---
title: "This Market, About to Reach 100 Billion Yuan, Is It Collecting 'IQ Tax'?"
description: "According to institutional forecasts, China's meal replacement market will reach a scale of 100 billion yuan in the coming years. Meal replacements are foods that can replace regular meals, such as black sesame paste and oatmeal. The market is growing rapidly, but the question remains: can these products actually make money? The reality may surprise you."
author: "一念"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-05-16"
language: "en"
canonical: "https://xinjignxiao.com/en/articles/this-market-about-to-reach-100-billion-yuan-is-it-collecting-iq-tax-25498498/"
markdown: "https://xinjignxiao.com/en/articles/this-market-about-to-reach-100-billion-yuan-is-it-collecting-iq-tax-25498498.md"
original_source: "https://mp.weixin.qq.com/s/xM-__vbqQHI92H7Sgpttqw"
translation: "https://xinjignxiao.com/zh/articles/%E8%BF%99%E4%B8%AA%E5%8D%B3%E5%B0%86%E8%BE%BE%E5%88%B0%E5%8D%83%E4%BA%BF%E8%A7%84%E6%A8%A1%E7%9A%84%E5%B8%82%E5%9C%BA-%E6%98%AF%E6%94%B6-%E6%99%BA%E5%95%86%E7%A8%8E-%E7%9A%84-25498498.md"
attribution: "New Distribution — https://xinjignxiao.com/en/articles/this-market-about-to-reach-100-billion-yuan-is-it-collecting-iq-tax-25498498/"
usage_policy: "https://xinjignxiao.com/ai-policy.txt"
---

# This Market, About to Reach 100 Billion Yuan, Is It Collecting 'IQ Tax'?

> According to institutional forecasts, China's meal replacement market will reach a scale of 100 billion yuan in the coming years. Meal replacements are foods that can replace regular meals, such as black sesame paste and oatmeal. The market is growing rapidly, but the question remains: can these products actually make money? The reality may surprise you.

