A comprehensive analysis of Bawang Cha Ji’s radical marketing: How to become the “Starbucks of the East”?

How did Bawang Chaji become the "Eastern Starbucks"? Bawang Chaji adopted a radical marketing strategy, and its investment in marketing may reach 1 billion yuan. Let's follow this article to see how Bawang Chaji does marketing. I hope it will be inspiring to everyone and I recommend it to my friends on the Internet.

A month ago, Bawang Cha Ji held a grand press conference in Shanghai. Founder Zhang Junjie passionately described the vision of Bawang Cha Ji on the spot. He choked up at one point and said that the sales volume would exceed Starbucks in 2024. Before this, no tea beverage company had held "this kind of press conference comparable to that of an Internet technology company."

Caption: Zhang Junjie, founder of Bawangchaji

When Bawang Chaji appeared in 2017, most investors thought it was a brand no different from Cha Yan Yue Se. Few people thought that Bawang Chaji would become one of the most watched tea brands in the past two years. In 2023, when the growth rate of the tea industry slowed down, it still opened 2,000 stores, surpassing Heytea and ranking ninth in the industry in terms of store numbers.

Matching the scale of store openings is Bawang Cha Ji's aggressive marketing strategy. According to LatePost, by 2024, Bawang Cha Ji's marketing investment is expected to reach 1 billion yuan, and the budget for targeted channels will reach 200-300 million yuan - far exceeding its competitors such as Gu Ming and Hey Tea.

Doujiao Spicy asked several industry insiders about the authenticity of the "1 billion marketing expenses". An employee of a tea brand said that if we roughly estimate the price of the resources invested by Bawang Chaji, it is about this level.

However, a Focus Media employee said that 200-300 million should be the annual budget, and the exact amount that can be consumed depends on the specific situation, "it may not be fully consumed."

Why is Bawang Cha Ji so aggressive in marketing?

Taking McDonald's, KFC and other mature large catering chain brands as an example, the marketing budget usually accounts for about 3%. Ge Xiantong, founder of Jingcai Capital, told Spicy that many catering brands in China are in the early stages of development. In the critical period of grabbing market share, the marketing expenses can account for 5 or 6 percentage points, or even close to 10 percentage points.

"This is related to the proportion of its direct sales model, its aggressive approach and the life span of its brand." Ge Xiantong said, in contrast, "Gu Ming and Cha Bai Dao have entered a relatively stable development, and they are basically franchising and sinking into the market, so they do not need too much marketing investment."

1. Brand positioning: Why is it “Eastern Starbucks”?

Behind the marketing action is a reflection of a company's business strategy - Bawang Cha Ji's aggressive marketing must indicate that the company will expand rapidly. This is in line with the basic rules of the industry. In the fast-changing milk tea market, the life cycle of a brand is limited. "Bawang Cha Ji doesn't have much time left." said a consumer investor.

An employee of Bawang Cha Ji told Doujiao Spicy that the company does not have a fixed plan for opening stores. It still depends on the saturation level of the milk tea market in various places. This is dynamic and depends not only on its own situation, but also on the situation of its competitors.

Zhang Junjie has said publicly many times that Bawang Chaji wants to be the "Eastern Starbucks". In 2023, Bawang Chaji's GMV will be 10.8 billion yuan, with a peak of 8,687 cups sold per day in a single store. In 2024, it will surpass Starbucks China in sales volume.

Bawang Chaji is not the first tea brand to tell the story of "Eastern Starbucks". As early as 2021, when Nayuki's Tea went public, it told investors that it wanted to benchmark "Starbucks".

The startup company claims that it wants to be "Starbucks" just to make it easier for consumers, investors and franchisees to understand. In essence, the company's future goal is to become a world leader in the tea industry .

"Starbucks" is a perfect benchmark for Chinese tea and coffee brands, but how to achieve this requires brands to find a solution that suits their own capabilities.

The inspiration of Bawang Cha Ji comes from coffee latte. Coffee latte has the highest repurchase rate among all kinds of beverages, so the idea of ​​replacing the combination of "coffee + milk" with "tea + milk" came into being.

The similarities between Bawang Cha Ji and Starbucks are the creation of the third space and the white-collar population in first- and second-tier cities. In order to create a high-end brand image, more than 50% of Bawang Cha Ji's stores are located in shopping malls. In Beijing, it has built flagship stores of over 200 square meters in Sanlitun and Heshenghui. Doujiao Spicy learned that starting from 2024, the size of Bawang Cha Ji's franchise stores cannot be less than 60 square meters, a standard that is even higher than that of Heytea, which is known for its quality.

Caption: Bawang Chaji Sanlitun store

But unlike Starbucks' direct operation model in China, Bawang Cha Ji's franchise model is more conducive to expansion.

He Jun, former dean of Bawang Cha Ji Business School, told Spicy that he and Zhang Junjie met in early 2021 and helped Bawang Cha Ji build a talent training system from 0 to 1. He observed that some founders of tea brands tend to be conservative after opening stores of a certain scale, and Zhang Junjie was very clear about the company's strategic planning and goals from the beginning.

