---
title: "The Story of Lao Gan Ma's Rise to Fame: The Logic Behind a National Brand Becoming a Trendy Label"
description: "Lao Gan Ma has become a cultural phenomenon, but 2019 was a challenging year for the company. As the leading brand in the table condiment market, which is worth 40 billion yuan, Lao Gan Ma faced internal and external pressures. Despite these challenges, the company's revenue exceeded 5 billion yuan in 2019, a 14.43% increase year-over-year, thanks to its unwavering commitment to product quality and strategic marketing campaigns."
author: "施杨"
publisher: "New Distribution"
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published: "2020-04-11"
language: "en"
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# The Story of Lao Gan Ma's Rise to Fame: The Logic Behind a National Brand Becoming a Trendy Label

> Lao Gan Ma has become a cultural phenomenon, but 2019 was a challenging year for the company. As the leading brand in the table condiment market, which is worth 40 billion yuan, Lao Gan Ma faced internal and external pressures. Despite these challenges, the company's revenue exceeded 5 billion yuan in 2019, a 14.43% increase year-over-year, thanks to its unwavering commitment to product quality and strategic marketing campaigns.

**Why is Lao Gan Ma so popular?**

The past year has been a challenging one for Lao Gan Ma.
As the leading brand in the table condiment industry and the "National Goddess" in the hearts of fans, Lao Gan Ma faced internal and external troubles in 2019.
According to public data, the table condiment market has reached 40 billion yuan, with the chili sauce market at 32 billion yuan and growing at over 7%. By the end of 2020, the chili sauce industry is expected to exceed 40 billion yuan.
However, overall, the Chinese table condiment market continues to experience oversupply and overcapacity. At the same time, with consumption upgrades and the increasingly powerful channel capabilities of internet platforms, some emerging brands are leveraging celebrity effects or channel innovations to show growing vitality.
For example, "Fanye," founded by singer Lin Yilun, is priced uniformly at 25 to 40 yuan on e-commerce platforms like Tmall. It sold 300,000 bottles within two hours of its launch and secured three rounds of financing in just two years. Li Ziqi, who has millions of followers across the internet, also sells chili sauce in her Taobao store, typically priced at 20 yuan or above. A two-bottle set priced at 39.9 yuan sells over 20,000 orders per month on average.
Hubang Chili Sauce, a lesser-known brand, has taken a different approach by focusing on the food delivery consumption scenario. Data shows that in 2018, online food delivery revenue reached 471.2 billion yuan. According to Hubang founder Hu Qiaosong, the food delivery scenario matches the dining environment for chili sauce well; moreover, the food delivery demographic is young, willing to try new products, and less price-sensitive. Finally, the closed channel of food delivery is suitable for Hubang's early stage, with relatively low costs and risks.
Whether it's Fanye, Li Ziqi, or Hubang, although these new table condiment brands' market shares are negligible compared to Lao Gan Ma and they are not yet widely recognized by mainstream consumers, from a growth perspective, these "external threats" are enough for Lao Gan Ma to take seriously.
On the other hand, Lao Gan Ma's "internal troubles" stem from Tao Huabi's retirement. According to Qixinbao data, Tao Huabi transferred her only 1% stake to her second son, Li Miaoxing, and has since stepped back from management. The shareholding structure of Lao Gan Ma is now Li Miaoxing holding 51% and Li Guishan holding 49%. Currently, Tao Huabi remains the chairman of Lao Gan Ma but holds no shares, while daily operations are managed by Li Miaoxing.
In the second year after the management change, media reported that Lao Gan Ma, under pressure from raw material costs, abandoned Guizhou chili peppers in favor of cheaper Henan peppers. After a factory fire in August 2019 put Lao Gan Ma on Weibo's hot search, the topic of ingredient substitution was again raised by public opinion.
For the outside world, Lao Gan Ma and Tao Huabi are mutually bound in brand perception. Lao Gan Ma's unique management style and development strategy were also formulated according to Tao Huabi's "stubborn" personality. Tao Huabi's retreat to the second line inevitably raises concerns among fans and consumers about product taste and quality. Can Lao Gan Ma in the "post-Tao Huabi era" continue to dominate and stay "hot"?

