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Receive every freshly baked tweet in a timely manner, and the new engine of China's low-temperature fresh milk growth should come from the vast county market!
At a time when online dividends are exhausted and low-temperature fresh milk in high-tier cities cannot further accelerate its penetration for the time being, more excavation and growth are actually pointing to a huge but easily ignored market - county-level consumption.
From the beginning of 2024, those dairy brands that focus on low-temperature business have begun to agree to sink into the county market, and they have made frequent moves. Surrounded by a number of powerful enemies, we began to snatch the most imaginative, and in the near future, carry the rapid growth of low-temperature milk!
With a long-term deep ploughing in the low-temperature industry, the new dairy industry is still growing against the trend under the background of overall pressure and fluctuations in the dairy industry, and responds to the current dividends of China's long-temperature and low-temperature conversion incision with a dazzling answer sheet of "revenue and net profit", and is promoted to the fourth strongest after Yili, Mengniu and Bright Dairy. In the future, it will continue to cater to the sinking market with the first engine of growth of more than 15% --- the unique D-to-C (brand direct connection to user) channel sales model, especially the county market where new consumption opportunities are constantly emerging.
Beijing Sanyuan, which is located in the low-temperature business in North China, directly entered the hinterland of a county market in Shandong Province in the mode of delivering milk to the door. At the beginning of 2024, a group of marketing iron troops, from the general manager of the milk delivery business department to the salesman and promoter, are all stationed in the county market, researching users, recruiting dealers, cooperating with their table subscriptions, and terminal promotions, and are very busy.
As the gold digger of the domestic fresh milk industry, Bright Dairy, which is based in Shanghai, continues to increase and deepen the field of fresh milk, and launches the first low-temperature milk products empowered by new technologies such as probiotic pasteurized milk, high-protein NF milk, and membrane filtered high-protein yogurt with the strategy of "leading fresh". Under the optimization of the regional expansion strategy of the whole country, the shelf life of "fresh pasture" will be increased from the original 15 days to 25 days, and the main attack and development of fresh milk consumption at the county level will be carried out, and the bottom market will be bigger and stronger.
Under the critical juncture of China's dairy industry from normal temperature to low temperature, the county market and its affiliated township markets not only leave more blank low-temperature business opportunities, but also indicate that the next threshold of dairy competition lies in low-temperature fresh milk! With a forward-looking strategic vision, these dairy companies have begun to focus on this layout, and have already started the road to the nugget of drinking the first low-temperature milk!
In the county market, the next threshold for dairy competition comes from low-temperature fresh milk, and with the acceleration of the development of new tea drinks, the consumption of low-temperature dairy products from the high-tier market to the low-tier market has begun to penetrate and spread without limit. Since 2019, the scale of the tea market in third- and fourth-tier cities has shown explosive growth. In one fell swoop, the market size will be about 60 billion in 2019 to about 140 billion in 2023.
Behind this new engine with rapid growth and the most consumption potential, emerging consumer formats such as snack discount stores, new tea drinks, and new fast food have become one of the few areas in China's entire consumer market that are still growing rapidly, and the 10,000-store chain has become the target of accelerated practice by new and old heads in the infinite spread of the sinking market.
According to the data of the domestic catering brand store data query platform Narrow Door, brands such as Mixue Bingcheng, Chabaidao, Luckin, Bawang Chaji, Cudi, Shanghai Auntie, and Tianlala account for more than 40% of their third-tier and below-tier stores. It is worth noting that the affordable brand of the tea industry, Michelle Bingcheng, accounts for about 57% of the stores in the county area and below, while the data of Tianlala exceeds 80%. Judging from the current trend, this sinking data is still increasing.
The boom in the consumption of emerging dairy products such as fresh milk, thick milk and base milk in the C-end caused by the continuous outbreak of the new tea beverage format has been confirmed in the high-tier market. Similarly, in the county market, the popularity of new tea drinks will also spread the consumption of fresh milk rapidly.
The proportion of low-temperature milk in the county market is very low, which is the main contributor to the increase of low-temperature fresh milk in the future.
In recent years, China's new urbanization strategy and the continuous improvement of infrastructure such as high-speed rail, logistics and transportation have brought about changes in consciousness, which have gradually led to the gradual convergence of the lifestyles of county and township residents with those of first- and second-tier cities. With the continuous influence of multi-point information, the awareness of "low-temperature fresh milk" is also constantly improving.
In fact, people in the county and townships, especially parents with children, have a good understanding, because the nutritional value and taste of low-temperature pasteurized milk are much higher than those of room-temperature milk.
