Dark horse brands in the race of winning China’s detergent market

A while ago, we already talked about how international FMCG brands are constantly challenged or besieged by local insurgent competitors (see link here). And in the niche market of detergent, Chinese brands even wield an overwhelming influence, at least according to the data insights from the online channel. Even though a big chunk of FMCG revenues usually comes from offline, many experts start to rely on e-commerce data to gauge future growth and potential.

Today the detergent sales via the e-commerce have been dominated by local brand like Liby, with its over 18% market share followed by a Hong Kong background brand AXE.

Industry analysts believe AXE’s success has not been achieved randomly. If we break down detergent sales by product functions, “cleaning” and “not hurting hands” are the two most important keywords to attract money from detergent buyers.

If not coincidentally, AXE has put strenuous efforts, more so compared with other rivals,  in promoting their Vitamin E enriched detergent, claiming to “protect hands”. Further research indicates the brand is intelligently pushing the exact product which mass consumers are looking for at the affordable price. The product formula innovation partially explains why AXE stands out in such fierce competition.

Meanwhile, analysts are also trying to map out another dark horse’s winning strategy: Finish.

By analyzing the keyword cloud associated with the movement of the detergent market, experts picked out trending words like: Siemens, Fortile, Midea. So how can home appliance brands correlate with the success of detergent products? The answer lies in the dishwasher. Soon analysts began to connect the dots between Finish and major dishwasher brands in China. It is estimated that Finish achieved the annual growth rate around 115%, which thanks to the fast adoption of dishwasher among Chinese families in recent years.

In fact, Finish already formed strong partnerships with major dishwasher brands in China. Most dishwasher brands usually give out Finish’s detergent as a companion gift for customers upon purchase.

 

Many believe such a partnership strategy is truly boosting Finish’s brand presence.

Today more and more real-time business intelligence monitoring tools are emerging in China, which all try to generate in-depth insights to help FMCG understand why it does not work, and above everything else to predict what should work for the Chinese consumers in order to stimulate instant sales growth.

The mechanism is usually by crawling as much online data as possible from channels like platform e-commerce, social e-commerce, social media, short video etc, then synthesizing the data into a concise visual dashboard. The key should tell the FMCG brands:

  • What are those key factors driving up your sales? It should cover pricing, category, SKU, consumer profile, consumer reviews, down to channel management.
  • How your competitors are taking up your market share? Especially keeping a watchful eye on these insurgent brands with their “Hero SKU”.
  • How to optimize your digital marketing strategy? In particular KOL evaluation. Certain research finding said some KOL with bigger fame tends to improve your brand awareness but not necessarily conversion. Insiders told spending money on social engagement is getting more like throwing money into cold water nowadays. You might create a huge social buzz with millions of views and clicks, but the final sales result could still look pathetic.

By: Cecilia Wu

Note: Part of the original content is from a Wechat article from a local agency MGCC