**-01- "C-position" and "Debut"**
Facing the impact of the new era, Haitian Rice Seasoning, also a traditional brand, chose to sponsor "Qipa Shuo" to increase its visibility among young consumers. Lao Gan Ma, which has a solid mass base, stated at a 2019 media interview that it would strengthen the construction and promotion of brand culture. Thus, the long-time "Buddhist and passive" Lao Gan Ma finally decided to take the initiative and officially announced its "debut."
In September of the same year, in an advertisement that made it to Weibo's hot search, Lao Gan Ma transformed into a young girl. Both the quirky dance steps and the catchy tune refreshed people's original perception of Lao Gan Ma. In the same month, at the New York Spring/Summer Fashion Week, a hoodie with a red base, Tao Huabi's portrait on the chest, and the Chinese characters "国民女神" and English "sauces queen" on the sleeves ignited the runway.
At the same time, Lao Gan Ma's Tmall flagship store launched promotional activities, including a package of 99 bottles of Lao Gan Ma plus a custom hoodie for 1,288 yuan, and promotions such as free custom hoodies for purchases over 1,999 yuan and free custom aprons for purchases over 999 yuan.
A woman from Heze, Shandong, ordered 600 bottles of Lao Gan Ma chili sauce at once, spending nearly 8,000 yuan, just to wear the same hoodie with her office sisters. According to Tmall data, after this event, young consumers on Lao Gan Ma's Tmall flagship store surged, sales increased by over 20%, and the influence lasted until Double 11.
In December 2019, Lao Gan Ma released its annual performance: sales revenue exceeded 5 billion yuan, a year-on-year increase of 14.43%, with domestic market coverage exceeding 96% and market share exceeding 65%. With this, Lao Gan Ma delivered a good report card. The record-high revenue data further alleviated external concerns about the "post-Tao Huabi era."
However, times change rapidly, and marketing is always just a means. It is more like a stimulant for brand vitality, capable of activating product vitality within a specific period, but it cannot become the core barrier of the product. If a brand wants to remain evergreen, it needs to win consumer respect through genuine craftsmanship and quality. This is also the biggest difference and advantage between Lao Gan Ma and many emerging table condiment brands.
In Lao Gan Ma's view, "being red" has never been the goal. Being able to "debut at the peak" and break through the challenging year stems from Lao Gan Ma's faithful implementation of its "product-first" business philosophy.
In fact, as early as 2013, Lao Gan Ma had already become the traffic leader in the condiment industry and occupied the "C-position" of public opinion, thanks to its "delicious" taste and hardcore corporate management strategy. The current marketing "debut" is just an attempt to express its original intention of "product-first" through official channels and in a way that young people can better accept. When "product-first" is taken to the extreme, it triggers the "tipping point" effect.
Malcolm Gladwell, a famous American sociologist, argued in his book "The Tipping Point" that this phenomenon of passive popularity due to absolute advantage in a certain aspect is very similar to the spread and outbreak patterns of viruses in nature.
By summarizing the laws of virus spread and epidemic outbreaks, Gladwell believed that for a thing or topic to spread quickly and powerfully at the objective level in society, it mainly relies on three forces: the Law of the Few, the Stickiness Factor, and the Power of Context.
If we analyze the reasons for Lao Gan Ma's true internet popularity using the three laws of the tipping point, it is not difficult to find that Lao Gan Ma has spent 30 years accurately meeting the triggering requirements of the three laws: addictive stickiness caused by craftsmanship quality, the few people convinced by the hardcore management philosophy of "product-first," and the public opinion environment changed by product sentiment.

**-02- The King of "Addiction Influence"**
In the 1980s, in Guiyang, there was a rural woman nicknamed "Chunmei." Due to poverty, Chunmei, who was illiterate, only had a third-grade education. At the age of 20, Chunmei got married, but her husband unfortunately passed away unexpectedly. To raise her two children, she worked at construction sites during the day and made vegetarian noodles at home at night.
