It kind of went off track.

Big companies have already begun to compromise.

"10 years ago, Procter & Gamble and Unilever can control the price of the store, they say how much money to sell, you have to sell how much money." Even when supermarkets in Wuhu is only a century lianhua. "It's better to communicate now, including 10 years ago, you rarely see their promotional outfit, but now more than a few years ago." This is the big company to supermarket shopping mall of compromise.

Procter & Gamble, Unilever in the FMCG giant, Century Lianhua and WAL-MART, Carrefour, RT mart and other supermarkets, known as KA, this is the "customer focus" English abbreviation, is the most important part of the traditional channels, there is no other links, direct supply, trading.

Photograph: SONG/REUTERS ALY

You probably know, the products sent to the hands of consumers in various places, and more rely on a network is called the dealer network. "Gold and silver bronze (or 123)" at different levels, representing the ability of different business scale.

"Now some very strong dealers will be directly and manufacturers to shoot table, unlike before the dealers have checks and balances. Now the business is not good to do, the dealer will force us (manufacturers) to make profits." Big companies don't like to do it, but they have to compromise on some of the dealers.

This kind of compromise, or "control power" lost in the face of this new channel, the electricity suppliers, the performance is more obvious.

"Electricity suppliers have their own festivals, such as' double 11 ',' 618 ', we originally scheduled for August or December launch of new products, electricity suppliers will require us to. Because the electricity business is growing fast, the requirements of the electricity suppliers are generally satisfied."

We now put more bluntly, the company's traditional sales channel system collapsed, this is not alarmist, Procter & Gamble and Unilever has been China market "myth" as existence, rely on a stable and strong distribution system.

In a private supermarket in Mianyang, Sichuan, on Sunday, he visited the shelves of daily chemicals, such as shampoo, shower gel, washing powder and so on, while talking to the shop owner on the phone. Sunday is a sales manager of Unilever resident, each week will pick some stores to visit a circle.

He has dozens of sales staff, they are hired by Unilever, by the dealer on behalf of the management. Every day, the sales staff to visit the jurisdiction of retail stores, most of the time is 100 to 1000 square meters of private non grocery stores, chain supermarkets, cosmetics store, if there is a shortage, information will be recorded in order to mobile phone system, and then enter the DMS dealer management system.

This system records the downstream retailers order dealers, it exported data tell whether the dealer warehouse personnel need to pick up the goods, the allotment to what place. Unilever can also see this system, according to the data to determine what time they need replenishment system -- DMS is a great company of master dealer distribution and inventory tools, but also their remote Distributor Management mode.

Too much for some remote areas, the sales staff will take the "car sales", that is to send a sales staff to inspect the goods loaded with stores, if there is out of stock, replenishment, trading on the spot. In extreme cases, such as high transportation costs, then the dealer will be based on the local business volume to determine whether the establishment of sub positions, or to find a distributor, which is completed in remote areas of bulk cargo. In the latter case, the dealer is usually unable to grasp the sales data of the retail terminal system, and sales company in order to get this part, usually a combination of market research and data research company hired Nelson.

Data from the distribution system to determine the decision of the Sales Department of large companies. If the sales data of a place is not high, so the sales department will be proposed to abolish certain products in the local delivery, if the inventory is too large, it will consider taking promotions, sometimes also includes distributors, retailers to provide subsidies and cash rewards.

Procter & Gamble (the United States) distribution center, the picture from bizjournals.com

If you're taking a bottle of shampoo from WAL-MART and Carrefour, the POS cash register system will be directly in the background system of Unilever through the commodity bar code records.

All these data will be Unilever's headquarters in Shanghai knows it with regional data together and decide how to organize production, the factory is to increase production capacity, whether to increase new workers; finally, it will become a performance.

Even in Rotterdam, Holland and London, Unilever's global headquarters will see these figures, which they expect to see from the emerging market profits. Expect a recession, falling demand for the market, will generate a new bright spot. When the economy slows, China is becoming more and more important for many multinational companies.This sales network, which is like a capillary, is the lifeblood of a large company.

"Multinational companies in China to succeed, the first step is the distribution network." Chinese million AIDS President Ma Ruchao in Shanghai in April of this year an industry innovation forum said, he came to the office in Chinese in 1990, Procter & Gamble, Colgate, Cadbury, responsible for carrying out China market business. In his view, the completion of the above distribution system is the first step in the Chinese market success, priority to good products, commodity prices and product mix.

