A distinguished guest from afar traveled a long distance to Boss Zhang's hometown. At the welcome dinner, although the guest, who frequently flew around the country and held status and prestige, usually drank famous liquors, Boss Zhang did not entertain him with a nationally renowned top-tier baijiu brand but instead chose his hometown's local liquor brand. After the banquet, the guest not only expressed no dissatisfaction but, upon leaving, took the initiative to buy several cases to take back. Boss Zhang, embarrassed to let him pay, gave them free of charge. Later, the guest kept asking Boss Zhang for more, and Boss Zhang kept giving them for free. Eventually, Boss Zhang could no longer afford to give them away, so he came up with an idea: he turned the guest into a distributor for the local liquor in other regions. Later, the guest's liquor business flourished elsewhere. President Wang is the boss of a local distillery in a certain place. In the good years, he covered several county-level markets and could achieve sales of several hundred million. In recent years, things have gotten worse year by year. National famous liquors have invaded his territory, and he can only sigh in helplessness. His products are aging, prices are transparent, profits are thin, and for high-end products, besides setting high prices, he lacks supporting resources. He launches new products every year, but they don't stay popular for more than half a year. At first, he went to great lengths and painstakingly researched, but almost all failed. Later, new products were just cobbled together, copying popular big sellers, and the quality of the liquor also declined. What changed were the so-called new products; what remained unchanged were the accumulated brand and channel resources. In the early stage, they could still generate some incremental growth and maintain survival, but later, this path became increasingly difficult. The momentum of resources weakened, and channels were lost. Excellent employees also jumped ship. Watching the carnival of the entire baijiu industry, President Wang kept smoking, wondering whether the factory could continue operating next year. When you read this, you may feel a sense of déjà vu. This is indeed a common phenomenon I encounter while serving small and medium-sized liquor enterprises: two extremes. One is to dominate the region, thoroughly penetrate the local market, create high value, provide meticulous service, and expand nationwide, branching out. The other is to be at the end of the rope, struggling year after year, barely surviving on the edge of death. According to statistics, in 2021, 18 listed baijiu companies achieved total revenue of 216.837 billion yuan, a year-on-year increase of 24.57%, and an increase of 27.08% compared to 2019; they achieved total net profit of 82.114 billion yuan, a year-on-year increase of 19.61%, and an increase of 31.65% compared to 2019. It can be seen that the overall trend for listed baijiu companies is positive, but brand concentration has further intensified, and the market share of small and medium brands has been further squeezed and eroded, with the Matthew effect becoming more pronounced. In an overall favorable baijiu environment, how can small and medium-sized liquor enterprises break through, defend their own doorstep, establish a base, and eat and drink well in an environment with abundant water and many fish, achieving breakthrough growth? First, we must understand the types of competition in the baijiu industry. Competition in baijiu is now a battle for existing market share, with overall sales declining, structure moving upward, profits improving, and brand concentration increasing. This is related to consumption upgrading, increased health awareness, and the guidance of major brands. Consumer awareness has shifted from drinking contests to tasting, and from drinking less to drinking better. The battle for existing market share is destined to be a competition of super user value. Which brand can deliver more user value, and consumers will naturally prefer that brand. So what are the attributes of baijiu, and what value should it provide to consumers? Baijiu is a very magical industry. Baijiu combines multiple attributes: functional, social, financial, and collectible. Baijiu accompanies almost everyone throughout their lives. From birth to death, it is inseparable from baijiu. The three major happy events in life are inseparable from alcohol. Humans are social beings, and baijiu is a lubricant for social relationships. Baijiu consumption is multi-scenario, satisfying both physical and spiritual needs. How to create user value for small and medium-sized baijiu enterprises is the key to breaking through. Return to the origin of user consumption What is the essence of consumption? Philip Kotler defined marketing as: Marketing is the process by which companies create value for customers and capture value from consumers in return by building strong customer relationships. Someone asked management scholar Drucker: What kind of shoemaker is a good shoemaker? Drucker replied that there are many answers, such as: Some shoemakers produce the most shoes in the world; they are good shoemakers. Some shoemakers earn the most money each year; they are also good shoemakers. Some shoemakers invent many patents for shoemaking, and others sell shoes to every corner of the world; they are all good shoemakers. But Drucker said they are not the best shoemakers. The best shoemaker is actually one who carefully makes a pair of shoes, puts them on a girl's feet, and then the girl feels very comfortable. Both masters affirm a viewpoint: Creating value for users is the key to enterprise development, and the essence of user consumption is value exchange. Consumption is a process of reconciling with the world, and consumers are willing to pay for value. Product manager Yu Jun: "User value = (new experience - old experience) - replacement cost. User value is whether the products and services provided by the enterprise can solve the material and spiritual needs of users. In Maslow's hierarchy of needs, material needs refer to basic