The so-called "vegetarian noodles" are a breakfast food loved by locals in Guiyang, a type of rice noodle without meat, mainly flavored with chili oil. Chunmei's homemade chili oil was extremely delicious, attracting many people to taste it, including many students.
Ouyang Zigang was a student at the nearby Hongxing Machine Tool Plant Technical School. At that time, he was rebellious and often fought. Because he frequently ate vegetarian noodles, Chunmei gradually became familiar with this rebellious young man. Chunmei not only often gave Ouyang free extra portions but also secretly paid his tuition after learning about his family's difficulties.
Ouyang was very grateful and recognized Chunmei as his godmother. Over time, other students also began to call Chunmei "Lao Gan Ma" (Godmother), partly because it felt affectionate following Ouyang's lead, and partly because Chunmei's vegetarian noodles left a deep impression on the students. Later, everyone within a ten-mile radius who had eaten Chunmei's vegetarian noodles began to call her Lao Gan Ma. In this way, Chunmei became everyone's Lao Gan Ma, and few knew her real name at the time: Tao Huabi.
Although this plot resembles a melodramatic TV series, it is indeed the origin of the Lao Gan Ma brand. From the initial stall selling vegetarian noodles with chili oil, to the roadside "Affordable Restaurant" known for giving away chili sauce, to the brand named Lao Gan Ma with her own portrait as the trademark...
Along the way, Tao Huabi's entrepreneurial journey was full of "earthy" and "hardcore" elements. Looking back at the origin of this story, we can discover the biggest characteristic that would later make Lao Gan Ma an industry giant: products that bring a large number of repeat customers.
Gladwell believed that in the process of an epidemic outbreak, the stickiness factor of the virus has enlightening significance for the outbreak of social epidemics. People often spend a lot of time thinking about how to make a thing or message easier to spread and how to let as many people know as possible.
But to truly ignite it, the key is how to maintain the "stickiness" between the thing and the public. When the spread thing has strong enough stickiness, it means it can affect almost everyone and achieve word-of-mouth spread through "person-to-person" transmission, continuously accumulating the momentum to ignite the topic. In the case of Lao Gan Ma, the carrier of its brand stickiness is undoubtedly its product.
Using the viewpoint of Nir Eyal, a famous American scholar, in his book "Hooked": products with strong stickiness are often those that are addictive enough. In his view: "The product itself is the best fulcrum for stickiness." In the book, Nir proposed the "Trigger-Action-Reward-Investment" addiction model to explain how a product makes users form usage habits. We can use this model to explain the logic behind Lao Gan Ma's powerful "addiction influence."

**Trigger: Let more people eat it, let more people remember it**
In the "addiction model," when designing a product, companies must first have the context to reach most consumers and firmly attach to consumers' memories after the initial consumption behavior. This is the so-called "trigger" mechanism.
In Tao Huabi's eyes, this is actually just two words: "delicious."
"Delicious" is Lao Gan Ma's first competitive advantage. As a table condiment, helping to accompany meals is almost the most basic and core function of Lao Gan Ma. To this end, Tao Huabi stubbornly insisted on quality control of "even if I lose, I must maintain product quality."
To ensure the chili sauce reaches the "delicious" quality, Tao Huabi personally oversaw product production for the past 30 years. Taking the process of making chili oil as an example, Tao Huabi would personally smell the chili oil, pour it into a pot and heat it at high temperature. If the quality of the chili oil was problematic, it would emit an unpleasant odor, and once discovered, it would be destroyed.
In the years after Tao Huabi's retirement, Lao Gan Ma invested heavily in technology iteration, raw material cultivation, and taste correction to stabilize the "delicious" quality of its products, striving to expand capacity while ensuring quality.
In terms of raw materials, Li Miaoxing once told the media: "Lao Gan Ma uses different chili peppers for different products, purchasing over 40,000 tons of high-quality chili peppers from all over the country each year. Currently, the company has established over 1,000 mu of chili and vegetable bases in Guizhou."