According to institutional forecasts, China's meal replacement market will reach a scale of 100 billion yuan in the coming years.
What is a meal replacement?
Literally, it refers to food that can replace regular meals, such as black sesame paste and oatmeal, which some people often use as breakfast substitutes.
Currently, the categories of meal replacement foods are also very diverse. On Taobao, searching with the keyword "meal replacement" yields meal replacement powders, satiety foods, meal replacement shakes, meal replacement biscuits, and more.
With so many meal replacement products, can they actually make money? The reality may exceed your imagination.
**-01-**
**How Profitable Is the Meal Replacement Industry?**
Even during the capital winter of 2019, new meal replacement brands like "Wang Baobao" and "Super Zero" still secured financing. Capital's sense of smell is usually much sharper than ordinary people's. Only markets with profit potential can attract capital that never gets up early without profit.
In recent years, the growth of the meal replacement industry has been like Popeye after eating spinach. From 2017 to 2019, the growth rate of meal replacement consumption on Tmall exceeded 50%.
Data from e-commerce platforms such as Alibaba and JD.com show that from March 2019 to February 2020, the total online transaction value of meal replacement products reached 3.657 billion yuan over nearly a year.
With this scale and growth rate, the future of the meal replacement industry is undoubtedly paved with gold.
Zaliang Xiansheng's oatmeal, priced at 38.8 yuan, has monthly sales exceeding 150,000 units on its Tmall flagship store, with monthly revenue reaching 5.82 million yuan.
A bucket of oatmeal for less than 40 yuan is indeed not expensive. But is the high sales volume of meal replacement products really just because they are cheap?
Not necessarily.
Dongchi's weight-loss meal replacement, priced at 1,680 yuan, might shock you if you haven't been exposed to the industry. However, even at such a high price, monthly sales exceed 5,000 orders, with monthly revenue exceeding 8.4 million yuan.
Of course, these two products do not represent the entire meal replacement industry. On Taobao, there are many meal replacement products with average order values around 200 to 400 yuan, with monthly sales of only a few thousand orders.
Even so, the overall growth of the meal replacement industry is real, and it also indicates that there is money to be made in this industry.
But meal replacement products have existed for a long time. Why have they suddenly grown in recent years?
Actually, it's because **meal replacements are not selling food at all, but rather concepts packaged by merchants.**
**-02-**
**Is the Meal Replacement Concept About Cutting Leeks or Collecting IQ Tax?**
The concept of meal replacement only entered China in recent years. Previously, no one called black sesame paste a meal replacement. Who would have thought that the same thing, just with a different name, would become popular?
However, in the United States, the history of the meal replacement concept can be traced back to the 1920s. At that time, some Americans began to indulge their inherent sci-fi fantasies, imagining a synthetic pill that could replace food. Of course, such pills only appeared in cartoons and never became reality.
The true meal replacement foods emerged in the 1960s, during the peak of the U.S. space program.
Astronauts couldn't cook in space, so a drink called Tang and an energy bar were developed. When astronauts took this food into space, it was the best advertisement, and food merchants keenly seized the opportunity.
The marketing concept in the market changed to "products made by scientists in the lab," and overnight, "space food" swept across America.
In 1986, a Canadian marathon runner named Brian Maxwell developed an energy bar. His initial idea was to help athletes replenish energy during long workouts.
As soon as this energy bar came out, some merchants seized the opportunity and pushed it into the mass consumer market. The marketing concept for men was "fitness fuel," while for women it was weight loss.
**So meal replacement products have never played the role of "food" but rather concepts endowed by merchants, and it is these concepts that are truly valuable.**
Meal replacement products in the Chinese market today also have concepts.
Zaliang Xiansheng's baked nut and fruit oatmeal focuses on the concept of a quick breakfast, targeting "lazy people" who don't like to make breakfast. Consumers are paying for the time saved in preparing breakfast.
Of course, the most common concept for meal replacement foods is weight loss.
If you haven't blocked the WeChat business contacts in your Moments, you've likely seen various ads for meal replacement powders and shakes. They claim that without exercise or dieting, just by eating nutritionally balanced and satiating meal replacements, you can lose 20 pounds a month.
The idea of losing weight without effort or hunger naturally attracts a large number of consumers who want to lose weight but can't control their mouths or get off the couch.
So **weight-loss meal replacements are never selling food, but a simple, effective, and effortless way to lose weight.**
Countless failures on the weight-loss journey see the slogans in WeChat Moments ads, look at the "success stories" with before-and-after photos, and are brainwashed by chicken soup like "lose weight, turn your life around." As a fat person who has never succeeded in losing weight, I deeply understand that inner torment. If you don't pay, it feels like missing a chance to take an elevator straight to the peak of life.
In that state of obsession, it's not hard to understand why they pull out their wallets and pay a large sum of money.
Moreover, those meal replacement powders and energy bars on Taobao, priced at a few hundred yuan, are actually quite reasonable. If it's from WeChat business sellers, they often cost thousands of yuan.
Just by adding the concept of weight loss, the price is several times higher than ordinary food. Is this cutting leeks or collecting IQ tax?
Since they've put out the weight-loss concept, as long as it actually helps you lose weight, it doesn't seem like cutting leeks.
