E-commerce dividends no longer decline in the era of traffic

  Is the online celebrity snack transition offline still "sweet"?

  Our reporter Yang Tianyue

  As the cost of e-commerce traffic and competitive pressure gradually increase, Internet snack brands have turned their attention to the offline market.

In the past, snack foods such as the three squirrels and Liangpin shops that were common on e-commerce platforms began to appear more and more on supermarket shelves.

Since the beginning of this year, the casual snack brand has been reduced by investment institutions, and the stock price has shrunk sharply.

Faced with the pressure of slowing operating performance growth, the three squirrels and Liangpin stores have all begun to increase their offline channels recently.

Can online celebrity snacks transfer offline, can they replicate the miracle of rapid growth?

  Internet celebrity snacks on supermarket shelves

  Recently, many consumers have discovered that the “net celebrity” leisure snack brands that have been selling well on online shopping platforms in the past few years have put their products on supermarket shelves.

In the Daxing store of Beijing Wumart Supermarket, three squirrels, Liangpin Shop, Baicaowei and other "net celebrity" brand casual snacks are neatly stacked on rows of shelves, such as dried pork, dried mango, orchid beans, egg waffles...nearly a hundred kinds A wide range of casual snacks.

"This is much more pleasing to the eye than it looks on the phone screen." said a middle-aged woman who is being selected.

  Not only is it convenient for physical selection, after switching to offline channels, the retail price of some snacks is even lower than that of online shopping platforms.

“Three squirrels sell the best nuts every day, 750 grams for 84 yuan a box. Liangpin’s salted cheese toast is 39.9 yuan a box, and the second one is 9.9 yuan.” A staff member in the shop said, “Now It’s catching up with activities and it’s cheaper than Taobao."

  In addition to Wumart supermarkets, searching on the takeaway platform can find that supermarkets and convenience store channels such as Aeon Supermarket, JD Convenience Store, Hema Xiansheng, etc., have already put on the snack products of these brands.

Forcing offline distribution channels seems to have become a new strategy for these "net celebrity" snack brands that rely on Internet platforms to "start up".

  On October 16, Three Squirrels announced at their new product launch conference that they would launch an offline distribution plan, recruiting more than 230 distributors within 100 days, and customizing more than 20 products for offline channels.

Liangpin Shop also established a new distribution channel division this year to promote full coverage of offline channels. It has now entered Wal-Mart, Hema Xiansheng, Yonghui Supermarket and other supermarket channels.

  Capital-intensive reduction of casual snack brands

  Industry data shows that Three Squirrels, Baicaowei, and Liangpin Shop rank among the top three in the casual snack market share, and all three are “Internet snack brands” that have emerged from the e-commerce dividend.

At the beginning of its establishment, these "net celebrities" brands quickly seized the market share of traditional snack companies that were slowing down by virtue of their younger marketing methods and the light operation model of e-commerce, and they were thriving in the capital market.

  Since the beginning of this year, the halo of the "net celebrity" brand has begun to disappear.

On September 30, the three squirrels issued an announcement stating that IDG’s funds would reduce their holdings by no more than 6%; on the same day, Liangpin Shop also disclosed an announcement stating that Hillhouse’s shareholders would reduce their holdings by no more than 6% of their shares.

In fact, Liangpin Shop has been under capital reduction since February this year, and Hillhouse Capital alone has reduced its holdings by nearly 450 million yuan. In the past year, the three squirrels have issued a total of 26 shareholder reductions and shares. Repurchase announcement.

  With the gradual decline of e-commerce dividends, the financial reports of several leisure snack companies also revealed signs of slowing growth.

The three squirrels' 2021 three-quarter report shows that the revenue of the first three quarters of this year was 7.07 billion yuan, a year-on-year decrease of 2.23%.

The second-tier brand Yanjinpu's third quarterly report for 2021 showed that the revenue in the first three quarters was 1.628 billion yuan, an increase of 13.48% year-on-year; the net profit was 77,289,800 yuan, a year-on-year decrease of 59%.

  Can the miracle of internet celebrity be reproduced?

  After the frustration of the capital market, Internet snack brands began to turn their attention to offline.

The latest offline distribution plan released by the Three Squirrels shows that the distribution business revenue in 2021 is estimated to be around 1.8 billion yuan, and the overall distribution business is planned to achieve an annual sales target of 5 billion yuan in 2023.

  At present, China has become one of the world's largest snack food markets and has maintained rapid growth in the past few years.

According to the statistics of the Prospective Industry Research Institute, the market size of China's snack food industry in 2020 will reach 2.7281 billion yuan. It is estimated that by 2025, the market size of the domestic snack food industry will exceed 4 trillion yuan.

  Can the miracle of "net celebrity" be reproduced by grabbing offline channels?

"Offline has always been the fault of the three squirrels. At present, offline resources are low, cost is high, and the difficulty is relatively high. It may be too late to start building offline layouts such as distribution models." China Food Industry Analyst Zhu Dan Peng believes that, unlike online channels "burning money", supermarkets are a system that takes time to settle.

  According to the 2021 mid-year report data previously released by the three squirrels, in the first half of this year, the online platform Tmall flagship store revenue fell by 26.8% year-on-year, and the revenue of JD's self-operated stores rose slightly by 9.4% year-on-year.

There were a total of 199 newly opened food outlets and alliance stores, and the total number of closed stores during the same period reached 138, and the number of closed stores was equivalent to the number of opened stores.

  "Snack food companies need to have brands, contacts, teams, logistics, and systems to enter large distribution channels. They cannot be accomplished overnight." Zhu Danpeng said that online and offline integrated operations, online and offline resources are integrated. Commonality will become the mainstream trend in the future development of FMCG throughout China.