4 principles and 4 risks of influencer brands

" Internet celebrity brand " is the most popular term in the business world recently. It has attracted the attention of many investors and media, and is hailed by the media as a "new business force." How do people define “Internet celebrity brand”?

As the name suggests, Internet celebrity brands are brands that quickly build popularity through online media, or even become famous overnight. This definition is not very precise, but it is concise.

In fact, the Internet has been around for some years, but “Internet celebrity brands” have only exploded in a concentrated manner today. What is the reason? What factors are driving the explosion of “Internet celebrity brands” today?

There are many different reasons for this, but the most discussed topics are new products, new brands, new channels, new media, influencers, new consumer groups, mature supply chains, new teams, enthusiastic capital, Tmall promotion, and low-threshold industries…

I think all the above statements are correct, but the "Internet celebrity brand" is not driven by a single factor, it is driven by all the above factors glued together, this is the charm of business. Therefore, success is not easy and requires constant exploration.

In addition to the above factors, there are two invisible "forces" that play a key role in promoting the concentrated outbreak of "Internet celebrity brands".

1. Two invisible “forces”

1. The first force is the power of "Chinese brands"

We put past influencer brands next to current influencer brands, which span time and industries, so that we can find some patterns.

These internet celebrity brands include: Xiaomi, Jialezhiji, Inman, Afu Essential Oil, Huang Taiji, Three Squirrels, Liziqi, Wang Baobao, Yuanqi Forest, Jiang Xiaobai, Xuanma, Heytea, Chayan Yuese, Sandunban, Zhong Xuegao, Westshaoye, Pop Mart, Half Acre Flower Field, Xiaoxiandun, Diaoye Beef Brisket, Ubars, Perfect Diary, Canban, Handu Yishe, Adopt a Cow, Luckin Coffee, Miniso, Smartisan Mobile Phone, and Huaxizi.

Among these brands, it is not difficult to find that Chinese brands occupy an absolute dominant share. Although some companies use the mental resources of Japanese and Korean brands to build their brands, such practices are now very rare compared to before.

Let’s imagine that if today’s Chinese consumers do not recognize “Chinese brands”, the direct impact will be: the creation of these “Internet celebrity brands” will be like rowing against the current, and the probability of success will be greatly reduced.

Fortunately, today's consumers' awareness of "Chinese brands" has increased rapidly in the past 10 years. In the past, the whole world considered China to be the "world's factory". At that time, Chinese companies were proud of being able to manufacture for world-renowned brands. Influential companies that were born at that time included Foxconn, Dayang Creations, and Dongguan Liantai Garment.

After entering 2010, perceptions changed quietly and began to shift in favor of Chinese brands. The reason for the change in perception is simple. It stems from the pioneering spirit of a large number of Chinese brands in the global market, which has directly reversed the cognitive basis of "Made in China" and reshaped the global consumers' new perception of "Chinese brands". They are:

• Huawei: A global leader in communications technology;
• Haier: Global leader in refrigerators;
• Gree: The global leader in air conditioning.

It is precisely because of the efforts of these brands that have the courage to break through that the global consumers' perception of "Chinese brands" has been redefined.

In addition, a set of data also shows that "Chinese brands" are widely recognized globally. From 2011 to 2021, China, the headquarters of the top 100 global brands, soared from fifth to second, second only to the United States. The number increased from the initial 5 to 23, the fastest growth rate in the world.

Regarding the changes in perception, Reese conducted a survey on global consumers at the beginning of the year. The purpose of the survey was to study how global consumers view Chinese brands. The results showed that global consumers' perception of "Chinese brands" is concentrated on leading technology/technical leadership, high cost performance, excellent design, good user experience/good quality, and reliable workmanship.

In this survey, Chinese consumers' perception of "Chinese brands" is concentrated on words such as high cost performance, good quality, and excellent design.

Reese's research results are sufficient to prove that "Chinese brands" are the general trend. The increase in awareness of "Chinese brands" provides Chinese companies with excellent opportunities to create brands.

The rise of “Internet celebrity brands” at this time is also largely driven by the increased awareness of “Chinese brands”. Let’s make an assumption. If consumers’ perception of “Chinese brands” remains the same as it was 30 years ago, and they are still full of admiration for “foreign brands”, then creating an “Internet celebrity brand” would be like rowing against the current, with half the effort and twice the results. This is what we are talking about today, the first driving force: the driving force brought by the increased awareness of "Chinese brands", or it can be said to be an opportunity.

