How to build a brand at zero cost?

For those of us who work in marketing, the shocks and challenges we have faced in the past five years are probably the most obvious. This is because at the level of marketing theory, many of the underlying logics have faced new statements and challenges. In the entire process, one very important thing is our understanding of things.

I have always believed that in any environment, everyone can only earn resources or money that are related to or match our cognition.

Cognition determines our starting point and end point.

Among some knowledge bloggers, you may know more about Teacher Chen Chunhua. She has made many amazing remarks, such as "the knowledge revolution eliminates not tools but people." She has a lot of research and management ideas from the business world.

But I have a suggestion for everyone. If you are a teacher from a purely academic field, you should still listen more to his academic lectures. However, if you are a teacher who comes from management, practice, or has real experience on the client side, you can listen more to his feelings and experiences in the operation process.

Among Drucker's works, he is very famous for his management theory, in which he mentioned three different logics: the industrial revolution, the productivity revolution, and the management revolution. For us now, I think what is important is the cognitive revolution, because the cognitive revolution determines the starting point for all of us and the end point of our future development.

I have been working in marketing for nearly 30 years now, and have indeed caught up with the era of large consumer goods, which were considered to be simpler or easier to make.

At that time, we had no shortage of money in medical beauty, tobacco, and Coca-Cola, and all resources and models could be used. However, based on my nearly 30 years of marketing experience, I would like to share the following four viewpoints with you. They are very valuable for reference, especially for those who are starting a business now.

The first is consumer insight. This word is a very simple word, but it is worth a thousand gold.

The second is digital content, which can turn stone into gold.

The third is an experiential process that brings huge profits with no investment.

The fourth is social fission, which makes a fortune every day.

Consumer insights are worth a thousand words

I believe that every one of us who is an entrepreneur, or every businessman, or every person who aspires to become an entrepreneur, thinks most about how to reduce costs and increase profits. Therefore, the so-called zero-cost marketing or zero-cost promotion has always been what business owners desire.

But frankly speaking, zero-cost marketing is not impossible. However, you will only have the opportunity to achieve zero-cost marketing if you meet many conditions or prerequisites, or even accumulate experience.

Drucker is a master whom I admire very much. He said that there are two very obvious essences of business operation:

The first is to innovate and create differentiated products and services. This theory, which was proposed almost 100 years ago, is still very effective in the Chinese market today.

The second is marketing. The concept of marketing abroad is bigger than the terms promotion, market, brand or marketing mentioned in the domestic market. It drives the entire exchange process.

Drucker mentioned that a core goal of marketing is to become the preferred brand in the minds of customers. Many new positioning concepts today hope to make the brand the first choice in the minds of consumers, but in fact, Master Drucker had already clearly seen the essence of our business operations 100 years ago.

Therefore, whether you are a friend working in the marketing industry, or a friend who is interested in starting a business, or even a friend who is already on the road to entrepreneurship, you must always remember your original intention of starting a business. Let’s not talk about the vision, but return to the operation level or the touch level. You should always remind yourself:

What kind of unique and valuable service do you provide to influence your target audience and your core consumers? In this process, how you can convey your information through more efficient means, convert your consumers, cultivate their habits, and become promoters of your word-of-mouth is what we must pay attention to.

Consumer insight is a hot word, but what exactly is consumer insight? I believe that not everyone can think this through so clearly. Here is a standard answer summarized by masters:

Consumer insight is a particularly creative discovery or insight, so it is based on his behavior, attitude, needs, demographic characteristics, and lifestyle to find products, brands or services that can help you influence or change the core values ​​of consumers.

Therefore, not only in the scientific community, but also in our daily marketing community, a lot of the wisdom of the ancients is actually still very instructive for us today. For example, whether we see a mountain as a mountain, or a mountain as not a mountain, or a mountain as still a mountain, these three realms actually help us distinguish whether we are mortals or cultivators, and whether we can finally find the true meaning of life.

So when we look back at our own products, services, and marketing plans, whether we can achieve zero cost or be more efficient depends on whether we have clear insights into consumers. Then all marketing actions, content accumulation, and brand sedimentation are based on these insights to help you influence consumers.

Let me briefly share with you the latest consumer trends in 2022. This trend can help us understand consumer behavior.

But it is important to note that consumer behavior is not consumer insight. The hidden logic behind consumer insights is that consumers’ attitudes and outlook on life can resonate with your products and services, and ultimately help you influence consumer behavior.

Let me share with you a product that I personally operate.

GoBeSoo is a global brand, but it has been very unsuccessful in the Chinese market for a long time. Several Korean companies and some domestic companies have co-branded with it, but have not performed well.

