Laoganma teased by "goose": e-commerce sales skyrocketed, last year has gone out of the trough
The story of "Fun Goose Injustice" has been continuously updated, bringing Lao Ganma, a Chinese hot sauce brand, back to the center of public opinion.
First, Tencent demanded that the court seize and freeze 10 million properties in the name of Laoganma and its subsidiaries on the ground of arrears in advertising fees. Since then, the plot began to reverse, Laoganma said Tencent suffered fraud.
On June 30, Laoganma Company issued a statement saying that it had never conducted any commercial cooperation with Tencent and had reported the case to Guiyang Police.
On July 1, the Shuanglong Branch of the Public Security Bureau of Guiyang City reported that the suspects Cao Mou, Liu Mouli, and Zheng Moujun forged the seal of the old Ganma company, posing as the manager of the company’s marketing department, and signed a cooperation agreement with Tencent in order to obtain The online game gift package codes provided in the promotion activities are later illegally profited through Internet reselling. The three suspects have now been forced to take measures.
On July 3, the People's Procuratorate of Nanming District, Guiyang City expressed its importance. The court attached great importance to it and assigned a prosecutor to intervene in advance to understand the case and guide the investigation.
Under the reversal of the plot, many e-commerce platforms have also joined in the excitement and started the promotion of Laoganma hot sauce.
According to data provided by Suning.com, as of 22:00 on July 1, Suning.com’s Laoganma hot pepper paste sales increased by 228% month-on-month, search volume increased by 407%, and 1-hour home orders at any time increased by 152%. According to Jingdong data, on July 1, the search volume of Laoganma increased by 300% year-on-year, and the turnover increased by more than 100% year-on-year; as of 15:15 on July 2, the search volume increased by 600%, and the turnover increased by more than 200. %.
Why did the old godmother who has been low-key for more than 20 years have such a strong appeal? How did the founder Tao Huabi build her hot sauce empire? In recent years, how is Laoganma operating now?
A bottle of tempeh sauce goes global
In 2008, China Food Industry Network reviewed the entrepreneurial history of Tao Huabi, the founder of Laoganma.
Tao Huabi was born in Guizhou in 1947. In the 1980s, Tao Huabi opened a snack bar in Longdongbao, Nanming District, Guiyang City. After several years of operation, Tao Huabi accumulated a little money, and the snack bar was upgraded to a restaurant. The Tao's restaurant is popular among students near Longdongbao because of its delicious food and cheap prices. Due to the large amount of food given to students, Tao Huabi was affectionately called "Lao Ganma" by the students.
The most fascinating thing about the restaurant operated by Tao Huabi is the free appetizer dish before the meal-oil chili and tempeh. Because the taste is particularly good, many people made a special trip to the store to taste it, and some people used plastic bags to take away this special snack. Since then, the reputation of oil chili has grown, and business has become better and better.
"Financial Weekly" also mentioned in the 2012 report that Laoganma is popular all over the country and has close ties with truck drivers. In 1994, Guiyang built a ring road, and the formerly remote Longdong Fort became the main road of the south ring of Guiyang, and the number of truck drivers passing by was increasing. Taking this opportunity, in addition to selling chili sauce to diners in the restaurant, Tao Huabi also began to give drivers free snacks and condiments such as tempeh sauce and spicy vegetables, which were very popular. It was the truck driver who brought Laoganma's hot sauce to the whole country.
In 1996, Tao Huabi formally established Laoganma Flavored Food Factory, which is the predecessor of Guiyang Nanming Laoganma Flavored Food Co., Ltd. today. In August 1997, "Guiyang Nanming Laoganma Flavor Food Co., Ltd." was officially listed, and the number of workers increased to more than 200 at once. By 2000, the "Laoganma" company had expanded rapidly, with 1,200 employees.
For more than 20 years, I have only focused on tempeh sauce. The business of Laoganma is getting bigger and bigger, step by step from a small family workshop to a well-known Chinese brand.
Laoganma's official website shows that after more than 20 years of development, Laoganma's product range has also expanded from lobster sauce to more than 20 categories such as hot pot base, tofu, and spicy vegetables.
