How to control the channel advantage and manage the market-side sales system?
In 2003, Chinese pharmacist Han Li invented e-cigarettes, and today, China has 90% of global e-cigarette patents, more than 90% of production, and nearly 90% of exports. In order to let more people inside and outside the industry understand the latest trends in the e-cigarette market and understand the views and opinions of the capital on this new track, the IECIE Shanghai Steam Culture Week jointly held the “E-cigarette Entrepreneurship under the New Consumption Era” forum.
The Chinese tobacco and tea market is a complex and diversified market. The phenomenon of selling fake goods, selling goods in a random price, and selling non-compliant products has occurred from time to time. Especially for electronic cigarettes, the current regulatory system does not Perfection is the result of frequent market chaos. So how to control the channel advantage and manage the market-side sales system?
This time we invited the leading companies in the e-cigarette industry e-commerce and offline stores, they are Zheng Nan (Gale), the senior vice president of the life, and Sun Fanglei, the general manager of the electronic cigarette. In addition, we also invited Zhao Jiabo, founder and CEO of Luwei Electronic Cigarette, and Zhao Yangbo, Vice President of Capital Investment.
The following is part of the round table:
Liu Shiwu: Hello everyone, I am a senior analyst, Liu Shiwu. Today is the last round table of this event. Thanks to the sharing of the previous guests.
The electronic cigarette was invented by the Chinese and has been in development for more than a decade. However, this category has only reached its peak in the past two years in our country. So, how can we understand this industry when the market outlook is still unclear?
Please come to four participants who have different identities in the e-cigarette industry and are veterans of e-cigarettes. First, please ask the four guests to briefly explain where they came from and how they are related to e-cigarettes.
Yuan Jia: Hello everyone! I am Yuan Jia, the founder of Luwei Electronic Cigarette, engaged in the electronic cigarette industry for ten years, from the simulation of electronic cigarettes to the era of big smoke, and finally returned to closed small smoke. In the past ten years, I have accumulated more resources in integrating the electronic cigarette supply chain, and have deep technical thresholds in every link, and quickly integrated barriers to form brands.
Zheng Nan: Hello everyone, I am from praise, the flower name isGale. The brands of various e-cigarettes in the pavilion are used in almost all channels of social e-commerce. We serve a lot of e-cigarette brands like Yueyin and Ono. Everyone has some discussion about the sales channels based on social e-commerce, including various marketing topics for C and B. You can talk to me.
Zhao Yangbo: Hello everyone, I am Zhao Yangbo. I and my partners are running a small fund to start the capital. I personally also participated in an e-cigarette brand, RXR, as an angel investor, and I am also exhibiting this time. Today, I am more of an investor, as a swimmer in the sea to share some of the capital concerns, as well as the real situation.
Sun Fanglei: I am from Sun Lifelei, a fresh life. My identity is a bit special. Some of them can represent a little channel. Fresh life itself is a participant, operator and shareholder of convenience stores and traditional retail channels. In addition, we also have an electronic The smoke brand is called free electronic cigarette, so I can also say that it is a participant in the electronic cigarette market.
Liu Shiwu: Thank you for your introduction. After listening to everyone’s sharing, these four guests are from all walks of life of e-cigarettes, and the work done before is different. The first question is: Since everyone knows the products of e-cigarettes from different time points and different channels, how do you go through the process from the beginning to know e-cigarettes and then become familiar with e-cigarettes? And how do you view this product now?
Yuan Jia: I have seen this development in the e-cigar industry for ten years. The e-cigarette has been popularized from abroad and then returned to domestic development, which has contributed to today’s market. We have supplied an e-cigarette brand in the United States for ten years, and we have better sales in the convenience store system in the United States (such as the 7·11 convenience store), both in terms of market and technical experience. At present, we believe that technology has been iterated to a certain extent and needs to be upgraded. How can the update of smoke oil and atomizer be synchronized? At the same time, how to increase the market segment through new ways of smoking such as “smoke-free technology” and serve more users in need, these are what we are doing.
Zheng Nan: I mainly want to tell you that the whole sales behavior and methods of e-cigarettes have changed a lot in these years. From active and search-like purchases like platforms, it has become E-cigarette brands are able to reach C-side consumers directly, and each brand has accumulated a fixed number of fans and customers.
With the admiration and support of this particular fan base, everyone can create a shared fission sales model, like in WeChat, everyone shares what I like to people around me, through my side.People repurchase purchases to promote sales and models of the entire e-cigarette. There are also a few presences. I saw a business today. Their players are scanning code to become my members, and they will give you certain discounts. If you do the second transmission, you can get more benefits. In addition to tastes and personal hobbies, changes in the pattern of sales, this is also the change in the form of sales and channels of e-cigarettes seen in recent years.
Zhao Yangbo: I am an old user of e-cigarettes. I have spent four or five years, and I have to take two or three ones a day. One day, I don’t have enough electricity to pump them. It is a heavy user. As an individual, personal participation in the brand is very interesting. It is a very sexy business model, whether it is for the brand, or for the channel or supplier.
Now, the industry faces a tough external policy environment, the impact of public opinion, and many brands are rushing to grab channels. It is a profitable business, but now it has become a business that burns money. This is a very interesting thing in the industry. At present, the business that burns money is very normal in the future. Relatively speaking, it is a relatively profitable business. This is the point that I personally care most about.
Sun Fanglei: The problem is just understanding and contact with the electronic cigarette industry. I feel that, first of all, I am a light smoker. I feel that there have been several changes in the rapid progress of e-cigarettes in recent years:
One is the change of scene and user. The earliest e-cigarettes are products for smoking cessation close to deep smokers, as well as large smoke steam fumes, which are more like community subcultures. To this day, the main scene of e-cigarettes has changed. During our own e-cigarette and contact with C-end users, a large number of light smokers can experience e-cigarettes in more scenes, such as when working overtime and socializing.