In terms of technology, Lao Gan Ma's production workshops have introduced new assembly lines and digitized recipes to ensure taste consistency. In Lao Gan Ma's product testing center, all raw materials, semi-finished products, and finished products undergo strict testing. All tests are conducted according to standards recognized by the China National Accreditation Service for Conformity Assessment, including 79 testing indicators. The center has over 280 people, testing more than 100 samples daily.
Providing users with an ultimate experience through high-quality products is the core barrier of Lao Gan Ma's products and the core of its ability to "trigger" large-scale context penetration and enhance product addictiveness. A person's stomach is the most nostalgic and hardest to change. Lao Gan Ma's taste and quality have penetrated the "addiction influence" of individuals, allowing it to enter the dining scenes of thousands of households over the past 30 years.

**Action: Remove the biggest obstacle to repurchase—price**
After large-scale exposure to Lao Gan Ma products, "triggered" consumers enter the next stage: "action." Here, "action" represents the birth of consumer repurchase behavior. At this stage, to increase the frequency of consumer purchase behavior, the product needs to satisfy two basic motivations in human behavior: first, the actor has a strong subjective willingness; second, the objective resistance to initiating the behavior is minimal.
In terms of subjective willingness, Lao Gan Ma's "delicious" quality conquers the taste buds of a large number of consumers. However, to generate stable repurchase, conditions are not yet sufficient. In fact, another major reason Lao Gan Ma has become a national-level product is its low pricing, which meets the acceptance of consumers at all levels—what we commonly call "cost-effectiveness."
Generally, the better the product and the lower the price, the higher the cost-effectiveness, resulting in less objective resistance to repurchase. In today's table condiment market, Lao Gan Ma's pricing has the dual characteristics of being low but "dominating."
First, let's talk about low prices. In an era of rising prices, Lao Gan Ma's prices remain very "stable." Tao Huabi stubbornly adhered to the pricing policy of "even if I lose money, I will not change the price range." In fact, Lao Gan Ma has always been down-to-earth, targeting middle and low-end consumers. Because it is too "delicious," it gradually began to "appeal to all" consumer classes.
However, appealing to all does not mean raising prices. Although Tao Huabi never studied marketing, she clearly knew that price often determines the positioning of the brand and target group. Price changes are not just changes in corporate profits and sales, but also a shift in brand positioning. Raising prices would not only go against her original intention in founding Lao Gan Ma but would also give competitors price space in business.
Although Lao Gan Ma's pricing is low, it relies on the product's own advantages and uses the strategy of small profits but quick turnover to occupy a huge market share. Competitors either lower quality to lower prices or give up the low-end to do high-end, but the table condiment industry finds it difficult to support high-end products.
According to public data, an 8-yuan bottle of Lao Gan Ma sells 1.3 million bottles daily, using 13,000 tons of chili peppers and 17,000 tons of soybeans annually. In 2015, sales were approximately 4 billion yuan, and output value increased nearly 75 times in 15 years. At the same time, based on Lao Gan Ma's tax payment of 2.2 billion yuan over the past five years, using a 25% corporate income tax rate to reverse-calculate, annual net profit is about 1.2 billion yuan, meaning Lao Gan Ma's net profit margin is over 30%.
Lao Gan Ma's product pricing has invisibly built an industry barrier. If pricing is lower than Lao Gan Ma's retail price, profits are almost zero; if pricing is higher than Lao Gan Ma's retail price, consumers usually refuse to buy, making it impossible to seize Lao Gan Ma's market share.

**Reward: A diversified product line based on quality**
Lao Gan Ma focuses on the table condiment field. In the early days of the company, Tao Huabi dominated the market with a single flavor of fermented soybean chili sauce. However, although the signature product was of high quality, a single product structure would cause the company to stagnate.
Therefore, Tao Huabi extended Lao Gan Ma's business from the original single chili oil to products such as fermented soybeans, spicy vegetables, fermented bean curd, chopped chili, and hot pot base. While providing consumers with different high-quality experiences through product diversification, it also filled the important "reward" link in the "addiction model."
