Text/Jincuo Dao Channel

Today’s netizens are really becoming more and more “irrational”.

During the epidemic, after Hongxing Erke made a "bankruptcy-style donation" of 50 million, 20 million netizens rushed into the live broadcast room and threw money. Some even rushed into the physical store, bought a pair of shoes, threw away the two cents and ran away.

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Nowadays, the news that the national toiletry product Bee Flower “cannot hold up” has been “exposed” by netizens again.

This made netizens a little anxious. How come this national brand is falling down one after another? It's impossible to save him.

A group of netizens swarmed into Fenghua’s live broadcast room and snatched someone else’s goods for a month in one day. They also threatened to make the Fenghua warehouse’s small forklift truck so busy that it would “drive out sparks.”

But this time, the misunderstanding was huge.

Compared with Huiyuan Juice, whose boss has become a deadbeat and has no property to enforce, Hongxing Erke, which has been losing money for 10 consecutive years, and Fenghua, who is labeled poor by netizens, is living a pretty good life.

I feel like Bee Flower is about to collapse, and I can’t blame netizens entirely for their misunderstanding.

Anyone who sees a large bottle of conditioner priced at 8 yuan, with a dirt-like packaging that looks like dish soap, can only think of two things:

I don’t recognize it. Person: Is this a fake product?

People who know it: Why hasn’t this brand collapsed yet?

It has no sense of existence in the first place, but its key words are completely out of tune, and its reputation as a quick fall has been confirmed.

Because of its crude packaging, some netizens offered to let it participate in the National Broadcasting Competition, but it was "rejected" on the grounds that it would cost money.

When someone asks if it costs money to shoot a commercial, they say it costs me.

Let it be repackaged, and you will be proud of it when it comes out of the sky.

But Bee Flower, who was "looked down upon" by everyone, lived a very prosperous life.

Now it has an annual production capacity of more than 100,000 tons and an annual output value of 1.5 billion yuan. For a shampoo with an average price of 8 or 9 yuan a bottle, think about how many bottles it can sell in a year?

It’s just that a small bottle of other people’s products starts at 20 yuan, but a large bottle of bee flower is sold so cheaply. Why haven’t you poured it out yet?

This brings us to Bee Flower’s life-saving trick - saving money where possible.

Packaging changes all the time, not to mention the bells and whistles, design and production cost money, so give it up decisively, and make one packaging that is earthy to the end.

Marketing is too expensive, so we won’t advertise for the next 30 years and rely entirely on users’ “tap water”.

Finally, squeeze out the cost of ingredients.

Someone has done some calculations and found that the gross profit margin of ordinary foreign hair conditioners is at least 40, while the gross profit margin of Bee Flower is only 15.

Relying on this stinginess, Bee Flower has simply driven the price down to the basement.

What is even more valuable is that everything else can be saved, except the quality.

Long before the relevant national standards were promulgated, many of the basic raw materials of "Bee Flower" had reached domestic and even international standards, and it had also become the drafter of domestic hair conditioner industry standards.

In the 36 years since the company was established, there has been no administrative penalty information.

Such large bowls are cheap and easy to use, allowing Fenghua to secure the loyalty of a large number of old customers and firmly occupy a place in the domestic product market.

Now, its sales network covers more than 1,600 cities at or above the county level in China, and its physical terminals have also entered more than 630 hypermarkets, supermarkets, and chain stores.

In 2016, Bee Flower ranked among the top ten brands of cleaning and care products in China as the only domestic brand.

Even though Bee Flower is now so cheap that even Pinduoduo can’t cut the price, and it’s so low-key that people think it’s going to go bankrupt, back then it was a hard-to-find “big internet celebrity”.

And it can develop to this point by relying on its "bigger brains" than others.

1. Create something out of nothing, and then make it No. 1 in the country

Bee Flower’s initial business was not shampoo and conditioner, but the packaging and processing of detergents and washing powder.

In 1985, Shanghai Huayin Detergent Factory, the predecessor of Bee Flower, was established.

When the factory was founded, the factory building was only more than 400 square meters and there were more than a dozen workers. Everyone worked hard and made less than 5 million yuan a year.

During these difficult times, Shanghai Huayin Detergent noticed a dividend of the times: people began to pursue a taste of life.

In the 1970s and 1980s, when the economy was in recession and supplies were scarce, many people were accustomed to washing their hair with soap or even washing powder. With the improvement of technology, this concept began to change.

Shanghai Huayin Detergent Factory first proposed the concept of "separation of washing and care" and produced the first bottle of shampoo, shampoo, conditioner and other products in China. It must be said that the thinking is very avant-garde.

As soon as the product came out, it was immediately popular in the market, sales continued to rise, and the brand power of Bee Flower continued to increase.

"Binghua", which is now crying out that it cannot afford advertising, actually broadcast a 15-second advertisement on CCTV every day in 1990: "Cheap, good quality, famous all over the world."

With this advertising slogan becoming popular all over the country, Bee Flower can be said to be unparalleled in the limelight and was a well-established Internet celebrity brand at that time. In the early 1990s, with bee flower hair conditioner costing two or three yuan a bottle, bee flower sales reached their peak, with annual sales exceeding 500 million.

According to a survey by the internationally renowned research company AC Nielsen, the domestic awareness rate of the Bee Flower brand at that time reached 36.6, ranking first among similar domestic brands in China.

