From individual cases to trends, from experience to methodology. The selection criteria for benchmark cases are as follows:
1. Marketing digitalization cases from brand owners or distributors;
2. Successful cases;
3. Representative of trends;
4. Clear path with methodology;
5. Replicable and scalable;
6. Benchmarks are not judged by size or fame. -01- In early and late 2020, I visited Zhengzhou Swire Coca-Cola Beverages Co., Ltd. twice. The first time was to discuss BC integration, and the second time was to observe the results of marketing digitalization. On March 6, 2020, I entered Zhengzhou Swire Coca-Cola as the company's first visitor during the pandemic, and exchanged views with management, with relevant personnel from Coca-Cola China headquarters participating online simultaneously. Professor Liu Chunxiong discusses BC integration strategy with the Zhengzhou Swire Coca-Cola team (Date: 2020.03.06) Given that China's digitalization at the time was segmented by channel, such as F2B, B2b, and B2C, with online and offline separation, I focused on explaining how to connect the three-dimensional space and achieve BC integration. In April, Zhengzhou Swire Coca-Cola's full-chain digitalization project was launched. On December 23, 2020, I, along with President Zhang Shujun and Deputy Editor-in-Chief Peng Chunyu from Sales and Marketing magazine, visited Zhengzhou Swire Coca-Cola again to observe and learn, and was deeply impressed by its digitalization achievements. Left: Liu Chunxiong (Founder of New Marketing Theory, Dean of Marketing Digitalization Research Institute); Center: Xu Yonggang (Director and General Manager of Zhengzhou Swire Coca-Cola Beverages Co., Ltd.); Right: Zhang Shujun (President of Sales and Marketing magazine). Due to internal data, the data parts have been blurred. (Date: 2020.12.23) If I were to select classic cases of marketing digitalization in 2020, I believe Zhengzhou Swire Coca-Cola's case qualifies, and it can be summarized by four keywords: full-chain digitalization, BC integration, visual digitalization, and full-domain digitalization. -02- Full-Chain Digitalization (B2B2C) Zhengzhou Swire Coca-Cola's digitalization consists of two parts: RTM digitalization and BC integration. RTM (Route to Market, also known as distribution) digitalization is the digitalization of deep distribution, a B2B digital system. Because Coca-Cola is a bottling plant that directly supplies terminals, with only a few regions having distributors, the RTM digitalization path is F2b (bottling plant to terminal store). Swire Coca-Cola RTM Digital Intelligence Platform (image blurred due to internal data) Of course, Zhengzhou Coca-Cola can achieve F2b because it covers almost all non-alcoholic beverage categories and has independent coolers at terminals, which is sufficient to support Coca-Cola's direct distribution model. However, the more direct the distribution model, the higher the requirements for refined management, and RTM digitalization precisely solves this problem. Zhengzhou Swire Coca-Cola's RTM Digital Intelligence Platform can reflect the operational status of salespeople and terminal stores in real time. It can be said that it makes the entire channel transparent. Complemented by visualization, the channel situation is intuitively visible. RTM digitalization, i.e., the digitalization of deep distribution systems, is being implemented by many FMCG companies. Especially during the B2B boom in 2014, brand owners saw the drawbacks of third-party B2B and successively established internal RTM digitalization. However, most FMCG manufacturers' deep distribution relies on distributors, and the digitalization of distributors is difficult, so the promotion of deep distribution digitalization faces significant resistance. Even if brand owners do direct distribution, they usually can only distribute to second-tier wholesalers, and it is difficult to reach small terminals (b). Leading companies in China that do deep distribution well had good IT systems before distribution digitalization. "Speaking with data" was already a basic requirement for daily channel management in these companies. In my opinion, Zhengzhou Swire Coca-Cola's RTM digitalization is based on IT. But digitalization is different from IT: first, digitalization is real-time, with terminal status visible in the system at any time; second, under RTM digitalization, the efficiency of individuals, teams, and terminals is visible at any time. -03- BC Integration Zhengzhou Swire Coca-Cola is one of the earlier companies to adopt BC integration, which is also an important difference between China's channel digitalization and platform e-commerce and new retail digitalization. BC integration means that deep distribution can extend from terminals to the C-end. The logic for Zhengzhou Swire Coca-Cola to achieve BC integration is: mini-program (Coca-Cola Youxianghui) + LBS + Tencent Youma. Tencent Youma is an upgrade of one-code-per-item. Youma integrates Tencent's full-platform capabilities, providing a one-stop solution from product management to marketing efficiency. The Youma solution integrates Tencent's technical accumulation in cloud services, WeChat ecosystem, and big data, enabling retail stores to better connect with users, perceive user behavior, formulate corresponding marketing strategies, or conduct subsequent user operations. Take the UTC promotion conducted by Zhengzhou Swire Coca-Cola as an example: After consumers open the cap, they scan the code through the "Youxianghui" mini-program built by Zhengzhou Swire Coca-Cola. Once they win a prize, consumers can come to the terminal, and the terminal owner verifies the winning status in "Youxianghui" through the CP platform. After the