On June 19, major e-commerce platforms released their 618 mid-year shopping festival reports, and Tsingtao Brewery continued to lead the beer category during the 618 period. According to official data, during JD.com's 618, Tsingtao Brewery's flagship store ranked No.1 on the day of 618 and TOP1 among beer brand flagship stores. In Tmall's 618 alcohol report, Tsingtao Brewery ranked first in both the beer category brand list and store list, and topped the beer category brand list throughout the 618 period, with sales up over 50% year-on-year.
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This Year's 618: Tsingtao Brewery Dominates the Charts Again
In fact, since ramping up its online channels, Tsingtao Brewery has frequently taken first place in e-commerce "big exams" like 618 and Double 11 over the past two years. In 2019, Tsingtao Brewery won both the beer brand and store championships on Tmall during 618; the classic 500mlx24 can product exceeded 10 million yuan in sales, selling a total of 2.85 million cans, making it the No.1 single product in the beer category. Tsingtao Brewery's Tmall 618 transaction volume grew 4.2 times compared to the previous Double 11. During the 2019 Double 11, Tsingtao Brewery's Tmall flagship store saw same-day sales increase 212% year-on-year, and conversion rate increase 182% year-on-year. The cans sold in the first 79 minutes were equivalent to the height of 32 Mount Everests; Tsingtao Brewery, Laoshan Brewery, and Tsingtao Specialty brands occupied the first, third, and eighth positions respectively in JD.com's POP store rankings, with sales growth exceeding 400%, and Tsingtao Brewery Classic once again won the single-product sales championship; on Suning.com, it was also the No.1 beer brand. During this year's 618, in addition to winning multiple championships, Tsingtao Brewery's growth data remains noteworthy:
Sales growth increased over 50% compared to the same period last year, store fans grew 900% year-on-year, member daily average transaction amount increased 425% compared to 2019 Double 11, and daily average transaction volume increased 482% year-on-year.
More notably, three products—Tsingtao Brewery 1903 National Trend can, Tsingtao Brewery White Beer, and Pure Draft Flower can—became the most popular product among men, the most popular among women, and the most popular new product, respectively. Among them, Tsingtao Brewery 1903 National Trend can saw a year-on-year increase of up to 3293%, White Beer increased 307%, and Pure Draft Flower can achieved over 100 million exposures across the internet, deeply favored by young consumers.
In the hot field of live-streaming sales, Tsingtao Brewery also showed no hesitation, partnering with Viya to sell 270,000 cans in 5 seconds, and also enlisting famous artists like Liu Tao and Wang Han. The first cloud launch event for a beer brand, hosted with famous host Wang Han, sold over 15,000 boxes of Tsingtao Brewery 1903 National Trend cans, with live-stream heat exceeding 323 million likes. It is worth mentioning that not only the main business of beer sold well, Tsingtao Brewery Museum flagship store also shone in this year's Tmall 618 rankings, ranking second among museum flagship stores, second only to the Palace Museum Cultural Official Flagship Store, and "Cultural Tsingtao" is also accelerating its entry into consumer groups. It can be seen that Tsingtao Brewery has shown explosive growth in the e-commerce field, with multiple products becoming favorites among netizens, and it has firmly secured the No.1 position in the beer category in consumers' minds. What is the secret behind Tsingtao Brewery's rapid rise in e-commerce?
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Clear Positioning, Creating a Benchmark for National Trend Brands
In fact, in the early stages of beer entering e-commerce, some beer brands did not deploy online on a large scale, and the top beer brand was Budweiser, not Tsingtao. According to Mr. Shi, e-commerce director of Tsingtao Brewery's Innovation Business Division, in the early years of rapid e-commerce development, only Budweiser performed well among beer brands. At that time, Taobao approached him, hoping that Tsingtao Brewery would make efforts online to jointly promote the e-commerce development pattern of the beer industry. Mr. Shi believes that online and offline channels actually have many commonalities, and profits can also be analyzed from the "4P" perspective: product, channel, price, and promotion. He said that it was through such analysis that they discovered the market opportunities were still quite significant. Subsequently, Tsingtao Brewery did not rush in headfirst but began meticulous planning. After a detailed analysis of e-commerce platforms, they found that beer brands on e-commerce channels were actually all doing TP (Tmall Partner) business, and profitability was not good. Tsingtao Brewery did not follow the low-price, low-profit e-commerce route like many beer brands, but instead took the opposite approach, putting profitability at the forefront. So how to achieve profitability? Based on this, Tsingtao Brewery began targeted strategies.