Through a strong distribution system, Unilever will be its brand across to more than 190 countries. Image from condomcollective.com (Note: Unilever in recent years, the sale of multiple brands, the company's existing brand portfolio or with the above picture shows some discrepancy.

Procter & Gamble 10 years ago in China market had nearly 20% sales growth, million AIDS (Oreo owners) in 2007, China also ushered in the market 4 times the growth rate, including Unilever had two digit Chinese market growth, have benefited from the smooth operation of the distribution system.

And now most of the news from the fast consumer industry is declining, layoffs, cut marketing costs...... Procter & gamble all of fiscal year 2015 business sector sales fell, sales fell 5%, net income even fell by 40%; in 2014 China million AIDS "no growth"; Unilever in the first quarter 2016 results briefing, said in a China growth basically is to rely on electricity suppliers to drive.

"The first thing we are aware of is the fragmentation of the distribution, while some of the value of the brand has declined, the result is that the price system has become unstable." Ma Ruchao said. This is a Domino effect, and the problem of the concentration of the outbreak may be faster than the big company expected.

In the past nearly two months, we interviewed 11 practitioners in the industry related to Ma Ruchao, if such indirect contact is also included, may reach 20 or so, or are they have once worked at Procter & Gamble, Unilever's sales department, sales department, or business departments, some dealers there are supermarkets, sales channels and management personnel, from the electricity supplier and so on all kinds of functions and large channel system related. We also went to Xuancheng, Anhui, a trip to see the big companies in the four or five line of the city's channel sink in the end what it does.

We interviewed these people, they know what is happening, and we are in and their exchanges, feel more, is confused, sometimes, there is a sense of weakness. Most of them are required to be anonymous, or can not appear any point to the company's information, should be interviewed object requirements, the majority of the text are not named or a pseudonym.

We finally summarize these exchanges for a series of reports in this series, we try to answer the following questions:

Consumers get information on the channel change, how big companies become confused?

Why are their products no longer popular?

When a second tier market saturation, they want to enter the three or four line market, but also encountered what?

Why don't you trust them and even make a table with them?

Advertising is still no less flowers, why not sales?

What does it mean for them? Is the future of this industry?

All of these issues are trying to answer the question why the traditional channels of large companies will collapse, it may not be the whole picture, but enough to reflect the industry issues. Of course, the Chinese from 1 line to 5 line (or part of the city has not yet hit) channel system crash is not happen overnight, you can see from this series of reports, the process of quantitative change to qualitative change is how it happened.

This is the first article in this series. The other two will be released this week.

"Tradition" is in fact the corresponding "Internet" and set up, and the other is "line" and "online"". Although we interviewed these people do not think that the Internet is the whole of the problem, but if you have to give a change occurs when the object, they are pointing to the internet.

We start with "how the Internet has destroyed their confidence".

Big companies now have more like to mention the Internet, in fact, it shows that they have more panic and anxiety.

Over the years that set of standards, rigorous process of destructive power, is widely believed to be the Internet, more precisely, is the electricity suppliers. If there is no electricity - they will make the assumption that large companies can follow the prescribed order to channel system from the United States to copy Chinese from China, a second tier city, and then copied to the 345 line of the city, which continued access to emerging markets, continue to grow.

However, the basic business rules are broken, the Internet gives them confusion. Big company in the past 20 years sales system of talent pool and database system, the Internet is the lack of, at least, is not paid attention to.

Cite a simple example, for example, is full 199 yuan minus 99, or the first 100 free single, it may be for us to spend the money is the same, but there will be a lot of different sales." Li Leihan, who works for Unilever, told the daily curiosity, "we need Tmall to tell us different promotion mechanisms, which is better. They have a lot of data."In fact, big companies have never lacked the data, it is said that they have to spend hundreds of millions of dollars in data collection and analysis every year. How to do promotion than appears helpless in the electricity business, even worse is that they think consumers become subtle.

Unilever and Alibaba in the last year reached a strategic cooperation. Picture (by cutting) from News Today socialbrandwatch.com/Tech

Held in September last year, the Alibaba in an industry summit, to the platform of Procter & Gamble Greater China CEO Matthew Price said they are now Chinese major market consumers, is a group of young white-collar workers, is also the mother of female consumers. And their consumption, far more complex than the United States local market.

The complexity of the reason is the diversity of consumption, which and the fast consumer company's mass market products appear contradictory. The more fundamental problem is that consumers have access to information channels have changed.