2. The second force is the rise of the “she economy”, where women have become the absolute main force of consumption

Let’s go back to the “Internet celebrity brands” listed above. After classifying these “Internet celebrity brands”, we found a phenomenon: brands consumed by women occupy a dominant position and can be said to be overwhelmingly ahead of brands consumed by men .

Female consumer brands include: Inman, Huang Taiji, Three Squirrels, Liziqi, Wang Baobao, Yuanqi Forest, Xuanma, Heytea, Cha Yan Yue Se, Afu Essential Oil, Sandunban, Zhong Xue Gao, West Master, Pop Mart, Half Acre Flower Field, Xiaoxiandun, Ubars, Perfect Diary, Canban, Handu Yishe, Adopt a Cow, Luckin Coffee, and Huaxizi. There is only one consumer brand that is mainly targeted at men: Jiang Xiaobai.

To illustrate the situation, let's confirm our point of view with a set of financing data. Among the brands that received financing this year, the most were in the beauty and skin care sectors.

• As of July this year, the beauty and skin care sector has received 69 financings;
• The second largest sector is food and beverage, which received 27 financings in the first nine months;
• Next is the maternal and infant sector, which received 14 financings in the first four months;
• Finally, the pet food sector received 16 financings in the first nine months.

Looking at another set of data, in early 2021, Tmall released a "Her Power" report, which showed that women accounted for 70% of Tmall's new brand consumers; among the top new brands, more than 80% of new brands were related to female consumption. The total transaction volume of new brands on Tmall exceeded 76 million yuan, of which 53.2 million yuan came from female consumers.

Based on the above data, it can be concluded that "female consumption" is another core force driving the explosion of Internet celebrity brands. We continue to explore in depth to find the logic behind why female consumer brands are more likely to give birth to internet celebrities.

We use a set of data recently released by Meituan, which is about the "Preference List of Consumer Categories for Both Genders". The data shows that male consumers prefer mainstream and uninnovative buffets, Hunan cuisine, Beijing cuisine, barbecue and seafood, while female consumers prefer more innovative bread and desserts, Korean cuisine, beverage shops, Southeast Asian cuisine and Western food.

Women prefer novelty in their consumption, while men prefer conservatism. Compared with men, women prefer to explore and try new categories and new brands. Based on this, new brands have the opportunity to be tried and then become "Internet celebrity brands." This is the first reason why female consumption drives the establishment of “Internet celebrity brands”.

The second reason is that women will spread the word about the brands they consume.

Cognitive neuropsychology proves that in terms of expression, women are significantly superior to men, both in terms of needs and desires, as well as in terms of ability and total amount.

Women are natural masters of public opinion. They need to create public opinion more, and are more willing and better at creating a large amount of public opinion.

Psychology has proven that women are more susceptible to infection and they often have the desire to pass on their consumption experiences (positive or negative) to the group they belong to.

Therefore, it is easy to generate interactive herd mentality within the group, thus generally triggering emotional consumption.

The combination of these two reasons has become a driving force for female consumer brands to become more likely to become "Internet celebrities".

• One is that women prefer to explore novelty and create opportunities for new brands;
• Another reason is that women are an easily spread group. They are willing to tell their groups about their consumption experiences, creating opportunities for new brands to spread.

The revelation to entrepreneurs or start-ups is that compared with men’s consumer products, women’s consumer brands are more likely to give birth to “Internet celebrities”.

To summarize the above, we believe that there are two forces driving the establishment of Internet celebrity brands, namely the improvement of the awareness of "Chinese brands" and the rise of "her power" . These two forces combined are driving Chinese consumers' willingness to try Chinese brands.

2. 4 principles for creating an influencer brand

In terms of group differences, female consumer brands occupy an absolute dominant position, and women's desire for novelty creates opportunities for new brands.

Women’s easy communication ability creates communication opportunities for new brands. Coupled with the speed of Internet diffusion, “Internet celebrity brands” are able to burst out with unprecedented power and quickly appear before our eyes.

