By Fang Gang
The formation of China's FMCG giants has always been built on the dividends of a channel empire where terminals reign supreme! Once, many domestic experts loudly proclaimed that channels were not king, but brands were; however, the JDB case of changing its brand name slapped these experts in the face!
Looking back at thirty years of marketing in China's FMCG industry, before 2013, almost no one thought that performance growth was difficult; at worst, three moves would work every time!
◎ First Move: Use Big Guns!
When the big guns fire, gold flows in! CCTV leads the way, highway billboards protect, print media covers, POP bombs... There is no brand that cannot be built, and no sales that cannot be blasted out! If not, then repeat, repeat, and repeat again; even chanting sutras will make you remember!
◎ Second Move: Tighten the Spring!
While the air force bombs densely, the infantry follows up with street fighting! Sales targets are set annually, divided monthly, and rise step by step! High distribution rate, high share, and high profit margin are the infantry commander's highest dreams! The bigger the territory, the bigger the brand! Squeeze sales from every inch of land; the hero is the one who can wring water from a dry towel!
◎ Third Move: Launch New Products!
This mountain is opened by me, and this land is planted by me! The more trees planted, the greater the yield! New products are like planting trees; dense planting ensures high yields! Every inch of land is stained with the blood of infantry brothers, and not a drop is wasted! Base markets are high-yield fields, launching satellites, with fruit trees planted densely like chives...
Of course, beyond the three moves, there are other tactics: flattening customers, channel sinking...
Only large enterprises, the industry leaders, can wield these three moves! Against the backdrop of the contradiction between people's ever-growing material and cultural needs and backward productive forces, each of the three moves is mighty!
In the history of China's FMCG marketing, and even in modern Chinese history, almost no one has experienced an era of unsellable goods, or overcapacity, and no one would have imagined that slow growth or negative growth would become the norm! It is the arrival of this norm that makes the three moves, once wielded with ease by marketing executives, useless even when they grit their teeth and fight with all their might!
Brand is the wind of momentum! Without momentum, there is only blame!
Under performance pressure, the sales team will strive to achieve targets by any means. When the environment and trends are unfavorable, they will swallow any type of sales pill! Although companies set price and profit management in KPIs, the execution layer will find various ways to circumvent them! This includes pressuring distributors to stock up, and leaving distributor advance payments unprocessed...
Under a performance-driven deep distribution system, they firmly believe that sales are squeezed out; if no milk, then squeeze blood! Once the channel's storage capacity reaches a critical point, coupled with the peak of total consumption, a collapse can happen at any time! This is the root of the virus!
The new social contradiction of this era: the contradiction between people's aspiration for a better life and unbalanced development!
Unbalanced means that the consumption pyramid in the Chinese market is stretching upward, and a single brand focused on basic needs can no longer satisfy or cover this pyramid! Marketing methods will diversify from here on. Channel traffic is leaking, and single terminal operations can no longer lock in enough target customers! Deep distribution alone cannot net enough fish. What needs to be done is to move upward, engaging in "high-level distribution"! Multi-dimensional distribution based on emerging channels such as e-commerce, social communities, micro-commerce, and B2B!
High-efficiency, high-volume supply chains and production lines can meet the largest common denominator of basic needs. How can high-end, personalized, flexible demands be met? High-level distribution and multi-dimensional distribution truly test the brand support and coverage capabilities of existing enterprises!
An interesting pattern: from an internal management perspective, the emphasis on performance is inversely proportional to brand strength! From an organizational structure perspective, the stronger the sales department, the weaker the marketing (brand, communications) department! The more performance-oriented an enterprise is, the higher the probability that its brand will weaken or decline!
On sunny days, we don't believe that big guns will fail, that the execution spring won't turn, or that launching new products will be so tiring!
But when the market inflection point arrives, no matter how individual stocks resist, the final performance indicators remain cold!
When one person feels cold, it might be illness; when everyone feels cold, winter has come! Many marketing executives have been dismissed in the cold winter of performance! (You can look at the casualty rate of marketing leaders at FMCG giants after 2013!) I didn't do anything wrong; my brothers and I gave it our all, but I lost!
Wahaha, a national enterprise we respect! Zong Qinghou, a tireless veteran we marketers admire, like a perpetual motion machine, issued a thought-provoking slogan in the winter of questioned performance: "The king returns, youth accelerates!"
"King, where have you been? Return, where are you going?"
Answer: "I went to the village; today I'm returning to the city!"
Reason: Only the elderly are left in the villages; the young have gone to the cities. Youth...!
This is the toxicity of deep distribution based on performance orientation, terminal supremacy, and the three moves! Going anywhere for sales, regardless of the place! Once you enter the village, you can't return to the city!
Several stark numbers are before us: China's urbanization rate has reached 55%! To achieve the same goal, Europe took 300 years, the United States 120 years, but China only 30 years!
Marketing serves people; when people leave, does marketing stay behind as a memorial or a tombstone?
The real problem is: sales reactions are lagging, organizational adjustments are even slower, and sometimes unreliable!
The most critical issue: if the brand goes native in the countryside, how can it wash its feet and come ashore?
The harsh reality: once you enter the village, you forget the way back to the city! Even if you return, can you still find the door of the terminal? (Urban commercial forms have changed dramatically!) It's very hard to lift a brand once it has been lowered!
When there's nothing left to flatten, there's rebellion (distributors quit); when there's nothing left to sink, it's a dead end!
China's rapid development has allowed us to experience what took developed countries several generations to achieve, all in one generation! This speed leaves us no time to think; we can only run desperately!
FMCG giants with tens of billions in revenue all grew wildly under the sunshine of demand dividends, in the fertile soil of channels, and in the air of reform and opening up! Some may find examples from various industries and enterprises to prove that deep distribution is still as effective as ever! The reality is that since 2010, deep distribution has not created any new giant brands!
If we say that poison means abolishing deep distribution, that's not right either! Jiang Xiaobai and Xiaoshile still have strong deep distribution skills! Their team execution is super strong, and their infantry street-fighting and combat capabilities are extremely high! But here are the warnings:
Warning: Performance-driven deep distribution is a poison to brands! Warning again: Excessive performance-driven deep distribution is a poison to brands! Final warning: Excessive and long-term performance-driven deep distribution is a poison to brands! Read clearly: It is a poison to brands!
Source: Teacher Liu's Forum (ID: liuchunxiong1964)
-END-