As 2019 draws to a close, it has become popular in recent years to use a single Chinese character to summarize the past year. Similarly, if we were to use one character to describe the entire instant noodle industry, none seems more fitting than "warm."

Affected by various macro and micro issues, especially the weakness of the entire FMCG industry, from 2013 to 2016, the instant noodle industry seemed to plunge into an ice cellar overnight. The internet was flooded with negative articles like "How long has it been since you last ate instant noodles?" and "American laboratory shows instant noodles take 31 days to digest," causing the industry, which had maintained growth for over 20 years, to face unprecedented difficulties.

Just when everyone was pessimistic about the instant noodle industry, thinking this behemoth would be replaced by food delivery and "disappear," it made a fierce comeback. From 2013 to 2016, it was "the north wind rolls the ground, breaking all grass," but starting in 2017, the instant noodle industry experienced "the spring breeze brings warmth to Tusu." By 2019, it could be described as "a riot of purple and red always feels like spring."

The instant noodle industry's counter-trend growth, despite the deep winter of the entire FMCG industry, brings us to Master Kong's contribution to the industry.

-01- Why Master Kong

The 21st century is the era of big data. We use numbers to predict the future and review the past. If numbers are poor, it means the company or industry made mistakes; if numbers are good, everything is praised. Numbers become "one beauty covers a hundred ugliness," and blindly pursuing numbers leads more and more companies to "explode."

Nothing happens "suddenly overnight"; it is more about the groundwork laid years ago. Just as we say Master Kong instant noodles now hold 46.6% of industry sales, it is merely the seeds planted over the years that have grown into towering "big numbers."

Looking back at Master Kong's success story, it is always highlighted how Wei Yingzhou, while developing the market, ate Taiwanese instant noodles on a green train, attracting the attention of the entire carriage. So he decided to enter the instant noodle industry, and success followed.

Success is never easy. In the late 1980s, the Chinese instant noodle market was diverse and competitive. Before Master Kong instant noodles were born, the Chinese market had Japanese instant noodles, Taiwanese instant noodles, and of course, more local instant noodles.

If Master Kong had simply introduced the Taiwanese instant noodles that smelled so good on the train, it would have been eliminated as a "middleman." Instead, Master Kong became the industry leader precisely because it planted a seed called "genuine ingredients" in consumers' minds.

A year after its founding, Master Kong launched Braised Beef Noodles at a price far higher than other instant noodles on the market. At that time, the best-selling instant noodles were just a noodle cake with some salt seasoning. But Master Kong's Braised Beef Noodles included not only a seasoning packet but also an oil packet and a vegetable packet, allowing consumers to truly eat a bowl of "beef noodles."

(Image: Early Master Kong Braised Beef Noodles packaging)

At that time, a bowl of Master Kong Braised Beef Noodles cost more than the beef noodles you could eat at a restaurant, so the initial promotion was difficult. However, Master Kong did not lower its product standards but instead catered to the mainstream consumer market.

It was this persistence that made consumers believe Master Kong represented "genuine ingredients." Later, when overall social consumption levels rose, this seed naturally thrived, helping the then-poor Master Kong defeat its competitors and become the industry leader.

This early success determined Master Kong's marketing strategy: "dig deep, plant seeds"! When it grows, it naturally yields different results.

In 2003, Master Kong assembled a research and development team of dozens of people to combine instant noodles with various Chinese regional cuisines, launching regional-flavored instant noodles. This "localization flavor strategy" allowed Master Kong to develop more than 200 products in terms of noodle flavors, accounting for about 25% of total sales.

Such innovative moves contributed greatly to Master Kong's early expansion, but when the industry's sales declined, they were questioned. Although Master Kong had many flavors, it never cultivated another hit like "Braised Beef Noodles" (which generates nearly 10 billion yuan in sales annually).

If we look only at sales figures, none of Master Kong's 200 regional flavors can compare to Braised Beef Noodles. However, with the arrival of new-era consumers, everyone is pursuing their own tastes. Especially with the popularity of programs like "A Bite of China" and "Life's a BBQ" that introduce regional cuisines, the post-90s and post-00s generations have discovered that different regions across the country "hide" different flavors, and even small skewers have local characteristics! Noodles, as the product with the most Chinese cultural characteristics, naturally have their own differences. There is always a flavor you haven't tried, and labels like novelty, challenge, and individuality provide the foundation for the growth of Master Kong's regional flavors.

So this seed was well planted, and the most obvious manifestation is that in recent years, Master Kong has not blindly pursued blooming everywhere. It can be understood that the development of multiple flavors is to meet the taste needs of consumers in different regions and to satisfy the individuality that young people like. Therefore, Master Kong's "localization flavor strategy" may not produce a hit with every product, but each one is more distinctive.

-02- Ingredient Upgrade

During the years when instant noodle sales were poor, especially when Master Kong's sales declined, critics would say that Master Kong's current situation was due to the failure of the ingredient upgrade. Of course, some Master Kong employees who supported the upgrade believed that the intention was good and that if persisted, it would succeed.

In fact, if we look only at immediate data, it is not outstanding, but in the long run, the ingredient upgrade has profound significance for Master Kong. The reason the upgrade did not achieve better sales "numbers" is precisely because the innovation was not thorough enough to attract consumers. In consumers' eyes, it was not a brand-new product, and they had no reason to buy.

Master Kong itself realized that to plant a seed, you must dig a deep hole; you cannot just leave the seed on the surface to make it look beautiful. Therefore, "innovation" must be genuinely innovative from the core, not just at the marketing level or through word games.