Among the recently emerging "Internet celebrity brands", at least half of them came to the Cliff Positioning Training Institute to study, including: Ubras, Xuanma, Half Acre Flower Field, Yongpu, Wang Xiaolu, Three Squirrels, etc.

After communicating with these entrepreneurs, we summarized the growth roadmap of “Internet celebrity brands”. It includes four stages: the start-up stage, the internet celebrity stage, the outdated stage and the recovery stage .

As the saying goes, all things are difficult at the beginning, and creating a brand also faces such difficulties. The difficulty in creating an "Internet celebrity brand" lies in the initial stage. In summary, there are two necessary steps to create an "Internet celebrity brand".

1. The first step is to create an attractive brand;
2. The second step is to encourage more people to try your new brand.

In other words, it is to get more and more people involved, and then use the speed of Internet communication to promote the brand to become popular on the Internet.

Among the above two steps, the second step already has a mature routine and is not difficult.

How to create an attractive brand? This is the key point and also the most difficult problem to overcome for all companies.

Next, based on our long-term research, we have concluded that creating an attractive brand should comply with the following four principles.

1. Principle 1: Create new categories

Mr. Wang Jianguo , the founder of Kidswant and also the founder of three unicorn companies, has a view that is very consistent with our philosophy. He believes:

The biggest disaster in business is homogeneous competition, and the biggest problem is simple imitation.

Mr. Wang Jianguo has a very thorough understanding of business and brands. When creating a brand, simply imitating is not attractive; its value comes from new categories. Creating an attractive brand must start with creating a new category.

New product categories have a strong appeal to consumers. Why do new categories have such a strong appeal to people?

The principle behind this is the need for human survival, which drives humans to explore the diversity of matter. This is a survival ability that was born in the process of human evolution.

From the perspective of evolution, product diversity gives us more choices rather than relying on just one resource, which is a very bad survival strategy. The need for survival will unconsciously lead us to explore more resources.

To put it more bluntly, human beings' long-evolved survival ability has made people extremely interested in new categories. This alone is enough to make new categories catch people's attention and become a resource for diversified choices in people's lives.

• One of the core reasons for Yuanqi Forest's success is that it pioneered a new category of "sugar-free sparkling water", which was previously unavailable.
• Ubars has become a new and highly anticipated brand in the underwear market because it has pioneered a new category of "size-free underwear";
• Heytea, China’s most valuable tea brand, pioneered the new category of “cheese tea”;
• Huaxizi, the most popular cosmetics brand in the past three years, has created a new category of "Oriental cosmetics";
• Sanban, the internet-famous mouthwash, has created a new category of “portable mouthwash”.

A careful study will reveal that behind the "Internet celebrity brands" is the logic of new categories. Internet celebrity brands without category innovation are destined to be short-lived .

In other words, if Yuanqi Forest's products lacked category innovation and produced a product similar to Nongfu Spring or Master Kong, it might not be where it is today.

The above theories and practical cases may be able to explain a truth: people lack the desire to explore existing concepts, and new concepts are inherently attractive, which brings some inspiration to entrepreneurs: to create an attractive brand, think about how to create a new category first.

2. Principle 2: Launch a new brand

Many companies understand the importance of launching a new brand, but face many obstacles in practice.

Large companies, in particular, are extremely cautious about using new brands because the process of reshaping a new brand is extremely complex, takes a long time, and its short-term effects are not as good as extending the brand.

But our view is that the best strategy for new categories is still new brands.

Each generation has its own new brand. Take the video website as an example.

• Consumers born after 1985 prefer Youku videos;
• Consumers born after 1990 prefer iQiyi videos;
• Consumers born after 1995 are obsessed with Bilibili.

New product categories usually target a new generation of consumers, and the new generation of consumers needs their own brands.

Why do the new generation of consumers prefer new brands? There are two reasons.

The first reason is that new brands can send out strong “identity signals”.

The reason why the new generation of consumers become pioneers of new brands is that this behavior makes them look novel and fashionable, and conveys their own identity signals. At the same time, young people are very eager for a sense of identity.

In contrast, among younger groups, conformity is viewed as a negative behavior. Choosing new brands makes the young group look different and fashionable. At the same time, it also helps them find partners with "common interests".

What does it mean? When a consumer wearing Lululemon sees another consumer wearing Lululemon, she guesses that the consumer has the same hobbies as her and is likely to become friends.