I was at Red Bull at the time. When we were working on this brand, we spent a lot of time doing consumer research and market research. In the end, we did not sell it the way it was sold in the international market. Instead, we repositioned the brand as a specialty juice and entered the children's market, that is, making children's juice.

The insight behind the positioning of this children's juice comes from a demand point that Chinese mothers are very concerned about, that is, after a child reaches the age of 3, when he switches from breast milk or formula milk to other beverages, his milk intake decreases and his water intake increases. But in fact, many children do not like to drink water. At this time, we saw an opportunity: to make a product that can help children increase their water intake.

Many Chinese mothers believe that juice is a very healthy thing, and they are willing to let their children drink imported juice without additives, so we seized this insight and developed a complete set of communication logic.

Finally, we have added a product as a drinking water substitute for babies aged three years old or even older. Our main formula is imported and combined with the best water from China to create a Fruit Power product, and then we use the way children like to play with it to attract them.

A very important key point in this process is that the small hands hold the big hands, and the big hands hold the small hands. That is, the mother makes the decision, but the child must like it, and both sides form a joint force.

After this product was launched, it penetrated the market very well. As you all know, in the entire Red Bull system, the marketing budget is spent very heavily. However, for this brand-new product category, we only spent a very small budget and created a single product with annual sales of over 1 billion. This is still very difficult in the Chinese market.

Unfortunately, the German brands and foreigners in the Asia-Pacific region don’t know much about the Chinese market. They are very insistent on their own brand tone, brand appeal, and brand vision, which resulted in this cooperation not being particularly smooth in the end. So even though this product is still on the market today, I think it’s a pity that the positioning is not communicated to consumers as consistently and clearly as it was back then.

Digital analysis turns stone into gold

Second, what I want to share with you is digital logic.

When talking about digital logic, the word that must be mentioned is the first principle. When it comes to the interpretation of the first principles, you may be more familiar with these two people, one is Musk and the other is Mr. Li Shanyou. But in fact, the first principle was first proposed by Aristotle.

Whether it is Musk's rocket launches, Tesla electric cars, or his future space construction, he will follow the first principles. If we break this matter down, the simplest logic is that it used to cost tens of millions of dollars to launch a rocket, but Musk has reduced it to hundreds of thousands of dollars. So for us who do marketing, what exactly do we want to achieve? This is what we need to focus on.

Doing first principles research will inevitably involve digitization. Here is a small case, and I won’t elaborate on it today. You can look at this case yourself, guess the result, and then go online to see the final answer. I believe the result can help you subvert your understanding of the market.

We recently had a discussion that if you can’t get the answer from 20 consumers, you won’t get the answer from 20,000 consumers either. Therefore, when you are working on your own entrepreneurial project or marketing project, you must frequently conduct in-depth interviews with experts and practitioners in the industry to develop your own insight and understanding of digitalization.

Today, the value of data is nothing worth arguing about, but why do I still want to talk about it? In fact, data can be divided into big data and small data. However, data itself cannot tell you the truth. Data can only tell you a status. However, the trend logic behind the data, the future trend development context, and its development principles are very worthy of our consideration. This is why I mention digitalization.

Another very important point is that no matter whether you are doing marketing, economics, or market management, you are trying to use quantitative, modular methods or algorithms to find the most likely certainty in this uncertainty to reduce our costs.

There should be more students in the group who are engaged in consumer products. Let me give you some comparable data.

When I was working in retail, there were close to 12 million small shops in the Chinese market. Small shops were run by couples, or stores like Marketplace. In today's Chinese market, as found in 2019, there are only 5.8 million small shops. I suspect that this number is still decreasing today.

You will find out why China has a strategy different from that of the international market: surrounding the cities with the countryside. China's development is gradually modernizing and extending downward. We call it the downstream market. It has China's largest population and the strongest growth potential, as well as the most traditional model.

So for the Chinese market, there is not just a simple distinction between online and offline markets, but there are many different markets. Why do I mention this? What I want to say is that due to the characteristics of the crowd, no matter what kind of product or marketing plan, your model and method must be effective among a certain group of people, but this effectiveness cannot prove that you are right. This is why we have to do data analysis and why we are talking about zero cost today.

Only when you have verified in the early stages that your methods and approaches are most effective for the target population of this strategy, and you have magnified them, your marginal cost will become zero. This is the value of the data analysis we want to do.

This is a project we did around 2018 called Netfish Internet Cafe.