terminal owner verifies a specified number of times through the CP platform, the system automatically places an order, and the manufacturer replenishes goods in a timely manner. Zhengzhou Swire Coca-Cola mini-program "Coca-Cola Youxianghui" This UTC process looks simple, but in actual operation, it faces two practical problems: 1. Participation. How many consumers are actually willing to scan the code? 2. Cost. Analyzing these two problems carefully, a common solution can be sought. First, regarding participation, the lack of consumer enthusiasm for scanning codes is fundamentally because the rewards may not be attractive. The reward settings are fixed, but current consumer needs are diverse. Fixed rewards may attract some people, but for others, they do not constitute a participation incentive. Second, regarding cost, Zhengzhou Swire Coca-Cola's seemingly simple promotion, when costs are aggregated, is definitely huge. So, is there another operational approach where reward products are "sponsored" by other brands? If so, costs would be greatly reduced. Combining the two problems, using "other products" to solve "diverse needs" should be the optimal solution. And the solution is one-code-per-item. General Manager Xu Yonggang explains the C-end platform construction (content blurred due to internal data) In the entire Henan region, if Swire Coca-Cola generates 1.9 billion transactions a year, and if only 5% of these transactions have code-scanning participation, the frequency would be nearly 100 million. In this context, Zhengzhou Swire Coca-Cola and Tencent jointly use Youma technology to focus on solving the problem of diverse needs. In the future, after consumers scan the Youma code, Youma will use big data to identify the consumer's personal tags and give you rewards based on what you like. For example, if you are a mobile game enthusiast, the reward after scanning might be a set of game skins; if you like online shopping, the reward might be electronic coupons; if you are fashionable, you will get new product samples... General Manager Xu Yonggang explains how the integrated platform drives traffic to the B-end Here, I want to particularly emphasize the importance of full-chain digitalization and BC integration for FMCG companies. Cola is an FMCG product, characterized by low unit value, immediate consumption, and anytime consumption. These characteristics determine that offline consumption is the main force, online sales proportion is low, and dependence on traditional channels is strong. Even in the internet age, this remains true. If, as some experts say, only complete online presence is digitalization, it would be extremely difficult. Full-chain digitalization (F2B2b2C, expressed as F2b2C in Zhengzhou Swire Coca-Cola) completely connects the original segmented digitalization of F2B, B2b, and b2C, with data centralized in a unified CDP (Customer Data Platform). This will be the standard configuration for future FMCG marketing digitalization. Full-chain digitalization has significant meaning. It also means the comprehensive integration of traditional offline and the internet, borderless integration. From then on, there will be no boundary between traditional and internet. This type of low-value, high-frequency consumer product, due to its characteristics, makes it difficult for both B-end and C-end to be fully online. But the characteristic of BC integration is precisely that, under the condition of online rate, it activates the B-end through a leverage effect, releasing existing stock. This is a different logic from B2C's online digitalization. -04- Full-Domain Digitalization: Production, Logistics, Distribution In addition to channel distribution, Zhengzhou Swire Coca-Cola has also achieved digitalization in production and logistics, completing full-domain digitalization. Production: Zhengzhou Swire Coca-Cola's factory has 8 intelligent production lines, each equipped with a LineView (online monitoring) system, equivalent to installing an eye on each line. The system classifies situations based on the impact of production line emergencies into three colors: green, blue, and red. Green means normal, blue indicates a problem, and red indicates a serious problem. Even if the production line stops for one second, it will automatically record when the stop occurred and why. What is the benefit? It prevents safety accidents. In the past, production line monitoring and management relied entirely on manual labor, with the shortcomings of delayed problem detection and easy neglect of minor issues. For example, if a bottle falls over, the process may last only one second, but the system can capture and record it sensitively, prompting an investigation and timely resolution. This not only improves production line efficiency but also facilitates daily management for line supervisors. Logistics: In the past, delivery was a problem area in logistics management because manufacturers could not track drivers' routes. Zhengzhou Swire Coca-Cola solved this by making driver routes visible. After technical transformation, the logistics management department can observe the real-time status of each delivery vehicle on a large screen. For example, a red dot indicates the vehicle is in operation. The store owner can open their phone to see where the goods are and how long until delivery, providing peace of mind. A blue dot indicates the vehicle has completed delivery and is on its way back to the warehouse, allowing the warehouse to prepare the next shipment. -05- Visual Digitalization Marketing automation and visual digitalization may be two important labels for retail digitalization and marketing digitalization. In retail digitalization, user tags and user profiles are