Four industry experts discuss the "new developments" of consumer brands: The market's temporary cool-down doesn't mean the end; opportunities for differentiated competition still abound. | WISE 2024 Future Consumption Conference
On November 29, the WISE2024 Future Consumption Conference was officially held in Beijing. This conference is hosted by 36Kr Future Consumption, with the theme of "Always with You", focusing on hot topics in the consumption industry. It invites more than 20 executives from investment institutions, platform sides, brand sides, and service providers to jointly explore the new trends and opportunities in the consumption industry.
In the first roundtable dialogue session of the conference held in the afternoon of the same day, with the theme of "2024, Brands Have 'New' Things", Yang Yafei, a senior analyst of 36Kr, Wang Yijie, the founding partner of Jinding Capital, Gao Song, the CEO & founder of Super Bowl, Zhang Lei, the manager of Asahi唯品, and Wu Peng, the CEO & founder of CAYE咖爷 Technology, had a wonderful exchange and sharing.
"2024, Brands Have 'New' Things"
2024 is a challenging year for the consumer market. Affected by the continuous market environment, many entrepreneurs are facing more severe business challenges and actively responding to them this year. The four guests of this roundtable also gave their own profound insights and perspectives from different dimensions such as investment opportunities, internal innovation, industrial chain layout, and brand going global.
As one of the few investment institutions still investing in the consumer track, Wang Yijie, the founding partner of Jinding Capital, has a deep feeling about the changes in the cold and warm of consumer investment and financing in recent years.
Wang Yijie said that an obvious trend starting from last year is that the supply and demand have reversed, and consumer goods companies have entered the "stage of competing for comprehensive strength". But there are also new opportunities in the crisis. First, people of all ages pay more attention to product quality, price-quality ratio and consumption experience. Second, from the perspective of the changing trend of the population structure, the long-term trend of health-related products is good, and the pet industry is also growing rapidly, and the demand for experiential and spiritual attributes is also gradually increasing.
According to Wang Yijie, Jinding completed a 10-fold project exit this year. When it comes to suggestions for new entrepreneurs, Wang Yijie said that although there are not as many opportunities as before, there are still many differentiated choices. First, aim at the future trend and find opportunities in the trend. Second, return to your own core advantages. Third, try to start in a relatively light and fast way.
One of the roundtable guests, Gao Song, the founder of Super Bowl, has been deeply cultivating in the healthy diet track for a long time. Gao Song shared his three "new" observations on the spot: First, young parents taking their children out to eat are no longer satisfied with Western fast food, and also hope that their children can eat more healthily. Second, there are more and more silver-haired users. Similar subtle functional needs such as sugar-free and sugar-controlled are also the directions that Super Bowl is going to explore next. Third, make innovations in the flavor of light food, express health more diversely, and be more in line with the tastes of Chinese people.
Super Bowl was established in 2015 and successively received two rounds of financing in 2020 and 2023. When it comes to the impact of investment on entrepreneurship, Gao Song said that the advantage behind financing comes from the reduction of marginal cost brought by scale, but entrepreneurs also need to continuously iterate organizational capabilities and improve supply chain capabilities.
In his opinion, the catering industry is an industry with a very fast return and very good cash flow. Users' feedback on brand actions can be clearly seen. Back to the smallest unit of catering, whether a store makes money or not is a specific and most basic problem to be solved. In addition, although the investment and financing in the primary market is relatively cooled, with the continuous emergence of IBS funds, it gives more catering a more updated and flexible financing method, which is an opportunity for the catering industry.
Asahi唯品 is a dark horse in the dairy product track in recent years, and has achieved double-digit growth against the trend this year. In Zhang Lei's opinion, Nowadays, consumers drink less milk because the scenarios where they drink milk have decreased. Instead, they might drink a cup of coffee or milk tea. Asahi唯品 hopes to create more scenarios where consumers can pair milk with other things. For example, around the breakfast scene, it cooperates with Xiaoxian Dun to make a "milk + bird's nest" breakfast combination. It cooperates with AG1 Xiaolvfen to make people drink more healthily, and also cooperates with Twinings to develop Earl Grey Cheese, and the exclusive product supplied to Sam's Club has also become a bestseller.
It is reported that since its birth, Asahi唯品 has carried out differentiated positioning. The soil has been abandoned for 5 years and nurtured for more than 20 years. It has built a fully closed industrial chain from soil to planting, cattle breeding, production and processing, and circulation. When it comes to the view of growth opportunities in the dairy product track, Zhang Lei said, Asahi唯品 is relatively pure, focusing on the organic category, and finding small cuts in life scenarios, digging deep into consumers' drinking scenarios, and there are still many opportunities.
