Distributing to retail outlets through distributors is the common model in the FMCG industry. But there are exceptions. For example, Coca-Cola partners with bottlers for deep distribution to outlets. In China, Swire Coca-Cola is one of Coca-Cola's partners. As Coca-Cola's 5th largest bottling partner globally, Swire Coca-Cola China has over 10,000 salespeople maintaining 2 million+ offline outlets and serving over 700 million consumers. When you casually buy a bottle of Coca-Cola or its other beverages at a small store, have you ever wondered how it reaches your hands? How does Swire Coca-Cola use digitalization to connect outlets (b) and serve consumers (C)? Through an interview with Feng Ke, CIO of Swire Coca-Cola China, we uncovered three key words: "Customer Service," "Outlet Assessment," and "Precise Reach."
Customer Service
First, "Customer Service." "We have always treated terminal stores as 'customers' to serve, so the starting point of digitalization is with them..." said Feng, CIO of Swire Coca-Cola China. In FMCG consumption, the most important thing is 'immediacy.' When you're thirsty and want a drink, or hungry and want a pack of instant noodles, you can go to a nearby store and buy it. This is very important. Brands need to serve small stores well because they are the frontline in serving consumers. Swire Coca-Cola's service to small store customers is executed through sales representatives. 10,000 sales reps maintain 2 million+ customers, including consumer activities, communicating display requirements with store owners, and assisting with ordering. A simple calculation shows that on average, each person maintains 200 small stores. Honestly, service quality is hard to guarantee. How to better serve these small store customers? Feng Ke said that in 2016, Swire Coca-Cola launched a web-based outlet service platform called "Leketong," then designed a mobile H5 interface, and it has now developed into a WeChat mini-program. Whether it was the web version or the H5 interface, the promotion and usage results were not very good. After using the mini-program, customer experience and operational convenience greatly improved. What can the "Leketong" mini-program do? We can understand it as an interactive platform between Swire Coca-Cola and its customers. First, it provides convenience for store owners to order, allowing them to place orders with just one click on their phones. Besides ordering, it also serves as a bridge for effective communication between the company and customers. For example, during the pandemic, Swire Coca-Cola tried live streaming for terminal store owners for the first time, explaining new products, training on novel product displays, and sales techniques in a more intuitive way. Through these trainings, store owners better understand products and improve their sales skills through reasonable promotional methods such as product displays, thereby better serving consumers and gaining more profit points. These live streams are hosted by Swire Coca-Cola's frontline salespeople or regional managers themselves. "Frontline regional sales can better grasp customer needs, so they are more down-to-earth as hosts." While providing training support to store owners, live streams also distribute red packet rewards to bring them closer. Live streaming has now become a regular operational tool for Swire Coca-Cola. In addition, the mini-program can provide other services. In the past, salespeople had to sign promotional agreements with customers in person and have third parties check them. Now, through the Leketong mini-program, contracts can be signed directly online, greatly improving signing efficiency compared to manual operations. Furthermore, based on digital tools and process encryption such as valid authentication, while improving information operation transparency, it also ensures the legality and security of signing, providing some protection for store owners' personal information. Currently, the mini-program's penetration rate in outlets has reached nearly 80-90%. This has greatly improved Swire Coca-Cola's customer service quality. ** Summary:** Manufacturers adopting deep distribution models usually have strong organizational management capabilities. But even so, serving outlets well faces huge challenges. _ _Because cognition, transactions, and relationships all require salespeople to handle: introducing products, communicating displays, placing orders on behalf of customers, maintaining customer relationships, etc. _ _The mini-program solves cognition (introducing products, communicating displays) and transactions (ordering, fee settlement), allowing salespeople to focus on customer relationships, bringing three benefits: _ _1. Improve the quality and efficiency of serving existing customers;** 2. Salespeople have more energy to develop new customers;**** 3. Enable online data for terminal stores (b);** _ _Killing three birds with one stone.