In 1993 and 1994, Bee Flower Conditioner was also rated as a famous brand product in Shanghai. Later, various certificates and trophies issued by the national, ministerial and municipal levels such as "China Famous Brand Product", "China Famous Trademark", "Shanghai Famous Trademark" and so on were obtained.

But who would have thought that the highlight of Bee Flower’s life would come so briefly.

2. If you can’t fight, leave, the countryside surrounds the city

After 1994, Bee Flower began to face the test of life and death.

On the one hand, the reputation has come out, and domestic shoddy and counterfeit products are emerging one after another, but what is even more terrible is the impact of foreign giants.

Foreign brands such as L'Oreal, Unilever, and Procter & Gamble have flooded into the Chinese market. With overwhelming brainwashing advertisements, cool packaging, and a variety of product matrices, local skin care brands have been crushed to pieces in an instant. Very few came down.

The concept of "separation of washing and protecting" proposed by Binghua was directly replaced by "unity of washing and protecting". For the country at that time, foreign monks liked to chant sutras.

Fenghua sales dropped from more than 100 million to more than 70 million, and 500 workers were reduced to 200. It loses millions every year, and the company loses zero assets.

At the time of life and death crisis, Fenghua calculated her combat effectiveness and could only summarize it in four words: high quality and low price, especially low price, so she decisively embarked on the route of surrounding the city from the countryside.

In order to hit the point of being cheap, it even canceled its advertising department, thus starting a new era of no advertising for the next 30 years.

Gu Jinwen, the director of the factory at the time, said, "Instead of spending a lot of money on advertising, it is better to rely on product quality to win and pass on profits to consumers."

In addition, it has changed from relying on the national wholesale market to follow the path of "big wholesale and big circulation". Instead, it has laid out its own retail channels and continuously introduced new technologies in product production. and young college students, improving the automation level of production lines, everything revolves around how to save costs.

Focusing on the low-end market, Fenghua relies on its high quality and low price to form misaligned competition with these foreign brands, firmly attracting a large number of rural and urban civilian consumer groups.

In this way, Bee Flower has become one of the few national brands in China that can compete with foreign giants in the cleaning and care industry.

Even in 2014, the shipment volume of bee flower conditioner ranked first in the country, exceeding the total of P&G's brands.

Netizens’ worries about time-honored brands are not groundless. Because in recent years, domestic products that once had smooth sailing have had extremely difficult times.

Ten years ago, Huiyuan was still the largest juice company in China. Its market value once soared to 23 billion, setting a record for the largest IPO on the Hong Kong Stock Exchange. At that time, the earthy packaging did not hinder its growth.

But this year, it was forced to carry tens of billions of debts and announce its delisting.

Founded in 2004, Guirenniao also followed the cost-effective route. At its peak, it had stores all over the country. There was a Guirenniao store in almost every pedestrian street. The company's annual revenue was close to 3 billion.

But such a strong old brand has suffered losses for three consecutive years from 2018 to 2020.

As of the end of last year, its overdue bonds payable were approximately 1.147 billion yuan, overdue bank loans were approximately 977 million yuan, and 25 bank accounts were frozen due to litigation. The founder Lin Tianfu has also become what people call "Lao Lai".

Why is it that everyone is a time-honored brand, and some even have old-fashioned packaging that has not been changed for many years? Fenghua can compete with the tough international giants, but these old brands have become a luxury to survive?

The main reason is: Under the earthy packaging, Bee Flower’s products are indeed resistant to beating.

Huiyuan personally ruined its own products. After gaining good reputation and sales, Huiyuan not only failed to further research product technology and improve product quality, but instead purchased rotten fruits and passed them off as good ones, and remained unmoved by its competitors in the face of freshly squeezed juices.

However, Guirenniao is obsessed with territory expansion and marketing, dreaming of building a sports empire, from cross-border shoes and clothing to various fields of sports economy, sports games, sports and fitness, and finally brings down itself.

In ironic contrast to them, when faced with difficulties, Bee Flower was the first to cut off the marketing that they were proud of. It spent a lot of energy on how to make better products and constantly The ability to adjust their products to suit the market.

So far, Bee Flower has developed more than 150 series of products, has dozens of invention and utility model patents, and maintains its leading position in industry technology.

Over the years, the price increase of bee flower products has been very low. In 2018, Chairman Gu Jinwen said in an interview with the outside world that the initial ex-factory price of Bee Flower 500ml conditioner was about 3 yuan, and later it became 5 yuan; the retail price also increased from 6 yuan to 9 yuan.

Relying on advanced technology and the ability to maintain high quality and low price, no advertising, and extremely earthy Bee Flower makes consumers inseparable from it.

Bee Flower has survived and is getting better and better, but the big names who once relied on marketing to reach the sky have fallen one after another.

Looking at their completely opposite fates, we can only say: good marketing can be popular for a while, but good products can survive for a lifetime.

After 100 days of popularity, Hongxing Erke’s live broadcast room has experienced a reversal of losing 10,000 fans every day. Therefore, some people are worried that Hongxing Erke’s wild consumption is a kind of harm to these old brands.

In fact, this is not the case. The short-term sales brought by wild consumption are not sustainable, but the value of brand exposure brought by "becoming popular" far exceeds the sales it brings.

For domestic products like Fenghua, relying on high-quality products and the dividends of the times will make it easier to "become popular", but to achieve "long-lasting popularity", it still needs to be their further efforts.

Author of this article | Li Pengxiang