First, in terms of products, use high-volume bestsellers as traffic-driving products, but do not promote these products as the main focus. Because on e-commerce platforms, express delivery fees, on-site promotion, platform taxes, and other costs compress profits, so low-unit-price products can only be used for traffic generation. In online channels, compared to competitors, Tsingtao Brewery chose to operate its e-commerce channels independently rather than as a TP, to ensure profitability. Based on understanding of the channels, besides traffic-driving products, through analysis, Tsingtao Brewery found that consumers are still willing to pay for high-value-added products online, so Tsingtao Brewery adopted a high-position pricing strategy for online products. In promotion, Tsingtao Brewery is also highly targeted. Moreover, Tsingtao Brewery does well in "chasing hot topics," for example, when consumers are stuck at home due to the pandemic, Tsingtao Brewery's promotional gifts are household items. And it responds promptly to environmental changes, such as when barbecue season approaches, gifts change to grills; when people stay up late, eye masks are given... And as Tsingtao Brewery's online scale grows and forms economies of scale, the expense ratio further declines, leading to more market scale effects. Various market measures have also achieved twice the result with half the effort, which is an important reason for Tsingtao Brewery's rapid growth in online channels in recent years.
So what inspiration does Tsingtao Brewery's rise in e-commerce bring to the industry? Mr. Shi said that in the entire FMCG industry, most brands ranking high in e-commerce are imported brands, such as Unilever, Budweiser, Coca-Cola, etc., and only a few Chinese brands stand out. Tsingtao Brewery's rapid rise in e-commerce tells domestic FMCG practitioners and consumers that domestic brands can also seek breakthroughs in e-commerce. Adhere to positioning and use correct strategies to break through in e-commerce. In the long run, e-commerce will replace media communication and TV advertising. Even if you no longer promote as much, as long as you achieve TOP in industry e-commerce for several consecutive years, then after a few years, this brand will become the TOP in consumers' minds. Against the backdrop of national goods, Tsingtao Brewery bravely stands at the forefront, defeating imported brands and firmly holding the top position. From this point of view, Tsingtao Brewery has become a benchmark for domestic brands in the e-commerce field, pointing out a new path for the rise of domestic brands.
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Trendy Style + High-end Strategy Continue Tsingtao's Century-old Glory
Tsingtao Brewery's strong performance is not only in the e-commerce field. On June 19, the liquor sector surged, and the "Big Four" domestic beer stocks—Tsingtao, Yanjing, Zhujiang, and Chongqing—all rose. In terms of total market value, Tsingtao Brewery, with a total market value of 94.97 billion yuan, far surpassed the other three, even exceeding the sum of the three. In 2019, its revenue and net profit also ranked first with 27.98 billion yuan and 1.929 billion yuan respectively. According to Tsingtao Brewery's 2019 annual performance report, the company achieved total beer sales of 8.05 million kiloliters; operating revenue of RMB 27.98 billion, a year-on-year increase of 5.3%; and net profit attributable to listed company shareholders of RMB 1.85 billion, a year-on-year increase of 30.2%. It can be seen that although the beer market is maturing and incremental space is limited, Tsingtao Brewery's revenue growth is not particularly dramatic, but the growth rate of net profit still attracts industry attention. What is the secret behind Tsingtao Brewery's rapid development? The editor summarizes it into two aspects: trendy style and high-end strategy.
1. The Trendy Style of Century-old Tsingtao First is the brand's trendy style, which makes Tsingtao Brewery, a century-old enterprise, show no signs of "aging" and attracts a large number of young consumers. This can be seen from the pandemic period. In the first half of this year, many enterprises faced difficulties due to the pandemic, pouring cold water on many industries and companies, but Tsingtao Brewery, with years of brand accumulation and rich experience in dealing with crises, saying "no" is definitely not their style. Facing market difficulties, Tsingtao Brewery took various measures to actively respond, and ramping up online efforts was one major move.
