How can a small brand turn into a big brand?

In the past, it only took a few minutes for big brands to suppress and ban small brands. Because big brands have absolute advantages in terms of capital, resources, and traffic.

There is a metaphor that says big brands are like noblemen driving Ferraris. Just saying their names can attract a lot of beautiful women, and the advertising costs for a single product alone are hundreds of millions every year. Small brands are like poor, rustic and loser men who have to tighten their belts all the time.

But today, the barriers built by these advantages have suddenly "failed". New brands have more opportunities to rise. I will help you see the current opportunities for brand rise from five dimensions. I hope you can find new inspiration and thinking from it.

01 Capital is no longer an advantage, capital turnover is

For example, when it comes to funding, in the past whoever had more money had the advantage. But today, the capital turnover of small businesses has become faster, and they have suddenly freed themselves from the constraints of funds.

There is a store on Taobao called Lirenlizhuang. With only a marketing budget of 100,000, it defeated the 30 million budget of the giant, with a return on investment of 300 times.

This store took advantage of Taobao's fast capital turnover rate at the time. They invested 100,000 yuan in advertising on Taobao today, and received the money back on the same day. They could then get more than 100,000 yuan to invest again the next day. Through repeated snowball operations, they were able to invest more than 20 million yuan in advertising with the initial capital of 100,000 yuan.

The competitors invested 30 million in advertising, but in the end, because their conversion rate was 3% lower than theirs, their final sales were not as much as theirs.

The opponent who originally had a large amount of "capital" was actually defeated under such circumstances.

02Old people do not necessarily have an advantage, young people have more hope

There is a brand called Perfect Diary. Its team is composed of inexperienced young people, but they ended up creating a leading cosmetics brand. It once became number one in the beauty category, defeating big-name foreign cosmetics brands. This has left those experts who have been working in the cosmetics industry for decades scratching their heads.

Some time ago, I wrote an article specifically analyzing "Why many brands have emerged in China in recent years", such as Zhong Xue Gao, Yuanqi Forest, Perfect Diary, etc. The answer I gave is that the new infrastructure has played a role, OEM has developed, and if you want to build a brand, you can just put your own label on it; logistics has improved, and the overall cost of products has become lower; self-media has developed, and marketing costs have become lower; new organizational changes have improved efficiency.

03Channels are no longer an advantage, new tracks are

I often use Hubang Hot Sauce as an example, because it is a Chinese hot sauce brand born under the giant Lao Gan Ma, and it can make tens of billions a year. The biggest factor for its success is the success of its channels. It cleverly used the takeout channel, skipped direct competition with old brands such as Lao Gan Ma, opened up a new blue ocean market, and achieved huge commercial success.

If we explain it from the four types of war in "Business War", it seems that we can't find the answer.

According to this book: Defensive business warfare is a strategy prepared for market leaders. Offensive business warfare is a strategy prepared for companies in second place. Flanking business warfare is a strategy prepared for small companies. Guerrilla business warfare is a strategy prepared for local or regional companies.

Look at Hubang hot sauce. Do you say it achieved success through "flanking attack"? I think it has never competed with Lao Gan Ma at all.

Looking at the counterattacks of brands such as Perfect Diary and Zhong Xue Gao, it seems that none of them belong to any of these four types of wars. You will find that these new brands emerge and big companies are simply unable to defend themselves. From the perspective of commercial purification, brands like Zhong Xue Gao are simply new species. They make ice cream in a new way. When it comes to traditional old-fashioned ice cream, you can only look at it stupidly and feel anxious.

In the past, most brands rose to prominence through channels. Brands like Wahaha achieved growth in scale by relying on their strong offline network system. Because of the inherent advantages in channels, brands like Wahaha can sell at least several hundred million yuan for any new product they launch. Other small brands do not have the funds themselves, and if they want to cooperate with such supermarkets, they cannot even pay the advertising fees, let alone TV advertising or online bidding advertising.

On the other hand, today brands such as Yuanqi Forest and Perfect Diary have broken the channel restrictions. Suddenly I realized that channels have become less important. At this time, small brands came in.

04 The premium ability of capital brands has weakened and we need to re-understand brands

In the past, as long as a brand was established, it would achieve huge success. But today, you will find that "brand" is important, but not so important. In the past, consumers looked at brands by how many gold awards they won. Today, consumers look at brands based on “good reviews, average reviews, or bad reviews.” Due to the rise of e-commerce and food delivery platforms, there are more windows for evaluation.

