Analyzing Wahaha'S Product Strategy

To sum up Wahaha's product strategy, proper follow-up, proper innovation, speed and rhythm of listing should be used for reference.

Today, Wahaha Group produces and sells nearly eight products of nearly 300 varieties, including milk drinks, bottled water, carbonated drinks, tea drinks, fruit juice drinks, canned foods, health care products and snack foods. In 2007, the sales volume reached about 20000000000 Yuan, accounting for 1/6 of the output of China's beverage industry. The annual sales contribution rate of Wahaha is 20%-30% on average, and many classic products such as nutrition express have sprung up. To some extent, the success of Wahaha is the success of product strategy.

To sum up Wahaha's product strategy, follow up appropriately, innovate appropriately, speed and rhythm of listing, we should learn from it. However, the product management and organization of Wahaha is worth considering.

　　 Forward: innovation and speed

　　 Follow up innovation

Imitation and follow up is the core word of Wahaha's product strategy. Wahaha eight treasures porridge, very cola, Wahaha juice drinks, melon seeds, activation and other products are typical follow up products. But just follow up strategy, it is difficult to explain Wahaha many products can catch up with others. Innovation is the core of Wahaha's follow-up strategy.

In 1991, Wahaha followed the children's drink of fruit milk with only two flavors. Wahaha launched six kinds of flavors: pineapple, lychee, Hami melon, strawberry, apple and grape. The six flavors were packaged and sold in a group, increasing the convenience and selectivity of customers' purchase, plus the large volume of TV advertising bombing, and sales came up quickly.

Subsequently, the opponent launched calcium milk, Wahaha immediately launched AD calcium milk, "vitamin A+D is more conducive to calcium absorption" appeal more quickly, catch up with competitors.

Kangshifu introduced green tea, "green good mood", popularized education for the public, Wahaha green tea was divided into "water source and raw materials", "Paradise water, tea" appeal, "USP" selling point was prominent, and also quickly entered the industry three strong.

This kind of innovation in follow-up is only a small trick, not brilliant, but effective, does not necessarily shape the long-term competitive advantage, but it will surely enhance the short-term sales volume of products.

　　 Moderate innovation

"Some people say that Wahaha will only follow up." "Follow up" and "take the lead" are not patented by Wahaha, neither of them is ruled out. The key is who will be most effective and what we will use. " Zong Qinghou said. Although Wahaha's follow-up strategy is well known in the industry, in the Wahaha huge product system, the contribution of innovative product sales is not high. Those who account for high sales and make big profits are the innovative products that are the first ones to enter the market.

In those days, the success of Wahaha pure water mainly depended on "preemptive market entry and preemptive dissemination", and the product itself did not innovate. In the past two years, Wahaha has successively introduced the "crooked and crooked" and "nutrient express lines", which is the innovation of product ingredient formula. These two products have been in the market for one or two years. At present, there are no strong competitors to challenge them, which is related to the barriers to technological innovation.

With the enhancement of Wahaha's comprehensive strength, from the primary innovation of packaging / taste to the advanced innovation of content and production technology, Wahaha's R & D center has studied more than 100 new products synchronously, and more than 10 products can be rapidly produced. In terms of funding, Wahaha takes at least 3% of its sales revenue as a development fund each year, with hundreds of millions of dollars spent on technology development each year. The strong R & D system and technology power have become the driving force for Wahaha products to constantly innovate and continue to develop.

　　 Speed winning

The speed here has three meanings: first, the follow-up speed of products from R & D to listing; the Wahaha AD calcium milk, fruit juice drinks and so on, which have been completed in the one or two months after the rival products are listed, have been followed up by the industry quickly. The two is the speed of product marketing. Wahaha focuses on the promotion of products. As long as Zong Qing's orders are given, more than 2000 dealers and two groups of merchants can be sold. Within one month, the products can be spread to millions of retail outlets throughout the country. This market speed can only be matched by Kangshifu, and three refers to the rhythm.

"Look at one eye, hold one in your hand, and think of one in your heart." Generally speaking, throughout the development of Wahaha, one or two years of launching new products or pushing one or two products a year, enterprises have time, energy, resources and probability of success. On the contrary, in 1995, Zong Qinghou stepped up the pace of listing new products at a time of agitation. More than ten new products were launched synchronously, dispersed in energy, dissipated in resources, and "bearded eyebrows".

In 2004, the Wahaha, which is not the same as the 1995, "the good scar has forgotten the pain", has launched three kinds of products at once, activating functional drinks, Wahaha melon seeds and instant cooking noodles, and the result is far from the expected goal. In 2007, while fighting with Danone, Zong Qinghou listed C, yo yo milk and bubble tea drinks on the list. The product positioning was problematic, the marketing was not systematic, and the prospects for new products were not good.

　　 Reverse: management, organization

　　 Product management

Generally speaking, the product introduction and growth period are different from product strategy and promotion strategy. The former pays attention to consumer education, product marketing, USP selling points, promotional activities, the latter pays attention to product segmentation, brand image building and training, competition confrontation, channel maintenance and so on.

Wahaha does not have a strict product / brand management system. There is no professional person to follow up maintenance and enhance product / brand development. Everything is decided by Zong Qinghou. However, the general manager of Zong has a pioneering spirit, and has the passion of new products, but it does not necessarily have the idea of maintaining products. Moreover, faced with eight major categories, nearly 300 items of product development, maintenance and management, Zong Qinghou must be unable to do so. Now, the crisis of some products has emerged.

For example, in the past ten years, the Wahaha pure water, the first place in China's bottled water industry, has been attacked by the "health more" Kang Shifu water. It has also been attacked by the "two kinds of water, weak alkalinity and weak acid", which is good at selling the farmer's mountain spring. Very coke, which has inspired countless young people's proud young brands, is becoming more and more ignored by consumers.

For example, in 2007, Wahaha launched its C, and its market prospects were not very promising. What is the essential difference between C juice and milk drinks and nutrition express? "This is the root of life, how fry is too urgent." Nutrition fast line is still in the fast growing period rush to push the new brand, kill each other, self replacement, too anxious.

　　 Chaotic product organization

Since 2001, Wahaha has been positioning itself as an all directional beverage company. Around this positioning, the product line extension of Wahaha juice drinks, tea drinks, functional drinks and mixed drinks is very good. However, since deciding the strategic positioning of the "all-round beverage company", it should be firmly implemented. What is the relationship between the following categories of products, such as melon seeds, instant noodles, vitamin tablets, and so on?

The reason for Zong Qing is that "beverage sales are seasonal, and melon seeds and instant noodles are on sale, which can balance the peak season". According to this logic, Wahaha will continue to launch a series of food consumed in winter, such as biscuits and candy.

Although these channels have complementary sales channels, the market operation methods are different. If Wahaha has to develop these foods, it is better to adopt an independent business unit system, similar to Kangshifu's instant noodle business unit, beverage department and pastry business department, and the three main departments' production and sale system is completely independent, and three sales teams develop independently.

Obviously, such a large group, eight kinds of related product lines, relative to Kangshifu, unification and other groups, the total number is not much. However, Wahaha is a highly centralized management of Zong Qing. How can a person manage such a large variety of products?

Wahaha has to make a choice: it should be hierarchical authorization, some product lines will operate independently, or give up some unimportant product categories. Otherwise, no matter how long Zong Qing is going to work, it will be difficult to "let go of all flowers and go hand in hand".

Editor: vivi