Second, the technical barriers of the electronic cigarette itself are changing. At the time of research, we saw that some products were very homogenized. This is because there are more mature solutions, a bit like the mobile phone was a big brand at the beginning, like the position of Qualcomm chips in the Android mobile phone field. same. But when Shenzhen MediaTek has the same excellent solution, more and more mobile phones will appear, and the two are also related. Because the emergence of mature technology solutions for e-cigarettes now makes these products cheaper.
The third is that after the price is cheap, new users have the opportunity to try it in more scenarios.
These three points give me a particularly deep impression.
Liu Shiwu: The angle of sharing is different. Let’s ask the guests separately. First of all, ask Yuan Jia, smoke oil is a very core part of e-cigarettes. Now, in addition to some flavors, new oil-regulating technologies are constantly appearing. Just in my hand, it’s also a replacement for Lu Weipu. After it has passed the lungs,There is no smoke when you spit it out. So from your own experience, what is the current development of smoke oil?
Yuan Jia: Since the invention of the smoke oil, it has been complemented and upgraded. When we learned about the market in the past few years, we found that the quality was uneven. Small workshops would use the technology to make electronic cigarette smoke products, or add unqualified substances, many even incomplete or prohibited substances.
As a brand side, we need to increase the cost of input and make safe products, for example, the consistency of taste and quality control in each batch of product cartridges. At this stage, the electronic cigarette product has been “closed combination of smoke oil and smoking equipment”, which is also to avoid risks. Because of the open electronic cigarettes, users can’t monitor their safety when they add ingredients in private. In the future, with the further improvement of national regulatory policies, closed products will be monitored and products will be realized. Trace back.
Liu Shiwu: Let’s ask the windy teacher. You serve a lot of e-cigarette customers. As a platform to provide front-end scenarios, how do you plan to cooperate with e-cigarette manufacturers? And what do you think is the feedback from the C-side users and the B-side customers?
Zheng Nan: In terms of C-end, one is to let the brand leave the traditional offline or online channel management thinking, directly reach the consumers who reach the C-end, turn them into their own fans, and let C-end brings them new sales power and ways and channels to reduce marketing costs.
In terms of B-side sales, in recent years, everyone is talking about social e-commerce. There are many large-scale dealers or merchants on the B side. In fact, they are also seeking a cross-border cooperation. At this time, no matter what kind of way, many of our merchants can become other suppliers, it can provide online distribution ability and supply to those online dealers with great sales ability, such as self-media, KOL , net red or some other brands.
In the transformation of the two sales models, for the products with very social attributes of e-cigarettes, it is a state that is in line with the current audience of e-cigarettes. Many people around me started to smoke e-cigarettes, which were all influenced by people around them. Rarely, they naturally wanted to buy an e-cigarette brand because he didn’t have a concept. They all bought it by their friends and recommendations.
Liu Shiwu: I would like to ask Mr. Zhao, General Zhao, and I hope that Mr. Zhao will talk about it. What kind of help do you think the capital party can bring to the e-cigar market? And what are the most impressive things in the process of working with your team to invest in e-cigarette brands?
Zhao Yangbo: Two questions, first of all, capital levelIn terms of the current situation, the individual feels that the capital environment is not very optimistic. It doesn’t matter to the e-cigarette industry. From last year to this year, the overall capital environment is not very good. E-cigarettes are not a big vent in it, but they are not small.
But recently I found that the capital’s assistance to e-cigarettes is not particularly large, except for the funds themselves. As far as the various brands are concerned, in my eyes, in fact, everyone is facing a problem, the brand is far from their own users. In China, the problem facing e-cigarettes is that online does not allow you to advertise in principle. More sales come from agents, from channels, from offline. This layer of separation is the first problem. The brand doesn’t quite understand why my users like my brand.
Second point, many brands are in my eyes, they have no real data. We have seen a lot of brands. We only tell us that one data is CLE data, that is, to different agents or to different channels, how much goods I have released; these agents and these channels really look for me again when I get the goods. By default, these agents and channels have already sold the shipment, but this is not the case. If there is only transaction data, and there is no so-called sales data, what is the real marketing of the brand? Capital doesn’t know, even the brand itself doesn’t know what its real sales are.
In this basic logic and context, capital can help the brand, just give you money, you go to the scene. This is in my eyes to raise the channel. In recent years, whether it is offline convenience stores or other nightclubs, the entrance fee is getting higher and higher. If the market develops like this, small and medium-sized brands and distinctive brands will basically have no more living space, and the more money. The more you can distribute the goods and seize the channels, but the really good brand, you are not very clear about your product characteristics and user attributes, you have no way to compete with these big brands and brands with capital money.
Thank you!
Liu Shiwu: Mr. Zhao shared some experiences from the perspective of investors. The last question asks Mr. Sun. In the electronic cigarette industry, you are standing at the top of the industry chain. You and the e-cigarette brand have cooperated or developed so far, and the market and brand customers have not given you any feedback. And change?
Sun Fanglei: In the cooperation, when we were doing the convenience store channel, when we were doing research, we saw a US data. Not less than 60% of e-cigarettes in the United States go out through retail channels. This retail channel includes grocery stores, convenience stores, gas station convenience stores and more.
The e-cigarettes in China have actually started from the Internet, and gradually everyone will put their eyes on the line. The logic of thinking on the line is something that can be solved quickly with money, and it must not be a problem. Therefore, this has caused the general capital of Zhao Qi, the whole cost is very high, including the entrance fee.