In the memory of “post-95” xinziyu, candy means reunion.
“When I was a child, my parents would always buy candy for the relatives and friends who came from the village to share their food. They would also specially carry a kilo or two of candy to visit their elders. During the Chinese new year, candy is also a must for every household. “
As soon as the Spring Festival arrives, small shops or supermarket stores are full of colorful candy. Behind the joy and sweetness, sister Ma, Xu Fuji, Alps, dove Many domestic and foreign candy brands have launched the Spring Festival campaign.
The Spring Festival has always been the peak season for candy sales, especially for domestic candy brands. Almost half of the annual revenue comes from around the Spring Festival, which also brings seasonal business risks to the healthy development of sugar enterprises.
But the bigger crisis comes from the outside: in the era of mass consumption upgrading and material abundance, the once “luxury” candy has become a common snack, and is impacted by other emerging snack categories. In the wave of health, the public tends to talk about “sugar”, the per capita consumption of candy continues to decline, and the rise of e-commerce exacerbates the impact of foreign brands on the domestic candy Market
As she grows older, Xin Ziyu is increasingly aware of the decline of candy: “the conditions at home have improved, and what her parents take home is not just candy. Snacks such as biscuits, ham sausages, ShaQima and potato chips, and even some local characteristics such as olives, dates and roast duck have become” regulars. “. Now we still buy candy for the Chinese new year, but if there are no children at home, a small bag of candy may have to be placed on the table until the end of the Lantern Festival. “
In the face of the industry crisis, the shuffling period is coming, candy enterprises have to change, transformation or innovation is imperative.
Start the Spring Festival campaign
After entering the twelfth lunar month, Su Qing ushered in the busiest day of the year.
Su Qing opened a candy and snack shop next to the most popular vegetable market in a county in northeastern Guizhou Province. At ordinary times, he opens his door to do business at more than seven o’clock, mainly selling local characteristic cakes, traditional handmade local products and a small amount of candy.
In December, Su Qing increased his purchase of candy. At five or six o’clock every day, he opened the store and packed various kinds of bulk candy into small plastic baskets for customers to choose. During this time, his wife was in charge of the shop, while Su Qing had to set up a stall in the pedestrian street 1000 meters away.
“The sales of candy will be in the new year’s period. The pedestrian flow can last until 11:00 or 12:00 in the evening, which is longer than the sales time in the store, and can also contact more young consumers who don’t like to go shopping in the vegetable market.” Su Qing said.
More than 2000 kilometers away from Guizhou, Beijing’s supermarket Candy area is also a busy scene.
Candy brands such as Xu Fuji, Ma Dajie, Alps, Ferrero and dove have made early preparations for the peak season of the Spring Festival. They have set up special exhibition stands for the Spring Festival. The “pyramid” made of a variety of candy and chocolate and new year candy gift boxes with different shapes attract many consumers to stop and buy.
On January 29, “bullet finance” saw in the candy area of a Carrefour supermarket in Chaoyang District of Beijing that two brands, Xu Fuji and Ma Dajie, occupied the largest display positions. Xu Fuji’s sales promoter team enthusiastically chanted a few sales slogans from time to time, while Ma Dajie’s brand had only one sales promoter, looking for packaging bags, answering customer inquiries, and arranging the display area Let the day just in the promotion of confusion.
In contrast, the candy in Suqing’s shop is much more affordable than that of Xu Fuji and Ma Dajie. Usually, 7-9 yuan is enough to weigh a jin of bulk candy. “There are many kinds of candy in my shop, and they pay attention to cost performance. Candy is not a big brand, but the quality is certainly no problem. Those who like big brand candy go to the supermarket or buy them online. ” Su Qing said.
An aunt who selects candy in Suqing’s store told “bullet finance” that although her children proposed to buy candy online, they only bought some chocolates in the end, and the others were bought in supermarkets or candy stores. “Online candy is basically packaged in large packages. It’s not cost-effective to spend the same money on only one flavor. The mixed products of the merchants may not be the combination they want, or even their own It’s more convenient to choose from the store. “
For a long time, the offline channel has been the main battlefield of candy brand competition. However, with the rise of e-commerce, candy brands are also making efforts online to set up their own official flagship stores.
According to the observation of “bullet finance”, online and offline candy sales show a trend of dissimilation competition. For the same brand, there are far less varieties of candy in online stores than offline stores, and most of them are packaged in a single category. However, most of the candy in gift boxes with innovative tastes and more expensive prices are online.
