leader.' Having hit the ceiling, Xiangpiaopiao realized that 'leader' alone couldn't solve the problem; from the frequent sluggish sales, it recognized that overly single product lines could no longer meet current customer needs. In 2016, it switched to another positioning consulting company to reposition milk tea, but 'Xiangpiaopiao for minor fatigue and hunger' was like the moon in water or a flower in a mirror. This plan, which seemed to cut into the snack and energy drink market, was eye-catching, but it was a superficial change that, besides violating people's perception and consumption habits of milk tea, didn't grasp the pulse of the times' needs. The later launches of 'MECO' milk tea and 'Lan Fong Yuen' silk stocking milk tea in bottled liquid form also received lukewarm market responses. At this point, consumer demand for milk tea had changed dramatically; people were no longer satisfied with Xiangpiaopiao's 1.0 version of milk tea. Or rather, with the joint efforts of milk tea shops and other competitors, consumers had already repositioned Xiangpiaopiao as 'outdated milk tea.' Traditional milk tea and bottled liquid milk tea had entered a decline phase. Xiangpiaopiao not only missed the best time to enter liquid milk tea but also heavily invested resources to promote the 'minor fatigue and hunger' positioning, which deepened consumers' impression of Xiangpiaopiao as 'outdated milk tea.' After adjusting its advertising strategy, the market growth momentum didn't last long before declining. The biggest crisis came from cross-industry disruption.
4. The Rise of Food Delivery: Perhaps the Last Straw for Xiangpiaopiao
From the initial 'tea powder brewing' to the new format of 'fresh milk + tea + fruit made on-site,' today's format is no longer like the old days. In today's decentralized world, fresh tea shops are everywhere from cities to towns. Xiangpiaopiao's tea powder + cup no longer meets consumer needs. For example, how can a black-and-white TV compete with an LCD TV? In the mobile internet era, as the post-90s and post-00s generations became the main consumers, food delivery platforms with a youthful aura began to rise. The popularity of food delivery provided convenient, fast, and diverse delicious beverages. It saved tea shops from cities to towns, solving the last-mile problem to consumers, which undoubtedly poured salt on the wound of the aging Xiangpiaopiao. Xiangpiaopiao's competitors changed from 'Youlemei and others' to street-side Nayuki and Heytea, as well as Meituan and Ele.me running errands for customers. This is the key to competition; Xiangpiaopiao, which blindly trusted positioning consulting companies, didn't even find the consumption pain points under social trends and changes. It beat its rivals but lost to the times. Like Kodak, which positioned itself only as film, when photography went digital, the century-old Kodak couldn't escape bankruptcy. Positioning is just a tool for companies to achieve stage goals, not something to stubbornly defend. A loss may turn out to be a gain; who knows? Today's Xiangpiaopiao is a bit like a large ship with a dazzling exterior but a leaking bottom. Because 'loving the new and hating the old, pursuing better' is a consumption instinct, and old and new momentum can switch at any time; becoming a leader doesn't mean you can occupy the future. Mobile has been around for years, but later it was discovered that its real competitor wasn't Unicom but Tencent; Kodak monopolized global film and was complacent, but the advent of digital cameras brought it down overnight; instant noodles are becoming more refined, with various sizes, dry-mixed, boiled, and countless flavors, and they've enlisted well-regarded celebrity endorsements, but they still can't reverse the decline. When the times abandon you, they don't even say goodbye. In Xige's view, Xiangpiaopiao was harmed by rigid, 'carving a mark on the boat' thinking. Only by being prepared for danger in times of peace can one go further. In the Zuo Zhuan, Duke Xiang, 11th year, there's a saying: 'Be prepared for danger in times of peace; thinking about danger leads to preparation, and preparation leads to safety.' Whether for companies or individuals, being prepared for the future prevents panic and vulnerability when disaster strikes. You never know who will kill you; all you can do is make yourself strong, stay vigilant, and plan ahead before disaster. We live in a constantly changing business environment.
No business model is permanent;
No competitive advantage is eternal;
No brand can forever satisfy customer needs.
Mindshare is not static; holding a position doesn't guarantee long-term stability.
The most terrifying thing is not visible competitors, but invisible ones. Anything can be dismantled, anything can be recombined; we need to believe that impossible things can happen. The most important core ability of a corporate helmsman is to capture social trends in difficult times, and when reaping rewards, not to look up at the sky but to look down at the road. Adapt to the changes of the times, like Coca-Cola, which has undergone multiple transformations to become the world's number one beverage, adjusting its sails as the wind blows. -04-
Reflection: Occupying Mindshare vs. Managing Demand
Success has no end; any category is either on the path to continued success or to elimination. Companies need to reflect that after becoming a leader, products and services must evolve with the needs of the times. First, mindshare is not static; mindshare is not a moat for brand management. It is just one of the tools that, within a certain period, helps companies defeat peers when meeting a specific demand. The emergence of the internet not only broke down channel hierarchies but also information barriers, accelerating the overall shift in society from consumption views, values, mindshare, to demand. 'Pioneer,' 'expert,' 'leader,' and 'higher-end' are not panaceas for occupying mindshare; mindshare is just a constantly changing consumption consensus. Modern enterprises must pay attention to both cognition and trend-driven changes in demand in marketing. Because demand is infinitely upgrading; in the face of demand changes, the importance of mindshare is insignificant. Walnut milk is just one beverage solution under the 'brain health' demand; consumers will never stop at 'beverage' as the solution for brain health. Cup milk tea was just a solution under the conditions of high prices and insufficient convenience at milk tea shops, which is why fresh, healthy, made-to-order chain brands like Heytea emerged. Wanglaoji herbal tea is also one solution for preventing heatiness through beverages, but 'preventing heatiness' has second, third, and even Nth alternative solutions, just no representative category or brand to explore them. Managing demand is the strategic high ground for brand and corporate longevity, far more reliable than 'occupying mindshare' ; it can win development opportunities and yield rich profits. Cognition changes, demand changes, values change; companies need to constantly stand from the consumer's perspective and observe multi-dimensionally whether their solution can become the customer's first choice in the next 5-10 years, rather than just focusing on existing competitors. Source: Xige Talks Marketing (ID: yangshuangxi2015) Tips will be paid 400-2000 yuan once adopted.