---
title: "New Brands: Born Online, Built by Capital, Stuck Offline, at Risk in Street Fights"
description: "New consumer brands often start online, grow with capital, but face challenges offline where street-level competition determines success. The article discusses the lifecycle of these brands, the importance of distribution channels, and the need to master offline tactics to become giants."
author: "方刚"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2021-12-09"
language: "en"
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# New Brands: Born Online, Built by Capital, Stuck Offline, at Risk in Street Fights

> New consumer brands often start online, grow with capital, but face challenges offline where street-level competition determines success. The article discusses the lifecycle of these brands, the importance of distribution channels, and the need to master offline tactics to become giants.

Source: New Beer (ID: newbeer_BJ) Author: Fang Gang
******On the topic of new consumer brands**
A few days ago, I posted on my Moments: **"The fate of new consumer brands: born online, built by capital, stuck offline, at risk in street fights!"** This sparked many reactions and discussions.
Last night, I shared several articles about new consumer brands in the New Beer group, including the FMCG article "Price 'Tricks' Generate 1 Billion Incremental Growth, One Move by a Certain Brand Surpasses a New Consumer Brand."
A few days ago, Ms. Lu Xiuqiong, Global Expert Partner at Bain & Company and former CMO of Coca-Cola, gave two consecutive lectures at Chaos Academy: "The Fate of New Consumer Brands: Stuck Offline, at Risk in Street Fights?" and "New Consumer Cultivation: Growth Through Cycles." In these, she dissected the growth cycle of new consumption with great insight.
Double 11 has passed. Although transaction volumes hit new highs, the buzz seems lower; fewer people are screaming about cutting off their hands. Add to that Li Ziqi's hiatus and the investigation into top livestream influencer data companies...
**Online concepts suddenly plummet like birds startled by a bow, and offline seems to have become the eye-catching topic again.** But new consumer brands born online often find themselves at a loss when facing the complex terrain and vast landscapes of offline.
**Online winds are strong, but the offline road is long; rise with the wind online, but succeed on the ground offline!**
******On the capital track**
To clarify the simple issue of the capital track and new consumption, it seems a bit complex. So, let's start with F2C, which capital loves most.
F2C stands for Factory to Customer, an e-commerce model from manufacturer to consumer. Sometimes written as F to C, but for simplicity, the homophone F2C (2 for to) is used. Representative cases: Taobao brands, Xiaomi, Apple...
**F2B2C**: F-factory (production), B-business (merchant), C-customer (consumer). Factory-merchant-consumer.
There are several variations here: The F end (factory/production/supply chain) can have its own factory (e.g., Jiangxiaobai) or a virtual factory (also called OEM), such as Apple, Xiaomi, Coca-Cola, Nike. Some brands use a combination of self-built and virtual supply chains.
**The B end (merchant) also has several definitions**: In offline language, there are many terms: distributor, agent, channel... The term that aligns online and offline is probably distribution channel.
F2B in online language is online distribution; in offline language, it's wholesale. Manufacturer management reaches B and stops, losing contact with C. This creates digital opportunities.
The C end is like a mine or energy source for enterprises, the ultimate goal of marketing. **When a company can fully capture sufficient consumer transaction behavior, it basically gains a God's-eye view, and after quantifying demand, it can achieve precise R&D.**
Of course, the C part can also be broken down into elements like big C, such as KOL, KOC, etc. In offline language, these are consumer representatives, opinion leaders, etc.
****F2B2b2C**: This is the online language expression of deep distribution. 'b' means small merchants, which in offline language are terminals, points of sale... In this model, unlike F2B2C, the manufacturer moves its organization and tentacles forward, controls B's food chain 'b', thereby gaining voice and management rights over B, facilitating employee-like and organized management of B.
In the F2B2b2C model, the b module can be self-built or distribution-based. Self-built means self-owned terminals, such as Liangpin Shop, Zhou Hei Ya, Helens, milk tea shops, etc. The difference lies in whether they are direct-operated, franchised, or a mix.
**The core is in the transaction system's setup and coverage: some are centralized data transaction systems**, like Helens, where store and consumer transactions are digitized, achieving BC data integration; **others are distributed or even loose**: capturing Bb transaction data (or partial data), with C-end transactions offline, disconnected or semi-disconnected.
In the self-built model, there was a once-hot concept "new retail," which essentially means digitizing offline terminal transactions. Currently, almost every category has "new retail" brands: tea drinks, snacks, fruits, hotpot ingredients, beer, baijiu, baking, ingredients, catering...
**Apart from self-built terminals, the rest of the F2B2b2C model is the distribution model, which uses distribution channels for intensive terminal coverage.**
This model tests two basic skills: **distribution capability and sell-through capability**. These two are like a happy couple entangled in disputes, often blaming each other: distribution complains about poor sell-through, sell-through blames distribution...