In terms of sales cycle, offline sales cycle is much longer than online sales cycle. When online stores stop delivering goods around the Spring Festival, offline channel becomes the only battlefield for candy sales.
In order to win the Spring Festival campaign, the major candy brands spend a lot of effort.
Taking Xu Fuji and Ma Dajie, the main force of new year’s sugar, as an example, Xu Fuji launched a gift box of nuts and sugar points before the Spring Festival, tried to cross-border nuts, and launched a gift box co branded with yogurt brand anmuchi; Ma Dajie launched a variety of gift boxes, such as old Beijing can’t eat enough candy gift box, Ma Dajie x Niulanshan two pot flavor wine chocolate gift box.
In order to win the Spring Festival promotion campaign, we should not only work hard on the product itself, but also on the marketing and channel.
Yang Xuebao, the CCO of sister Ma’s food, told bullet finance that sister Ma has taken four major measures in Spring Festival sales:
First, strengthen online sales. In the past, sister Ma’s online sales were relatively weak compared with offline sales. In November 2020, sister Ma began to strengthen e-commerce online sales. “In the live broadcast of the electricity supplier, we have found Kwai Fu, Wu Zhaoguo, star Wong Cho Lam, CCTV host Zhang Bin and magician Louis Liu and other influential people to broadcast live goods.”
Second, expand new retail channels. Sister Ma has reached cooperation with national community group buying platforms such as Xingsheng Youyou, Jingxi and Duoduo, and regional platforms such as Changsha Zhihua Zhiguo, Shandong Xiaoai alliance and Zhengzhou Youjing oilfield. “In the past two months, niugatang alone has sold more than 60000 cases and more than 1.8 million bags in a city in Hunan Province.”
Third, increase offline experience activities. “On the offline” main battlefield “, in addition to the normal display as usual, we also selected more than 1000 Carrefour, Yonghui and other supermarkets and stores in 100 cities across the country to carry out about 10000 creative DIY activities for nougat and chocolate, so that consumers can participate in the candy production process.”
Fourth, promote government enterprise group buying. “For some government departments or enterprises that need group buying during the Spring Festival, promote the sales of candy gift boxes and Guochao gift boxes in old Beijing.”
According to Yang Xuebao, after the implementation of the four measures, from the perspective of factory delivery, the sales performance of the Spring Festival has achieved double-digit growth compared with previous years.
What Yang Xuebao is most worried about is the adverse impact of the epidemic on offline sales. “Our goods have been delivered from the factory to supermarkets, hypermarkets and dealers. Now we hope that the epidemic can get better as soon as possible. Otherwise, we don’t dare to go shopping, and we may be involved in some channel inventory consumption problems in the next year.”
Ring the industry alarm
Behind the candy brand’s Spring Festival campaign is the long-standing problem of “Spring Festival dependence” in the industry.
Yang Xuebao told bullet finance that sales in the two months before New Year’s Eve (November and December of the lunar calendar) accounted for about 50% of Ma’s annual sales.
Although it has long been acquired by Nestle, a foreign-funded enterprise, Xu Fuji’s income is also dependent on Spring Festival sales. At the beginning of 2018, Xu Fuji’s insiders disclosed that Xu Fuji’s Spring Festival sales accounted for 40% to 50% of the whole year.
This also means that once the sales volume is poor during the Spring Festival, the performance of candy enterprises will be greatly affected, and it is easy to leave a stereotype of “new year candy” to consumers in the long run. From the perspective of enterprise operation, the annual revenue imbalance is obviously not conducive to long-term development.
Although foreign brands have also introduced the Spring Festival gift boxes in accordance with the local customs, compared with the domestic brands highly bound to the Spring Festival, foreign candy brands have relatively average annual sales volume and less dependence on the Spring Festival.
Therefore, how to balance the low season and peak season income has become a difficult problem for domestic candy enterprises.
“There have been some changes in our product mix since 2009.” Yang Xuebao told “bullet finance” that in order to balance off-season and peak sales, in 2009, sister Ma increased jelly business, and in 2013, she added more leisure products such as baking, bean products and biscuits.
