On December 16th, 2018, China International Fruit & Vegetable Fair (China FVF) grand opened at Beijing. A conference that focuses on building the quality fruits was held at the same day, where Han Liu, who is the founder of the Easywei gave his talk on how to do fruit brand marketing in the Mobile Internet era. The talk is stated as below:
Good afternoon! Dear distinguished guests and our fruit industry colleagues.
We all know that the whole fruit market does not perform well, the sales are generally rather flat since the beginning of this year with only few seasonal fruits are selling well. Many of the merchants has invested a huge amount of time and money into the fruit business, but this unexpected downturn had made them to think the market has entered the “difficult time” in advance. So how exactly can we change this situation?
In the next 15 minutes, I will speak and discuss with all of you about how to market the fruit industry and remain profitable in the Mobile Internet era. Lately, we talk about Mobile Internet a lot, so what kind of characteristics does Mobile Internet provide to us? The most obvious one is all the information has become in a form of long tail driving. What that means is that a large number of occurrences coming from the “head” or central part of the distribution, which for example: CCTV and all the other traditional media that you could immediately think of. Consumers are navigating away from mainstream markets, and since we are now in the Mobile Internet era, which actually opens a door for “Self-media”. Anyone could open any accounts on any social media publishing platforms. Have you ever felt there are just too much information for you to consume and digest some how in some ways? We consume an increasing amounts of information through every possible channel. The information is overloaded, and we don’t actually have a choice.
What this overloading lead to is that the information has become more fragmented than it used to be. We are surrounded by all kinds of information at every single moments like before going to bed/waking up, having breakfast, at work, shopping, singing at Karaoke bar, or event at bathroom. Information is everywhere around us, but how much can you actually remember? According to George Armitage Miller, who was a Harvard’s psychologist, the number of objects an average human can hold in working memory is 7, which is why we can only recall the most important 7 things. If you ask a random man to remember the name of every brands that belong to one category, very few of them would remember more than 7 even though they are very much interested with the chosen category. Let alone the category that he or she does not even pay attention to, which that only 1 to 2 brand names could be memorized. We just could not catch up with the pace at which internet pervades into our life.
According to a survey made by Netease, the clicks on mobile phone done by the average Chinese person are 600 times per day. If one click stays for one minute, then there would be 600 minutes in a whole day, that is, 10 hours. We spend 8 hours in working in a day and 8 hours in sleeping, and 8 hours left for us, which is fully covered by the mobile phone, and we still have to squeeze 2 hours from our work and sleep time for the Mobile Internet. Obviously, technology can draw away people's attention in some way.
So how can we do business with such a group of mentally unhealthy people? Let’s first look at the characteristics of Mobile Internet users?
1. Low brand loyalty. Because there are too many options and too many alternative products available.
2. Poor logical thinking. Too much information result in almost passive spoon-feeding acceptance of information rather than active thinking.
3. Easy to be fooled
Here comes one solution, which was one of the marketing methods that we have seen in the past few years. By making up the stories to attract user’s attention to gain profit. For example, People’s Daily has once criticized the way merchants selling the fruits by lying to the public that there is an old man whose fruits are all wrinkled, shriveled and spoiled, so that they could use people’s sympathize with the old man’s sufferings to earn some money. This method worked, some of the celebrities even retweeted the stories to encourage more people to buy his fruits. But this fraud did not last long. Eventually the public found out the old man actually lives a pretty good life and this whole sad story of him was made up by the merchants.
The other method would be KOL or internet celebrity marketing. Having an internet celebrity or KOL to promote something often cost much more than traditional media does. However there is no way to measure of how much sale that they can actually boost or how much reputation they can leverage a brand into.
Big promotions. One of the most classic example would be how e-commerce take risks of being current account deficit to provide big promotions.
These methods would not work if we practice them too many times. It only works for short-time business but not for long term, since it is hard to build brand loyalty in such a short time. So what need to be paid attention to when comes to fruit marketing in a Mobile Internet era?
Here, we use rules called “ABCDE”.
A means Agency. A professional marketing agency focusing on fruit business is the key. A good agency that specializes in fruit brand marketing must have deep knowledge about the fruit industry. Generally, to have such knowledge it should require at least 2 or 3 years experience in the industry, even much longer. Therefore, if you are looking for an agency to build your brand, you need to find the one, which understands the fruit industry well and also has rich experience in marketing. It is never a good idea to use an agency without any experience in fruit marketing.