automatically completed through MarTech (marketing technology), so retail digitalization is also marketing automation. Marketing digitalization is the visualization of a brand owner's people, goods, and places. Visualization achieves intuitive visibility and what you see is what you get. Observing Coca-Cola's digitalization, I clearly felt the benefits of visualization: people, goods, and places, from black box to transparency. The status of every person, every store, and every vehicle is online in real time and clearly visible. For example, in logistics digitalization, the visualization of driver routes has the following two major advantages: First, it facilitates management. Through driver route visualization, you can fully grasp their routes and scope. General Manager Xu Yonggang demonstrates the logistics delivery management system Second, in operations, each vehicle has a positioning system and backend instructions. After the vehicle leaves the warehouse, the system sends a WeChat message to the store owner (store information is already in the digital system) telling them the goods are about to arrive and they can start preparing. If you are not there when the goods arrive, you can arrange for someone else to receive them. At the same time, there are thousands of deliveries, but only a few people in the backend coordinate, and there is no need to worry because if an anomaly occurs, the system will automatically alert. If there is no anomaly, the backend does not need to intervene, nor does it need to be monitored constantly. In the digital age, either marketing automation or everyone is a data analyst. You should be able to see the operational status at a glance through intuitive visual data. For example, managers can see subordinates' work status through efficiency rankings, and frontline salespeople can intuitively understand customer operations through visualization. Digitalization in production, logistics, and channel distribution involves a large number of offline personnel, so this is digitalization that integrates online and offline. In online-offline integration, the 2C part can achieve marketing automation, but the 2B part must be combined with offline personnel, allowing individuals and full-chain personnel to understand the status of people, goods, and places at any time, meeting the requirement that "everyone is an analyst" in front of data. -06- From Case to Trend Trends in FMCG digitalization from Zhengzhou Swire Coca-Cola's digitalization: 1. Full-chain digitalization. Digitalization started with e-commerce (B2C), then B2B. These are all platform digitalization, unrelated to brand owners. Coca-Cola's direct distribution, Zhengzhou Swire Coca-Cola has reached tens of thousands of terminals in Henan Province. This is a B2B deep distribution system. Coca-Cola also has e-commerce (B2C), but it is unrelated to channels. Coca-Cola's full-chain digitalization completely connects the manufacturer (F) and terminals (b) and users. Therefore, the accurate path for Zhengzhou Swire Coca-Cola's full-chain digitalization should be: F2b2C. Full-chain digitalization first means a system covers all links of the channel chain, reaching the C-end directly; second, all links are in the same system. Full-chain digitalization indicates that the boundary between traditional marketing and the internet has disappeared, and comprehensive integration has begun. 2. BC integration. After I proposed the concept of BC integration in May 2019, Coca-Cola was one of the first leading companies to accept it. The logic for Zhengzhou Swire Coca-Cola to achieve BC integration is: mini-program (Coca-Cola Youxianghui) + LBS + Tencent Youma. Cola, as a low-value, high-frequency consumer product, has characteristics that make it difficult for both B-end and C-end to be fully online. But the characteristic of BC integration is precisely that, under the condition of online rate, it activates the B-end through a leverage effect, releasing existing stock. This is a different logic from B2C's online digitalization. 3. Integrating large platforms. The largest digital platforms are Alibaba and Tencent. The digital leverage of BC integration requires tagged C-end traffic, and cooperation with large platforms has certain advantages. Coca-Cola cooperates with Tencent, and Tencent's traffic diversion and empowerment capabilities can be well combined with Coca-Cola. 4. Full-domain digitalization. Production, logistics, marketing, and communication, all domains are digitalized. Recently, some have proposed that data entered by personnel through SFA is often "toxic" fake data, but as long as full-domain data is connected, cross-validation is possible. Full-domain digitalization is very beneficial for flexible supply chains and flexible production, as well as rapid response to LTL orders. 5. Visual digitalization. The label of e-commerce digitalization is marketing automation, with online automatic distribution through user profiles and AI algorithms. BC integration is a combination of offline and the internet, requiring real-time information for managers at all levels, such as terminal efficiency rankings and employee efficiency rankings. It also requires frontline personnel to have information at their fingertips for offline interaction with users. Therefore, visual digitalization will be the standard configuration for full-chain digitalization. 6. All-employee digitalization. In a digital environment, everyone is a data analyst, working based on data. Most leading companies in various industries in China already have a strong data awareness, and meetings and reports are based on data. However, in the past, data was IT-based; now it is DT data. DT data is updated in real time and easier to analyze.