After cultivating consumers' repurchase habits, the means to further strengthen brand stickiness is to provide diverse "rewards." Psychological research shows that unexpected results will stimulate consumer curiosity, and increasing the results with variables is the meaning of "rewards."
Unlike ordinary feedback loops, the "addiction model" can further replicate and stimulate people's inner consumption desires through superimposed "rewards." At the same time, when consumers become tired of a product, varied rewards can also maintain their unquenchable enthusiasm for use or purchase.
From 1998 to 2014 was an important period for Lao Gan Ma's new product development. Relying on the experience accumulated in the product production system, Lao Gan Ma further occupied consumers' minds in the table condiment industry through new products developed.
Today, Lao Gan Ma has up to 22 products under its brand, each with a large number of fans. Data shows that from 1998 to 2014, Lao Gan Ma's output value increased from 50 million yuan to 4 billion yuan. These products, as incentive "rewards," meet the more diverse needs of consumers, further strengthening the "addiction influence" of the Lao Gan Ma brand and making it the largest chili product manufacturer in China in terms of production and sales.

**Investment: The cycle of addiction**
The final stage of the addiction model requires users to invest in the product. The "investment" stage helps increase the probability of users and other potential users entering the addiction model. Generally speaking, if a traditional brand's product can achieve "trigger-action-reward," it can basically occupy consumers' minds in the industry to a certain extent and achieve high-stickiness product adhesion.
For Lao Gan Ma, the purchase behavior itself is a form of monetary investment, expressing users' recognition of the product. In addition, "investment" has a deeper meaning: enhancing the interaction and participation between consumers and the product.
For example, Lao Gan Ma's loyal consumers have unconsciously strengthened the channel stickiness of Lao Gan Ma through taste recognition over the past decade or more. The most typical case is the relationship between Lao Gan Ma and the catering industry.
In 2014, Shaanxi Radio and Television Station's "City Express" reported: One day, Mr. Shen invited friends to dine at Haidilao Hot Pot Xiguan store. While mixing dipping sauce, Mr. Shen tasted that the Lao Gan Ma on the condiment table seemed a bit off, and he firmly believed that the "Lao Gan Ma" seasoning at Haidilao Xiguan store was not authentic. After media investigation, it was indeed found that Haidilao Xiguan store had mistakenly labeled ordinary fermented soybean chili sauce as Lao Gan Ma.
In fact, the catering industry has extremely high requirements for the stability of dish taste. If seasonings are changed, it often causes fluctuations in dish taste and consumer dissatisfaction. Lao Gan Ma's "delicious" characteristics are firmly remembered by loyal consumers in the deepest part of their hearts, inadvertently strengthening the binding relationship between Lao Gan Ma and the catering channel while returning to the "trigger" mechanism, expanding opportunities for Lao Gan Ma to contact more consumers, and opening up another territory beyond the home dining scene.
At the same time, in contrast to "unconscious investment," there is the "conscious investment" of the younger generation of consumers on social media since the rise of the internet. Young Lao Gan Ma fans expand the brand's voice among young people by spending a lot of time on social media creating related topics, sharing usage experiences, and digging into corporate story backgrounds, extending the "trigger" mechanism to more young people through online word-of-mouth communication.

**-03- "Super Spreaders" Appear**
Every once in a while, Lao Gan Ma "automatically" makes it to the hot search. For example, in the summer of 2016, netizen Niaoba Mori posted a post titled "Ice Cream + Lao Gan Ma Experiment Report."
Immediately, a large number of food bloggers announced they would follow suit, and combinations of Lao Gan Ma with various cold drinks appeared endlessly on social platforms, triggering a trend. To this day, the topic #老干妈配雪糕# has received 26,000 comments and over 20 million views.
In communication studies, there is a rule that the rapid spread of a thing requires a "communication explosion point," and this "explosion point" is the person who connects the spread. Although this person is an individual, they have extraordinary communication power, which is very similar to the concept of "super spreaders" in epidemiology. Gladwell called such people "the few."
When "the few" realize that something is worth recommending to the public, they will spread the information through their social skills, vitality, enthusiasm, and charm. In "The Tipping Point," Gladwell compared the characteristics of "the few" to connectors, mavens, and salesmen.