According to the data, the current sales of low-temperature dairy products in county-level cities and counties account for only 11.8%, while the town-level proportion is only 9.6%, which is lower than the national average of 16.8% and is far from 90% in developed countries.
There is no doubt that the county market will be an important contributor to the increase in sales of low-temperature fresh milk in the future. And the next step of dairy competition also comes from low-temperature fresh milk!
Early intervention, establish a strong foundation to follow the palatability and precipitable characteristics of fresh milk, and it is particularly important to compete for the first sip of milk.
In fact, in China's current market, which is dominated by regular and low-temperature milk, the value shaping of normal and low-temperature milk is very different. Due to its long shelf life and strong circulation, room temperature milk has always been the main gift-giving scene rather than self-drinking. Therefore, the thick nutrition, high-end, atmospheric packaging design and the outward extension of the spirit of Yueji are undoubtedly revealed. In the collection of attributes of room temperature milk, the attributes of self-drinking, social and gift complement each other, and they always switch back and forth in different scenarios. Therefore, at the level of consumer purchase logic, room temperature milk can be randomly selected and replaced between national brands.
Low-temperature fresh milk is often the main scene of self-drinking or home drinking, and palatability is often crucial. In this regard, fresh milk and liquor have similar subtleties.
China is a vast land with different terroirs, and in this thick and amorous land, a large number of fine wines with different varieties and different styles and different aromas have been cultivated. Whether it is sauce aroma, light fragrance or strong fragrance, they are distributed in different regions with different factions and styles, forming the most distinctive geographical cornerstone map of liquor in China. "The flavor that consumers are exposed to when they drink baijiu for the first time is very important for subsequent choices. Since then, the cultivation of emerging brands of baijiu in new markets has paid special attention to the education and communication of aromas. Because, entrepreneurs know that competing for the consumer's first drink flavor is very important for subsequent choices.
The convergence between fresh milk and liquor also reveals the key purchase factors for the subsequent continuous choice of fresh milk in the first sip. According to Kantar Index, 20% of heavy buyers of cold milk contribute 59% of sales, which is the core principle of heavy repeat buyers who are deeply stuck to their first sip.
This also explains the reason behind the strong growth resilience of New Hope, whose main business is "low-temperature milk", in the context of a relatively weak dairy consumption environment: that is, the continuous contribution of heavy fresh milk buyers' repurchase. It can be seen from a set of data that in 2023, New Dairy will have 19 million global digital users, while the number of repeat purchasers will increase by 38% year-on-year, while the cycle repurchase rate will reach 52%, and the retention rate of cycle buyers will reach 41%.
Therefore, it is particularly important to compete for the user's first sip of milk, so as to encourage the user to retain the taste and taste of the first milk. As a result, it will continue to repurchase and enter a state of deep dependence and repeated selection.
In the county and township families with children, dairy products are just needed, and once the habit is cultivated, it can be relatively solidified, high-frequency, universal, and just needed, so the follow-up repurchase consumption will bring continuous contributions.
Preconceived notions define the boundaries between "authentic" and "non-authentic".
The brand that consumers first come into contact with and the first to enter their field of vision must be considered the most authentic. For example, recently, Haihe and Sanyuan have been caught in public opinion disputes because of the extremely similar packaging appearance of a color milk. But one of the clearest logics is that despite the similarity in appearance and the fact that Haihe is more expensive than Sanyuan, consumers in Tianjin still consider Haihe to be "authentic" and Sanyuan to be "non-authentic".
This is the principle that it is difficult for the latecomer to prevail, unless the latecomer spends a considerable amount of time, resources and energy to slowly infiltrate and impregnate, it is possible to replace the first-in-class. Haihe's color milk category has always been unbeatable, and it has a lot to do with the impression, companionship and penetration that was first rooted in Tianjin consumers. Therefore, although Sanyuan has made products that are extremely similar to Haihe and the price is very advantageous, it is still regarded as "inauthentic" by consumers.
Low-temperature milk is still unable to avoid homogeneous competition, and dairy companies are still commonly used tactics to imitate and follow each other. Therefore, the sooner a fresh milk brand enters the county market and begins to face consumers and triggers its high-frequency repurchase, the sooner it will be perceived as "authentic" by local consumers, which is the power of "preconceived".
The further decline in the price of raw milk is just in line with the consumption upgrade of the county market on the premise of "not raising prices".