Outlet Assessment
If the mini-program-based "Customer Service" achieves "standardization" for over 2 million outlets, then "Outlet Assessment" aims to achieve "differentiation" in operational strategy. What is "Outlet Assessment"? Simply put, it is evaluating outlets based on Swire Coca-Cola's multi-source data to achieve "thousand-store, thousand-strategy." This is for better customer service, higher sales, and better consumer experience. The reason this is possible is first, based on Swire Coca-Cola's strong backend data. Channel digitalization for FMCG companies is about connecting the F2B2b2C (manufacturer-distributor-small store-consumer) chain. For many FMCG brands, the distributor (B) is a difficult node to connect. Many distributors are unwilling to share data with brands, and often lack the capability to do so. But Swire Coca-Cola, with deep distribution to outlets, does not have this problem. "Customers are Swire Coca-Cola's customers. Over 2 million customers are recorded in our system. They can do business with us for ten or twenty years. As long as they remain our customers, the system has their past sales records." Moreover, the channel and category to which a customer belongs are clearly defined in the backend. Service strategies and requirements differ by channel. The channel itself is a label, with finer classifications below it. For example, some customers cannot accept deliveries in the morning but only in the afternoon, because the store owner is only present in the afternoon; or there are notes on invoice and payment requirements. Feng Ke explained that based on sales data, if multiple outlets in a region all perform well, it indicates that the region is relatively hot. In addition to Swire Coca-Cola's strong backend data, it also integrates consumer profiles from the Tencent ecosystem to make more refined assessments of outlets, such as the composition of consumer groups around the outlet. For example, if there are many white-collar workers, more coffee and dairy products should be placed. If there are many sports enthusiasts, more sports drinks and water should be placed. Previously, the display standards for the same channel were uniform; now it can gradually achieve "thousand-store, thousand-strategy." ** Summary:** _ _FMCG products are C-end brands, but FMCG manufacturers do B/b-end business. _ _In B/b-end business, the most important thing is classification, adopting different sales strategies based on different customer situations. _ _Classifying dozens, hundreds, or even thousands of customers is not a problem, but it's hard to imagine classifying millions of customers. _ _But Swire Coca-Cola can not only classify over 2 million customers in multiple dimensions, provide targeted services, but also adjust distribution based on market conditions. _ _Why? _ _The key is data: _ _1. Customer data accumulated in the system;** 2. Online ordering data from the mini-program;**** 3. Consumer profile tags from the Tencent ecosystem;** _ _Digital decision-making should combine internal management data with external online data.
Precise Reach
If "Outlet Assessment" aims to achieve "thousand-store, thousand-strategy" for outlets (b), then "Precise Reach" aims to achieve "thousand-person, thousand-face" for consumers (C). Swire Coca-Cola has engaged in multi-dimensional cooperation with Tencent. Their cooperation includes not only mini-programs but also map LBS, Tencent Youma, WeChat Pay, WeChat Work, Smart Retail, etc. This gives Swire Coca-Cola the capability to extend deep distribution from the store (b) end to the consumer (C) end. For example, a consumer buys a bottle of Coke, scans the bottle code to get a reward, and can redeem it at a nearby store. Incentivizing consumers to go to stores for redemption, they can exchange for a bottle of coffee or tea. They might also buy a pack of gum or tissues. This not only brings foot traffic and sales to terminal stores but also allows Swire Coca-Cola to accumulate consumer purchase data. Feng Ke said that Swire Coca-Cola is cooperating with Tencent Smart Retail to research digital marketing, exploring how to reach consumers more precisely and meet their real needs. ** Summary:** _ _Connecting small stores (b) and reaching consumers (C), bringing consumers into the private domain, fully understanding consumer needs and desires, this is the most desired effect for FMCG manufacturers through bC integration. __ ****But whether it's Coke or other beverages, the characteristics are low price and high frequency, and consumer purchase randomness is high. _** _This means it's difficult to achieve bC integration through a standalone online data system. _ _****Relying on the Tencent ecosystem, through multi-source and multi-dimensional data fusion, achieving "precise reach" on a large group scale might be the development direction for high-frequency FMCG products such as beverages and snacks.** _ _Of course, this requires a development process. To what extent can it be achieved? We will continue to pay attention!
Final Thoughts:
Finally, let's summarize the characteristics of Swire Coca-Cola: **1.**Very few distributors, mainly relying on its own deep distribution. Its channel chain is F2b2C, not F2B2b2C. Direct connection to outlets places high demands on internal management. 2. The digital foundation is very good. Many companies haven't even achieved internal management informatization, so jumping directly to digitalization is very difficult and unrealistic. 3. A full-category beverage company. Besides Coca-Cola, it also has brands like Minute Maid, Pure Joy, Costa, and Chunchashe, covering multiple categories including soda, juice, tea, and coffee. Single-category beverage companies will find it hard to imitate its model. This article is part of New Distribution's bC integration special topic focusing on the beverage category. For more cases and insights, please follow New Distribution.