During this period, Tao Bihua always insisted on "no listing, no loan, no financing", the company's equity is also extremely simple, the shareholders are always three mothers and children.
Data from Tianyanzha shows that after Tao Huabi withdrew in 2014, Guiyang Nanming Laoganma Flavored Food Co., Ltd. behind the “Laoganma” brand was owned by the eldest son Li Guishan and the youngest son Li Miaoxing 51%. Tao Huabi remains the legal representative and chairman.
In 2015 and 2016, Tao Huabi ranked 487th and 473th on the Hurun Rich List with 7 billion yuan and 7.5 billion yuan, respectively. In 2017 and 2018, Tao Huabi ceased to be on the list and was replaced by two sons, Li Guishan and Li Miaoxing. In 2019, Li Guishan and Li Miaoxing were listed on the Hurun Rich List with a personal wealth of 4.5 billion yuan, ranking 912th.
"Financial Weekly" said that more than 2,000 employees in Laoganma Company, Tao Huabi can call out 60% of the names, and remember the birthdays of many of them, she must be a witness for each employee when she gets married.
Domestic dealer network, overseas agent team
Laoganma who does not advertise, how to win market recognition
Huatai Securities once published the article "Laoganma's Road to Branding: Focusing on Product Quality, Maintaining the Brand Image" in 2016, which introduced why Laoganma can successfully sell products to the market without marketing Nationwide, even overseas.
In terms of sales channels, Laoganma first established a large regional distributor, and then established a secondary network throughout the region through the large regional distributors, and finally formed a sales channel across the country and a moat for the sales network, and actively used this The superior output products further strengthen its brand image; in terms of catering channels, the Laoganma series products are also favored by terminal catering enterprises with high-quality and stable chili sauce, which promotes corporate brand communication.
In overseas markets, Lao Ganma has gradually formed the business strategy guiding ideology of “relying on the domestic market and actively expanding the international market”. The company first positioned itself as an overseas Chinese, focusing on the emotional brand, and harvested a stable consumer group in the overseas market; secondly, Laoganma changed its business strategy and adopted the method of setting up authorized agents directly in the overseas market, forming a win-win situation with authorized agents , Promoted the widespread spread of corporate brand influence in overseas markets.
The price of Laoganma's products in China does not exceed 15 yuan, but overseas, the price of Laoganma's products is not so close to the people. A 210-gram bottle of Laoganma Hot Sauce on Amazon.com is priced at US$8.84, nearly RMB50.
Tao Huabi himself was also asked why overseas prices are so high? Tao Bihua once domineeringly responded to Xinhuanet, "I am Chinese, I don't make money from Chinese people, I want to sell Lao Ganma to foreign countries and make money from foreigners."
Laoganma's fire also attracted the attention of a group of speculators. Around 2000, all kinds of cottage "Lao Ganma" brands appeared in the country.
In order to maintain the brand equity of Laoganma, Laoganma built a trademark moat. Many derivatives such as "Laoganma", "Laoganpa", "Laoyima", etc., have been applied by the company. Is a trademark.
The data of Tianyancha Professional Edition shows that as of July 2 this year, Laoganma Company and its foreign-invested enterprises and branches have registered a total of 192 trademarks, of which the largest number of registered trademarks in 2008 reached 66, basically covering all categories of trademarks. , And the success rate of registration is 97%.
Laoganma's new challenge
Although the status of Laoganma's national hot sauce brand is difficult to shake, in recent years, low-profile Laoganma has also produced negative news in terms of product quality and company management.
In 2014, Tao Huabi, 67, transferred his only 1% equity to Li Miaoxing, his second son, and faded out of management. Laoganma's shareholding structure changed to second son Li Miaoxing holding 51% and eldest son Li Guishan holding 49%.
Shortly after Tao Huabi ceded management of the company, Lao Ganma was exposed to the news of "stealing labor and cutting materials." In 2015, "Business" magazine reported that Lao Ganma gave up the use of Guizhou peppers and chose Henan peppers, which are cheaper. The price of pepper in Guizhou is around 12-13 yuan/jin, while the price of pepper in Henan has remained at around 7 yuan/jin, which is about 5 yuan cheaper than Guizhou pepper.