physiological and safety satisfaction, while spiritual needs refer to social, esteem, and self-actualization." Value creation generally starts from two directions: First, user orientation, which is understanding and insight into user needs and desires. For example, OPPO phones address slow charging with the user value of "Charge for 5 minutes, talk for 2 hours." Baidu Maps provides the user value of "Technology makes travel simple." Alibaba's "Make it easy to do business anywhere." Based on user orientation, I proposed the user value for a hawthorn beverage company: "No worries before meals, no worries after meals," solving the pain points of many people having no appetite before meals and indigestion after meals. For a large-scale liquor operator facing pressure on distributors to sell liquor and difficulty in market development, I proposed a value proposition for the B-end: "Sell liquor easily, choose **." Second, competition orientation, which targets competitors to find differentiation that effectively separates from competitors. For example: 7-Up, the non-cola; Feihe milk powder, more suitable for Chinese constitutions; Aliyun Drive, no speed limit, just fast; Kugou, just more songs. Based on competition, when I served as a marketing consultant for a local baijiu distillery, I proposed "Smooth is the real soft and mellow" based on the soft and mellow trend, solving the user-level judgment standard for soft and mellow and effectively differentiating. For a meal replacement powder company, I proposed the value proposition "Naturally enjoy being slim and beautiful," to express achieving weight loss without excessive dieting or harmful drugs. Value creation is based on users Use external thinking to solve user problems User value must be based on external thinking. External thinking is conveying information based on the other party's cognitive level, feelings, and specific environment, based on the user. Users are result-oriented and only care about what effects it brings them, not your process. Never make the mistake of internal thinking, believing that what you feel is what others feel, and your views are also others' views. For example: When users buy sunflower seeds, they don't care what sunflower seeds the manufacturer uses, where they are planted, or how long the sunlight is. Users care about whether eating the seeds causes上火 (heatiness), whether hands get dirty after eating, whether they are easy to crack, how to keep uncracked seeds from getting damp and maintain crispness, and whether the cracking sound is loud. Creation of perceivable value Value that users can perceive is the greatest value; otherwise, it is invalid. Perceivable value gives users direct stimulation, triggers conditioned reflexes for purchase, hits pain points directly, reduces decision costs, and improves decision efficiency. First: Value anchor—user value creation based on competition orientation The creation of value points should solve the user's top pain point. Jiang Nanchun, founder of Focus Media, believes: Do customers recognize it? Do competitors hate it? Do employees talk about it? Feng Weidong, CEO of Tiantu Investment: "Who am I? What's different? How do you know?" List the value propositions of China's leading baijiu brands: Moutai—China's Moutai, fragrance wafting worldwide; Wuliangye—China's Wuliangye, the world's Wuliangye; Luzhou Laojiao Guojiao 1573—Taste the flavor of time; Luzhou Laojiao Laohao Tequ—Authentic strong aroma, Chinese taste; Jiannanchun—Tang Dynasty palace liquor; today's Jiannanchun; Fenjiu—Qinghua Fenjiu, China in the bones; Yanghe—A better era deserves a better you; Gujing—Brewed in China, fragrant worldwide. Value propositions generally start from functional appeals, and as sales scale grows, they gradually transition from functional to emotional appeals, from concrete to abstract, showing a ladder-like progression. If you start with emotional appeals, users are unaware and indifferent. Image source: Time's Friend, Luo Zhenyu's New Year's Eve speech For example, Xuanjiu's "Small cellar brewing, softer and mellower," Kouzijiao's "True storage, real cellar," Jinhui's "Only cellar aroma, no mud smell," Tanjiu's "Dare to label true vintage, connoisseurs drink good liquor," Luzhou Laojiao's century-old cellar liquor's "Old cellar, better liquor," and the "Smooth is the real soft and mellow" I proposed for the liquor enterprise I served, and a food company's "Authentic ***, natural pepper and hemp fragrance." Small and medium-sized liquor enterprises should avoid value propositions that they think are high-end but consumers are unaware of. Gain insight into pain points from the user level, reverse-engineer from within the enterprise to discover and refine. The sharper and smaller the entry point, the better—less resistance, easier entry, and easier to occupy a position. Second: Consumption force—matching the value point Once the value point is found, make a matching arrangement around the consumption force of the value point, forming strong support for the value anchor, strengthening users' trust in purchase, and showing authority and professionalism. For example: One of the functional appeals of baijiu is not getting a headache. How to make users feel no headache? Besides the direct physical sensation after drinking, pre-drinking cognitive education is more important. The direct physical sensation occurs after purchase; before purchase, how to influence the purchase decision? A distillery did it with evidence, explaining no headache through four dimensions: inherited craftsmanship over a thousand years, ground vat fermentation, small molecule liquor, and ultra-low fusel oil content. Third: Aesthetics—visual explicit presentation Speaking of aesthetics, there is a concept of aesthetic power. Donald Norman, the famous American cognitive psychologist and industrial designer, said in his masterpiece "The Design of Everyday Things" that human brain activity has three levels: the visceral level, the behavioral level, and the reflective level. The visceral level is innate, deep-rooted unconscious needs, such as "good-looking." The behavioral level is acquired, learned