China Food

Like tea, Naixue and others have set foot in one after another, and bottled drinks have become the next battlefield for new tea drinks?

in the crazy tea industry, can bottled drinks become the next main battlefield of new tea brands?

Text: Zhou hongchu   

Source: (ID: hongcan18)

Recently, Michelle Ice City Co., Ltd. was granted the appearance patent of “bottle (Snow King loves drinking water)”. According to the patent abstract, the design product is used for beverage packaging, and the key point of the product lies in the combination of shape and pattern. The packaging shows that the bottle is pure drinking water.
Some netizens speculated that honey snow ice city would start to enter the bottled beverage market.
However, the red meal network observed that the new tea brand with the layout of the bottled beverage track is not an isolated case.
As early as more than a year ago, Xi tea and Naixue had targeted the circuit of bottled tea, and successively launched a series of hot bottled drinks such as bubble water, fruit juice tea and light milk tea.
△ picture source: Xicha official blog
Layout new retail,
Tea brands are eyeing bottled drinks
In the past two years, many bottled beverage giants, including Wahaha, Wang Laoji, Weiwei soymilk and other brands, have set foot in the tea industry and opened beverage stores. While beverage leaders cross into the tea industry, a number of tea brands have also begun to “cross-border” and lay out bottled drinks at the retail end.
The new tea brand that extended its tentacles to new retail and launched bottled drinks earlier is Xi tea.
On June 18, 2020, Xixiao tea, a subsidiary of Xicha, announced the launch of the second brand “Xixiao tea bottling factory” At the same time, the first portable bottled beverage NFC juice was fully listed in Xi tea’s mainland stores. Within a month, Xi tea was officially announced again and launched a new soda production line. The first batch of products mainly focus on 0 sugar, 0 fat, 0 card + dietary fiber. So far, Xi tea has launched four series of bottled drinks: fruit juice tea, bubble water, light milk tea and pop lemon tea.
△ Xi tea light milk tea, photo source: Xi tea official blog
It is worth noting that in addition to Xicha offline stores, online applets and flagship stores, Xicha’s beverage products have also entered convenience stores, supermarkets and other channels rarely involved by new tea brands before.
While Xicha stormed into the bottled beverage track, Naixue, who is in the same echelon, is also quietly laying out the layout.
In October 2020, the snow broke through the official account that the company launched the launch of the Tmall snow flagship store and launched the Tmall flagship store. Since then, the company has launched four different bubbles of water in recent years. In addition, it has also worked with the famous Spanish illustrator, Lara Costa, for the production of a nutritious milk shake product.
In the 2021 semi annual report, Naixue said that retail products will be launched to offline chain stores and other channels in the second half of this year.
One month before the release of the semi annual report, the “Shenzhen Naixue Beverage Technology Co., Ltd.” held by Naixue’s tea related company Shenzhen Pindao Catering Management Co., Ltd. was established.
△ Naixue bubble water, photo source: Naixue guanbo
In addition, there are media reports that Shanghai Chatian Catering Management Co., Ltd., the parent company of Lele tea, applied for relevant trademarks such as “happy tea” and “bottle tea” at the end of last year. The registration of relevant categories includes beer, beverage and convenience food, which also seems to have the intention of entering the bottled beverage track.
Now, honey Snow Ice City, which is seeking to be listed, is also laying out the bottled beverage track, and the head tea brands are laying out one after another. What is their deep intention? What is the charm of the beverage track?
Tea industry,
Brands need to find new growth space
Earlier, the “top ten tea brands in China in 2021” was announced, and red has made an in-depth analysis of the current tea market.
△ picture source: Photo Network
The article mentioned that after several years of development, now the new tea market basically has its own representative brands at all consumption levels, the distinction is more obvious, and the advantages of head brands are becoming more and more prominent. This also means that it is not easy for brands to break through.
With the gradual disappearance of tea category dividends, it will become more and more difficult to seize the market scale only by product innovation or simply by opening stores in the future.
It is an indisputable fact that new tea brands have fallen into deep involution, and brands have entered diversified and multi-dimensional competition. Under this background, many tea brands begin to look for new growth curves and more possibilities in the future.
Previously, new tea drinkers have made many attempts and explorations in tea + baking, coffee, wine and other fields.
For example, Xi tea launched baking products in 2017 and tried to add coffee and cocktail products in 2019. Naixue’s tea has opened a number of special stores for wine in Beijing, Shenzhen, Chongqing and other places.
