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The business hero is not the adventurer who dares to pay attention, but the conservative who has always kept the “cost” in his heart.

Editor’s note: This article is from WeChat public account “General Liang” (ID :liangjiangjunisme), the author Liang General.

The world has entered the era of niche brands from the era of the mass brand.

The market is becoming more and more segmented, and consumer demand is becoming more and more personalized. It is inevitable that the giant’s finger joints will leak sands and can feed a niche brand. For example, before we bought furniture, we could only go to the “IKEA” and “actual home” hypermarkets, but now you can choose a niche home brand like “吱” and “Limein” on Taobao.

On the other hand, the giants have also begun to expand their product lines and actively hatch niche brands and online red brands to drive business growth. For example, Procter & Gamble has Metamucil, which is a weight loss meal replacement product.

In a metaphor, the brand world has entered the “TFboy era” from the “Zhao Benshan era”.

Uncle Benshan represents a national idol, from 3 years old to 90 years old, who knows nothing about it; TFboy represents the idol of the new era, some people love their love to die, and another Some people have never even heard of their names.

After the rise of small brands, they will face a question soon: Why am I always doing a little?

For example, the same is to open a barbecue restaurant, why “a long time ago” can open to more than 50 directly operated stores nationwide? Why is your barbecue restaurant never going out of the backstreet?

The same is selling makeup, why can the “perfect diary” be valued at $1 billion two years after its establishment? And your goods are still back in the hands of channel dealers?

Being a small brand may only require a chance and a little ingenuity, but if you want to become a big brand, you need management, marketing, technology, capital and other knowledge, and more souls.

So why is your brand always not doing much?

In my opinion, the core reason why “the brand has always been small” is that companies do not use cost thinking to manage brands. What is “cost thinking”? It is not only money that counts as cost, but your time, energy, innovation, management, etc. are all costs.

Let’s take a look at this issue. “Not doing big” means that there are things that limit your development and there are at least three reasons why you can limit your brand development:

• 1. Market Form

• 2.Competitive relationship

• 3. Self-employed

All three factors will result in a corresponding “cost” of operations, each of which will constrain the company’s continued growth:

• Market Form = Opportunity Cost

• Competitive relationship = competitive cost

• Self-operating = copying costs

01Market Form: Check your “opportunity cost”

Many people have heard a word called “market capacity”, which is the first consideration at the beginning of our business. The size of the market will determine the size of your market.

For example, if you are a foreign beverage brand and you target the core market in China, then you will have a market of several hundred million, but if you position the market in Sweden, the largest size of your market is 10.18 million. people.

But “market capacity” is only a fundamental factor and cannot be used as the sole criterion for measurement. For example, China’s drinking water market is very large, with about 150 billion market size in 2019. This market capacity is big enough, but do you dare to enter? Evergrande Ice Spring, born with a golden key, has lost, and small entrepreneurs don’t even think about it.

If the market is a three-dimensional form, “market capacity” is only one of the dimensions, we add a few dimensions to look at your market.

Volume issues: market size

Where is your market a billion-dollar market or a billion-dollar market? Is there still a demand that is not fully satisfied?

Speed ​​issues: market growth

The market you are in is already close to saturation? Still growing steadily? Is the growth rate 3% or 30%?

For example, China’s first- and second-tier markets are saturated for most brands, while the third and fourth-tier markets can be nuggets; for example, China’s pet economy and silver-haired economy are growing strongly in the future, but kitchen appliances The industry and mobile phone industry have been saturated for two years.

Time question: Is it just needed

“just need” is to say that a certain product, we always need it, it will not be easily outdated.

For example, in consumer products, milk is just a consumer product, and a certain flavor of beverage may be overdone in a few years; in Internet applications, instant messaging software such as WeChat is just needed, but experts in this line The Q&A software is not just needed.

FrequencySecond question: Is it high frequency?

“High frequency” means that we consume enough products.

For example, facial tissue is a high-frequency consumer product, but the wedding photography industry is a typical low-frequency consumer product, normal people will end 1-2 marriages in their lifetime.

Distribution issues: market concentration

“Concentration” means that this industry is held in the hands of several giants, or is it divided by a group of “ant”?

For example, the Chinese dairy industry is dominated by giants such as Yili and Mengniu, and the industry is highly concentrated. However, due to the geographical location of the catering industry, the typical industry concentration is low and it is impossible to be divided by several big brands.

