Author丨Wu Chaofan
Editor丨Tangerine
In 2023, China's dairy industry as a whole showed a trend of weak consumption and sluggish growth, but Royal Group bucked the trend and achieved double-digit growth. Recently, at the FBIF Food Innovation Exhibition, Liu Ji, deputy general manager of Royal Dairy Group and general manager of Royal Anhui (a buffalo) marketing company, introduced the specific situation and reasons for the growth of Royal Dairy to Nei Sanjun.
Find the gaps
According to Liu Ji, Royal Group's liquid milk revenue will grow by nearly 20% in 2023, and the growth rate in the first quarter of this year will be close to 10%. In Liu Ji's view, such achievements are related to its product attributes and strong prices.
Nei Sanjun has repeatedly reported on the current dairy market price inversion and low-price competition, but Liu Ji revealed that the Royal Group has not faced this problem. Liu Ji said: "Because Royal is mainly engaged in buffalo milk business, there are relatively few competitors in the market, and it is not easy to fall into low-price competition. In addition, due to the relatively good protection of our profit margins, dealers and terminal stores are more willing to cooperate with us. ”
Of course, this is also related to the low price of upstream milk sources. Liu Ji revealed: "Of course, we have indeed enjoyed the dividend of the current low price of upstream milk. But he also stressed: "We will also try to increase some purchase prices when purchasing milk sources, and try to maintain the healthy development of the market." ”
At the same time, the unique nature of the products is part of the reason why Royal Group believes that they can protect prices and achieve growth. Liu Ji said: "At present, vanillin is added to infant milk powder in order to cover up the fishy smell brought by fish oil. After the child gets used to the taste, he will not be used to drinking pure milk. Buffalo milk products have a sweet aftertaste, and the taste advantage will be stronger. Therefore, buffalo milk is more attractive to young children during the critical phase of switching from milk powder to cow's milk. ”
As for how to make consumers aware of the uniqueness of buffalo milk, Royal Group also has its own solutions. "We are not advertising on a large scale to tell consumers about the benefits of buffalo milk," Liu said. Instead, in the form of popular science, the arguments of relevant papers are shown to consumers, so that consumers can realize the quality of buffalo milk. For example, he said that in relevant science popularization activities and offline stores, we tell consumers what the trace elements of buffalo milk and the composition of natural milk calcium are, so that consumers can better understand the advantages of their products.
Due to the unique attributes of its products, the current layout of Royal Group in some provinces is also concentrated in some special channels.
Special channel
At present, Royal Group mainly focuses on the layout of special channels in some provinces, such as mother and baby stores, fruit stores, Bao Ma stores, etc. Liu Ji said: "At present, our Guangxi market is omni-channel operation, but in other provinces, such as Guangdong, Guizhou and other places, the layout is mainly based on special canals, and the performance is also very bright. ”
As for why these channels were chosen, Liu Ji said: "These channels are relatively more clear and precise in targeting customer groups. For example, consumers in mother-and-baby stores and mother-in-law stores are more willing to spend on their children, and these channels themselves are related to milk, and it is not inconsistent to sell milk in these channels. As a result, our growth is relatively high. ”
"Secondly, we now attach great importance to stores or distributors with private domain customer groups, and the current investment promotion policy is also based on these stores. In the current environment where it is difficult to sell ambient milk, we believe that this channel can avoid us from falling into direct competition with other categories, and has a category advantage. Buffalo milk itself is not a popular milk source, so it needs a precise customer group. He added.
As for how to attract these channels, at present, Royal Group mainly focuses on fresh milk stores. Liu Ji revealed: "At present, we have opened some fresh milk stores in some markets to expand our brand recognition through tasting. Even though milk stations currently account for a small percentage of the company's revenue, we have always insisted on doing this. Even last month in Yunnan, more than 20 stores were opened. Through this form, we let more dealers and consumers know about Royal. This is actually similar to Xiaomi opening an experience store in the sinking market. ”
After such a model is recognized by the market, Royal Group also intends to expand nationwide this year.
Nationwide
It is understood that at present, the layout of Royal Dairy is only in southwest and south China. Liu Ji revealed: "This year will take Anhui as a starting point, focusing on East China and West China. Previously, we did have a heavy layout in the southwest region, and we have factories in Guizhou, Chengdu, Nanning, and Yunnan. In order to open up the East China market, we have also lightened some factories in the southwest market and moved the industrial chain to East China. ”
It is worth noting that this view has been disclosed in the annual report of the Royal Group. According to the announcement, the strategic plan proposed by Royal Group in the 2023 financial report is to "deeply cultivate the southwest, advance into the Greater Bay Area, and lay out the east of the country".
"In 2025, the construction of the buffalo plant in Anhui will begin. At the same time, we have a reserve of 5,000 embryos in Pakistan, and after we ship these embryos back to China, we can use them to break the production capacity constraints in some regions and better deploy the national market. ”
As for the reason for the expansion, Liu Ji explained: "Although the industry is in a difficult period right now, we see this as a good opportunity for nationalization. At present, the dealers of the dairy industry in the country are facing difficulties, and the sales of normal temperature milk and low temperature milk are poor. And our products are more profitable, and they are more attractive to these distributors. It may not be as large as conventional milk at the moment, but in this way it can slowly turn their predicament around. ”
In fact, at present, the entire dairy industry is facing difficulties in the growth of manufacturers and distributors, but Royal Group intends to rise to the challenge and challenge the market. Liu Ji said: "Starting from this year, we hope to maintain growth at a rate of no less than 20% per year. ”