Take Pinduoduo for example. Although a group of people criticize it for selling fake products, they have to admit its commercial success. Behind this, on the one hand, it seized the dividends of WeChat, and on the other hand, it seized consumer demand. Among the 1.4 billion Chinese people, only 200-300 million actually use Taobao, JD.com and the like. The rest of the people are consumer groups to be developed, and Pinduoduo's fission mechanism just targets this group.

On Pinduoduo, brands no longer look like brands, and products no longer look like products. Instead, they look more like new networks of relationships. Consumers look at price, mood, relationship... (the dimension of brand is too small). Here, you will find that everyone is rebuilding the "network relationship chain" around the "Pinduoduo APP".

The result of this is that brands no longer look at certificates of honor, history, or qualifications, but only at consumer evaluations and consumer emotions.

With the development of the evaluation system, small brands have more advantages. Consumers use "evaluations" as a brand yardstick and use it as a criterion to make consumer choices. Because of the existence of this network structure, new brand opportunities arise.

05 The consumption chain becomes shorter and new opportunities emerge

The consumption chain brought about by new technologies is shortening. The rise of live streaming has restructured the consumer industry chain, with anchors bypassing brands and channels and letting manufacturers supply goods directly. In the past, this would have been impossible.

If the anchor finds that the supply chain is unstable, he will build the supply chain himself. So, in my circle of friends, there are people who specialize in selling goods, people who specialize in supply chain, and some who are both anchors and supply chain people.

Even more, when these anchors have their own supply chain and anchor team, they will develop their own "own brands". This would have been impossible in the past.

It's like, before, it cost 3 yuan to buy Wahaha mineral water in the supermarket, but suddenly one day Zong Qinghou said, you can all buy it from me, the price is only 60 cents, and it will be delivered to your home directly by plane. Then the previous layers of channel dealers and middlemen were dumbfounded and suddenly became unemployed.

06Looking at China’s consumption structure from a dynamic perspective

Whether it is the weakening of channels, the shortening of consumption chains, or the role of new infrastructure... We should all re-examine today's business environment. Even the word "brand" should be interpreted from a "dynamic perspective". Although the core of the word brand remains unchanged, if we do not add new annotations to it, the truth practice may deviate from the essence.

By analyzing these changes, I just want to help you have a broader perspective to discover new business opportunities. Success cannot be copied, but success can be learned from and failure can be avoided. In my opinion, the rise of any brand has its own path, and these paths are like different "dimensional slices". You can find the answers directly on them:

1. Can we create new opportunities in channels? Case in point: Hubang hot sauce.

2. Can new opportunities be created in the supply chain? Case: Hema Fresh.

3. Can new opportunities be created in product innovation? Case: Zhong Xuegao.

4. Whether technological innovation can create new opportunities. Case: Zhou Hei Ya.

5. Can you create new opportunities in content marketing? Case: Perfect Diary.

6. Can we create new opportunities based on the platform’s advantages? Case: Lirenli Makeup.

7. Can we create new opportunities in product packaging? Case: Qia Qia melon seeds.

8. In terms of strategic positioning, can we create new opportunities? Case: Hanting Hotel.

9. Can we create new opportunities in the grand social narrative? Case: China Li Ning.

. . .

On the surface, what we see is that the success of these brands is due to something, but the truth is not just that. After you finish reading this article, I also want to tell you that the success of any business is never a single point of success.

07Some sincere thoughts and suggestions

I often say, "Marketing is never about doing big things, but about doing a series of small things right." Melatonin did not succeed by marketing; Xiaoguan Tea did not succeed by marketing; and Yuanqi Forest did not succeed by hyping up concepts.

I suggest that you who are reading this article can try to find your own opportunities from this thinking framework. Of course, if your product is not good, then don’t think about anything else and just focus on making the product.

You may ask me, what does business success depend on? The answer is business logic and luck. It doesn’t matter if you don’t know how to do this. We at Western Red Strategic Marketing are good at it. You can come to us.

Like I just said, marketing is a series of small things done right. If you are looking for a "magic trick" from me, I can only say I don't have one. What I can do is to help you sort out the logic of your business and help you gradually improve it from every small dimension. It may be a major operation or just a minor one.

In addition, I will continue to update my business insights here, and I strongly recommend you to follow me. If my article is useful to you, please forward it to your friends. I hope we can help them together.

These are my thoughts on how small brands attack big brands.

Author: Li Xianhong

Source: Western Red Strategic Marketing