In 2019, from snacks to catering has become a new strategic direction for sister ma. To this end, Ma also increased the high-frequency consumption of fresh bean products business, the production of tofu, soybean milk and soybean skin. “Today, our products are available in daily Youxian and Haidilao. However, due to the limitation of time and cold chain transportation, fresh soybean products are only sold in North China such as Beijing, Hebei and Tianjin. From April to may 2020, our bread also achieved a year-on-year growth of over 40%. ” Yang Xuebao said.
However, the candy enterprises are facing not only the seasonal operation risk, but also the weakening of the overall demand.
In recent years, new snack brands such as three squirrels, liangpinpuzi and baicaowei have risen rapidly, and rich snack categories have formed a diversion for part of the candy market. With the improvement of public health awareness, the demand for low sugar and sugar free products is increasing, which also leads to the per capita consumption of candy in China decreasing year by year.
According to the market research and investment strategy consultation report of China’s confectionery snack industry 2020-2025 issued by Huajing Industry Research Institute, China’s per capita confectionery consumption has dropped from 1.41kg in 2014 to 1.28kg in 2019.
In fact, the trend of reducing saccharification and health has brought industrial crisis.
According to the report of Huajing Industry Research Institute, since 2016, China’s candy production reached a high of 3.519 million tons, there has been a negative growth. In 2017, the output decreased by 205000 tons, and in 2018, the output was only 2.883 million tons. It was not until 2019 that the output of candy rose to 3.298 million tons. However, as of October 2020, the cumulative output of candy in China was 2.307 million tons, a year-on-year decrease of 8.69%.
Figure / Huajing information network
In the view of Zhu danpeng, an analyst of China’s food industry, candy companies should take differentiated development measures to cope with the risks brought about by the shrinking market.
“Now the degree of homogeneity of candy products in China is very high, but we can see that the new generation is irresistible to new brands and novel products, so innovation and upgrading iteration still need to be done. Traditional candy brands don’t mean there are no consumers, but they don’t solve the core needs and demands of the consumer side, and they don’t solve the pain points of the consumer side. ” Zhu danpeng further pointed out.
Fierce foreign investment
Although the domestic candy market is shrinking, but from the data performance point of view, China’s candy market has no opportunity.
One example is: in recent years, the sales volume of Russian candy such as purple candy still has a relatively good growth in China, which has become a powerful troublemaker in China’s candy market.
Huang Xiaoxiao, who lives in Guangxi, told bullet finance that she began to buy Russian candy such as purple candy on the e-commerce platform in 2019. Nearly two years later, the Russian food category she bought also expanded to sausage, honey and other aspects.
According to Manzhouli customs data, from January to October 2019 alone, the import value of Russian purple sugar at Manzhouli Port reached 460 million yuan, an increase of 86.4% year on year.
“KdV (a large Russian candy and snack manufacturer) Purple candy has a very good taste and materials. It’s an imported food, but the price is not expensive. In addition to buying it for family members at ordinary times, it can also be bought as a gift for relatives in other provinces on New Year’s holidays. It’s very good. KdV’s another soft candy sandwich, children also like to eat Huang said.
The rapid expansion in the Chinese market has also promoted the development of Russian related enterprises. According to Lyudmila fiodorova, general manager of skylex consulting in Russia, sales of KdV group, which opened stores and warehouses in Inner Mongolia in 2018, increased by 50% year on year.
Today, Russia’s candy exports to China are still increasing.
Dmitry Krasnov, head of the agricultural products export development center of the Ministry of agriculture of the Russian Federation, previously pointed out that Russia’s candy exports to China in 2020 will reach 170 million US dollars, a year-on-year increase of 20%; Russia’s candy exports to China will reach 79000 tons, compared with 67800 tons in 2019.
The representative of Russia United confectionery Co., Ltd., the largest confectionery company in Eastern Europe, said that despite the impact of the new coronavirus pandemic, the export of products to China will still increase by 20% in 2020.
“Due to rich varieties, exquisite packaging and diversified convenient purchasing channels, Russian candy is selling well in China, which promotes the growth of candy imports.” Sun Fei, who has worked in the field of candy import for many years, told the media.
Looking around the Chinese candy market, the foreign troublemakers are not only Russian candy.
In terms of market share, foreign brands have been dominant in China’s candy market for a long time. The top five foreign-funded enterprises in the market share are Mars, Nestle, Alps, Yizi international and Ferrero. The domestic brands Xu Fuji and golden monkey have also been acquired by foreign-funded enterprises Nestle and Hershey.