A couple of years ago, I met a woman in her 30s, a manager at a listed company, and a social elite. She spent over 6,000 yuan on Herbalife meal replacement shakes. After drinking them for over two months, she did lose weight, but her skin became loose.
But at least it achieved the advertised effect—she really lost weight. In fact, if you only drink black sesame paste for two months, you'd also lose weight. Many other meal replacement foods claiming to help with weight loss can also make you lose weight. After all, the energy provided by meal replacement foods is not even enough for the body's basal metabolic rate, so it's hard not to lose weight.
But the question is whether they truly guarantee no hunger and balanced nutrition as advertised. This has always been controversial. Most meal replacements contain plenty of dietary fiber, which is hard to digest and expands in water, making you feel full—but it's really just deceiving your stomach.
Moreover, this deception is not thorough. Many people who have tried meal replacement foods report that they can't get full and still need to eat, and the extra energy consumed is all converted into weight gain.
As for the nutrition of meal replacement foods, experts and ordinary users have also raised doubts. In February 2019, the news of a 23-year-old woman developing liver failure from eating meal replacements for weight loss sparked widespread online discussion.
Despite this, it still cannot stop consumers who want to lose weight but don't want to diet or exercise. The market size of meal replacement foods continues to grow rapidly. This is not surprising, as every era has products that collect IQ tax, and including you and me, who can guarantee they've never paid for "intelligence"?
Moreover, **the innovation of meal replacement products and the inherent pain points of the industry also determine that those categories that purely collect IQ tax are destined to be eliminated.**
**-03-**
**Pain Points and Innovation in Meal Replacement Foods**
Traditional meal replacement foods include powders that are mixed with water, such as the well-known konjac meal replacement powder, as well as meal replacement shakes, biscuits, and bars. However, these meal replacement foods generally have a common problem: they taste bad.
**The monotonous taste makes it hard to stick with them.**
On Weibo and Zhihu, netizens have expressed that meal replacements are too unpalatable to swallow. This is a major flaw in the entire industry, and if not addressed, the industry's development will inevitably be limited.
However, meal replacement foods are, after all, food, with no high technical barriers. Traditional food companies can easily transition if they want.
For example, Dongchi, which tops the popular meal replacement list, has launched meal replacement sets focused on light meals, a concept that has also emerged in recent years. These are essentially normal foods with scientifically balanced nutrition. You could buy a book for a few dozen yuan and pair them yourself.
But Dongchi's 21-day weight-loss meal replacement set, despite a high average order value of 1,680 yuan, has attracted a large following due to its variety. After all, with pre-planned breakfast, lunch, and dinner, featuring different delicious foods every day, it's mouth-watering just to look at. Compared to those hard-to-swallow meal replacement powders and shakes, it's many times tastier. Consumers of meal replacement foods, who are likely foodies, find it even harder to resist this temptation.
Through product innovation, Dongchi has stood out in this fiercely competitive red ocean. But whether it can rely solely on products to defend its market share remains a question. After all, from a product perspective, the lack of strong barriers makes it easy to replicate.
For meal replacement companies, brand is crucial to defending the moat. Brand building requires more marketing than just the product itself.
A few years ago, Herbalife's weight-loss meal replacement shakes became a viral product in WeChat Moments, relying on overwhelming promotion on social networks.
Around 2018, in crowded places like shopping malls or subways, you could often see attractive young women proactively asking people to add them on WeChat, saying they were starting a business and hoped for support.
In their Moments, besides inspirational chicken soup, there were posts about how someone lost weight after taking their shakes.
If you were tempted and wanted to try, they would try to recruit you as a downline, inviting you to join them in losing weight while starting a business. The so-called business was essentially adding friends in the subway and posting on Moments like them, until someone else was tempted and became a downline—essentially a pyramid scheme.
Many small meal replacement brands now rely on similar methods to Herbalife, using the WeChat business system to collect IQ tax while also cutting a wave of leeks. But for long-term brand development, this approach is not beneficial, as participants are not just consumers but also want to make money. If a large number of low-level agents can't make money, the brand has reached its end.
**Only by truly focusing on product and brand can one succeed. But for meal replacement companies, an unavoidable issue is that the industry will eventually become a highly competitive arena.**
**Where there is money to be made, there will inevitably be competition. Since meal replacement products have low technical barriers and are profitable, it's impossible to stop others from entering. In the end, it comes down to supply chain management, product innovation, and brand operation capabilities. Whoever is stronger will have the last laugh.**
As for those companies that purely collect IQ tax, once consumers' intelligence is raised, they will have no room to survive.
Source: Danjie Entrepreneurship (ID: manjiechuangye), Author: Yinian
Tips will be paid 400-2000 yuan upon adoption.


---

## Copyright and AI use

This article is sourced from New Distribution. Search, quotation, summarization, and model training are permitted, but every use must credit New Distribution and retain the canonical source URL.

Contact: zhaobo258@gmail.com · +86 158 5481 7671