Editor's Note: The annual China FMCG Channel Innovation Conference, hosted by New Distribution, has always attracted significant industry attention. From March 18-20, the 2022 (7th) China FMCG Channel Innovation Conference will be held in Chengdu. The theme 'Rebuilding the Foundation' has caused a stir in the industry and generated a huge response.

This response has unique reasons rooted in the times. Under the influence of internet ideology, the FMCG sector has experienced a certain degree of 'innovation syndrome' in recent years. Anything with a new label must be embraced; anything with old traces must be rejected. Concerned observers worry that in this atmosphere of 'novelty at all costs', our enterprises and organizations are highly likely to head down the wrong strategic path.

Clearly, 'Rebuilding the Foundation' is a reflection on the 'novelty at all costs' trend, and the industry's response is a positive reaction to this reflection.

'Foundation' is not just a tactical concept; it is a strategic thought

Without a base area, there would have been no final success for the Chinese revolution. The construction of base areas in the Chinese revolution was not successful at the first attempt. But under the guidance of the base area thought, repeated construction eventually made the base areas stronger and larger. The victory of the Chinese revolutionary war was inseparable from base areas. This thought also applies to market competition: enterprises without a strong foundation are destined to miss out on victory.

'Foundation' is certainly a tactic and strategy, but it should also become a strategic thought for enterprises.

For example, 'guerrilla warfare' is itself a combat tactic, but after distilling the 'Sixteen-Character Principle', guerrilla warfare became a strategy—an effective strategy for the weak to defeat the strong.

The biggest difference between strategic thought and tactical strategy is that tactics often become ineffective as circumstances change, while strategic thought shines even brighter after the test of time.

Isn't the weak Taliban's eventual victory in the 20-year Afghan war proof that guerrilla strategy is still effective in today's technological age?

'Base area' is a concept we are very familiar with, but it is not exactly the same as 'foundation'. The former focuses on offline, regional markets and is very easy to understand. The latter, in addition to the above, also includes products, brands, organization, and more.

We say that 'foundation' is a strategic thought because it is not just a base area, but also core big products, core business units, and even core organizational teams.

Huawei is facing suppression from the United States, and no enterprise crisis can surpass it. Why can it still survive and even continue to grow? Because Huawei's foundation is its communications business. Huawei's consumer business has been severely suppressed, even forced to be sold off, but as long as the communications business remains healthy, Huawei remains strong.

Mr. Luo Zhenyu defined 'what is a foundation' in his 2020 New Year's Eve speech: It is something that cannot be changed, cannot be taken away, and cannot be lost.

And what guides us to truly achieve the above, if not a strategic thought?

Only by strengthening the foundation can marketing have its due value

The best investors can quickly and accurately judge a company's value, and their first method is to look at the 'foundation'. As long as the value of 'Feitian Moutai' does not decline, Moutai's business will remain smooth; as long as the positioning of 'social center' is not lost, Tencent will have no problems. 'Feitian Moutai' and 'social center' are respectively the foundations of Moutai and Tencent.

A company's 'foundation' represents its true value. This value is not illusory; it is measured by the capital market with real money.

Therefore, the most scientific criterion for judging whether our marketing has created due value is whether it contributes to strengthening and expanding our foundation.

Why did Perfect Diary, once extremely popular, see its market value drop by 90%? Why did the new consumer track, which was hot in the first half of 2021, become cold and ignored in the second half? Why did their huge marketing expenses, over 60%, fail to create due value? Why are they so vulnerable despite their huge sales scale?

Almost all of them invested the absolute majority of their funds in traffic purchase, without building their own foundation.

Any brand without a foundation has no tomorrow. They can only become commercial vagrants, doing whatever is hot today and rushing to do whatever is hot tomorrow.

After understanding 'foundation', we can understand why Genki Forest, after becoming popular online, has continued to invest huge resources offline for years, desperately building a channel system. Because the final battlefield for beverages is always offline.

If it cannot build its own 'foundation' offline, Genki Forest is destined to be just a brilliant meteor.

After understanding 'foundation', we can understand why Jiangxiaobai, after ten years of entrepreneurship and various storms, still stands firm in the market.

In addition to excellent product innovation, its 'foundation' of covering and effectively controlling over 2 million offline terminal outlets is the key to its continued development in the track of baijiu, where innovative brands find it hardest to survive.

Whether for brand owners or distributors, if our marketing deviates from our foundation, then all our innovation and marketing actions completely lose their meaning.

History has proven this, and the future will follow the same logic.

The fateful question of 'Rebuilding the Foundation' needs us to find the answer together

Why do we propose 'Rebuilding the Foundation' rather than 'Returning to the Foundation'?

Because we worry that the word 'returning' might be misunderstood as needing to go back to the old path. That would be absolutely wrong.

History is always strikingly similar, but it never simply repeats itself. Our 'Rebuilding the Foundation' is by no means a rehash of old tunes or a return to old paths.

We oppose the attitude that whenever innovation is mentioned, one must adopt a posture of breaking with yesterday, wishing to 'uproot' all our past.

We also oppose the attitude that whenever returning is mentioned, one immediately brings out the principles from ten years ago, clinging to outdated methods and resisting innovation.

'Rebuilding the Foundation' requires us to correctly understand ourselves and the environment; to think about how to grasp certainty to stabilize ourselves in uncertain times; and to make judgments and choices about how to develop ourselves in the future.

  • How can the 'foundation' thought be combined with my company's business?
  • Where is my 'foundation'? Is what I think is my 'foundation' actually a 'pseudo-foundation'?
  • What challenges is my 'foundation' facing? How can I continue to consolidate and strengthen my 'foundation'?

The above questions are fateful questions concerning the future of our companies. Where can we find answers? On the one hand, we need to engage in continuous deep thinking and self-questioning with our teams; on the other hand, we must discuss and exchange ideas with more industry experts.

Remember, all the 'foundation' problems you are encountering or worrying about may have already been experienced and solved by other peers or experts! There is no need for us to pay a huge or even life-and-death price for problems that have already been solved!

So, if you care about your company's 'foundation', if your company is encountering 'foundation' problems, then this 7th China FMCG Channel Innovation Conference with the theme 'Rebuilding the Foundation' is an event you cannot miss!

From March 18 to 20, the 2022 (7th) China FMCG Channel Innovation Conference will be held in Chengdu! Under the theme 'Rebuilding the Foundation', over 3 days, there will be 102 heavyweight guests, 1 main forum, 12 sub-forums, 7 closed-door salons, and 3500+ FMCG manufacturers and distributors from across the country, all discussing and exchanging ideas together, and jointly discussing 'Rebuilding the Foundation'!

Scan the QR code now to book tickets and enjoy the early bird discount!

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