Channel digitalization is a hot topic in the FMCG industry, to the point where no one discusses whether to do it, but rather how to do it. Executives are all "aspiring" to it and require their teams to "make it happen." However, there is a significant problem: no one claims to have succeeded, and no one can clearly explain how to do it; even if someone comes forward, many peers will scoff. As a practitioner in digitalization for several leading brands, having gone through multiple explorations in channel digitalization, I would like to share a few insights from the brand's perspective for discussion with peers. My view: The most important thing in channel digitalization is to distinguish between the lifeline and ecosystem lines of the channel, and adopt the most suitable approach to accomplish it. Amidst many uncertainties, one thing is certain: there is no fixed method for channel digitalization. At least from the current perspective, the methods for channel digitalization vary greatly depending on the brand's scale, category, and target consumers. Therefore, do not blindly trust so-called external experts and software vendors, but do engage with them to form the most suitable route for yourself. Because external experts often speak from an industry-wide perspective or from the perspective of industries they are familiar with, and their goal is to attract readers and followers. Software vendors, on the other hand, often speak from the perspective of their products, aiming to sell products, and will not discuss content that their products lack or are not good at. Even for a single brand, channel digitalization requires multiple methodologies. Only the brand itself knows itself best; the person in charge of channel digitalization must understand the business very well and can quickly learn to fill gaps in digital knowledge. I believe that in channel digitalization, the first thing is to clarify the essence of the channel. The essence of the channel is dealers and distributors. Previously, I saw articles discussing whether channel digitalization should bypass channel partners, and why C-end successful brands are not successful in offline channels. I believe that for at least the next 10 years, offline channels cannot do without dealers and distributors. For C-end brands to succeed offline, the key is to slowly cultivate their own channel network system. The dealer system remains the lowest-cost, highest-coverage-efficiency, and most stable coverage model for offline channels in the FMCG industry. For distributors, the most important thing in channel digitalization is to clearly define what is the lifeline and what is the ecosystem line. The lifeline is the most critical, as it affects the brand's survival. Additionally, the lifeline consists of customers with the highest channel profit for the brand, the highest coverage efficiency, and the highest proportion of the customer's business. Customers on the lifeline share weal and woe with the brand; they are of one mind with the brand, and their cooperation with brand policies is the highest. This degree is hard to grasp, but we can look at a few examples. For instance, in the alcoholic beverage channel, there are typically large customers who primarily provide capital advances, with strong financial resources, broad networks, and strong capabilities, but they rarely deliver to terminals. Such customers are often not the brand's lifeline, but may be the lifeline for some individuals; losing a large customer does not lose terminals, but large customers often pose the greatest resistance to company policies. If a large customer has their own terminal delivery, cooperates highly with the company, or the brand accounts for more than 50% of their business, they are certainly the brand's lifeline. There are small and medium-sized distributors who, despite limited capital and strength, diligently help the brand achieve good market share; they are the company's lifeline. However, these groups currently face significant survival crises, and brands need to find ways to help them survive, adding various empowerment measures, and can also assist in mergers to consolidate energy. For example, in the snack food channel, there are typically first-tier distributors responsible for a prefecture-level city, and distributors responsible for delivery. Unlike the alcoholic beverage category, a single snack brand often accounts for a small proportion of a wholesaler's business, with lower loyalty and stability; On the contrary, it accounts for a higher proportion in first-tier distributors, and snack food salespeople are few, so maintaining terminals relies on the sales staff of first-tier distributors. For snack foods, first-tier distributors become the lifeline, especially in regions with high market share. For the lifeline and ecosystem lines, channel digitalization has its own guiding principles. For the lifeline's channel digitalization, the core conclusion is to focus on empowerment, forming a symbiotic entity through network, people, vehicles, and finance. The brand should consider all aspects to ensure the lifeline survives and thrives. It is necessary to achieve strategic unity, business unity, system unity, and trust unity between both parties. Network, i.e., the channel digitalization system, if conditions allow, build your own dealer inventory management system, delivery system, expense system, and personnel management system, and provide them free of charge to lifeline customers. Naturally, the brand can also obtain the channel data it wants. Lifeline customers must unconditionally cooperate with the brand's system deployment, because both parties are a symbiotic entity; only when the brand is good will the customer be good. The brand and lifeline customers must have an efficient mechanism for collecting and responding to needs. Once customers cooperate with system use, the brand must ensure the system plays an empowering role. With system integration, the data of lifeline customers can truly transform from "dead data" collected to "live data" that runs. To address the concerns of lifeline customers, the brand must also provide the fame and fortune they deserve, sign confidentiality agreements to protect data, and not let the horse run without eating grass. People, whether in deep or shallow distribution, a major trend is that both brands and customers increasingly cannot afford to hire people. Therefore, people must be raised together. A good model is where the dealer pays the basic salary, and the brand pays bonuses and incentives, with the incentive plan using the system to ensure more work, more reward. This maximizes the initiative of sales representatives and gives them a sense of presence between the brand and the dealer. Vehicles, following the principle of empowerment and symbiosis, should be jointly funded and managed as much as possible. Brands should encourage lifeline customers to build their own logistics systems, and each vehicle should be incentivized. Brands should also use management experience and professional systems to empower customers, not blindly increase vehicles, and ensure each vehicle plays its due value. Finance, divided into two aspects: capital and expenses. In terms of capital, brands should establish a financial ecosystem to address emergency needs such as payment advances for lifeline customers. In terms of expenses, the first consideration is efficient planning, application, execution, and reimbursement processes, so that lifeline customers do not waste funds on expense advances. For the ecosystem line's channel digitalization, the core conclusion is to focus on experience. It should be the most efficient and easiest way for customers to meet the brand's management needs. For ecosystem line customers, brands often find it difficult to control their people, vehicles, and finances; the two sides are in the same bed but with different dreams, making it impossible for customers to become an extension of the brand's channel, and symbiosis cannot be achieved. Thus, only the network remains. The channel digitalization system for ecosystem line customers is to meet the brand's management needs. Brands need to use the system to grasp dealer orders, collect channel inventory data, and ensure the efficiency and effectiveness of expense投放, etc. Ecosystem line customers, compared to lifeline customers, are destined to spend much less time using the brand's system. Take the inventory system as an example; I advocate that lifeline business should run on the brand's system, even revenue-related matters. But for ecosystem line customers, perhaps the most convenient and quick data upload is the best solution. Some might say this cannot guarantee data authenticity. Indeed, ecosystem line customers cannot follow the brand in channel transformation; only traditional management methods, such as on-site inventory checks and monthly audits, can strengthen data. Here, problems that cannot be solved through management cannot be solved through systems. For the expense system, I advocate skipping ecosystem customers and directly investing in terminals. Traditional expense投放 generally includes discounts with purchase, merchandising, tiered discounts with rebates, and other fixed agreements. Among these, discounts with purchase and merchandising are the most common, and these two forms can be achieved through self-built terminal B2B mall and merchandising image recognition, respectively. The specific implementation forms of the system are mostly introduced by software vendors, so I will not elaborate. Ecosystem line and lifeline customers can often transform into each other. In the process of channel digitalization, one should not be too aggressive or too conservative; the difficulty is not the system, but the grasp of the degree and implementation steps. It is precisely for this reason that it should be led by the business department, not driven by the technology department. The above is purely personal opinion and is for reference only. -END-