Wangyu Internet Cafe is a very expensive Internet cafe. Its regular prices are about five to ten times higher than those of regular Internet cafes. Its membership card costs hundreds or even thousands of yuan. But it has a big problem, that is, there are many dormant users among its members. Even if these users still have a lot of money in their cards, they no longer come to the Internet cafe.

After analysis, we found that the value of these silent users is still very large, so we conducted some label attribute research and consumer interviews specifically for these dormant users. In the end, we all agreed that this is a very potential target group.

We used different algorithms and model construction, and finally obtained a relatively effective model called the TMGF model. We classify and score consumers based on their consumption frequency, unit price, online time, and referral behaviors. We then evaluate the value of each consumer, find the most valuable consumers, and activate them through different promotional activities.

Thanks to this precise research and insight, we finally achieved an input-output ratio of 7.34. For the Internet cafe industry, this is a very successful case.

Back to digital marketing, my advice is: you must understand your business model and logic, as well as your insights into consumers, find this possibility, and finally find the most valuable strategic core consumers, so that you have the opportunity to achieve high output with zero input.

Experience-based process builds momentum

After sharing consumer insights and digitalization, the next very important thing, which is also a very weak point for most Chinese companies, is experience and process.

Every behavior, action, and label of consumers is very valuable, but there is a biased usage in the market now, which is to completely label consumers and then group them.

From my point of view, I don’t quite agree with this model.

I am more in favor of treating people as human beings, that is, consumers are human beings, not machines. He must have slowly developed some deterministic behaviors in uncertainty, but he cannot guarantee that these deterministic behaviors will have deterministic results the next 100 times.

So this is why we need to build this experiential process logic: the consumer’s life cycle, the product’s life cycle, and his consumption behavior are superimposed on each other, and finally form the consumer’s context and path.

When we did consumer interviews in the past, we would stay in the consumer’s home for two to three days and tell them that we were just observing them, staying with them, and watching their behavior. Although this will still have an impact on consumers because there are outsiders involved.

But in some subconscious and unconscious behaviors, he will still reveal his true face. Especially when you are familiar with them and communicate and observe them closely, they will bring you more information. There are many process experiences hidden behind their behaviors that can help you find the highlight.

Everyone may know the Heineken brand, but not many people may know that Heineken has draft beer and fresh beer machines, which is a pioneering version of the craft beer that is very popular now.

At that time, consumers gradually began to feel taste fatigue for industrial beer and wanted to switch to other beers. With this insight, Heineken imported brand new machines from Europe.

This machine provides a capsule, which is a capsule made of original leather and is transported through a cold chain. The beer brewed on the spot with these capsules is very delicious and memorable. The draft beer has a very strong flavor, which solves the consumer's demand for fresh taste on the spot.

Although Heineken is a wealthy brand that is willing to spend money, this product line consists of machines, and each machine alone costs several thousand yuan, so there is not much budget for promotion.

At that time, we took advantage of the strong social attributes of the product itself, such as the cool topics that young people like, and the influence of the Heineken brand on young people in the sports field. We wanted to use various opportunities to bring in some big names to endorse it.

We were also very honored at that time. When we were doing offline promotion activities in Alibaba’s park, Mr. Jack Ma happened to pass by. After experiencing it on site, he was very interested and joined our activities. Although this was intentionally planned, the final result was gratifying. Through Jack Ma's celebrity effect, we got a strong marketing exposure for free.

In this process, everyone will find that no matter it is a KOL, an expert, or a spokesperson, it often does not necessarily require any cost. Your planning, your planning, your coincidences, and your clear target process design can sometimes help you achieve this unexpected surprise.

We have also used spokespersons or KOLs in many other cases. They did not ask for appearance fees, but they thought this was quite interesting and decided to participate.

So for our zero-cost marketing, especially for entrepreneurs launching new products, the daily accumulation of connections and resources is still very helpful for you to build your brand.

Social fission is making a fortune

A very popular concept nowadays is called socialization, or fission. However, if you want to really do socialization and fission very well and make a lot of money every day, there is a very important underlying logic that you need to understand, which is what are the decision-making factors or driving factors of your matter.

This actually goes back to the issue of digitalization that I mentioned earlier and our insights into this industry.

These two pictures were made by Alibaba Research Institute and Boston Consulting Group. I think this model is very good, but it may not be applicable to every product or every category. But the logic of this model can help us build the decision factors, or decision chains, for our own industry.

Through this grow model, Alibaba has found several important factors in the fast-moving consumer goods industry that are likely to affect brand development, such as industry penetration rate, repurchase rate, price rate, extension rate, etc., and integrated them to help companies determine whether your category, your product, your brand, and the audience you serve have the possibility of growth, or where the core of its growth possibility lies.