Neurology has also proven that when animals see their own kind, their brains release more dosamine, which makes them excited and feel safer.

In terms of conveying "identity signals", old brands have shown disadvantages. They represent the choices of the previous generation and are symbols of tradition, conservatism, the past, and conformity. They conflict with the "identity signals" that the new generation of consumers are trying to express, such as new generation, individuality, fashion, and vitality.

For entrepreneurs or companies creating new product categories, new brands have the natural advantages of novelty and scarcity, which are very attractive to the new generation of consumers.

The second reason is that new brands reshape people’s expectations of the product.

We encourage companies to use new brands because new brands send a signal to consumers that the product is different from previous products.

New brands usually convey a completely new value proposition, and people are curious about new products and are usually willing to try them. However, when companies use old brands to represent new product categories, it will lower people's expectations of the new product categories.

Taking online news brands as an example, Sina and Tencent were the dominant brands in the PC era. In the mobile news era, Toutiao became the new leader. This is the best example of the attractiveness of new brands.

As a new brand, Toutiao has brought different expectations about "news information" to the audience. To put it bluntly, the message that Sina Mobile conveys to customers is that the news content is the same as the news information on the PC web version. Otherwise, why is it also called Sina?

Consumers will think: We already have Sina’s PC website, there is no need to continue downloading Sina’s mobile APP. Using the old brand will be counterproductive.

But Toutiao has brought different expectations to customers. Users hope to see different information on Toutiao because Toutiao is a new brand and there must be differences.

Let’s make an assumption. If “0 sugar sparkling water” was promoted and sold using the Master Kong brand, I guess “0 sugar sparkling water” would not be as popular as it is today. The reason is that consumers already have fixed expectations for Master Kong's products.

For entrepreneurs or companies that innovate product categories, new brands make new categories even more “new”! The past impressions of old brands make people lose interest in new categories.

Therefore, we have repeatedly emphasized that the best strategy for new product categories is to adopt new brands. Using old brands for new product categories will make the new generation of consumers lose the motivation to try.

3. Principle 3: Form a new team

Recently, the research results of the world's authoritative magazine "Nature" stated: If you want original results, please build a new team! To study this result, they conducted an experiment.

The experimental process is as follows: they use different teams to research and write papers, and then evaluate the quality of the papers.

The results show that large teams tend to develop existing technologies, while small teams play a more important role in discovering cutting-edge content. It was also found that the results of the new team have more advantages than those of the old team in terms of originality and interdisciplinary influence.

The Harvard Business Review also expressed a similar view. They believed that: in the network of existing teams, people's ideas tend to tend to the past, which makes them evaluate a new idea based on past experience. From past practice, new ideas usually follow the old path and become mediocre.

In practice, the new team has produced fruitful results. Let’s look at a case in which a turnaround was achieved through a new team. This case is the well-known Walmart .

That year, in order to respond to the threat of online shopping, Walmart developed an online business division that focuses specifically on online shopping. However, the practical results are not satisfactory.

Not long after, Walmart announced the acquisition of online shopping site jet.com. After acquiring jet.com, Walmart chose to stop operating the jet.com website, but retained the jet.com team. Jet.com CEO Marc Lore will be responsible for operating the Walmart website.

This decision changed the fate of Walmart's online store. The new team injected energy and new ideas into the online business. Walmart's online store turned the corner and user growth entered the "fast lane."

In 2017, the first year that the new team operated the online business, Walmart's online mall grew by 47.2%; in the second year, it grew by 39.3%; in the third year, it grew by 32.7%. Its market share jumped to 4.6%, making it the third largest online shopping site in the United States, with the fastest growth rate.

Let’s look at another domestic example, which is also relatively close to our lives, it is the “Tai Er” pickled fish .

"Tai Er" Pickled Fish is a new brand created by the new team of Jiu Mao Jiu Company. The new team designed a new visual image, a new brand name, and a new interactive model for "Tai Er", which is very popular among young people. This is the reason why "Tai Er" pickled fish is successful.

To take a step back, if Jiu Mao Jiu Company used its existing team to make sauerkraut fish, it might not be as successful as Tai Er.

WeChat, which we use in our daily lives, is actually not a product developed by Tencent’s old team, but a product developed by a new team in Guangzhou led by Zhang Xiaolong. The two teams within Tencent that competed with Zhang Xiaolong’s team were defeated.