WAL-MART, Darunfa supermarket stores, including Watsons, once played "Popularization" role. Many people go to these places not only to supply the necessities of life, but also by the way to see what is not the same thing ". Some curious people will try to change their product use, in which situations, the product on the shelf placement, product packaging color, promotion has become the main purchase decision factors.

This is the FMCG is defined as "impulse" buy, why also Procter & Gamble and Unilever this kind of company is "good marketing", the first and the second main global advertising money is spent. Even with the reduction of marketing costs, Procter & Gamble last year's global marketing spending is still as high as $8 billion 200 million.

In the fast consumer company, the spread of a "consumer truth model", the traditional mode of consumption is the case: found that consumers (see ads) - consumers to buy products under the line - consumer use of products.

Li Leihan told us that their past marketing process is generally six months ahead: bought the product of television advertising, in the next few months, the marketing department will be responsible for material (such as shelves, exhibition, promotional cards) design and production, they need to ensure that all visual materials are in line with the brand positioning, and sales department communication is also at this time, the latter get all the details of the products from the market, to ensure that the National Mall purchasing department and dealers Distribution of products, can accurately and consistently convey the product demand point, finally, the two departments jointly plan budget, ensure the products get good display in the terminal market.

PANTENE TV ads screenshot

Big companies have used the TV advertising + supermarket stores, a huge consumer groups to live. In their marketing experience, consumer spending paths in the past are predictable.

But now that it is out of the law, the consumer behavior of young consumers is not regular. In time, they can travel abroad or travel in the electricity supplier website promotion page, boutique shopping guide app or sea Amoy website topics recommended, even on the side of the "Amway" friends, access to a wide range of consumer information. This is also accompanied by consumer upgrades.

In the end for what reason to buy, it is more random, may be packaging, may also be a sense of freshness, and even, just a feeling. But the fast consumer company, including Procter & Gamble, has always been good at the functional demands".

"Well, consumers are willing to be a little better for themselves, I see it, I want to meet the curiosity and desire to possess. We found that, whether it is bath products, or cleaning products, consumers are now more focused on opening the bottle cap, there is a scent and fantasy, although it has no effect on the function. We will also go to the marketing environment." A brand manager of Unilever told the "Daily" curiosity, "now is the era of the screen, the visual stimuli than any other stimulus, the facial features of people is through, you can design a visual scene on the screen into a fragrance business, such as the use of VR." You seem to be able to find a reason why big companies are now keen on a variety of techniques to try.

Visual stimulation of video advertising is transferred to the plane

Big companies to "model of consumer truth" has also made adjustments: consumers understand the information online - to enter the shop to buy - receive products - use products and feedback. But they also know that every step of the path may be interrupted.

However, they can not ignore the power of the electricity business platform released. Unilever rarely published separately business data China area, but in 2015 earnings report, the company specially referred to the development of China electricity supplier, said Chinese regional electricity supplier sales accounted for 5% of total sales China Unilever, which was more than the company overall table in the global electricity supplier market is higher than the 3 percentage points.

In the electronic business platform, 24 to 18 year old consumers accounted for 64% of sales, 25 to 29 years of age accounted for 20%." This is Procter & Gamble Greater China communication and public relations vice president Xu Youjie at the end of last year to accept the "curiosity" interview, the data provided.

"Now all ads whether there is no base location (national or regional), have to go online to guide, very little guide line." The Unilever brand manager told the "Daily" curiosity, "Unilever marketing channel has been more than 20 years, the marketing department is the bridge between the electricity supplier and the line, did not favour one more than another."

百度翻译字数限制为5000字, "上如此"及其后面没有被翻译!

In fact, big companies have never lacked the data, it is said that they have to spend hundreds of millions of dollars in data collection and analysis every year. How to do promotion than appears helpless in the electricity business, even worse is that they think consumers become subtle.

Unilever and Alibaba in the last year reached a strategic cooperation. Picture (by cutting) from News Today socialbrandwatch.com/Tech

Held in September last year, the Alibaba in an industry summit, to the platform of Procter & Gamble Greater China CEO Matthew Price said they are now Chinese major market consumers, is a group of young white-collar workers, is also the mother of female consumers. And their consumption, far more complex than the United States local market.

The complexity of the reason is the diversity of consumption, which and the fast consumer company's mass market products appear contradictory. The more fundamental problem is that consumers have access to information channels have changed.

WAL-MART, Darunfa supermarket stores, including Watsons, once played "Popularization" role. Many people go to these places not only to supply the necessities of life, but also by the way to see what is not the same thing ". Some curious people will try to change their product use, in which situations, the product on the shelf placement, product packaging color, promotion has become the main purchase decision factors.