The distribution module is currently a piece of Tang monk meat; F2C is eating it, F2B2C is nibbling at it, and new retail brands are directly cutting it vertically...
******On the battlefield of new consumer brands**
New consumer products are mostly born and incubated online. Besides data bubbles, upfront capital investment, and strategic losses that create artificial growth, a key factor is that online and offline have different geographical characteristics:
**1. Wide open view, little resistance, press the accelerator and run!** This is the biggest feature online. No boundaries, small online ponds, few rivers and lakes. Many new consumer brands use platform C-end data as a "God's-eye view," plus capital's divine boost, starting from a high vantage point, often advancing a thousand miles a day. In just one or two years, they can achieve what offline brands take decades or even centuries to master.
**2. Offline has limited visibility, complex terrain, and pressing the accelerator doesn't guarantee speed!** This is the essence of the offline market.
There are boundaries, mountains, and rivers... This roughly consists of B and b. The God's-eye view is shattered by boundaries, mountains, and countless B and b like grass. No maps, no directions, no marking of competitor firepower, no records of mountains and rivers... A phoenix landing on the ground is worse than a chicken; that's probably the truth.
**3. Online is an incubator, offline is a chicken farm!** Squirrel Dad's brand 0-1, 1-10 evolution theory basically explains this: sow online, harvest offline! The worst are those who sow all their lives but never harvest, or those who put chicks directly into the offline chicken farm to compete with big chickens for food and muscle...
Zhang Liaoyuan believes that Three Squirrels achieved the 0-1 breakthrough online, then crossed 1-10 through offline distribution.
In his view, offline enterprises find it hard to go from 0 to 1, needing to consider category, form a brand, enter a channel, and fumble for years, but replicating 1-10 is easier. Online is the opposite: because of the unity of marketplace and media, 0-1 is easy, but 1-10 replication is hard, so they need to go offline.
"Three Squirrels relied on traffic dividends to reach 10 billion in scale. Brands like Genki Forest rose through omnimedia models, and in the future, they all need to go offline." He also reflected that the logic of offline direct-operated stores is wrong.
**New consumer products hatched online have been over-indoctrinated by disintermediation like F2C and D2C, with almost zero understanding of B and b. Online, you rely on wings; offline, you rely on legs. The evolution of amphibians doesn't happen in a day; it requires solidification of organizational functions and proficiency in operational skills!**
Offline is vast, and the rivers and lakes are deep. China has about 300 "cities," 2,856 "counties," 41,658 "townships," and 662,238 "villages."
**1. How many terminals are in these cities, counties, townships, and villages? Store names, addresses, phone numbers, owner names? What brands (categories) are sold in the terminals?...**
**2. Who bought which brand, at what time, for how much?**
**3. Who delivers the brands in the stores?**
**4. What are the sales patterns and seasonal distribution of brands (categories) in each store?**
**5. How long does each product stay (in and out) in the store (channel)?**
This is roughly the battlefield, and street fighting is the ultimate means to decide victory or defeat! Even the U.S., despite technological superiority in the Korean War, Vietnam War, Iraq War, and Afghanistan War, failed in street fights...
****Not all new consumer brands will fail to break through offline or fight street battles.** Those who can build an iron army in the deep distribution system, fight for every inch of ground offline, and navigate street fights with ease have already surpassed new consumer brands and transformed into giant-level brands! New marketing expert and Chairman of Liangjian Consulting, Mr. Niu Enkun, said that in two decades in the liquor industry, I only remember three brands with the best offline operations: Yanghe, Jiangxiaobai, and Jingjiu.
The other two are already old consumer brands and giants; only Jiangxiaobai is just ten years old!
For a 30-year offline marketing practitioner, seeing one spot reveals the whole picture. The image below is the king of street fights among new consumer brands I've seen: Jiangxiaobai!
**Topic:****"Dialogue · New Growth" Episode 1:** Category Innovation, Accelerating Core Competitiveness
**Time:** December 9, 2021 (Thursday) 14:00-15:00
**Guests:** [Lu Wenjin] - Chairman of Hubang Chili Sauce [Ji Zhongkai] - Marketing Management Director of Hubang Chili Sauce [Zhang Rui] - Vice President of Operations at Fenxiang Xiaoke [Zhao Bo] - Founder of New Distribution
**********Introduction:** This is an era where no one can do without spice, and new consumption drives development across industries. Focusing on the chili sauce market, with vast space and low entry barriers, various internet-famous and emerging brands have entered.
The industry features low concentration, fragmented competition, and declining brand loyalty; competition has become fierce. What development space remains in the chili sauce track? What key factors will drive industrial iteration and upgrade?
"Dialogue · New Growth" Hubang Special, explore the essence of the industry here...
**Are you "watching" me?**


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