"Master Kong's water sales have been recovering these past few months, especially the large bottles (large-capacity packaged drinking water), which are growing rapidly." Recently, while researching the beverage market, a reporter learned from a Master Kong beverage distributor that Master Kong packaged drinking water (hereinafter referred to as Kangshui) has seen continuous sales growth for several months, with particularly rapid growth in large-format products like 1L and 1.5L. After learning this, the reporter further inquired about Kangshui's current market situation from informed sources, who indicated that in recent months, Kangshui's market share has indeed been steadily increasing. It's worth noting that although Kangshui once held the top spot in the domestic packaged drinking water market, its performance declined in recent years, falling out of the top three in the industry. This led many to question whether Kangshui's 16-year-long affordable pricing strategy was a failure. Yet now it shows signs of recovery. What's the reason? -01- The 'Affordable Era' Arrives, and 'National Water' Gains Strategic Advantage Why choose Kangshui? "During the pandemic, for health reasons, my family started drinking packaged water exclusively. We're not too confident in tap water anymore. Master Kong's drinking water is affordable, and since it's a big brand, the quality is trustworthy," said Xiao Xu, a consumer from a county-level city. She added that her family now buys Master Kong's large-capacity packaged water for two reasons: health and affordability. Additionally, Xiao Xu did the math: her family of five has a monthly income of around 7,000 yuan, with over 2,000 yuan going to mortgage payments. For health, they need packaged water, but other brands are typically twice as expensive or more. If they chose other major brands, just the daily water cost for the family would be ten yuan, which is unrealistic. It's clear that due to the pandemic, declining purchasing power and increased health awareness are obvious trends. More people are now choosing packaged water. Data shows that among various beverages, packaged water is one of the fastest-growing categories during the pandemic, with the market expected to exceed 200 billion yuan this year. The decline in purchasing power has made consumers more rational in their product choices. Especially with affordable, quality products like Kangshui, consumers realize that in some consumer goods sectors, affordability can still mean good quality. Kangshui's recovery is precisely due to the trend of greater health awareness and consumers' pursuit of high cost-performance products. Let's look at some data: This year's Two Sessions report mentioned that China's per capita annual income is around 30,000 yuan, meaning an average monthly income of just over 2,000 yuan, with 600 million people earning only about 1,000 yuan per month. Moreover, China's modern family structure is also changing. Big data reports show that in 2019, China's single population reached 240 million, with over 77 million adults living alone. The National Bureau of Statistics and the Ministry of Civil Affairs estimate that the single rate in major cities exceeds 50%. 'Single-person households' place more emphasis on quality of life, but after paying rent, their disposable income is quite limited. So we see that most consumers, on one hand, value health and pursue quality life, but on the other hand, still need to consider whether prices are affordable. The 1L bottle priced at 1.5 yuan is very suitable for small families of 1-2 people. According to McKinsey's survey, in 2019, 59% of consumers wanted to increase savings and prepare for the future, even if they had money, they wouldn't spend recklessly; they preferred to spend on 'essentials' and wanted products with guaranteed quality and affordable prices. In 2017, this proportion was 52%. This explains why Kangshui's performance has been growing recently, because Kangshui's strategy of 'providing healthy, reassuring water that over a billion people can afford' aligns with the trend of affordable quality products, gaining a head start in this shift in consumer demand. It also makes one admire Master Kong's strategic steadfastness, selling a product at 16-year-old prices. It is this strategic steadfastness that has earned Master Kong the title of 'National Brand.' Data shows that in 2019, Master Kong's brand penetration reached 80.8%, reaching 850 million consumers annually; recently, it was selected as an excellent case in the UNDP China Corporate Sustainable Development Report, indicating that Master Kong's development model is recognized by the UN as one of the future trends. -02- Technology Builds Core Product Competitiveness Is Kangshui's recovery solely due to its price aligning with current trends? Of course not. What consumers truly pursue now is not just cheapness, but cost-performance, which is determined by both price and quality. Kangshui's ability to gain consumer recognition is also due to its continuously improving quality. It is understood that Kangshui products have received NSF International certification, and its 8-step filtration technology is patented nationally—using world-class RO (reverse osmosis) technology with precision up to 0.0001 microns, effectively blocking impurities and ensuring water safety and taste. Additionally, Master Kong promptly absorbs market feedback and makes changes to keep up with the times. For example, after consumers complained