In the survey of the expenditure portraits of consumers in the county, such as social gatherings, insurance and financial management, medical care, clothes, shoes and hats, childcare expenses, food, tobacco and alcohol, etc., "childcare expenses, food, tobacco and alcohol" are two categories with strong willingness to upgrade, but it is hoped that the consumption upgrade will not increase the price.
In the cognition of most county consumers, low-temperature fresh milk still belongs to the category of nutritional products, rather than just needing affordable food. The People's Daily once wrote an article analyzing "from the perspective of consumers' nutritional cognition of milk, milk has not yet become a necessity of daily life". This phenomenon is particularly prominent in the vast county market. If it succeeds in impressing county consumers, the answer is "upgrading the consumption of liquid milk on the premise of not raising the price".
At present, China is in the cycle of raw milk surplus, the terminal price band of fresh milk is constantly declining, and the quality is steadily rising, which is an excellent time to enter the county market. At the same time, this also corresponds to the call at the national level: "Emphasize the implementation of production and marketing, guide enterprises to produce affordable milk, make affordable and healthy dairy products become the mainstream of the market, and let more affordable dairy products enter schools and communities".
The unique regional characteristics of the county market inspire different solutions to the problem, and the author has conducted in-depth research on several county markets, and deeply felt the unique consumer social form of China's vast county market. For example, acquaintances or semi-acquaintances have social relations, some across the county may only take half an hour of battery car time, a handful of core commercial complexes, supermarkets, so that people are mostly scattered in the streets and alleys to buy daily necessities, and so on. It is now sorted out, hoping to give new inspiration and ideas from another perspective to dairy enterprises that intend to sink to the county market.
Compared with the traditional distribution model, the layout of chain milk stations may be more suitable for the county market.
In the several county markets that the author has visited, there are not many core business districts, and after a little turnaround, I have almost finished shopping, and from the perspective of dairy products, the most obvious in the field of vision is the room temperature milk series of Yili and Mengniu.
Due to its long shelf life, room temperature milk is most suitable for the conventional multi-level distribution of consumer goods, which is popularly described as a "simple and crude circulation model", and with these, the supermarket channel has been occupied by Yili and Mengniu for many years, and the monopoly of the channel and the buyout of the terminal space make it difficult for new entrants to enter.
Most of the county markets have very convenient transportation, and dozens of minutes of battery car driving can cover a very wide range, and the people living here generally live a leisurely life, without a particularly wide social circle, and they have relatively high loyalty to brands and offline chain stores.
Compared with the first- and second-tier core cities with a rent of tens of thousands of yuan, sometimes a few thousand yuan (or 2 to 3,000 yuan), you can find a very cost-effective location, such as a place close to commercial centers, schools and other places with rich people.
Under such geographical conditions, the multi-store market development method of launching chain milk stations with local partners is more likely to replace the traditional low-line multi-layer distribution model, and the underlying business logic behind it is to replace the traditional distribution system in the layer by layer to increase the high price, improve efficiency, reduce the price increase rate, drive dairy manufacturers to optimize the supply chain and centralized management, and provide consumers with a convenient, high-quality and low-cost upgrade experience......
Therefore, the root of this logic is to make the price of fresh milk low, so that consumers can see the real value. Therefore, for a county-level market, the chain of several milk stations can cover the entire county-level area, and can also enable new brands to achieve the effect of "flowering overnight".
Relying on the word-of-mouth fission of the milk-to-home model can firmly lock in users.
The county market is a society of acquaintances or semi-acquaintances, and in some counties, a family of people forms a huge network of relatives. In such an ideology, the entry of any new thing or new brand can bring about the rapid fission of the brand from exposure to rapid fission through the establishment and dissemination of word-of-mouth and circle marketing.
For county markets, there are many places where people with community connections gather, such as the activity area of the central square, in the old-fashioned park, in the pavilions along the river, in the morning market, and in the fixed-date market. In these places, it is not only the vitality of the people in the county, but also the existence of a unique sense of relaxation. In these places, setting up the table to solicit orders and reach orders and transactions has the harvest of immediate results.
At the same time, selling milk cards can deeply bundle target users, and use circle marketing to sell monthly, semi-annual and annual cards, so that user needs can be locked in reversely. Through the network of interpersonal relationships in the county, it is more suitable for cultivating long-term consumer customers than high-tier cities.
The sinking quality-price ratio of convenience stores and community e-commerce channels can quickly increase the volume.