Whether it is zero-cost marketing or innovative practice, the biggest possibility this brings to us is that it can help you find your innovative possibilities and market gap opportunities very effectively.

Don’t think that a market gap must be one that no one is doing. A market gap may exist if someone is doing it, but because he does it poorly or fails to grasp a clear consumer insight, his way of expression, the price range and display channels of his products may be wrong.

For example, we all think that Yuanqi Forest is doing very well now. In fact, Yuanqi Forest took a detour for a long time before finally finding an innovative way to play in the convenience store channel and opening up this track. Because all of Yuanqi Forest’s product concepts have appeared in previous big brands, but none of them became popular.

This is a social gift card project that we developed with WeBank.

At that time, WeChat had a big business of sending red envelopes. This action not only completely took over the payment channels that Alipay had built up over the years, increasing its market share, but also changed the way consumers paid.

Payment is a very small business of WeBank. After we found this point, one thing we have always wanted to do is to convert the consumer's payment account, which we call a secondary account, into the consumer's membership card ID, which we call two codes in one, and then use this social gift card, that is, what you give out is not a red envelope, but a product.

At that time, we found several very core customers, one was Starbucks, one was McDonald's, and the other was a shopping mall. This is equivalent to covering different categories, different channels, and different consumers to test the fission efficiency of this social gift card.

The results were very unexpected and the response on several of our test channels was very good.

I believe that everyone may still be using various Starbucks cards today, but at that time, Starbucks’ social gift cards accounted for 27% of the total cards. During the three months since the launch, everyone has been giving out cups of coffee. Maybe this leader likes latte, so I will give him a cup of latte. If a team is working overtime, you can draw different coffees and McDonald's combos from the red envelope you give to everyone. At that time, this event not only penetrated the product and achieved product fission, but also made consumers feel fun and interesting.

Later, because the state controlled financial payments and was not willing to connect the bank's secondary accounts and member accounts, this business came to an end. Although there are still companies that are making this kind of social gift card, they have not achieved the logic that we wanted to form at the time to connect the secondary account with your membership account, so it can only be said to be a castrated version of the social gift card.

Another example of zero-cost promotion is that everyone has visited tourist attractions. A big pain point of tourist attractions is that you take a lot of photos in your mobile phone, but you cannot print them out as commemorative photos on the spot. The traditional practice in scenic spots now is to set up a background wall, or have a scenic spot, and you stand there, I'll take a picture for you, and then print it out on the spot and charge you 30, 50, or 200 yuan.

We provided a set of solutions at that time. Tourists can interact with the scenic area's machines with any photo they take. They can make free prayers, have AI create poems, and have their fortunes told. Tourists can share it on their Moments, which not only attracts consumption but also creates fission with consumers.

Therefore, this project helps many scenic spots to effectively concentrate scattered traffic, and allows the scenic spot platforms to use this traffic for secondary consumption in the future, such as ticket transfers, or some promotional projects.

Therefore, I share this case with you to tell you that you need to jump into the consumer's cognition and make insights that can change his behavior. Only then will it help you effectively save costs and create sales opportunities for your products.

at last. Let me review the four points I shared today so that you can find points that are helpful to your business based on our previous sharing and cases.

The first very important thing is that we must know the importance of insight, and gradually develop the professionalism, judgment and sensitivity of insight.

I think there is a very simple way to do this, which is to find someone every day to have an in-depth chat about your product. You may chat with 100 or 200 people, and you will slowly form the concept. You can make quick judgments and find the sensitivity of your insights. I think this is a very good method.

The second is digital content. This helps us form digital insights, which is a very valuable thing.

The third is the experiential process. This is also a suggestion for everyone not to look at labels, because labeling is actually a habit that Alibaba's e-commerce has brought to everyone.

We need to restore consumers to human beings, real people. Yesterday I read a news report that many metaverse companies are not using real people’s behavior to extract data, but are using people in virtual world games to extract their data. I think this approach is very correct. This is why I said today that we should try our best to look at this person, his entire life cycle and process cycle from an experiential perspective, so that we can find the most valuable points in your product cycle.

The last one is social fission. This must be based on accumulation. You need to know insights, data analysis, and processes before you can find the point where you can do social fission.

For example, when we go to the mountains to pray for our relatives and friends, this activity itself has natural fissionability. Only by finding the fission point inside can you influence it and help you form social communication.

The above is the wonderful sharing brought by Mr. Shenyang in this issue. In the following months, I will invite operators in the industry to discuss brand, growth and marketing trends together.

Author: Sister Mulan

Source: Mulan Sister