△ Naixue blabarbar liquor store, photo source: Naixue guanbo
The racing track of bottled drinks, which belongs to the category of drinks like tea, has natural similarities in genes, and naturally has become the number one position for many tea brands to test the water.
However, the race track for tea brands to choose bottled drinks is not blind and rash, because the bottled beverage market is indeed unique in terms of market scale and the genes of business format.
First of all, bottled drinks, as a trillion market, have broad market prospects.
Zong Qinghou, founder of Wahaha, once said, “the beverage industry is not outdated and will always be a sunrise industry.”
Relevant data prove that this statement is true. In August this year, the insight into the beverage consumption trend in 2021 released by the first financial business data center in conjunction with tmall shows that the beverage market has reached 991.4 billion yuan in 2019 and is expected to exceed 1.3 trillion yuan in 2024.
△ picture source: Photo Network
On the other hand, the bottled beverage market has also been favored by capital in recent years. In 2020, the number and amount of financing in the food and beverage industry reached a new high. In 2021, 56 beverage brands were financed in Q1 alone, with a year-on-year increase of 250%. This can be seen from the classic case of fried chicken Yuanqi forest, which has been popular in the beverage industry for four years, has raised five rounds and is said to be valued at more than $15 billion.
Secondly, the gross profit of bottled drinks is higher than that of current tea drinks.
About the gross profit of tea shops, yiou has investigated a tea brand. In a tea brand store (the rent of the store is about 156000 yuan / month, the water and electricity fee is about 2000 yuan / month, and the store needs to hire 30 basic store employees and one general person in charge) the average monthly tea sales volume is 50000 cups. Calculated at the price of 30 yuan / cup, the food cost of each cup of tea accounts for 21.6%, the operating cost is 24.23%, and the gross profit margin of one cup of tea is 54.17%. It is worth mentioning that the gross profit has not deducted marketing costs, equipment depreciation and related costs arising from the operation of the brand headquarters.
△ data source: yiou prospective industry research institute
In contrast, the gross profit of bottled drinks is much higher.
According to a professional who has worked deeply in the beverage industry for many years, if the comprehensive costs such as content, packaging materials, OEM fees and logistics freight are removed, the gross profit of beverages (especially “flavored drinks” here, excluding purified water) is as high as 70% – 75%. For example, the sales price of bubble water in Yuanqi forest is between 5-6 yuan, but the net profit is about 4.5 yuan.
Third, the consumption scene and coverage of bottled drinks are wider than that of current tea drinks.
Because bottled drinks are more portable, they will be more widely used in consumption scenarios and crowd coverage than new tea drinks, such as home, work, shopping, study, leisure, sports and other scenarios. From this point of view, “ready-made tea + bottled drinks” is also a tea brand. In order to further tap the multiple needs of target consumer groups and expand consumers in the whole period Multi scenario consumption is a good choice to realize business growth space.
Based on the above three advantages, it is not surprising that bottled drinks attract tea brands.
△ photo source: Official Blog of Naixue
In addition, red meal network found that at present, tea brands that have taken the lead in layout have tasted the sweetness. For example, on the first day of sales, Xicha’s first batch of soft drinks went on sale in Weiya’s live studio. 300000 bottles and 25000 boxes of soft drinks were emptied in seconds. After inquiry, the reporter found that in the flagship store of Xi tea tmall, there were more than 40000 baby evaluations of its sugar free water. In addition, Naixue’s first half financial report also disclosed that the new retail revenue in the first half of 2021 was 69.729 million, nearly five times that of 15.496 million in the same period last year.
Can bottled drinks really become the next nuggets for new tea brands?
The action of head brands is often the wind vane of an industry. Head brands such as Xi tea and Naixue have taken the lead in entering the Bureau and made certain achievements. Therefore, some people in the industry said that bottled drinks may be expected to become the next key layout direction of new tea brands.
However, in the view of red, bottled drinks, as a new track, tea brands face many problems and challenges if they want to enter this trillion market.
1. New and old brands attack each other, and anti cross-border needs more sufficient financial resources and brand confidence
Entering a brand-new track is undoubtedly difficult and building a new brand. For many tea brands, bottled beverage is a new field in terms of product, packaging, channel and marketing. This requires a comprehensive consideration of whether the financial resources behind the brand can match the final strength.