experiences and actions, such as "easy to use." The reflective level is the highest, involving active conscious thinking. Through thinking, people discover more fun, called "interesting." Love at first sight, especially easy to use, and most importantly, through aesthetics, one can also associate with good products—starting with appearance and ending with talent. Aesthetics not only touches the mind and brings the pleasure of dopamine secretion but also serves as a medium for self-propagation, adding points to the value proposition. Caution: Never use Moutai's packaging as a reason to despise packaging aesthetics. When learning, don't look at its successful appearance, but restore its original state before success. Success is the most deceptive; you only see the most dazzling part and ignore the rest. Fourth: Trust certificate—supporting evidence tactics There is a way of expression called self-evident, and another called performance. To prove it is pure grain brewing, they display raw material bottles; to illustrate the quality of the liquor, they make derivative products; to let users perceive pure grain brewing more directly, there are tasting and identification methods, such as hand rubbing and biopsy. Delivering value Delivering value is a dual occupation: occupying the user's mind and occupying the shelf, achieving "think of it, buy it." What is a complete set of tactics for small and medium-sized enterprises to deliver value? First: Cognitive igniter—immersive experience Without cognition, there is no transaction. Cognition is the prerequisite. How to make value meet user needs and trigger the user's purchase switch? Immersive experience is the most effective: one experience, a lifetime memory. For example, the three-level experience of Lidu Liquor, which our new marketing team served, deepens the user's experience level at different levels and increases the sense of value; the ritual sense of experience, photo sense, participation sense, and entertainment sense touch users, making them actively join, achieving resonance, and co-creating with users. Immersive experience is gradually iterated, not completed at once. First, have cognitive awareness and a thinking framework. In the future, regional distilleries should weaken the industrial attributes of the distillery, increase cultural, entertainment, and tourism functions, and build it into an open regional tourist landmark. Second: Engine of momentum—circle movement What small and medium-sized liquor enterprises lack most is resources. The social attribute of baijiu determines that baijiu is aspirational consumption. Leader consumers influence and drive mass consumption. Starting from the top of the pyramid has low cost, high value, and great influence. The 1990 principle: In any matter, 1% of people lead the trend, 9% quickly follow, and the remaining 90% of the general public will follow the crowd. Start from circles, sort out the circle structure, connect circles, promote spontaneous organizational activities within circles, expand multiple fission of circles, and maintain the sustained vitality of circles. Third: Amplifier of sales—new channel commerce New channel commerce is an amplifier of sales. It is experience-oriented, using a dual-store model—offline store + online cloud store, dual scenarios—to store + to home, dual IP—brand IP + personal IP, dual experience—in-store experience + online experience—to empower channels and increase sales. Through self-built and traditional channel terminal transformation, form a new channel commerce with reasonable density, integrating experience, communication, and transaction, achieving better service for users, better user experience, and more efficient user connection. Small and medium-sized liquor enterprises should do a good job in their base, do a good job in local markets, refine and deepen channel terminals, and achieve "more, faster, better, and more economical": more—higher output per store, faster—faster service efficiency, better—better product structure, and more economical—lower costs. Fourth: Stabilizer of brand—super communication Find a core value point, express and present it through strategy, and then continuously communicate to consolidate the value point, achieve positioning, and form consumption memory. Consumption is most easily forgotten. In addition to repetitive one-way indoctrination like a repeater, it is necessary to interact with users through multiple themes, multiple forms, multiple structures, and sustained interaction. Communication strengthens cognition, builds a cognitive barrier wall, defends against competitors, and maintains brand loyalty. For example, the baijiu industry likes to hold sealing altar festivals and cellar opening festivals. How to explore and expand a festival that belongs to fans themselves? It should be closer to users. Value symbiosis Adhere to long-termism, be a friend of time. Enterprise value is solving social problems. The realization of enterprise value must handle solving user value, creating employee value, and empowering customer value. To achieve this goal, value symbiosis is necessary. Only through value symbiosis can we better achieve division of labor and cooperation, create greater value, reduce management difficulty, lower employee turnover, make channel prices more rigid, channels smoother, and user experience better. Focusing and concentrating on creating value for users is the key basic element of enterprise management. Achieving user value creation means achieving customer creation, and breakthrough is just around the corner. Finally, dear readers, think about it: What value does your enterprise create for users? About the author: Zhu Chaoyang, General Manager of Needlepoint Management Consulting Co., Ltd., co-author of "New Marketing 2.0," a practical marketing expert who grew from the front line of the market. He has served the beer, baijiu, food, beverage, and condiment industries, providing marketing consulting services to many small and medium-sized enterprises. He helps enterprises grow rapidly, achieve strength and scale, and maintain stable and sustainable development. Are you "watching" me?