■ In 2022, the metaverse forest, which has created a new consumer market myth, seems to have reached an inflection point.

■ According to the data, from 2018 to 2021, the sales growth rate of Genki Forest is 300%, 200%, 309% and 170.3%, respectively, which is dazzling in any industry; At the end of 2021, the valuation of Genki Forest had reached US$150 billion (about RMB 950 billion).

■ Red Star Capital Bureau noted that in 2022, the sales growth rate of Genki Forest has dropped to about 30%; Advent products can be found everywhere in the market, and the problem of random prices also plagues Genki Forest.

■ In just over a year, what happened to the young Genki Forest?

Start "currying" with dealers

Yuanqi Forest ushered in a sales bottleneck, and from the early channel layout of the enterprise, there may already be traces to follow.

At the channel level, from 2016 to 2018, when Genki Forest was just rising, the most core channel for enterprises was the CVS channel (convenience store) in high-tier cities, and then expanded to the KA channel (hypermarket) in high-tier cities. But now, after several years of rapid growth, the growth rate of Yuanqi Forest in first-tier cities such as Beijing, Shanghai and Guangzhou has slowed down, and the growth of online e-commerce channels has also become saturated.

If you want to make a breakthrough in performance, Yuanqi Forest must rely on traditional dealer channels, which is exactly what was previously ignored. Therefore, in the past half a year, Yuanqi Forest took the initiative to "put down its body" and set off a vigorous channel transformation and change.

At the dealer conference at the end of last year, "channels and distributors" was regarded by Yuanqi Forest as the most reflective and reactive link in 2022, and it was also one of the most important work directions in 2023. Founder Tang Binsen said: "In the long run, relying on dealers to develop our sales network is the right way. He also said that Genki Forest will pay unprecedented attention to dealers in 2023. In the first half of this year, many media reported that Tang Binsen began to visit dealers frequently and mingle with dealers.

"Currying" favor with the dealers in the sinking market may indeed give the vitality forest a chance to go to the "crossroads of fate".

According to public information, in 2022, the beverage retail market share of the sinking market of county-level cities-county towns-rural areas accounted for 61% of the beverage market. From the perspective of channel type, small retail channels such as grocery stores still occupy half of the market. The market and channel types in this part of the region are often referred to as "traditional channels", and the performance of sales work mostly depends on the construction of channels and distributors.

Genki Forest has said that the market strategy of "dealers" in 2023 is to continue to expand the market growth of the sinking market through the further deployment of distributors/distributors, the market market policy focusing on core flavors, and bottle code activities in important markets.

Today, the focus of Genki Forest on the channel has changed, and dealers are placed in a vital position by Genki Forest. Because Yuanqi Forest realizes that this sinking market, which was once ignored by itself, is the real base camp of China's soft drink industry. If you want to enter this base camp, you must rely on dealers to lead the way.

Internet thinking is poison?

The popularity of the resumption of the vitality forest in the past, on the one hand, is that the product stepped on the sugar-free outlet, on the other hand, it is also inseparable from the almost crazy marketing publicity.

In terms of products, the concepts of "0 sugar", "0 calories", "0 addition" and "0 fat" of Yuanqi Forest have successfully bound a group of young consumers who pursue health and are afraid of gaining weight. However, since then, these concepts of Genki Forest have also attracted many questions.

In terms of publicity, Genki Forest has always been very generous. On the one hand, through the signing of endorsements by top stars and the sponsorship of popular variety shows, the brand influence is improved, and on the other hand, through online platforms such as Xiaohongshu and Douyin, where young people gather, the "grass planting effect" is quickly formed. According to public information, in 2020, Yuanqi Forest's revenue will be 27.9 billion yuan, and advertising expenses will be 33 million yuan, accounting for 33.<>% of the total revenue.

Tang Binsen previously mentioned in an interview that "when he dares to create 20 billion yuan in revenue, he will spend 18.<> billion yuan for advertising", which also confirms the "marketing-driven" strategy of Yuanqi Forest.