Humidity issues: User aggregate effects

The so-called “market humidity” is just a metaphor, that is, your market is best active, users are grouped, and users can be easily aggregated. What kind of market is wet?

For example, Bubble Mart was originally positioned as a fashion department store buyer, mainly selling creative gifts, digital peripherals, Japanese and Korean stationery, fashion jewelry and so on. Later, the hot sale of a trend toy caused their concern, the company’s overall transformation, All In “tide play” market. Now it has become the first retailer in the tide play industry. There are more than 100 stores and more than 400 vending machines in the country.

For example, in the art circle in recent years, everyone is doing business in a circle culture. “China’s New Rap”, “This is Street Dance”, “The Summer of the Band”… These explosions are all cut into a very sticky group.

To the masses to drive the public, to lead the trend with circle culture, this is not an accidental business behavior, this is already a business idea.

If you find that the consumer is very cold, it may be that your market track is too dry, please water it.

As the saying goes, “Men are afraid of getting into the wrong line, women are afraid of marrying the wrong man.” The market itself is the “line” and “lang” of each brand. Entrepreneurial brands must have “opportunity costs” if they want to enter any market segment.

“Opportunity Cost” is how much I have to pay to qualify for a table at the table? How much more will it cost to win? How much more will it cost to win?

When we find that the brand has not been doing much, the first step is to do a self-test of the shape of the market and see what is happening in the market in which it is currently located. For example, if you find that the market associated with the product is near saturation, what you might want to do is to open up a new category market and get more revenue at a lower opportunity cost.

The market itself is only an objective constraint. If the brand has not done much, most of the reasons are derived from the competitive relationship and its own operations.

02Competition: Your competition becomesHow high is this?

If a company can grow bigger, it must eliminate competition to some extent.

Please remember this sentence, this sentence tells us how to correctly view the competition, that is, the competition is not the two people in the race you chase, but try to do not PK with the opponent on a track.

Being able to make big brands in recent years, all of them conform to this basic competition logic. Let’s take the example of Ruixing, which is most familiar to everyone.

Luckincoffee, which went public in 18 months, eroded the giant Starbucks market in China. Although Ruixing and Starbucks both sell coffee, the business models of the two are completely different. Where is the biggest difference? In the case of Ruixing’s acquisition, it is completely different from Starbucks.

The traditional coffee shop’s guest scene is offline. They choose a place where people and consumers are suitable to open a store through reasonable location, thus transforming a few kilometers of coffee people around the store into consumers. For example, they generally like to choose shopping malls, office buildings, office areas like SOHO to open stores.

But Rui Xing’s winning scene is not an offline store, it broke Starbucks’ store business model. Its customer acquisition scene mainly comes from online traffic, from the fission sharing of friends circle, APP, public number and so on. For example, in my circle of friends, I often brushed up to this lucky share of Ruixing.

The largest moat in chain restaurants is the store operation problem caused by the lack of concentration in the industry. This is a bit of a circumstance. It is straightforward to say that although they all sell the same taste of coffee, the same quality store environment, but because the location of the store is not the same, the store’s consumers are different; the store staff is different, then each one The management and operation of the store is very different.

So, this variety of different issues has brought about a variety of fine problems such as how to choose a location, how to purchase goods. If Rui Xing goes to Starbucks PK, even if it has strong capital strength, it can’t have today’s results, at least not listed so soon.

Rui Xing’s approach is to rely on the data to complete these things, rather than people to complete.

Rui Xing 91% of the stores are called cache stores, which are only 20-60 square meters in size, and there are no seats for smaller ones. However, please note that Ruixing is not a simple “takeaway coffee”. In 2019, its take-out order has dropped from 61% to 28%.

A large number of take-out orders in the early stage let it know who the consumers are and where they are, thus providing a big data basis for the store site selection, and improving the convenience of consumers purchasing coffee through intensive shop opening.

Using capital to quickly occupy offline markets, attracting users through user subsidies, obtaining customers through online scenarios, selecting stores by data, and improving store operation efficiency. This is Ruixing’s competitive strategy. Avoiding the advantages of Starbucks, its “competition costs” are low.