that the packaging was too soft and prone to spilling when opened, Kangshui upgraded and thickened the bottle, eliminating the original flaw while improving the product's visual appeal and grip—making the bottle clearer and more solid to hold. Advanced technology gives the product strong safety backing, maximizing consumer drinking health while also providing a sweet taste. So how does Kangshui keep its price so low despite such high quality? -03- Digitalization Helps Kangshui Outpace Costs Master Kong is recognized in the industry for its excellent cost control. What's its secret? It is understood that Master Kong controls costs through three main aspects: 1. Strong Digital Management As an established company, Master Kong has actually been investing in digitalization for years. Relying on a digital management system that penetrates every management level, Master Kong has strong control. Multiple departments use the system for precise production-sales coordination, even forecasting production scale for future periods, greatly avoiding waste in raw materials and transportation costs. From unified procurement of raw materials at the upstream of the supply chain to saving freight costs downstream, everything is tightly controlled through the system. By optimizing production processes to improve efficiency and countering cost increases, they ultimately outpace rising costs—something many companies cannot achieve. 2. High-Density Plant Construction to Compress Logistics Costs To control costs without compromising quality, Master Kong adopts a high-density plant construction model, shortening the distance from production to terminal and compressing logistics costs. To this end, Master Kong's water plants are spread across the country, and saving logistics costs has become an important way to control costs. 3. Intensive Channel Cultivation A distributor told reporters, "I believe Master Kong's sales network is the main reason for its market leadership." Master Kong's terminals and distributors cover the entire country, and managing such a vast channel network is undoubtedly a huge project. Again, it relies on digitalization. Through its digital system, Master Kong classifies channels and implements targeted sales policies based on different locations and operating conditions to support the development of different channels. The interests of distributors in various regions are protected, and cross-regional selling is avoided, keeping everything orderly. Technology is always the primary productive force. Through production technology improvements and digital management, Master Kong has achieved continuous quality upgrades and strict cost control, truly delivering quality products at affordable prices. With these three measures, Kangshui successfully outpaces costs, allowing it to adhere to its brand strategy of being an affordable 'national water.' -04- Champion Marketing + Strong Channel Power Drive Brand Development Kangshui, which has seen continuous growth against the trend, has partnered with Lang Ping, head coach of the Chinese women's volleyball team, who shares a similar 'fate' with Kangshui, as its spokesperson. Both once reached the top and won championships, both missed opportunities and fell behind competitors, and now both are achieving V-shaped reversals. Isn't this exactly what the Chinese women's volleyball team under Lang Ping has experienced? The stories of the two perfectly align, and this partnership has been praised by industry insiders. The marketing aligned with the spirit of the women's volleyball team has brought Kangshui a new image in consumers' minds and brought it back into the spotlight. Besides outstanding communication, another factor driving Kangshui's brand development this round is its strong channel power. Kangshui distributor Mr. Wang told reporters: "Although Kangshui's retail price is much lower than competitors, they actually control costs well, giving distributors a higher overall profit margin than those '2-yuan waters.' Moreover, Master Kong's brand power is still there, and terminals recognize it, so we distributors are willing to do it." This undoubtedly makes Kangshui's channel power stronger than some competitors. Additionally, Mr. Wang mentioned that thanks to the manufacturer's investment, Kangshui has secured good shelf positions in many supermarkets. It's well known that in supermarkets, location largely determines product sales. Kangshui not only competes with competitors' products of the same specification but also places large-capacity formats in advantageous positions, making it easy for consumers to compare products, which highlights Kangshui's outstanding cost-performance. In summary, Kangshui, whether in product quality, pricing steadfastness, or the marketing strategy of partnering with Lang Ping, brings new insights to the industry. Moreover, its concessions to distributors add fuel to its channel power. Facing the trend of health and affordability in consumer goods, Kangshui, with its strong quality control, cost management, and marketing innovation, upholds its strategy and original mission of 'providing healthy, reassuring water that over a billion people can afford.' Given the current situation, where the pandemic cannot be completely eliminated in the short term and the international situation is difficult, can Kangshui seize this opportunity to successfully turn the tide and return to the top? Let's wait and see. Tips will be paid 400-2000 yuan once adopted.