According to "Undercurrent", Zhang Junjie wrote in the PPT for investors, "Become a brand known by young people in China", "Become the best choice for Chinese physical investors and entrepreneurs", and "Become the tea queen in 100 countries around the world."

The underlying logic is that Zhang Junjie sees that the influence of Chinese culture is increasing and that Chinese tea drinks have the opportunity to become world-class brands.

How much you believe in this sentence will determine how far an entrepreneur can go . As for why Zhang Junjie is motivated to achieve a greater goal? He Jun believes that the closest explanation is that this is an innate "sense of mission."

Among all the founders of tea brands, Zhang Junjie's strengths are strategy and organizational ability. In 2017, when Zhang Junjie started his business, the competition in the milk tea industry was already a red ocean. He combined factors such as category, marketing and business model to find the uniqueness of Bawang Chaji - different from the most popular fruit tea on the market at that time, it was positioned as a traditional Chinese style original leaf fresh milk tea, and different from the direct sales of Cha Yan Yue Se, it switched to a franchise model.

Since its establishment, Bawang Chaji's positioning has hardly changed. It has not experienced changes in pricing and models like its competitors. In business competition, fewer mistakes means higher efficiency.

At Bawang Cha Ji, the emphasis is on "planning before action" - first strategy, then talent, and finally business. "When Bawang Cha Ji enters a new place, it must first determine the regional strategy, then build a matching team, before it can start business." Most brands first let franchisees join, and then build management institutions in the local area after reaching a certain scale .

All the decisions made by Zhang Junjie are centered around "Eastern Starbucks". The deep meaning of "Starbucks" is standardization, scale and globalization. Within Bawang Chaji, there was hesitation about whether to cut off the "fruit tea" category. The investor asked, "How much impact will cutting off fruit tea have on the overall revenue?" After estimating the data, Zhang Junjie finally decided to cut off the "fruit tea" category.

At the time, this was a very "bold" decision. But in essence, compared with "fruit tea", the supply chain of whole leaf fresh milk tea is simpler and the production process is easier to standardize, which became the basis for Bawang Chaji to quickly replicate and expand.

2. Marketing moves: Heytea goes left, Bawangchaji goes right

Nie Yunchen, founder of Heytea, believes that brand is the core of a company. It is a misunderstanding to attribute McDonald's success to standardization. "Brand is the foundation of a brand. Everything we do should return to the brand itself. It is the prerequisite for development and expansion. It is the ultimate reward for all our efforts. What is good for the brand is the standard for all our choices."

What Zhang Junjie pursues is standardization and scale.

The above two different business ideas, when reflected in marketing, also present different styles.

Heytea does not spend money on marketing, they hope to use content to drive brand growth. Heytea will not place advertisements on pure channel media such as Focus Media, and even in content creation, they do not emphasize a certain fixed methodology internally .

In the past two years, Bawang Tea has made bold investments in marketing, which is related to the company's expansion rhythm. Recently, Bawang Tea upgraded its brand to "Meet friends around the world with oriental tea", becoming the first tea brand to equate national symbols with brand symbols. Before this, Bawang Tea has always adhered to the national style positioning. Compared with the trendy attributes of Heytea, the national style attributes are more distinct, especially when going overseas.

In addition to grand brand narratives, they also regard marketing as a highly effective means of exposure.

Bawangchaji is extremely result-oriented and directly adopts marketing strategies that have been proven in other brands . For example, after the joint venture between Heytea and Fendi became popular, it continued to collide with first-tier luxury brands such as Dior and LV in design; after Shiseido and GQ Lab’s “Red” campaign went viral, Bawangchaji also launched the “Fans” marketing plan, and they also chose to cooperate with GQ Lab; after Heytea signed Pamela as its chief product recommendation officer, Bawangchaji quickly signed Liu Genghong and Zheng Qinwen.

Caption: Bawangchaji signs tennis star Zheng Qinwen

Topicality is always what Bawang Cha Ji needs. Even though many voices on social media question whether Bawang Cha Ji is "touching porcelain marketing", this does not prevent consumers from taking photos and sharing their milk tea that looks like Dior's design. Bawang Cha Ji's signature product, Boya Juexian, can sell 100 million cups a year. In 2023, the primary goal of the Bawang Cha Ji brand team is to let more consumers know about Bawang Cha Ji and encourage more new customers to drink their first cup of tea at Bawang Cha Ji.

Caption: Bawang Cha Ji's best-selling product "Bo Ya Jue Xian"

In addition, Bawang Cha Ji is also the first brand to propose calorie calculation and ingredient disclosure - just like the "touching porcelain" hot spot, this is also a reflection of the accurate capture of consumer psychology and emotions. Bawang Cha Ji has made a series of marketing actions around "health": co-branded with Keep, launched a calorie calculator, signed Liu Genghong and Zheng Qinwen. We can infer the effect of Bawang Cha Ji's "health" from Heytea's experience. According to Spicy, after Heytea's Pamela recommended series products were launched, many of them were in the top three in sales for a long time.

A consumer who works out regularly said that he often sees people drinking Ba Wang Cha Ji in the gym.