Changing consumers' inherent impression of convenience stores as "expensive", a convenience store chain format with an ultra-high quality-price ratio and county-level market as the core has begun to become popular in China in recent years, such as Xinjiayi, which originated in Hunan and is based in Changsha, has been in the limelight in recent years. In just a few years, with a total of more than 1,000 stores, it has been deployed in China's vast third-, fourth-tier and county-level markets. In particular, "fresh milk" and "beer", which have a high quality-price ratio, are the growth engines of fresh food, which constitute a competitive barrier to differentiation.
One of the most popular fresh food categories in the store of Xinjiayi, a convenience chain that sinks to the county market, is fresh milk.
In contrast to the current decline of hypermarkets, these emerging chain channels are redesigned and combined from the supply chain, so that there are fewer nodes, and at cheaper prices to provide better quality and attract consumers to pay. That is, the quality-price ratio is used to break down the category mentality, and fresh milk is becoming the first major category that meets this core principle.
Another channel that has risen rapidly is community group buying, which has been sinking in recent years.
According to Kantar Index, liquid dairy is the largest category in community group buying channel sales, accounting for 22.8%. Many dairy companies, such as Mengniu and Tianrun, are selling their goods through community group buying channels.
The national community group buying giants represented by Pinduoduo and Meituan Maicai have solved the user's ready-to-eat needs under the model of "pre-sale + self-pickup" and relying on the regionalized and localized group buying form of the community. At the time of the peak of Internet traffic, it was not only a sizable second growth curve, but also included a broader sinking market. Meituan data shows that county-level consumer orders for life services will rise from 23.8% in 2019 to 30.6% in 2023. At present, relying on more than 2,000 county-level logistics networks across the country, these two community group buying giants are more competitive in the construction, optimization and refinement of the supply chain in response to the market's demand for both low price and quality.
On the trillion-dollar track of community group buying, brand manufacturers can quickly complete brand exposure, obtain a larger market scale and reach a wider range of target consumers through their short term of ownership. However, the disadvantage is that community group buying cannot undertake the exposure of all product series of dairy brands due to the small number of single products and low profits of single products.
Direct selling is the ultimate model for low-temperature fresh milk brands to establish market barriers and channel barriers.
In China, low-temperature fresh milk is mainly operated in the direct sales channel mode, supplemented by the distributor mode. According to data, in 2022, the direct sales channel of low-temperature fresh milk will account for about 73%, of which direct supply of dairy products, milk delivery to households, e-commerce (Tmall, JD.com, Douyin, Xiaohongshu, etc.), periodic purchase and DTC are the main channels of direct sales channels.
For enterprises in the long run, the direct precipitation of users in the company's unique private domain traffic pool is the ballast stone for the long-term development of low-temperature fresh milk.
Therefore, whether it is Bright or New Hope, through various ways of public domain drainage, such as WeChat applet, Douyin or Xiaohongshu and other online platform sales ports, after the introduction of the company's own private domain channels, continue to accurately push product introduction and product promotion information to reach, increase the user's stickiness and brand loyalty to the company's products, continuously increase the repurchase rate, fully tap the new needs of users and the reach of new products, and form a large and stable user group pool.
Therefore, backed by a huge pool of traffic users and heavy buyers, continuous repurchase and sticky marketing are the powerful growth engines of dairy enterprises based on "low-temperature business", and it is also the fundamental source of bringing the low-temperature fresh milk business to the "extreme"!
ConclusionWhen you really step into the county, you will see that the real effective working time of the middle and young people here is only about 5-6 hours a day, and a lot of time is spent watching short videos, receiving an understanding of the outside world through Douyin, Kuaishou and other information. And many of them are slowly moving closer to the high-tier cities, and this invisible barrier is gradually dissolving. It is foreseeable that the county market, a new consumption opportunity is rising rapidly and the regional value needs to be deeply explored!
For dairy companies, sinking is the only way for low-temperature fresh milk business. The easiest part of this is that the new product has been on the market for several years and has been successfully verified, and then selectively moved to the county market, and still shows strong product vitality. For example, Junlebao's Yuexianhuo, which sank to the township market in Dongyang, Zhejiang, is still the best selling product in the store and supports the store's high profit source.
However, how to deeply cultivate the county market, take this road well, and constantly explore ways to reach consumers efficiently (such as new models such as fresh milk vending machines that have appeared in the community in recent years), in addition to the need to lay out efficient supply chain construction and management capabilities, continue to improve performance capabilities, and reduce high-energy losses, more importantly, the adaptation of personnel and the precipitation in the sinking market, in order to fully grasp the deterministic growth!
Therefore, for dairy companies that bet on the low-temperature fresh milk business track, it may be the best time to be one step ahead of others and plant a tree that will grow into a leafy tree in the near future!
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