IWhen we talk about the word competition, the average person only thinks about the price. In fact, the real competition is diversified and complicated. The simplest way to divide is to return to the most classic 4P theory, that is, from products, channels, prices and promotion. Look at your “competition costs”.

Products: The best competition is to eliminate competition from the product layer.

If you develop a product that requires a lot of people and no other competitors, this is the best business. Unfortunately, this kind of product is very rare, and generally only exists in some high-tech enterprises.

The most common way in the industry is to do brand positioning, and the most common positioning method in brand positioning is “category innovation”, which is to make micro-adjustment of existing products, add or upgrade certain elements, and make this product become A new type of product that you have never seen before.

In 2017, Junlebao launched a yogurt product called “Rising Cheese”, which sold 200 million bags in the first year and is expected to reach 400 million bags in 2019.

Yogurt is a “container” that blends many other raw materials into a variety of flavors. Previously, the Chinese yogurt market has been relying on flesh + yogurt to expand the category, such as the famous Mengniu big fruit series, which is a combination of various fruits and yogurt. The sweet thing of “cheese” has never been grafted with yogurt, and Junlebao is the first.

After launching the market, this product does not have homogenized competing products. Other flavors of yogurt can only be regarded as indirect competing products. Therefore, the “competition cost” of this product is very low. Its parent company Junlebao has won a very high market growth.

But this kind of category innovation also has its weakness. If the technical content of the product is not high, then the opponent can quickly imitate it in a short time. For example, Yili has launched its own cheese yogurt product, looking at the packaging design and the copywriting style. In the product of the standard rose cheese.

The product itself is the biggest moat, even if we sell the same products as our competitors, we must try to increase the cost of the product being imitated. For example, the war between ofo and mobike, although ofoIt’s low and better, but this method is essentially fissile by social relationships, and the social relationship chain has traffic ceilings. Successful companies will inevitably have “path dependence”. They have tasted the sweetness of low-cost customers and are not willing to make high-cost investment for the future of the company.

At this point, there are some micro-businesses that are far-sighted, such as McGee. McGeely was originally a micro-business brand, but if the micro-business wants to do more, it must enter the mainstream market and enter the public’s field of vision. Therefore, McGee has made a lot of content titles in recent years, and strives to transform into one. Brand-powered enterprise.

I want to repeat this point: If a company can grow bigger, it must eliminate competition to some extent. What is competition? Competition is a fight, and if you fight, you must not only see if you can win, but also whether you can afford it.

03Own operation: Have you considered the company’s “copying cost”?

Only from the perspective of business management, if your development encounters a bottleneck, it is likely that your past business model is not working. In other words, your past success can’t be “copied”.

There are many examples of this, such as Le Chun Yogurt. Lechun is a typical “user-oriented” company. Its organizational structure is designed around the user’s operation and experience. For example, employees conduct user interviews every week, collect suggestions for products, and then communicate to the back-end products. R & D department. For example, Le Chun’s durian flavored yogurt was called out by fans of Le Chun.

Lechun mainly relied on the content marketing of WeChat and Weibo platforms, and gained a vote of loyal yogurt powder through some interactive story marketing and formula production.

Staring at users rather than rivals, focusing on product experience, community operations… It’s safe to say that Le Pure is full of all the labels of the “Future Marketing Model”.

With these thoughts and means, Le Chun has become a very successful small brand. But when it doesn’t satisfy its own weakness and wants to enter the mass market, the problem comes.

There is no production line of your own, resulting in insufficient capacity. In order to expand salestin.

me in another post my article The four reasons why advertising companies “die on the road” introduced that McKinsey invented and promoted a series of knowledge-based tools within the company, such as the near-pyramid principle that everyone is familiar with.

These principles allow employees to get up to speed when facing new customers, reducing the cost of nurturing new employees and reducing the intellectual cost of serving new customers.

The rapid growth of a small business into a large enterprise is often a process of Ctrl C+Ctrl V. If you re-enter it every time, your development must be slow and inefficient.

Summary:

Why is your brand always doing little? You may have many answers, but no matter what your answer is, you can think about your answer again with “cost thinking.”

• Is your market opportunity cost too big?

• Is your competition cost too high?

• Is your company’s copyable cost low enough?

In film and television works, business heroes are often portrayed as an adventurer who dares to pay attention. But in the real world, business heroes have always been the conservatives who often hang “costs” in their hearts.