The commercial fully automatic coffee machine brand CAYE咖爷 Technology is one of the potential stocks in the consumer track this year. 36Kr previously reported that CAYE咖爷 Technology has completed two rounds of financing against the trend this year.
Wu Peng, the founder of CAYE咖爷 Technology, said in the sharing that this year, consumers' access to coffee has become extremely convenient, and the price war has become a significant sign of "intense competition". But at the same time, he also saw some structural opportunities. First, cost reduction and efficiency increase will become the long-term strategic core of terminal stores in the next step. Second, the globalization process is accelerating, and many brands are determined to make Chinese coffee go global. In the globalization process, the local supply chain has unique advantages in both efficiency and global process coordination.
When it comes to starting a business for two years and completing five rounds of financing, Wu Peng mentioned that the entry of capital has given CAYE咖爷 Technology an opportunity to reshape the industry. Starting from the self-research of the material end, and then assembling the parts into the whole machine, it shapes the industry ecology in an all-round way and strives to change the inherent view of the global market on this细分 category of Chinese coffee machines. According to Wu Peng, CAYE咖爷 Technology has established substantive strategic cooperation with internationally renowned leading chain brands. In addition, industrial capitals represented by Hillhouse and Meituan also give them a natural trust endorsement in customer expansion.
The four guests also had in-depth exchanges on the core issues concerned by other industries.
The following is the quick record of the roundtable:
Yang Yafei: Thank you all. I'm very glad to talk with you in Beijing about the recent events. Today's guests have diverse backgrounds. Let's ask each guest to introduce themselves.
Wu Peng: Hello everyone, we are a company specializing in coffee machine manufacturing, and we are the first coffee machine company in China to carry out the whole machine application development relying on the self-developed core components and core modules. At present, our products are mainly for various commercial scenarios such as coffee chains and catering, milk tea, convenience stores, hotels, etc. that cross-border operate coffee business.
Zhang Lei: Hello everyone, I'm Zhang Lei, the manager of Asahi唯品. Asahi唯品 focuses on circular agriculture as the bottom layer, and is a closed-loop processing enterprise integrating agriculture, animal husbandry, production and processing. We focus on making high-end dairy products, mainly low-temperature organic products, and our customers are diverse. We cover many B-end customers such as those in the coffee and milk tea industries, and many high-quality channels.
Gao Song: Hello everyone, I'm Gao Song, the founder of Super Bowl Healthy Light Food. Super Bowl is a catering company dedicated to providing users with healthy, delicious and convenient meals. Now there are nearly 100 directly-operated stores in Beijing, Shanghai and Chengdu. Our vision is to make Chinese people eat more healthily. When people want to eat healthily, they can eat more deliciously.
Wang Yijie: Hello everyone, I'm Wang Yijie from Jinding Capital. We have invested in many entrepreneurial projects in the consumer industry in the past, such as Guyu, Wang Xiaolu,夸父炸串, Shuai Ke, etc., including the food industry, pet industry, beauty industry, etc. I'm very glad to participate in this event today.
Yang Yafei: I would like to ask the three entrepreneurs. Today's theme is that brands have "new" things, and doing "new" things also faces many challenges at present. I would like to ask you, what new things have you seen in the consumer or market side in your industry or company in the past year? Are there any targeted countermeasures?
Wu Peng: I would like to explain with one word - "intense competition". Taking our target customers as an example, we can clearly perceive the new competitive situation in the current coffee market. Nowadays, more and more coffee brands are emerging. Not only are there traditional coffee chain stores, catering chain giants are also crossing the border to get involved in the coffee business, and some milk tea chain giants have also joined the battle, and even convenience store chains have also entered the coffee market. Others, such as hotels, light food restaurants, and bakeries, have also integrated the coffee business format. The access to coffee has become unprecedentedly convenient, and the price war has become a significant sign of "intense competition". In the past, coffee with a petty bourgeois sentiment and a price of twenty or thirty yuan per cup has now become an entry-level drink of 9.9 yuan, 8.8 yuan, and 6.6 yuan.
In the process of "intense competition", we have captured some structural opportunities. The first one is that cost reduction and efficiency increase will become the long-term strategic core of terminal stores in the next step. When the terminal is difficult to significantly increase the price, seeking efficiency improvement upstream will become a rigid customer demand.
Therefore, we are also insight into this trend when we devote ourselves to the field of professional commercial coffee machines, starting from the core components to reduce costs and increase efficiency, and achieving extremely high efficiency while ensuring the quality is on par with imported products to help customers succeed. This is also the dominant feature of the current industry.