B refers to Brand. Every fruit merchants want to have their own brands built. Why? Branding could help us to gain more profits. So what are the three most crucial prerequisites for brand building? Can you monopoly the fruits supply? Can you monopoly the distribution channels? If you cannot monopoly either the supply or distribution channels, make sure your products are differentiated enough. If you cannot meet either 3 standards, branding is like water and trees without source can not survive. The goal of branding is for brand premium, which is the final result. Fruit brands sell better than fruit without a brand. Take an example, if your fruit brand is the only one that everybody knows well about comparing to the others, they would often choose to buy from you because they recognize your brand as something that could ensure the safety and quality of the products, but not other unfamiliar brands. So without a clear social recognition, quality and brand sometimes just doesn’t equal to each other. How do we achieve brand premium? The procedure of branding is a way to control the supply chain so as to manage each aspect of the chain for their consistent development. As a result, the brand can gain market shares sustainably in the market of same type of product, and can obtain higher brand premium thus to facilitate the healthy development of supply chain further, which I will talk about more later on. What I want to clarify here is that branding is important. It does not only apply to packaging design, in-store promotion, or running a show but beyond that. Branding is strategic planning, advertising, public relations, social media, those are supposed to be a kind of marketing tools that supports the brand strategy and to finally achieve the brand’s purpose.
C refers to Clients. First we need to find the key clients or Super Clients, who have the most passion for your product. These clients 1) love or obsessed with your product and use your product frequently; 2) are not one-time buyers and their purchasing is related to their emotion and lifestyle; 3) are less sensitive to the price; and 4) are willing to buy more and can encourage other people to buy. Super Clients are core clients or word-of-mouth communicator. Their behaviors are usually easier to predict because of their relatively stable habit and preferences. Super Clients may be only 10% of the entire client base but they can contribute to 30%-70% sales revenue.
D is Distribution or distribution channels. A healthy supply chain can bring profit to everyone from upstream to downstream in the chain. Are most of the supply chains healthy? The answer is no. What occurring right now is that the local fruit base sells the goods over to wholesale stalls, wholesale stalls pass them away to secondary wholesaler, then secondary wholesaler sell to sub-secondary wholesalers for profits, and that goes on and on. Many fruits growers realize that the relationship between local fruit base and wholesale stalls is becoming a game theory oriented relationship, which also exists between different levels of wholesalers. Take the imported cherry for example, at the beginning of this year, the wholesale price of the imported cherry once dropped to the lowest as 100 RMB 5kg. But the reason why consumers didn’t realize that as a benefit is because the last tertiary wholesaler always keep the fixed price no matter how the export price “goes downhill”. The last tertiary wholesaler doesn’t have sale pressure but the rest of them do. With the upstream loses it money, the downstream gains it profits, how could a supply chain goes healthy as long as it is under this kind of gaming relationship? We all knew that Zespri is the world’s most successful fruit brand. But we should really think about how Zespri successfully maximized it profits and interests by controlling its distribution channels. If a brand doesn’t own the rights of control, then what would happen is that every one of the merchants in the chain only cares about how to maximize the individual benefits. That is something that we don’t want to let it happen because the one who has the most to lose is the brand itself.
Let’s go back to where we just talked about, why do we want to build a brand? The goal of branding is for brand premium, and the reason why we can achieve that is because we manage and enforce each aspect of the chain for their consistent development to extent market share. Advertising or holding events is not the purpose of branding but we should see it as a necessary method of building the brand. If your agency doesn’t know well about your products and the fruit market, it is easy to confuse the “method” with “purpose”.
E refers to E-commerce. In the era of Mobile Internet, shelves in the virtual network have unlimited space. Any product can find its own niche market. In the past, we might find it’s hard to find niche product in physical store, however, nowadays we can find any niche product on the Internet. And any of these products may have incredible sales.
So to conclude what I have been trying to say here: if you want to become successful on fruit business, you may want to be proficient using Mobile Internet in order to find your niche market. Then you need to go find your key clients or Super Clients and your professional agency who specializes in fruit brand marketing while reinforcing the management of distribution channels to build a healthy supply chain. With limited time that we have here, that is all. You are very much welcome to add my WeChat to exchange any ideas that you may have, or to contact the Fruit Observer, which would give you in-depth analysis and trending dynamics of the fruit industry! Thank you for listening!
The copyright of this article is belonged to Easywei Marketing & Consulting Co, Ltd. Easywei is a leading integrated marketing consulting firm in China specialized in fruit business, and used to work for ASOEX and OXEC Beijing to promote fruits from Chile and fruits from Peru. For more information about Easywei, please look up our website: www.easywei.cn
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