In mid-May, Tsingtao Brewery invited contemporary traffic star Hua Chenyu as its spokesperson, and during the 618 carnival, released a short film "Cross-era Toast" starring Hua Chenyu. The topic "#Hua Chenyu Wears Century-old National Trend#" sparked heated discussions online, and the rise of "century-old national trend" culture is quite popular among young consumers. As for the trend of live-streaming sales, Tsingtao Brewery had already laid out plans early, continuously partnering with famous internet celebrities and artists like Viya and Liu Tao for live-streaming sales. This year, it even joined forces with famous host Wang Han's Taobao live-streaming variety show "Set Off for Beauty" to launch the new packaging of Tsingtao Brewery 1903 National Trend can across the internet, which once ignited the entire network. Youthful and trendy marketing has brought Tsingtao Brewery closer to the new generation of consumers, and also made its performance in online channels more outstanding. Judging from the performance of online channels in recent years, Tsingtao Brewery has successfully continued its leading position in the beer industry through a combination of hard strength and innovative marketing.
2. High-end Strategy Boosts Profit Growth In addition to incorporating trends and appearing younger in brand marketing, Tsingtao Brewery has also made significant reforms and innovations in product structure in recent years. From the beer market environment in recent years, we can see that as the industry matures, major beer companies have continued to increase ton prices, continuously verifying the high-end trend, and the industry as a whole shows a trend of volume stagnation and price increase. Currently, sales of mid-to-high-end beer in China maintain a high single-digit growth rate, while economy beer sales continue to decline. In terms of high-end strategy, Tsingtao Brewery, with its century-old history, clearly has outstanding advantages in brand power, brewing technology, and production capacity. Its strong hard strength is sufficient to support the continuous upgrade of Tsingtao Brewery's product matrix to high-end.
Currently, Tsingtao Brewery's product structure is following this trend, focusing on the "1+1" brand strategy, with the main brand positioned in the high-end market and second brands like Laoshan serving mass consumption. In recent years, the product structure has been continuously optimized, and the ton price has been continuously increased. As of 2019, Tsingtao Brewery's main brand sales accounted for 50%, and revenue accounted for 63%, with high-value-added brand sales increasing 7% year-on-year. With experience in successfully creating high-end large single products, Tsingtao Brewery continues to enrich its high-end product matrix. In 2019, Pure Draft sales accounted for about 9%, and Classic 1903 sales accounted for about 4%. According to GlobalData data, Tsingtao Brewery's market share in high-end products is expected to continue to increase. And the high-end product matrix will inevitably bring higher profit margins to the enterprise, and high-end products have become a profit booster for Tsingtao Brewery.
New Distribution Comment: Tmall 618 double champion Tsingtao Brewery, relying on solid product strength, trend-following innovative marketing, and precise brand positioning, has entered consumers' hearts and continuously released the dividends of leading brands. In today's prevailing national trend, Tsingtao Brewery has made good use of its century-old brand advantage. Continuously increasing investment in online channels and fighting for consumer mindshare on major e-commerce platforms, it can be seen that Tsingtao Brewery does not have the common problem of many traditional brands being distant from consumers. Tsingtao Brewery has managed to get close to consumers and understand their real needs. With clear positioning and precise strategies, the century-old Tsingtao's performance in e-commerce is in no way inferior to international brands. With continuous technological progress, emerging channels like e-commerce are also constantly upgrading, and Tsingtao Brewery has truly kept pace with the times, which is an important factor for an enterprise to maintain long-term development and not be abandoned by the times. In terms of brand promotion and consumer cultivation, Tsingtao Brewery has also demonstrated outstanding capabilities as a leading brand. Innovations related to "Tsingtao culture" like the Tsingtao Brewery Museum have played a good role in promoting continuous consumer cultivation.
The impressive results of consecutive chart-topping prove the correctness of Tsingtao Brewery's strategy. Whether in marketing or product structure, it has shown sustained and stable upward momentum. Its century-old beer brewing technology research has placed it at the forefront of product development, even forming certain barriers, ensuring the sustainable development of its brand. Topping the 618 charts is only a partial reflection of brand strength. In today's fiercely competitive market, understanding how to use the environment and one's own advantages, following trends, and respecting changes brought by technological progress are the fundamentals for a brand's survival. Whether the century-old Tsingtao can continue to write its glory in the future, we look forward to witnessing it together.
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