"Connectors" have rich networks, deeply cultivate and move between different circles, connecting people from different circles with the outside world. In many epidemiological case files, "super spreaders" are "connectors" who, during infection, are keen to participate in social gatherings and even religious activities.
"Mavens" are true information brokers, good at discovering new things and products and packaging them. In social and online trends, "mavens" are the database, responsible for providing information; "connectors" are the glue, helping to spread information.
In addition, "salesmen" are characterized by understanding what the public's interests are, having strong influence and the ability to drive sales.
In fact, if we trace history, we will find that Lao Gan Ma's first "the few" was Ouyang Zigang.
> First, he had good interpersonal skills and a certain appeal among classmates, fitting the characteristics of a "connector"; second, he often took other students to Tao Huabi's snack stall to eat vegetarian noodles, possessing the "salesman" trait of driving sales; third, he had the "maven" ability to discover explosive topics. He was the first to call Tao Huabi "godmother," and the name Lao Gan Ma spread from there.
Nowadays, celebrities, self-media, and internet influencers who possess the above abilities and characteristics have become opinion leaders in today's society, almost equated with traffic itself. When a brand wants to invite these individuals with discourse power to create momentum for the brand, it also needs to pay a considerable fee. However, in front of Lao Gan Ma, these "super spreaders" in the online world have begun to voluntarily act as Lao Gan Ma's promotional ambassadors.
In fact, from an industry perspective, according to iResearch Consulting's 2018 "China Internet Celebrity Economy Development Insight Report," the total number of Chinese internet celebrity fans has exceeded 588 million. Among them, the Z-generation aged 19 to 22 accounts for the highest proportion, reaching 24.2%. Compared to millennials, Generation Z is more unconventional, and in terms of hobbies and consumption tendencies, they prefer brands and products that can represent their own personality cognition.
On the surface, Lao Gan Ma seems incompatible with Generation Z in terms of product packaging, corporate background, and target users, but there is one point that breaks the dimensional barrier between the two: rebellious personality.
Lao Gan Ma inherits Tao Huabi's "stubborn" character, which is completely different from the normal development "routine" of ordinary enterprises. Ordinary companies try every means to finance, list, and expand business scale, but Lao Gan Ma, with its "product-first" approach, insists on not borrowing, not taking shares, not financing, and not listing. Tao Huabi rarely appears in the media, but every time she does, it is to emphasize the "four no's policy." No matter how the local government urges and suggests, Lao Gan Ma remains unmoved.
"I don't understand what you're talking about. I paid several hundred million in taxes last year, and I still act according to my knowledge." In July 2018, facing the persuasion of Shenzhen Stock Exchange representatives, Tao Huabi only had this one reply. "Listing is cheating people's money!" In an interview, Tao Huabi even passed on the instruction not to list to her sons.
In addition, Lao Gan Ma still maintains a somewhat incredible primitive business method: producing high-quality products, one hand for money, one hand for goods. Lao Gan Ma does not allow distributors to owe credit, and of course, it does not owe money itself. This is reflected in the financial statements as abundant cash flow and simple operating accounts, with no accounts receivable, no accounts payable, and no interest-bearing debt.
Simplicity and uniqueness blend together, forming Lao Gan Ma's unique management style. These seemingly contradictory but logical elements have instead formed a natural affinity for Lao Gan Ma in the hearts of young people. The unconventional founder personality has also made Tao Huabi a "domineering female president" in the eyes of Generation Z.
So, in the eyes of "super spreaders," perhaps they are more like riding on Lao Gan Ma's popularity. For "mavens," Lao Gan Ma is a treasure trove of topics; for "connectors," Lao Gan Ma has a huge base of product users, and related topics are easy to ignite on the internet; for "salesmen," topics related to Lao Gan Ma have high affinity, can quickly attract public attention, and even serve as an entry point for product promotion.
For example, in early 2018, a blogger called the lipstick color Liu Tao wore when hosting the Spring Festival Gala "Lao Gan Ma color." The next day, major beauty bloggers began to pick up Lao Gan Ma and apply chili oil to their lips.
