Internet circles often use a 'three-stage' analogy to describe business operations: from 0 to 1, from 1 to 10, and from 10 to 100. For a company's market size to grow from 0 to 100 million yuan, the core element is innovation, whether it's category innovation or product innovation. As long as an entrepreneur can innovate in some aspect, meet current new consumer demands, and pinpoint a pain point, the company can complete the leap from 0 to 1. This is also the growth prototype for most new consumer brands. However, many new consumer brands find it difficult to grow from 100 million to 1 billion yuan. It's not that the product itself is bad, nor is the marketing poorly done, but rather that to go from niche to mass market, offline is the real battlefield. So how do new consumer brands go offline? We observed the offline operations of a large number of new consumer brands and summarized four basic rules. ****Online emphasizes total volume, offline emphasizes density When new consumer brands go offline, the first problem they face is that consumers who bought online are scattered across the country, like 'sprinkling pepper,' so there's no scale in regional markets, and naturally no one is willing to become a distributor. The logic of online is unlimited virtual shelves, unlimited products, and near-infinite customer traffic. 'People, goods, and places' achieve niche matching through precise big data push, so even long-tail products can find their most suitable consumers. The logic of offline is limited shelf space, a mass configuration. Online emphasizes total volume, offline emphasizes density. Density refers to user density. User density is a very important concept in offline channels. Density is potential energy, and potential energy is influence. The logic of building user density is simple: match the audience and find the right traffic. Offline channels emphasize distribution rate, which represents reach density. As long as you distribute products everywhere, you can always sell them. But when overly segmented new consumer products also pursue distribution rate, what you get in return is definitely a high return rate. Even mass products don't dare to do this now, let alone niche products. So, we need to find places where niche groups gather to have user density. When OATLY oat milk entered China, it found that if it started from soy milk, it would never do well, so it chose to focus—focusing on people, scenarios, and channels. Targeting the white-collar class on Xiaohongshu, it entered Shanghai's boutique coffee shops, thereby forming brand-focused mindshare and premium pricing. On this basis, it entered Tmall and cooperated with the plant-based milk category to create a new plant-based category. Genki Forest's offline strategy is to first enter chain convenience stores like 7-ELEVEn, FamilyMart, Lawson, and Bingobox, because chain convenience stores highly match its customer base. In fact, whether it's a traditional brand or a new consumer brand, any brand's initial stage must focus on channel concentration, i.e., core channels, forming high-density awareness in the short term through rapid sell-through and high repurchase rates. Only after achieving a certain share in core channels is there an opportunity and market to expand to other channels. ****Find the sell-through logic For offline channels, it's not enough to just get products on shelves; sell-through leads to repurchase, and repurchase truly leads to a positive marketing cycle. Don't approach distributors right away; if you find a distributor who doesn't know how to sell, the product will die quickly. What is the sell-through logic for new consumer brands? Consumption scenarios. Products must have consumption scenarios, i.e., a group of people consuming at a specific time and place. With this scenario, finding the sell-through logic becomes simple. Once you find the sell-through logic, you can build the value chain system. Jiangxiaobai has been controversial in the industry; the industry acknowledges its success, but many practitioners question its product. In fact, Jiangxiaobai's success lies in its discovery of the new generation's consumption scenarios: small gatherings, small drinks, small moments, and small moods. Based on these 'four small' scenarios, Jiangxiaobai launched baijiu suitable for young people to drink in dining channels, successfully breaking out. In China's chili sauce market, consumers only know the number one brand, Laoganma, and don't know who is second. Laoganma has also gone abroad, gaining countless fans. Besides product strength, its occupation of the price band below 10 yuan is also an important reason. Hubang Chili Sauce's product is priced one price band higher than Laoganma. Initially, despite good product experience, it tried various channels, such as traditional and e-commerce channels, but none succeeded. Later, Hubang Chili Sauce discovered a new scenario—food delivery. In the food delivery