This is the FMCG is defined as "impulse" buy, why also Procter & Gamble and Unilever this kind of company is "good marketing", the first and the second main global advertising money is spent. Even with the reduction of marketing costs, Procter & Gamble last year's global marketing spending is still as high as $8 billion 200 million.

In the fast consumer company, the spread of a "consumer truth model", the traditional mode of consumption is the case: found that consumers (see ads) - consumers to buy products under the line - consumer use of products.

Li Leihan told us that their past marketing process is generally six months ahead: bought the product of television advertising, in the next few months, the marketing department will be responsible for material (such as shelves, exhibition, promotional cards) design and production, they need to ensure that all visual materials are in line with the brand positioning, and sales department communication is also at this time, the latter get all the details of the products from the market, to ensure that the National Mall purchasing department and dealers Distribution of products, can accurately and consistently convey the product demand point, finally, the two departments jointly plan budget, ensure the products get good display in the terminal market.

PANTENE TV ads screenshot

Big companies have used the TV advertising + supermarket stores, a huge consumer groups to live. In their marketing experience, consumer spending paths in the past are predictable.

But now that it is out of the law, the consumer behavior of young consumers is not regular. In time, they can travel abroad or travel in the electricity supplier website promotion page, boutique shopping guide app or sea Amoy website topics recommended, even on the side of the "Amway" friends, access to a wide range of consumer information. This is also accompanied by consumer upgrades.

In the end for what reason to buy, it is more random, may be packaging, may also be a sense of freshness, and even, just a feeling. But the fast consumer company, including Procter & Gamble, has always been good at the functional demands".

"Well, consumers are willing to be a little better for themselves, I see it, I want to meet the curiosity and desire to possess. We found that, whether it is bath products, or cleaning products, consumers are now more focused on opening the bottle cap, there is a scent and fantasy, although it has no effect on the function. We will also go to the marketing environment." A brand manager of Unilever told the "Daily" curiosity, "now is the era of the screen, the visual stimuli than any other stimulus, the facial features of people is through, you can design a visual scene on the screen into a fragrance business, such as the use of VR." You seem to be able to find a reason why big companies are now keen on a variety of techniques to try.

Visual stimulation of video advertising is transferred to the plane

Big companies to "model of consumer truth" has also made adjustments: consumers understand the information online - to enter the shop to buy - receive products - use products and feedback. But they also know that every step of the path may be interrupted.

However, they can not ignore the power of the electricity business platform released. Unilever rarely published separately business data China area, but in 2015 earnings report, the company specially referred to the development of China electricity supplier, said Chinese regional electricity supplier sales accounted for 5% of total sales China Unilever, which was more than the company overall table in the global electricity supplier market is higher than the 3 percentage points.

In the electronic business platform, 24 to 18 year old consumers accounted for 64% of sales, 25 to 29 years of age accounted for 20%." This is Procter & Gamble Greater China communication and public relations vice president Xu Youjie at the end of last year to accept the "curiosity" interview, the data provided.

"Now all ads whether there is no base location (national or regional), have to go online to guide, very little guide line." The Unilever brand manager told the "Daily" curiosity, "Unilever marketing channel has been more than 20 years, the marketing department is the bridge between the electricity supplier and the line, did not favour one more than another."

China million AIDS President Ma Ru Chao described the success path of multinational companies in 1990s Chinese are: Beijing, Shanghai, Guangzhou set up a representative office, extended to other city to Chinese most outstanding university to recruit the best graduates looking for distributors - small shop purchase - posted to the Chinese occupation managers learn Chinese - Promotion - cycle.

The Internet is to break this cycle, it is an irreversible trend. "Everyone from the exclusion electricity supplier initially, now slowly to accept, or even want to use some of the electricity supplier or the mobile Internet, to change the interaction between the store and consumers, I think this is a good thing. The ultimate goal is to find consumers." CHCEDO division general manager Wu Kun said, the electricity suppliers to shape a cheap image, but in addition to the price of the line, the added value of what? This is the entire industry is now exploring the problem."

"Stable base to find new channels, fast eliminate the company has always been this approach, the line is the foundation, and not to do the electricity suppliers on the lost basis." Procter & Gamble electricity business department an employee said.

What they need now is how to rebuild their confidence.

(should be subject to the requirements of the visitors, the text on Sunday, Li Leihan, Dong Rina as a pseudonym, geographical name by processing)