Today, the Weibo topic #老干妈口红# has been read 160 million times, with over 12,000 comments. Streamers not only sent Lao Gan Ma to the hot search but also advertised various lipstick brands with "Lao Gan Ma color," showing strong sales-driving ability.

**-04- The Birth of the "Goddess"**
If the few are the key nodes accelerating the outbreak of trends, and the stickiness factor comes from the unforgettable nature of the spread information itself, then the Power of Context means the impact of changes in the social environment or public opinion environment on the outbreak of epidemics.
In "The Tipping Point," Gladwell believed that humans are extremely sensitive to changes in the environment during the communication process, just as viruses are extremely sensitive to changes in ambient temperature.
Similarly, the outbreak of a trend is closely related to the conditions, time, place, public opinion, and other factors. This is the power of context. Coincidentally, on the road to being pushed to "internet celebrity," environmental factors are also playing a role in fueling the fire, especially the impact of overseas market public opinion on the domestic market in recent years.
Why would Lao Gan Ma, a Chinese local brand, be affected by the overseas market environment? In fact, Lao Gan Ma did not initially plan to "rush out of Asia and go global." Its "addiction influence" was initially "brought" abroad by a group of people: Chinese international students. A song circulated among international students: "In my left hand a chicken, in my right hand a duck, and on my back ten bottles of Lao Gan Ma." This undoubtedly reflects the dependence of international students on Lao Gan Ma.
According to Maslow's hierarchy of needs, after solving the problem of food and clothing, people will inevitably put forward emotional appeals. As we all know, due to differences in Eastern and Western food cultures, many Chinese and international students find it difficult to adapt to new dietary systems. Lao Gan Ma undoubtedly solves this problem. International students can find familiar tastes in Lao Gan Ma products. For them, far from home, Lao Gan Ma is no longer just a simple chili sauce but a nostalgia for home.
In this unique environment, Lao Gan Ma has become a symbol, meaning: not only delicious, but also carrying the sentiment of hometown. This emotionally driven consumption motivation is called "emotional persuasion" in advertising.
On the other hand, the Chinese study abroad trend has maintained strong momentum in the past 20 years. In 2016, the Institute of International Education stated that Chinese students had become the most important source of income for American universities. In the United States, nearly one-third of international students come from China. According to statistics from the Ministry of Education on Chinese students studying abroad, in 2018, the total number of Chinese students studying abroad exceeded 660,000.
Among this huge group of international students, there are inevitably "super spreaders" with "the few" attributes, and they are the key to spreading Lao Gan Ma's "addiction influence" overseas. Some foreign netizens even joked: "When you marry a Chinese woman, you marry two women: your fiancée and Tao Huabi."
As Lao Gan Ma's brand and products gradually penetrate overseas through Chinese and international students, the public opinion attitude and environment of the overseas market toward Lao Gan Ma began to change. More and more foreign netizens fell under the "addiction influence" of Lao Gan Ma. A mix of nostalgia and national pride was ignited in 2013.
At that time, Lao Gan Ma was hailed by the American luxury e-commerce site Gilt as "the world's top premium condiment" and was snapped up at a price of 79.1 yuan for two bottles. Once reported, this event immediately attracted high attention from Chinese people.
In 2015, the Los Angeles Times invited two famous chefs and a food critic to blind-taste the world's most delicious chili sauces. Lao Gan Ma won again, further raising its price.
On most foreign shopping websites, Lao Gan Ma is translated as "Lao GanMa," but some admiring fans respectfully call it "The Godmother." Although Lao Gan Ma has attracted a large number of foreign die-hard fans, because overseas is not the place of origin, the increase in channel links and logistics costs has made Lao Gan Ma hard to find in some areas.
Until 2018, Tao Huabi said in an exclusive interview with Guizhou Radio and Television Station: "You ask me how many countries Lao Gan Ma is sold to? I don't know either. I can only tell you that wherever there are Chinese people in the world, there is Lao Gan Ma."