For a long time, China’s candy industry is seriously lack of innovation, lack of brand and lagging marketing means, which is considered to be an important reason for foreign capital to surpass.
Yang Xuebao said frankly to “bullet finance” that international brands are far superior to native domestic brands in terms of capital, talent and management, which has brought great competitive pressure to domestic brands.
He believes that when dealing with the competition of international brands, the core response measures of domestic brands are to make good products, to make products more suitable for the taste of Chinese people, to work hard from the fundamental quality of products, and to ensure the taste of candy from the selection of raw materials and technology. While doing a good job in product quality, we should also actively learn from international brands, such as talent cultivation, overall operation and brand publicity.
Yang Xuebao, for example, said, “many consumers and dealers once said that Ma Dajie’s products are simple and even rustic, the packaging is not very exquisite, and the connotation is very few. In the past two years, we have taken suggestions to improve the packaging appearance while maintaining the product quality. For example, Guochao gift box “old Beijing can’t eat enough” and Niulanshan Erguotou flavor wine chocolate gift box will be launched in 2020. External feedback is very good. Niulanshan Erguotou flavor wine chocolate gift box has been sold out in late January this year. “
Facing the crisis
In the face of industrial crisis, international and domestic candy brands are exploring the way of transformation and upgrading, and trying to launch new categories.
For example, the Alps launched lollipops with DHA algal oil; Mars launched new products such as spicy Snickers and bomb cube; Xu Fuji took the initiative to reduce the use of sugar, and from 2016 to 2018, Xu Fuji reduced sugar by more than 10000 tons; big white rabbit launched new products such as cream plum, chocolate and red bean milk candy; sister Ma, Xifeng wine and Niulanshan Erguotou jointly launched heart of wine chocolate
For sugar enterprises, in the background of “generation Z” becoming the main consumption force, better catering to the preferences of young consumers has become a breakthrough.
According to a research report by international consulting firm Kaidu, China’s consumer market has entered a period of “individualism”. Generation Z especially hopes to find a balance between China’s traditional and cultural heritage and contemporary global cultural expression, and define their contemporary Chinese identity from a more global perspective.
In other words, it also means that the so-called foreign brands are no longer the first choice for Z generation consumers. In the past few years, guochaofeng, led by Li Ning of China, has risen. It is the best verification that Laoganma, Wangwang, dabaitu and other old brands have cross-border joint names and use Guochao to refresh the brand image.
In the candy industry, such cross-border co branding is also quite popular. For example, Xu Fuji works hand in hand with xiaohuangren and pop mart, and sister Ma works with Huba IP, hot wind, Xifeng wine and Niulanshan
“The biggest advantage of cross-border cooperation lies in giving consumers different experience, or satisfying consumers’ emotional needs, which is the key reason why so many enterprises do cross-border cooperation.” Zhu danpeng told “bullet finance”.
Yang Xuebao said frankly that cross-border is actually a way for everyone to share resources and combine advantages. The cross-border co branding of brands in different fields improves the popularity and rejuvenation of each brand, increases the favor of users, and improves the sales volume of products. Through the continuous cross-border brand, in the case of a bad environment, it also brings more hope and opportunities to the development of enterprises.
For example, he said that sister Ma had a cross-border cooperation with didi as early as 2013, and didi users exchanged points for the gift bag provided by sister MA in didi mall. Although from the financial point of view, it is a loss, but from the perspective of brand communication and consumer communication, more than 100000 people finally participated in the activity, established the awareness of madajie brand through the Internet platform, and reached new users.
In ancient times, sugar was a real luxury, now, it has already been flying into ordinary people’s homes.
At present, the candy industry, especially the pace of Chinese traditional candy innovation, has failed to keep up with the speed of consumption upgrading, and the crisis is obvious to all. But under the crisis, the popularity of Russian candy still reveals that there are a lot of opportunities in this industry.
Innovation is always the best booster. Now, some sugar enterprises have taken the steps of transformation and upgrading, and there are still many variables in the industry structure. However, it is certain that this “sweet war” will become increasingly fierce and trigger a new round of reshuffle. Who can live to the end in this innovation war, test the internal strength of sugar enterprises, and time will give the final answer.
*Note: Xin Ziyu, Su Qing and Huang Xiaoxiao are all pseudonyms in the text; the picture and the untitled picture in the text are from bullet finance and economics, photo: Xu Yun.
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