01 Does 1 billion yuan count as a blockbuster product? For Yili and Mengniu, a new product that doesn't exceed 1 billion yuan in its first year is abandoned. Uni-President says they only make blockbuster products at the 1 billion yuan level, and they don't aim higher. Both are industry leaders, yet for 1 billion yuan products, Uni-President treats it as the ceiling, while Yili and Mengniu treat it as the floor. This seems like a contradictory signal. Whose lead should we follow? 02 In 2018, Yili's revenue was 80 billion yuan, with its largest product, Ambrosial (Anmuxi), generating 17 billion yuan in annual sales, and three brands each exceeding 10 billion yuan in annual sales. Yili is a company composed of super blockbuster products. Uni-President's 2018 revenue was 21.772 billion yuan. Apart from early super blockbusters like Green Tea, Ice Black Tea, Fresh Orange, and Pickled Cabbage Beef Noodles, which had relatively high sales, recent launches like Tom Yam Noodles, Xiao Ming Classmate, Sea's Words, and A Water each have sales around 1 billion yuan. There are also a number of popular products that may not reach 1 billion yuan, such as Shui Quduo, Yaha Iced Coffee, Kaixiaozao, and Assam Milk Tea. Uni-President is becoming a company with many products, each with distinct characteristics. Two industries with different attributes and at different stages of development may both be making the right choices. 03 The dairy industry is an imported industry and is still in a growth phase. At the same time, industry upgrading is evident. Imported industries, compared to local native industries, lack regional characteristics, making them more suitable for super blockbusters, and industry concentration is relatively high. The dairy industry is in a growth phase. Generally, consumer demand during growth phases has stronger consistency, which is suitable for blockbuster products. Starting with Mengniu's Telunsu, the dairy industry has initiated upgrades led by super blockbusters. Bright Dairy's Mosilian started another wave of upgrades, but the biggest beneficiary was Yili's Ambrosial. Generally, industry upgrades should result in a pyramid-shaped industry structure, with a relatively low proportion of high-end products. In the dairy industry, high, medium, and low ends are currently balanced. This may be due to the large share of the two industry giants and their push for super blockbusters. Is the dairy industry's state exceptional? I think it's somewhat special. In the future, super blockbusters will still exist in various industries, but such concentration of super blockbusters will become increasingly rare. 04 Uni-President's food and beverage industry, although also having imported characteristics, has stronger localization. The food and beverage industry has two major directions: upgrading and segmentation. Upgrading is about breaking through the industry ceiling. For example, Tom Yam Noodles represents a lifestyle noodle that breaks the low-end, unhealthy image of traditional instant noodles. Unlike the dairy industry, where upgrading creates a single blockbuster, the beverage industry forms a spindle-shaped structure. For example, in mineral water, the early mainstream price point was 1 yuan, now it's 2 yuan, and a 3 yuan mainstream price point is emerging. Uni-President's A Water is already the mainstream price point in Shanghai, and they are even positioning for higher price points. With each round of mainstream price increases, the lower price point still exists but with reduced sales, while higher price points attract new players. The food and beverage industry shows more obvious "consumption segmentation" characteristics. Consumption segmentation is about personalization, and although it also involves price point increases, personalization is the theme. For example, Xiao Ming Classmate, Sea's Words, and Shui Quduo. Personalization is niche, and its volume naturally cannot compare with mass market. Therefore, for food and beverage companies like Uni-President that mainly serve middle-class consumers, a 1 billion yuan product is truly a super blockbuster. 05 100 billion yuan is a super blockbuster, while 10 billion yuan is a regular blockbuster. Will there be 100 billion yuan blockbusters in the FMCG industry in the future? Perhaps, for example, regional categories going national, or innovative categories that could give birth to super blockbusters. But they will be rare. 10 billion yuan blockbusters may be the super blockbusters of the future, especially in the upgrading and segmentation of existing categories. Of course, the threshold for blockbusters varies by industry. Is data judgment a numbers game? No. It reflects an understanding of the industry state and consumer perception. Marketing must be built on the premise of understanding the industry and consumer changes. Back in the day, when Uni-President was promoting Pickled Cabbage Beef Noodles, they abandoned many low-margin products and also positioned Tom Yam Noodles, which is hot today. In hindsight, that was strategic layout. Layout is an arrangement made in advance based on insight into the future, beyond ordinary expectations. When proven correct later, it's hard to catch up. Source: Teacher Liu's New Marketing -END-