Now, some competitors are launching "more quantity at the same price" or "half a bag more," which seems to achieve some sales breakthroughs, but as an industry leader, Master Kong has not changed its consistent "dig deep, plant seeds" strategy for these "immediate numbers." After the ingredient upgrade, Master Kong buried the "innovation" seed deeper into the company's growth genes, and the market bloomed with more beautiful flowers.

-03- Innovation Returns

Here, the most important thing is to find the scenarios that consumers need at this stage, including eating scenarios and buying scenarios. Master Kong is no longer fixated on whether products are fried or non-fried, broth or non-broth, high or low price, or international or local flavors. If the product meets consumers' standards, they will naturally approve.

Summarizing Master Kong's performance throughout 2019, we see a confident and fearless Master Kong. It is this confidence and fearlessness that makes institutions like China International Capital Corporation optimistic about Master Kong's future prospects.

Master Kong's "confidence" and "warmth" in 2019 are the results of the "innovation" seed replanted after the ingredient upgrade. Let's see what Master Kong, with innovation returning, has done in recent years. This naturally involves the three driving forces of enterprise development: product, marketing, and channel.

Product is the foundation, marketing is brand power, and channel is business.

In terms of products, Master Kong has made comprehensive efforts across low, medium, and high-end segments. In the affordable range, there are Red Onion Pork Rib Noodles, Spicy Crayfish Crispy Noodles, and Korean-style Fire Chicken Noodles, all deeply loved by the public, and the regional-flavored Preserved Vegetable Stewed Noodles have also emerged. In the mid-range, since 2016, Master Kong has launched broth-type Black and White Pepper Noodles, Sour Soup Beef Noodles, Fresh Vegetable Noodles, etc., all achieving good results.

In the high-end segment, the launch of Master Kong's Express Noodle Restaurant immediately became a new internet sensation. Consumers sighed, "If I don't work hard, I can't even afford instant noodles," while placing orders and exclaiming, "So delicious!"

A bowl of 20-yuan "Express Noodle Restaurant" is a "high-end" noodle even in a restaurant, and few on food delivery platforms can rival it. But when you eat large chunks of meat, sip the rich broth, and taste the springy noodles, you feel the price matches the quality, just like when Braised Beef Noodles first came out 27 years ago—it was more expensive than the beef noodles made by restaurant chefs, yet people still felt that eating Master Kong Braised Beef Noodles was authentic.

The success of Express Noodle Restaurant is inseparable from Master Kong's marketing innovation. An important technical method is the aerospace RP technology, which was made possible by the cooperation foundation established between Master Kong and China Aerospace in 2017.

By becoming a partner of China's aerospace industry, on one hand, it conveys the spirit of China's aerospace to every young person; on the other hand, through aerospace science popularization activities, it educates consumers about the safety of instant noodles, especially Master Kong's own efforts in food safety. While planting the seed of "aerospace power" in young people's minds, it also leaves a deep impression that instant noodles are safe food. This is not only helpful for Master Kong but also an indelible contribution to the entire industry.

If Express Noodle Restaurant is just initial cooperation, more aerospace-technology instant foods will appear in the future. In August 2019, Master Kong, together with the Shenzhen Aerospace Science and Technology Research Institute, established the "Joint Laboratory for Aerospace Instant Food," bringing the dream of astronauts eating noodles in space closer and making instant noodles more technologically advanced.

In addition to aerospace, Master Kong has conveyed to consumers through collaborations with NBA stars and marathons that "instant noodles are nutritious, delicious, and safe products."

As the saying goes, "Food safety brings peace to the world," ensuring that every bowl of instant noodles you eat is safe, nutritious, and delicious is the effort of Master Kong people. Helping you correctly understand the instant noodle industry is the unshirkable responsibility of Master Kong as the industry leader.

In channel reform, people often talk about how other FMCG companies excel in using internet tools, but few mention Master Kong's successful cases. Recently, a netizen posted online the route visit form they drew when they worked at Master Kong, triggering a wave of collective memories.

As the earliest enterprise to implement visit route maps and the eight-step visit process, Master Kong has an incomparable advantage in channel control. Similarly, in the internet era, Master Kong is also top-notch in terminal machine system management. In 2016, Master Kong's "Shifu Tong APP" was already guiding salespeople in their work.

"Shifu Tong" as a data platform can provide distributors with real-time inventory management and terminal sales, allowing distributors to review their business, estimate expenses, predict sales, and clearly know their profits.

At the same time, it facilitates business workload; there is no need to use the original route visit maps. "Shifu Tong" plans all terminal routes and provides a real-time terminal ordering platform, saving distributor delivery time. Moreover, through "Shifu Tong," supervisors and salespeople can promptly identify their shortcomings and advantages in terminal image, display, barcodes, etc. These provide significant technical assistance for Master Kong's control of outlets in sinking channels.

Looking back at 2019, what is most commendable about Master Kong this year is that it cultivated confidence in the entire industry, allowing instant noodle practitioners to find their own breakout points rather than simply imitating or copying the industry leader.

"Plant a seed in spring, harvest ten thousand acres in autumn." Master Kong, relying on its two to three decades of "seed planting" experience, plants seeds of hope in consumers' hearts, then nourishes them through marketing and channels, waiting for them to grow into towering "big numbers."

This is a slow method, one that consumes time and energy, and it cannot tolerate any falsehood; otherwise, consumers will uproot your "seed." And such a slow method can only be achieved by an industry leader like Master Kong.

There is no peaceful time; as an industry leader, one is destined to carry a heavy burden...

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