The second feature is globalization. Many customers have plans to expand the global market, to Europe, America, Southeast Asia and even to open stores all over the world, and are determined to make Chinese coffee go global. In the process of globalization, the local supply chain has unique advantages in both efficiency and global process coordination, and can work hand in hand with customers to move towards the international journey.
CAYE咖爷 Technology CEO & Founder Wu Peng
Zhang Lei: Just now Mr. Wu said it's intense competition. If it's in the dairy industry, it's extremely intense. Dairy products have been the most difficult year in the past 10 years. This year, the imbalance between supply and demand in the entire supply end has led to an excess of milk sources, and consumers' purchase volume has decreased. This year, it can be seen that the overall dairy product track is declining, but there are still categories that are growing.
So when people usually buy fresh milk and milk, it can be seen that the price war in both online and offline consumption is very fierce, but there are opportunities in the细分 market. For example, from the perspective of the channel end: the online growth is relatively good now. At present, the overall logistics of the online is developed and combined with e-commerce, (there are more platforms to meet users' purchases). Similarly, from the perspective of细分 categories, the growth of sugar-free yogurt has exceeded double digits, indicating that users are also paying more attention to their health this year.
Asahi唯品 has achieved double-digit growth this year because we have seen several opportunities: Now consumers drink less milk because the scenarios where they drink milk have decreased. We might drink a cup of coffee or a cup of milk tea in our daily life, and we won't drink milk anymore because people's daily stomach capacity is limited. Therefore, we hope to create more scenarios where consumers can pair milk with other things. This year, around the breakfast scene, we cooperated with the bird's nest brand Xiaoxian Dun to make a "milk + bird's nest" breakfast combination. We also cooperated with AG1 Xiaolvfen to make people drink more healthily. At the same time, we also cooperated with Twinings to develop Earl Grey Cheese, which is exclusively supplied to Sam's Club and is also a bestseller in Sam's Club.
So we think that finding small cuts in life scenarios, digging deep into consumers' drinking scenarios, and making it more possible for users to use milk are opportunities for development, and this is what we will continue to insist on.
Manager of Asahi唯品 Zhang Lei
Gao Song: What Mr. Zhang said is very good. Indeed, some industries are maintaining considerable growth, such as the big health industry. We are in the healthy diet track, and we still have feelings. What new changes have happened this year? I will share three observations in the scenarios. The first scenario change is that when young parents take their children out to eat, they are no longer satisfied with eating Western fast food such as McDonald's and KFC. They also hope that their children can eat more healthily, and Super Bowl has become their choice. But the standard Super Bowl is the amount for adults, which is too much for children. Therefore, according to the children's scenario, we launched Babybowl, a Super Bowl suitable for children's appetite and nutritional combination, so that children can also start to pay attention to health.
The second scenario is that there are more and more silver-haired users in our store. I often see old men and women with white hair in the store, and they know more about health than I do. I want to know what their needs are and how to design products that are more suitable for them, such as sugar-free products. I have been wearing a dynamic blood glucose meter recently. In fact, nearly 200 million people in China have blood sugar problems. Sugar control is a rigid demand for these people. 70% of people have potential blood sugar risks, but they are not aware of it. They are likely to be the future population. Similar subtle functional needs are the direction we need to work hard on next.
The third one is that Super Bowl has always wanted to make delicious and healthy meals, and we are constantly exploring what the definition of delicious is. The first exploration is to integrate Sichuan flavors into healthy meals, such as the well-selling tomato brisket and chili sauce, which is an innovation in the flavor of light food.
In terms of product form, we are also pursuing innovation. Last year, we launched the Super Roll, and last month, we just launched a new fresh vegetable pot. The expression of health can be more diverse and more in line with the tastes of Chinese people. These are the three new things I shared in three specific scenarios.
Yang Yafei: I would like to ask Mr. Wang. Jinding is an investor. 36Kr has been reporting on excellent entrepreneurs in recent years, but we have seen that the investment and financing have declined significantly in the past two years. The three guests just mentioned have many feelings about the intense market environment, and they also see细分 opportunities. Jinding is still one of the few institutions that invest in the consumer sector. Can you talk about the opportunities for consumer investment that you have seen?
Wang Yijie: Let me talk about my personal opinion. From my many years of doing consumer investment, I feel that the changes in the process are very obvious. Around 2020 until 2022, most of them were in the new consumer dividend period. At that time, the investment and financing market was relatively prosperous, and many people got money.
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