Braised beef and pickled cabbage flavors are a thing of the past, as premium instant noodles become consumers' new favorite. Even Uni-President Chairman Lo Chih-hsien didn't expect that his remark, "There is a consensus within Uni-President to gradually exit the so-called (mainland) instant noodle market," would be simplified to "Uni-President will no longer make instant noodles, and we won't be able to eat pickled cabbage noodles anymore," and go viral on social media. No one would be foolish enough to shut down a business with annual revenue exceeding 8.2 billion yuan, especially since Uni-President is a listed company. The reason this remark caused such a stir is that everyone shares a consensus: instant noodles are outdated. "Post-92" Instant Noodles Almost at the same time as Deng Xiaoping's "Southern Tour Speech" in 1992, the two giants Uni-President and Master Kong began producing instant noodles in mainland China. If we calculate based on this timeline, the instant noodle brands we know well are already 25 years old, older than "young idol stars." Initially, the synonym for instant noodles in the minds of Chinese people was not Uni-President but Master Kong. In 1988, 29-year-old Taiwanese youth Wei Ying-hang boarded a train from Beijing North Station to Tongliao, Inner Mongolia, and soaked a bowl of instant noodles he had brought from Taiwan, attracting the attention of many passengers. From this, Wei saw a business opportunity and entered the instant noodle field. The story of his rise may be true or false, but it reflects Master Kong's down-to-earth image, which exactly matched the consumption scenario of instant noodles at the time—the slow green trains. At that time, Master Kong learned through market research that in the main noodle-consuming regions like Beijing and Tianjin, the most preferred noodle flavor was beef, followed by pork ribs and chicken, with seafood ranking last. On July 18, 1992, the first bowl of "Braised Beef Noodles" was born in Tianjin Master Kong. At the same time, Uni-President brought its popular shrimp noodles from Taiwan to the mainland market, and it was this wrong choice that made Uni-President lag behind Master Kong for the next decade or more. With the massive migration of rural labor to cities, the 1.98-yuan Master Kong Braised Beef Noodles quickly became a must-have for train journeys. In early 1993, the average speed of passenger trains nationwide was 48 km/h, and it wasn't until the first major speed-up in 1997 that the average speed increased to 64.9 km/h. Even at the maximum speed of 140 km/h on the Beijing-Guangzhou line, covering the entire 2,302-kilometer route still took nearly 17 hours. During long train journeys, instant noodles became the most cost-effective food due to their portability, high calorie content, and affordable price. A steaming bowl of "This is the taste" Master Kong Braised Beef Noodles became an unforgettable memory for people traveling by train. Pickled Cabbage, the Last Glory 2008 might have been the best time for Master Kong instant noodles. With production bases established in over 40 cities nationwide, the market share of instant noodle sales reached 50.8%, with sales exceeding 13 billion packs. In the same year, Uni-President, which had fallen to fourth place in the market, adjusted its product line and launched Pickled Cabbage Beef Noodles, inviting famous host Wang Han to vigorously promote the new product. In 2009, Uni-President sold 900 million yuan with just this single product, awakening Master Kong, which had been sticking to braised beef noodles, and the latter also launched three pickled cabbage varieties, including pickled cabbage beef and pickled cabbage ribs, to compete with Uni-President. Pickled Cabbage Beef Noodles helped Uni-President turn a profit by the end of 2011. In 2012, Uni-President's instant noodle sales revenue was 7.269 billion yuan, of which "Pickled Cabbage Beef Noodles" generated up to 4 billion yuan, accounting for 56% of Uni-President's total instant noodle business revenue. In recent years, with changes in consumer eating habits, the entire instant noodle market has begun to shrink continuously, which has had a more significant impact on Uni-President, which holds nearly 50% of the market share. In 2013, Uni-President's instant noodle sales declined for the first time, with annual sales growing only 2.6% compared to the same period in 2012, while sales volume declined 1.3% compared to the same period in 2012. Even the pickled cabbage noodles, which had a market size of 10 billion yuan at the time, failed to save the sluggish market. Another number is more convincing: according to the "China Instant Noodle Nutrition and Health Trend Report," the instant noodle industry grew from 48 billion servings in 2005 to 50 billion servings in 2011, an increase of 2 billion servings over seven years, indicating that the ceiling of the instant noodle market had already appeared. Two major events also occurred in 2008: China opened its first high-speed railway, the Beijing-Tianjin Intercity, with a design speed of 350 km/h, marking China's railway entry into the fast-rail and high-speed rail era; and Uni-President launched "Tang Daren" (Soup Master), a high-quality instant noodle centered on "soup." Although this high-priced noodle, with an average price of over 5 yuan, seemed somewhat abrupt at the time, it has now come into its own. De-Instant-Noodle-ization Greasy, stimulating, unhealthy... Over the past two decades, instant noodles have always been "that taste," but consumer tastes have been changing, and they seem to have grown tired of "cheap but not good" instant noodles. If it's hard to change consumers' "prejudice" against instant noodles, then "de-instant-noodle-ize." Lo Chih-hsien's somewhat radical statement at the beginning of this article is based on this, but some media did not include his other remark: Uni-President is not leaving "noodles," but the question is how "noodles" should be presented; we cannot use the old methods to respond. Lo believes that the market does not regard Tang Daren as instant noodles but as a snack. After years of continuous decline in the instant noodle market, many companies have begun to use new flavors, high-priced noodles, and distinctive features to cater to the tastes of consumers in the wave of consumption upgrading. Companies that innovate and find the right market have begun to reverse the decline and achieve growth. According to Uni-President's 2016 financial report, instant noodle sales increased by 8.6% year-on-year, higher than the industry's 1.3% growth rate. The "Tang Daren" series achieved double-digit growth. "Duhui Xiaoguan" and "Xiangban Yicheng," priced above 5 yuan per cup, feature regional cuisines. At the same time, Uni-President is also testing high-end brands, but Tmall sales data is not optimistic. "Manhan Yan," priced at nearly 30 yuan per cup, has monthly sales of 35 boxes. "Manhan Dacan," launched at the end of 2016, priced at nearly 20 yuan per cup, has monthly sales of 45 boxes. Master Kong's instant noodle revenue in the first quarter of 2017 increased by 5.76% year-on-year. Similar to Uni-President, it also attempted to respond to consumers' pursuit of high-end and refined products with high-quality soup, and its Golden Soup Shrimp Balls and Beef Noodles have monthly sales exceeding 3,000 units on Tmall. Consumption upgrading is a challenge for local companies, but for foreign companies, it may be an opportunity. Japan's Nissin Group owns instant noodle brands such as Demae Itcho, Cup Noodles, and UFO, and in its 2021 business plan, it regards the Chinese market as a key focus. From 2013 to 2015, Nissin Group's cup noodle business in China had an average annual growth rate of 39%, with the seafood flavor of Cup Noodles being the most popular, followed by five-spice beef. On Tmall's Nissin flagship store, Cup Noodles retailing at 5.5 yuan per cup have sold nearly 60,000 cups under one listing. Due to the rapid growth of the cup noodle business, Nissin's sales in China (including Hong Kong) increased by 8.7% in 2016, achieving its planned growth target one year ahead of schedule. Traditional instant noodles are declining, but the demand for "noodles" still exists. As Lo Chih-hsien said, instant noodles cannot be presented in the old way. The future market belongs to those new-flavor noodles. Source: 21st Century Business Review (ID: weixin21cbr) -END-