According to the observation of red, even tea head brands such as Xi tea and Naixue have universal recognition in brand awareness and attention, it is not plain sailing at the beginning of the new track of entering the bottled beverage.
△ picture source: Xicha official blog
For example, when Xi tea launched Peach Oolong bubble water in July 2020, although it went through hundreds of formula iterations and polishing, it was finally removed from the shelf because of the slight deficiency in the taste of the drink, and all of them were recalled and destroyed. It is understood that at that time, the loss of tea was millions.
Some brands spend a long time, energy and high cost to make products, but they are not favored and recognized by the consumer market. Such a result may appear at any time for any brand that is new to this field.
However, not everyone can bear such consequences with the strength and confidence of the head brand.
More importantly, a large number of new entrants and beverage industry leaders who have been working on the track for many years are also eyeing the big cake of the beverage track. It is not easy for tea brands to stand out in the fierce competition.
Take the bubble water targeted by tea brands such as Xi tea and Naixue as an example. At present, in addition to Yuanqi forest, which is the latest strong rival, many leaders in the beverage industry, including nongnongshan spring, Suntory, Wahaha and Coca Cola, have also launched similar products. It is conceivable how fierce the competition in this track is.
Xicha, Naixue and the bubble water of Yuanqi forest fight hand to hand in the convenience store. Photo source: Red meal online photo
2. New challenges of channel layout
In addition to the actual gap in brand strength and the gathering of competitors, the gap in channel layout is also a problem that tea brands have to face.
When Xi tea entered the bottled beverage track across the border, Wang Dongming, columnist of red meal network and chain consultant of catering industry, once said frankly, “it is difficult for supermarkets to make money for general products, because supermarkets have high requirements for food safety, logistics and supply chain, so the investment cost is high and the channel opening cost is high, and neither of these two situations can be borne by catering enterprises.”
Unlike current tea drinks, which are mainly sold through offline stores and online orders, a large proportion of bottled drinks are sold through offline channels such as supermarkets and convenience stores. However, the development experience and resources of channels depend on time.
For the initiative of the current tea brand to reach out to the bottled beverage track, the director of bronze capital investment once commented, “for such current tea enterprises, the main advantages lie in brand and operation, but at the same time, they also face more challenges in how to build a sinking channel network for deep distribution.”
Another professional in the beverage industry who did not want to be named also told the red meal network reporter, “if the tea brand only relies on its own offline stores or online shopping mall to make channel layout, whether it is market capacity or product coverage, it is far from being able to compete with traditional beverage brands.”
△ convenience stores are also an important channel for beverage brands to compete. Photo source: Photo Network
Red found that at present, Xi tea bottled beverage business has mainstream e-commerce channels such as tmall and online; Offline, the number of sales outlets has exceeded 30000. In addition to fully covering its own stores, it also includes mainstream convenience stores represented by 711 and the whole family, supermarkets, and new retail channels represented by HEMA and dingdong.
However, this is still far from the channel layout of traditional bottled beverage giants.
It is understood that nongnongshan spring has laid 1 million offline terminals only one month after the launch of bubble aquatic products, almost the total number of terminal sales points accumulated by Yuanqi forest in recent years, which is more than 30 times different from the “30000” channel layout of tea.
In general, the business logic of fast-moving products is different from that of physical stores. FMCG pays more attention to offline distribution. The layout of offline distribution channels of traditional bottled beverage giants has been very perfect. For tea brands, the challenge lies in how to build a sinking in-depth distribution channel network.
With a market scale of more than trillion, the bottled beverage track undoubtedly has great temptation for the new tea brands that are currently in a period of growth bottleneck and development confusion.
However, in the environment of competition between new and old brands and continuous product change, the tea brands that have entered the market are still in the exploratory stage. Whether the new tea drinks can stand out in the bottled beverage market remains to be tested by time.
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