Costs are falling, but selling prices are rising. A Laoganma dealer revealed to the e-commerce online e-commerce media that he had not increased the price for more than ten years since he sold Laoganma. Since the management changed in 2014, the price has risen. %. Last year, the price of dried shredded pork was more than two yuan higher due to the rising pork price. The current price is maintained at 10-12 yuan."
In the past 5 years of Tao Huabi's decentralization, Laoganma's performance has shown a downward trend. According to many media reports, Laoganma's performance has declined from 2014 to 2018. Guangzhou Daily pointed out that between 2014 and 2018, the sales revenue of Laoganma was 4 billion, 4.549 billion, 4.447 billion, and 4.389 billion respectively, which were not disclosed in 2015. In a survey data of Oerlikon Consulting, the market share of Laoganma's condiment retail market in 2018 was only 3.6%, which was lower than that of Haitian and Li Kum Kee.
Challenger of Laoganma
In addition to equity and management structure adjustments, external competitors are also "invading" Lao Ganma's market share.
According to data released by the China Condiment Association, as of 2018, the hot sauce market reached 32 billion yuan, and it is expected to reach 40 billion yuan by the end of 2020. Such a large development prospect has attracted many competitors. Subject to the industrial and commercial registration, in the first half of 2020, my country has established nearly 60,000 condiment-related enterprises (all enterprise status), a year-on-year increase of 29.1%.
According to the "Market Analysis of China's Condiment Industry in 2020" released by the Prospective Industry Research Institute, the current competition pattern of my country's condiment industry is relatively scattered, the market share of major manufacturers is not high, and the industry concentration is low.
Although sporadic brands can't shake Laoganma's strong offline dealer network, they have sprung up on e-commerce platforms. In addition to established companies such as Li Kum Kee, Fanshaoguang, and Limin, new hot sauce brands taking the net red route have emerged, including Lin Yilun’s Fan Ye, Zhang Song’s “Song Er”, Yue Yunpeng’s “Hi Hi Phi”, and Hubang Hot Sauce. , Plum and chili sauce. The hot sauce industry is no longer unique to Laoganma. The personal hot sauce brand "fanye" founded by star Lin Yilun cross-border, has raised 4 rounds since 2015, and was valued at 360 million yuan after the B round of financing.
"Tide brand" Laoganma performance recovery
Laoganma also began to break the "tradition" of not advertising, and even caught up with the tide brand.
In September 2018, Lao Ganma and Opening Ceremony cross-border cooperation sweater, also boarded the stage of the 2019 Spring and Summer New York Fashion Week. This Laoganma hot sauce sweater, priced at 1,288 yuan, was sold out instantly when it appeared in the Tmall flagship store.
In September 2019, Lao Ganma and the magical twisting dance food of Ju Bingzhu spread on various social platforms, and the image of Tao Huabi in the advertisement became a young woman. At a media interview in September 2019, Laoganma Company publicly stated that it will strengthen the building and promotion of Laoganma brand culture.
At the beginning of 2020, Laoganma and Taobao shopping cart launched the "Laoganma love bottle". According to Guiyang.com, sales of Laoganma’s Tmall flagship store increased by 20% after the event. Li Junmu, head of the brand’s e-commerce, said: “When Tmall came to us for cooperation, we initially refused You know, Laoganma is a very Buddhist brand. We never make any advertisements, but I didn’t expect it to become popular again in this way. The brand was shocked.”
The late Internet marketing may have helped Laoganma reverse its performance decline in 2019. "Interface" reported that the sales revenue of Laoganma in 2019 exceeded 5 billion yuan, up 14.43% year-on-year, a record high.
However, there are also market rumors that the credit for the 2019 performance reversal is that Tao Huabi, who retreated behind the scenes, was forced to return to re-use the previous raw materials and formulas, but the news has not been officially confirmed.
Tao Huabi, who printed his head on the bottle, is 73 years old this year. The outside world is worried that if Tao Huabi fades out, how much will Lao Ganma be affected?
(This article is from Surging News, for more original information, please download the "surging news" APP)
Comprehensive report by surging news reporter Wang Qifan