The inspiration brought to us entrepreneurs by the above cases is that old teams cannot produce new things, and new product categories require new teams.

4. Principle 4: Grasp new media

Creating new categories and launching new brands make a company's brand attractive. Everything is ready, only the east wind is missing.

To become an Internet celebrity brand, the next step is for companies to encourage more people to try it, which requires companies to leverage the power of new media.

To be precise, new media is crucial in promoting new brands to become "Internet celebrity brands". Its value lies in promoting the accelerated dissemination of new brands and making them popular on the Internet in a short period of time.

As Lin Sheng, the founder of Zhong Xue Gao, said: There are three ways to cold-start a new consumer brand: first, post 5,000 KOC reviews, then post 2,000 Douyin videos, and finally, get Li Jiaqi and Viya, and then build channels among the mid-level Douyin anchors.

This is actually true. New media brand update brings brands one step closer to internet celebrity brands. But the prerequisite is to create an attractive new brand. If the "Internet celebrity brand" lacks category innovation, it is destined to be a "short-lived ghost."

Mr. Zhang Liaoyuan, the founder of Three Squirrels, believes that in the era of traffic centralization, whoever can grasp the channel dividends with the greatest efficiency will succeed.

Judging from past practice, new media will give rise to new brands.

• Weibo , which gave rise to internet celebrity brands such as Xiaomi, Diaoye Beef Brisket, Vancl, Hammer Mobile Phone, and Afu Essential Oil from 2011 to 2013;
• WeChat public accounts gave rise to internet celebrity brands such as Three Squirrels, Jiang Xiaobai, Luckin Coffee, Heytea, and Miniso between 2013 and 2016;
• Xiaohongshu , between 2016 and 2019, gave birth to internet celebrity brands such as Perfect Diary, Zhong Xue Gao, Yuanqi Forest, Ubars and Adopt a Cow;
• From 2019 to date, Douyin has spawned internet celebrity brands such as Hua Xizi, Zihaiguo, Wang Xiaolu, and Bai Xiao T.

Of course, not all of these internet celebrity brands can survive.

New media has two promoting effects on the growth of new brands.

The first is the cost advantage . Since new brands cannot compete with old brands for resources in traditional media, due to cost reasons, new brands naturally "squeeze into" new media.

The second is attractiveness . New media usually has a huge new attraction to young consumers, who are more friendly to new media, thus promoting the growth of new brands.

Another value of new media is to publish new brand lists and “interpret” the value brought by new brands . The interpretation of new media further amplifies the value of new product categories and increases the popularity of new brands.

We found that many "Internet celebrity brands" themselves do not have much influence, but through the interpretation of new media, they are shaped into the image of a successful brand.

The most popular list is Tmall’s new consumer brand list. Tmall is constantly promoting the growth of new brands and has launched the "Potential New Brand Incubation Plan" for this purpose.

Judging from Tmall’s sales, the proportion of new brand sales has been rising year by year.

• In 2016, new brands accounted for 22% of Tmall’s total sales;
• In 2017, it rose to 24% ;
• In 2018, it rose to 31% ;
• It rose to 35% in 2019.

During every major promotional shopping festival, Tmall will be the first to release a "New Consumer Brand List". The release of the “New Consumer Brand List” will also further enhance Tmall’s competitiveness. Tmall empowers new brands, and at the same time, new brands bring traffic to Tmall. Publishing the “New Consumer Brand List” is the unique advantage of the Tmall platform.

JD.com adopts a centralized purchasing model. Due to the instability of new brands, it is difficult to include them in JD.com’s procurement scope.

Pinduoduo will not release a "new consumer brand list" because of Pinduoduo's inherent perception that new brands have no motivation to enter the Pinduoduo list.

One phenomenon is that after Tmall released the list, many self-media released new brand lists.

The release of the new brand list provides material for the media, which follow up and interpret how the new brands succeed, thereby further promoting the new brands to become "Internet celebrity brands."

Take the Huaxizi brand as an example. On November 3, the "Huaxizi" brand appeared on the WeChat public account as many as 890,000 times. Such a large exposure created a large amount of free communication for "Huaxizi".

Author: Zhu Hongwen

Source: Zhu Hongwen