Ruixing Coffee mainly relies on the means of pushing new products, creating explosive models, and refining the operation of the private domain to revive the blood.

From setting the record for the world's fastest IPO to being blown up by financial fraud, plummeting stock prices, suspension and delisting, and the closure of a large number of stores, Ruixing has gone from being in the limelight to being caught in bankruptcy, and its reputation has once hit rock bottom.

On Dec. 17, 2020, Ruixing made an announcement that it had reached a settlement with the U.S. Securities and Exchange Commission, agreeing to pay $180 million, or about 1.2 billion yuan, in what was described as the highest fine ever imposed in the United States!

However, in just one and a half years, Ruixing has been "resurrected". Ruixing's latest financial data show that for the whole year of 2021, Ruixing is still losing money, but the loss is narrowing. 2021 net income was 7.965 billion yuan, an increase of 97.5% year-on-year, almost doubled.

What's more, by the end of 2021, Ruixing Coffee had a combined total of 6,024 stores, which has surpassed Starbucks' 5,557 stores in China. Meanwhile, Starbucks' store sales in China fell 14 percent year-over-year, and customer unit prices slipped 9 percent, ultimately leading to a 6-point decline in transactions.

So how did Rexall come back from the dead? Let's go back to the classic 4P marketing theory and see what changes Ruixing has made.

1, product: return to the product as the core, with the explosive products to support the word of mouth

We often say: the product is 1, marketing is 0, only to make quality products, marketing can be unlimited amplification. The product is the foundation of an enterprise, but also the pillar, the bridge linking the enterprise and the user is also the product. In the past three years, Ruixing Coffee has returned to the product as the core, with explosive products to support the reputation.

a, to create "no cognitive threshold" of the coffee

Compared to milk tea, coffee has a bitter, acidic taste, in addition to the first line of consumers who have been fully educated, the general acceptance of most of the Chinese consumers on the coffee is not high, how to mobilize the subconscious of consumers, remove the consumer's general acceptance of coffee. How to mobilize the subconscious mind of consumers to remove the impression of bitter coffee in the consumer's impression, so that young people are more willing to try.

Ruixing uses flavors that are familiar to consumers to "guide" the coffee, tapping into the local food culture to find flavors that are popular with the general public and lowering the threshold for trying coffee. For example, the choice of "thick milk", "raw coconut", "red velvet", which itself has been popular among the mass consumers, there is a certain basis for the product. Doing catering is a kind of adventure, did not drink something we do not know whether it is good, but there is a certain basis for the product is more likely to win the favor, but also improves the acceptance of the public, increasing the probability of hot product sales.

b, the formation of explosive matrix

The single explosive product to expand into the explosive series, the Ruixing explosive series to do a list, you will find that this is simply a "product multiplication table"

Raw coconut × latte series, resulting in raw coconut latte.

Raw Coconut x SOE series, resulting in Yunnan - Raw Coconut Latte, Yega - Raw Coconut Latte.

Raw Coconut x Rena Ice series, yielding Coconut OK Rena Ice.

Raw Coconut x Meteorite, yielding Meteorite Raw Coconut Latte.

Thick Milk x Meteorite yields Meteorite Thick Milk Latte.

Meteorite x Rena Ice yields Meteorite Latte Rena Ice.

This is a highly effective product strategy: find new ingredients, find the classic product line, keep cross-combining, and come up with different pop-ups, keep deepening the recognition, and form your own pop-up matrix.

c, high-frequency push new: high iteration, systematic new product research and development mechanism

Through rapid iterative push new, use big data to find stable explosive products. 2021 Ruixing frantic new, 113 new products were launched in a year, through new product testing, obtaining consumer word-of-mouth feedback data, digitize raw materials and flavors, and then track popular trends. Then tracking the popular trend, and constantly iterating out new explosive products.

Meanwhile, Ruixing's products are no longer limited to coffee, but also milk tea and light food, which are also tested and iterated through rapid new product launches.

2, price: improve pricing, protect margins

With the guarantee of product reputation, in terms of pricing, Ruixing is also constantly improving product pricing, shopping mall store unit price increased by 2-4 yuan, the ordinary store increased by 1 yuan. At the same time as the price was raised, the previous practice of wildly spreading coupons was also canceled. Overall, the actual selling price of Ruixing has increased a lot more than before, which also protects the brand's profit margin.

3, channel: cost, efficiency first

Ruixing's business model has been criticized, and in 2018 there were questions about Ruixing Coffee's model, in order to catch up with Starbucks, to take a large number of stores in the vicinity of Starbucks at a high price to expand, resulting in very high costs for itself. No matter how well the story of coffee is told, in the end, brick-and-mortar stores have to return to the essence, which is cost and efficiency.

a, streamlining stores

Currently Ruixing in the operation of the store, compared with the previous has been a big improvement, now Ruixing's store cycle is extremely short, simple decoration, equipment can be dismantled, basically one or two weeks to open out, if the operation is not ideal, you can quickly "take the bag and go! If the operation is unsatisfactory, you can quickly "take the bag and leave". At the same time, the store area is reduced, reducing the expenditure on rent, the staff is also being optimized, resulting in the entire single-store model is constantly optimized.

Simplified stores are also in line with modern consumer trends, coffee consumption habits gradually cultivated, more focused on focusing on the essence of coffee drinks and the need for convenience, "fast coffee" consumption scene continues to improve, and simplified Ruixing in the self-service mode of the advantages will be more and more prominent.

In 2021, self-managed stores realized their first profit, reaching 1.2528 billion yuan. Meanwhile, Ruixing is the head brand of affordable coffee in the self-pickup model, and its brand influence continues to increase. The brand preference index reached 5.91% in 2021 in the 13-year "Golden Token" company brand preference survey conducted by CBN magazine, surpassing Manner (5.16%), Starbucks (2.88%) and other boutique coffee brands, and gaining the No. 1 ranking in the coffee chain category.

b, start franchising

2021 early Ruixing started the franchise business, as of the end of the first quarter of this year, Ruixing **** 6,580 stores, of which about 30% are franchised stores. Franchise revenue rose 239.3 percent year-on-year to $549 million, of which $366 million came from sales of raw materials to franchisees and $66 million from profit sharing, according to the first-quarter earnings report.

Richmond has utilized its franchise stores to quickly complete its market dominance while expanding its sinking markets.

4, dissemination/promotion: refined private domain operation, trying every means to acquire customers

Rui Luck's private domain users number nearly 20 million, private domain users in explosive growth, and after the user transformed into a private domain user, Rui Luck's monthly consumption frequency increased by 30%, the number of weekly repurchase increased by 28%.

And the core of all this lies in not wasting any customer acquisition opportunity at every touch point of the consumer, trying every means to acquire customers and realize the conversion of traffic.

Online, the video number live release coupons, the circle of friends released ads, will be attracted to the public domain users, into the private domain users, and then use the WeChat small program single full reduction, so that the old users to drive the new users, both the formation of fission to pull the new, but also prompted the transaction.

Online, QR codes can be found everywhere in the store, including easy to pull up, small cards, etc., no matter whether it is to pay attention to the public number or to join the community, the ultimate goal is to attract flow for the private domain.

Ruixing's turnaround against the wind is not an accidental explosion of popularity fermented on social media, but a return to the core of the product, through the adjustment of products, channels, prices and promotion, with the cost, benefits and word of mouth, and continue to form the core purchasing power, to build the brand's kernel - so that consumers can easily enjoy the "Everyday coffee".