scenario, there's no trace of Laoganma, or even any chili sauce company nationwide, and many delivery meals need some flavor stimulation. So, Hubang Chili Sauce transformed its product according to the delivery scenario: first, it launched small jar packaging, one jar per meal; second, it gave the packaging emotion to facilitate sharing. Hubang successfully shifted its chili sauce battlefield to the delivery channel, quickly achieving over 300 million yuan in that channel. Now Hubang Chili Sauce is an indispensable partner for delivery merchants, with an unassailable position. The strong correlation between product, scenario, and people brings a strong consumption experience awareness. Under such a sell-through logic, rapid breakthroughs in core channels can be achieved. ****Stable value chain For offline channels, price stability is the lifeline. For example, traditional brands like Coca-Cola, Jinmailang, Master Kong, and Tsingtao Beer all have their own distribution mechanisms. Coca-Cola has the '101 sales model,' Jinmailang has the 'four-in-one model,' Master Kong has 'channel intensive cultivation,' and Tsingtao Beer has 'micro-operation'... These models are essentially a value chain that survives on layer-by-layer price increases, which depend on price stability. In terms of capabilities, new consumer brands are all e-commerce logic; they develop e-commerce capabilities. This capability is not friendly when used for offline channels: on one hand, most new consumer brands are OEM-produced, leading to relatively high costs, and since they were born online, they never considered reserving profits for middlemen. Once offline, they find insufficient channel profits; if they leave enough profit, the selling price becomes too high. On the other hand, all online marketing activities are wave-based, such as '6·18,' 'Double 11,' and influencer live streams. These wave-like promotional activities cause price fluctuations, and fluctuating prices cannot build a stable value chain, and without a value chain, offline cannot be done. So, whether a new consumer brand can design a reasonable channel value chain system is crucial for attacking offline. In this regard, Genki Forest has done well. According to CNR data, Genki Forest's annual sales in 2021 reached 7.5 billion yuan, of which 6 billion yuan came from offline channels. For offline channels, Genki Forest has a series of layouts, such as giving equity incentives to core distributors and deploying 80,000 smart freezers in channels. In Genki Forest's offline revenue, convenience store channels account for the majority. Genki Forest plans to deploy 80,000 smart freezers to empower offline stores to improve 'logistics-warehouse-store' management efficiency, reduce costs and increase efficiency for terminal stores, and promote product sell-through. It's worth mentioning that the stability of the value chain also requires new consumer brands to do a good job of matching online and offline products. If the same product is promoted online every day and gains popularity, then going offline with the same product unchanged is definitely not advisable. ****Omnichannel integration After stabilizing core channels, new consumer brands can consider omnichannel marketing. Omnichannel marketing is not about diverting traffic from online to offline (or vice versa), but rather, after connecting online and offline, integrating 'people, goods, and places' so that consumers can freely choose the way to obtain information, assist decision-making, and complete purchases throughout the entire consumption path, achieving a closed loop of behavior in brand operations and consumer relationship management across the entire chain and full cycle. This is the ultimate direction of channel operations for new consumer brands. When offline experiential consumption becomes mainstream, the future of offline consumption must provide added value beyond retail and goods. On one hand, it can effectively differentiate from online; on the other hand, it can synergize with online to form omnichannel interaction with consumers. For example, for Perfect Diary, the core purpose of opening stores is not just to sell things, but also to add WeChat friends. This seems to go against traditional channel values. But in fact, Perfect Diary's plan is very shrewd. Do you know how many WeChat friends Perfect Diary has added through methods like scanning codes to get cotton pads? Over a million. What does this mean? It means Perfect Diary can send countless moments (theoretically) every day to show to these million WeChat friends. A consumer visiting an offline store once is just one touchpoint, but once they add the store as a friend, the brand can guide channel partners to manage them in a battalion-style, and the touchpoints can become infinite. This is channel innovation that diverts offline traffic to a private domain traffic pool. **Source: Sales and Market (ID: cnmarket) Author: Wang Yu Are you 'watching' me?