In Tao Huabi's eyes, the ability of Lao Gan Ma to raise prices overseas is based on the excellent quality of the product itself and the recognition of Lao Gan Ma by overseas Chinese. One sentence, "I am Chinese, I don't earn Chinese people's money. I want to sell Lao Gan Ma abroad and earn foreigners' money!" further ignited the "patriotic heart" of Lao Gan Ma fans.

**-05- The Logic of Dual-State Complementarity**
Looking at the history of Lao Gan Ma's "breaking out of the circle," we can find that the birth of a "national trend brand" requires two states. One is the "agile state" of becoming a "national trend brand" through "active" hot spot creation and IP marketing; the other is the "stable state" of accumulating fan and word-of-mouth momentum by relying on the brand's own characteristics of "old brand, deep sentiment, excellent products, and low prices."
In management, the dual-state business theory splits a company's main business into stable and agile parts. The stable business is like the city wall and moat of the enterprise; the agile business is like the siege engine for expanding territory.
Enterprises with only stable business lack vitality; enterprises with only agile business lack effective profit models and stable income sources. The brand may become popular through marketing for a while, but due to the lack of a product moat, its vitality is likely to be short-lived.
To upgrade an old national brand to a high-quality trend brand, the logic is very similar. Nowadays, explosive products appear on the market from time to time, but explosive products may not necessarily rely on a wave of IP marketing to dominate the market. When a national brand wants to remain invincible in the market and have a positive reputation in the public opinion environment, it needs the "agile state" and "stable state" to complement each other and form a combination punch.
For example, Lao Gan Ma's timely "debut" to express its brand stance in response to market changes is an "agile state" for spreading product concepts. Lao Gan Ma's ability to easily "hot debut" through brand marketing in 2019 is not accidental. The real logic behind its "debut at the peak" is its 30-year reliance on the "tipping point" logic of "product-first" to reach the "C-position" of public opinion, transforming "product-first" into the "stable state" of "mass base."
Among the many national brands that have "broken out of the circle," Warrior (Huili) sneakers share the same logic as Lao Gan Ma. In 1935, Warrior Shoes officially registered its trademark, earlier than Adidas and Nike, making it the oldest sports shoe brand in China.
In that era of scarce resources, superior quality and affordable prices made Warrior's product "stickiness" unique in the shoe market at the time. Even "the few" like Lang Ping praised Warrior products.
In the 1980s, Warrior's fame reached its peak. The Chinese women's volleyball team wore Warrior shoes to win the World Cup and the Los Angeles Olympics. Driven by the public opinion environment, the "white sole, red line" brand logo became popular across the country. The "tipping point" effect driven by "product-first" made Warrior the national sports shoe at that time.
Starting in the 1990s, as the market gradually opened up, overseas brands rushed in to seize domestic market share. Although Warrior was affordable and good, its reputation in the market and public opinion declined significantly, even leading to bankruptcy and restructuring.
Until 2016, with the nostalgic national trend blowing in the consumer market, celebrities like Yang Mi and Wu Yifan often wore Warrior shoes on various occasions, and each time with the celebrity halo, Warrior saw a wave of sales growth.
Warrior also actively promoted the "national brand" label in online and offline brand publicity, making it an "agile state" in brand building, to evoke the "hidden door" of consumer awareness of the Warrior brand. Through the "stable state" characteristics of national sentiment, word-of-mouth, and product quality, it promoted both sales and public opinion reputation.
Data shows that since 2016, Warrior brand sales have grown at a rate of over 20% per year, and in 2018, shoe sales reached 80 million pairs.
It can be seen that in the process of national brands transforming into trend brands, the "stable state" is the foundation of the "agile state." From today's perspective, hardcore product quality and mass base have become the "stable state" cornerstone for Warrior on its road to becoming an "internet celebrity trend brand."
**Only when the "agile state" is triggered under the "stable state" can brand influence spread at an extremely rapid speed and cause a large-scale positive impact. The subsequent "breaking out of the circle" effect then extends its fan base to younger consumer groups.**

Source: China Business Review (ID: ceibs-cbr) Author: Shi Yang


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