Spicy learned that Zhang Junjie is a fully empowered manager. In addition to absolute control over the strategic direction, he prefers to give decision-making power to front-line people who can "hear the gunfire." This is learned from Huawei. Zhang Junjie adjusted some of Huawei's management tools and applied them to corporate management very early on .

The person in charge of brand marketing at Bawang Cha Ji is Xu Chi, general manager of the brand marketing center. Before joining Bawang Cha Ji, he had many years of experience in catering marketing. At Bawang Cha Ji, there are many executives like Xu Chi who joined from other large companies. Bawang Cha Ji's idea of ​​recruiting people is to find people who have made achievements in the industry.

Spicy learned that Bawang Chaji has delegated some brand marketing authority to the regions. We can see that Bawang Chaji has many regional limited joint ventures. In Bawang Chaji, second-line departments such as supply chain and technology always serve first-line stores and franchise departments. He Jun believes that brand marketing actions should be combined with the culture and consumption characteristics of local customers to carry out some targeted activities in order to create greater value for the store.

Nie Yunchen, the founder of Heytea, plays the role of a super product manager. Even today, Nie Yunchen has a veto over Heytea's products. He will carefully review the products and official account copywriting. He also personally negotiates many important collaborations for Heytea. He hopes to control the quality of Heytea from every detail .

There was even a rumor that "Nie Yunchen had resigned" for a while, but a consumer investor familiar with Heytea immediately refuted it, "It's impossible. Apart from Nie Yunchen, who else can manage Heytea?"

There is no superiority or inferiority between these two ideas, but they ultimately determine the two completely different brand temperaments.

3. Future Challenges: Find New Possibilities Before Growth Stops

Zhang Junjie worked in a milk tea shop when he was 17 years old, and later opened a milk tea shop. At the age of 31, he witnessed the rise and fall of brands such as Yi Dian Dian and Coco. He perhaps understands better than anyone that the milk tea industry is always pursuing new hot spots, and "there is no eternal strong."

On the brand side, it is difficult to create absolute scarcity. Even if there is, it will take several generations of effort. This is why Zhang Junjie pursues standardization and scale so much. He is eager to build a strong organization so that he can constantly find new possibilities to cope with market changes before he stops growing.

Figure: Eastern culture of Bawang Chaji

Two agents told Spicy that a new brand, Chucha, focuses on the "sea salt tea" series, priced at 6-20 yuan, to fill the "low-end market" position of Bawang Chaji. Currently, more than 200 stores have been opened in Guangdong and Guangxi. Following Bawang Chaji's idea, Chucha plans to build 20 model stores in each province first, and then quickly open them to franchisees.

There is no public information about the relationship between Chucha and Bawangchaji, and it is unknown whether it is capital investment, acquisition or internal incubation. Currently, the two brands are still independent operating teams.

Bawang Chaji is also actively going overseas - Bawang Chaji established an overseas business department as early as 2018, and opened stores in Southeast Asia in 2019. Bawang Chaji also plans to advertise in Paris during the Olympic Games, reflecting its determination to go global.

Currently, Bawang Chaji has opened stores in Singapore, Thailand, and Malaysia. Next, they plan to enter the United States, where brand potential is high. Bawang Chaji's current idea is to build a brand overseas and build scale in China.

The national conditions of each market are different. The experience of countless Chinese companies going overseas tells us that globalization is localization, which needs to be adapted to local conditions. And "localization" is not only the localization of operations, but also the localization of organizations.

Malaysia is the first country that Bawang Chaji entered and is currently the best performing country. In Malaysia, Bawang Chaji is positioned at a higher end, rising to the level of "Eastern Starbucks". Like Starbucks, it adopts a joint venture model and often opens stores next to Starbucks. This is because there is already a local milk tea brand "Tealive" that is positioned at a mid-to-low end price.

Caption: Bawang Cha Ji in Malaysia

Bawang Cha Ji also adopted a marketing-heavy strategy - signing popular celebrities and co-branding with other brands are still the most direct and effective methods. As soon as it entered the market, Bawang Cha Ji signed Lee Chong Wei, a badminton player with a high reputation in the local area. In addition, Bawang Cha Ji also actively cooperated with well-known local brands in Malaysia, such as Royal Selangor, a national treasure-level pewter brand in Malaysia. The limited edition cups launched by the brand were sold out in offline stores in just three days.

At present, the local Chinese community still has a high sense of brand recognition for Bawang Cha Ji, and how to break the circle is still what Bawang Cha Ji needs to think about next. In January 2024, all Bawang Cha Ji stores in Singapore were replaced. According to Bawang Cha Ji's public response, they will make new products and upgrade the space.

All tea brands are looking for potential possibilities to avoid being a flash in the pan, and everyone is crossing the river by feeling the stones. Brands such as Cha Yan Yue Se, Hey Tea, and Nayuki’s Tea have made many attempts, but with little success.

Zhang Junjie's journey to become the "Eastern Starbucks" is destined to be more difficult than imagined.

Author: sharemy

Source: WeChat official account: "Chopped Pepper Spicy (ID: ylwanjia)"