However, by burning money to quickly occupy the market, which is a typical Internet game, Genki Forest puts it in the beverage industry, and it will be difficult to work in the long run. After all, there are no technical barriers to the beverage itself, and "0 sugar" quickly turns from the blue ocean to the red ocean. Public information shows that since 2020, more than 30 sugar-free sparkling water products have been launched, including industry giants such as Coca-Cola and Nongfu Spring, as well as new tea drink brands such as Heytea and Naixue's tea. Although these sparkling water brands have a variety of main concepts, the packaging and ingredients are not much different, and there is not much novelty.

In addition, Nongfu Spring directly told the dealer, "If you cooperate with them (Genki Forest), don't cooperate with us." Coca-Cola and Pepsi also "said" to kill Genki Forest in 2022.

The users of Genki Forest are mainly young people around the age of 20, and these consumers love to pursue new things and often have low brand loyalty. Under the intensification of market competition, the market share of Genki Forest flavored sparkling water has continued to decline, from 2019% in 85 to up to 2022% in 50.

In fact, in addition to products and marketing, Yuanqi Forest uses Internet thinking as a channel, which also makes the channel taste. For example, in order to achieve the goal of sustained high growth, constantly pressing goods to dealers, dealers will try their best to dump goods, which has led to the problem of indiscriminate prices in 2022.

At present, the company profile of the official website of Yuanqi Forest has changed from "Internet innovative beverage company" to "Chinese food and beverage enterprise", adjusting the product matrix, focusing on traditional channels, and building its own factories, and the pace of Yuanqi Forest's return to tradition is accelerating.

In general, Yuanqi Forest originally wanted to take a shortcut, but there is no shortcut in China's food and beverage industry, and today's Yuanqi Forest can only make up for the basic skills.

Can you "wrench the wrist" with the giant

The soft drink industry has the characteristics of high frequency, rigid demand, low consumer brand loyalty, and large market capacity, so there are many players.

But it is difficult for companies in this industry to wrestle with head players such as Nongfu Spring and Coca-Cola, including Yuanqi Forest. The reason is that the construction of offline channels is actually very difficult.

According to statistics, at present, offline traditional channels in China consist of about 630.75 million small stores, of which more than <>% of terminal small stores are concentrated in third-tier cities and below. These stores are distributed in various prefecture-level cities, districts, counties, and township streets across the country.

In this ultra-large-scale, three-dimensional, multi-level market, it is obviously a complicated matter to truly reach the terminal and make millions of store owners willing to promote and sell products. To win this difficult battle, you must rely on in-depth distribution and build your own distribution network. Deep distribution is also a complex and huge circulation value chain, in which distributors are extremely important, because the brand itself can not effectively connect millions of terminals, distribution, order, distribution, after-sales service, dealers are relay nodes.

Taking Nongfu Spring as an example, its success is not only good advertising, what really makes Nongfu Spring rise is its channel distribution network that directly controls the terminal.

In 2008, Nongfu Spring began the market intensive farming model, the core of which is direct control of the terminal. Nongfu Spring's business personnel are responsible for the maintenance of terminals, the planning of brand promotion activities, and the delivery of dealers. Since then, Nongfu Spring has also adjusted the distribution system many times, and currently mainly adopts the distribution mode of combining first-class dealers and KA customers.

It is worth mentioning that since 2020, in order to further promote the sinking of the market, Nongfu Spring has signed a tripartite agreement between the company, distributors and sub-distributors with a small number of sub-distributors with market potential in the township market, so as to strengthen communication with such sub-distributors and facilitate the company to have an in-depth understanding of the sinking market information.

In general, from the headquarters to the regions, provinces, cities, streets and towns, and then to the terminal stores, this is destined to be a large and complex sales network. The young Genki Forest, if you want to wrestle with the giants, it may take time to accumulate.

Chengdu Business Daily - Red Star News reporter Liu Yao