How many 'Northeast Farmers' Wife' are there behind the Oriental Selection?

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Text | Chopped Pepper TMT, Author | Father of the Windowsill

The vigorous "corn" incident between Dongfang Selection and Simba also involved Dongfang Selection's corn supplier "Northeast Farmer's Wife"-because the live broadcast was launched on the cusp of the storm, and the price of corn sold was only 3.6 yuan/root ( Equivalent to 60% of the selection price of the East), the Northeast Nongsao was considered by netizens to violate business ethics and "backstab" partners.

Some netizens even started "map cannons" and criticized Northeasterners for not doing business with integrity.

But the other side of things quickly emerged.

Careful netizens found that Northeast Nongsao is not only a supplier selected by Dongfang, but also a supplier of retail brands such as Dole and Rosen. Northeast Nongsao has always had direct-to-consumer self-operated channels.

Xiaohongshu user "Li Dahua who just wants to play" posted that she started buying corn from the Northeast Nongsao as early as 2019, because she found that the "Dule" brand corn kernels she often eats were made by the Northeast Nongsao on an OEM basis. , while Dole sells for 5 yuan a bag, and a bag of corn kernels is only 1 yuan when the Northeast Nongsao is the cheapest. At present, the average price of a 60g bag of corn kernels from the Northeast Nongsao on the Jingdong platform is 2.99 yuan, and the Doletong specification is 5.49 yuan.

The Northeast Nongsao Jingdong flagship store opened in August 2015, and the products with the highest comprehensive rankings are rated at 50W+; the Tmall flagship store is an 8-year-old store, and the No. 1 corn monthly sales volume is 4W+; the Pinduoduo store has been open for 3 years , the highest-selling corn has sold 10W+ pieces. And Oriental Selection was established less than a year ago.

In such an era when factories are keen to go to 1688, Pinduoduo to do direct sales, and consumers are keen to dig deep into the supply chain to find a "factory replacement", how many "Northeast Farmers' Wife" are there behind Dongfang Selection? Will similar "Corn Incidents" happen in the future?

How many "Northeast Farmers' Wife" are there behind the Oriental Selection?

After the corn price controversy broke out, the corn selected by Dongfang showed the status of "off the shelf". Searching for "corn" in Dongfang Zhenxuan's Douyin store, you could only find corn juice. In response to this, Dongfang Selection said that the delisting is due to the supplier's capacity problem, and some products will be put on the shelves again.

In fact, Dongfang Selection did not take off the shelves because of the betrayal of the Northeast Nongsao, but stopped selling corn in the live broadcast room as early as late August.

In the live broadcast of the Northeast Nongsao, the anchor also worked hard to clarify that the live broadcast was not launched because of the selection of the East, and there was no "backstab" partner, and the brand has been doing self-broadcasting.

So, will there be other "Northeast Farmers' Wife" in the supply chain behind Dongfang Selection?

According to the observation of Choojiao TMT, most of the products selected by Dongfang are supplied by factories and sold after OEM, and most of the factories also have their own online stores.

We found that there are roughly three situations between Oriental selection and suppliers' self-operated products:

1. For individual products, the selection price of Dongfang is higher than that of the supplier.

Among the self-operated products selected by Dongfang, the top-selling sausage "Zhenxiang Sausage" and Fengweipai's "Black Pepper Flavored Pork Sausage Sausage" come from the same supplier - Jiaozuo Chenghui Food Co., Ltd. In the 1688 store of Chenghui Foods, the wholesale price of a 700g black pepper-flavored sausage is only 21.88 yuan, while in Oriental Selection, 800g costs 78 yuan.

It should be noted that Chenghui Foods has no stores on mainstream e-commerce platforms such as Taobao and Douyin. If consumers want to buy, they can only go to 1688.

Another case is the black sesame, walnut and black bean powder, an independent product of Oriental Selection. This product is produced by Anhui Yanzhifang Food Co., Ltd., and the Yanzhifang Tmall flagship store has 614,000 fans, and the monthly sales of "black sesame, walnut and black bean powder" are 4,000+ pieces.

Oriental selection black sesame walnut black bean powder is priced at 79.9 yuan per 500g, and it is sugar-free. And Yanzhifang's self-operated products are priced at 49.9 yuan to 69.9 yuan per 500g according to different ingredients. The two products are different, and the price is slightly different, which is understandable.

2. For individual products, the selection price of Dongfang is lower than that of the supplier.

Dongfang Selection "Organic Wild Blueberry Puree", the brand is Dongfang Preferred (Beijing) Technology Co., Ltd., and the manufacturer is Daxinganling Chaoyue Wild Berry Development Co., Ltd. Factory Enterprise Store” stores a variety of berry products including blueberry puree, cranberry puree, and blueberry anthocyanin complex concentrate.

However, the blueberry puree of the same specification and the same model sells for 198 yuan, which is twice as expensive as the 99 yuan selected by Dongfang.

At present, the blueberry puree sold by Dongfang Selection has sold 365,000 copies. For Chaoyue, this is an impossible achievement for its own store.

Similarly, the supplier of Dongfang’s self-selected Durian Melaleuca cake is “Dumang Moment”, which is also in the consumer goods market. The same durian Melaleuca sells 2,000+ copies per month in the flagship store of Durian Moment.

The Dongfang Zhenxuan products are priced at 8.8 yuan per 100g (but the product is currently off the shelf), while the dumang moment products are priced at 17.98 yuan per 100g, which is twice as expensive as Dongfang Zhenxuan.

3. For the vast majority of products, the selection price of Dongfang is not much different from that of suppliers.

Dongfang selected the self-operated product "Wuchang Rice Fragrant Rice", and the supplier was COFCO Rice (Wuchang) Co., Ltd. COFCO's brand Fulinmen's "Wuchang Rice" also comes from COFCO Rice (Wuchang) Co., Ltd. Fulinmen Wuchang rice has also been on sale for a long time in e-commerce channels such as COFCO flagship stores. There is almost no difference in price between the two models.

Similar to blueberry puree, there is also sea buckthorn juice. The "NFC sea buckthorn juice drink" selected by Dongfang is from Xishengyuan, Shanxi. A 246ML can of sea buckthorn juice is priced at 59.9 yuan/10 cans, while the same quantity selected in Dongfang is 236ML/10 cans. The price is 58 yuan.

In general, Dongfang Selection has chosen to keep the price of its own products in line with the supplier, or to significantly reduce the price of the products. In most cases, consumers do not need to go to the supplier's store to buy products in order to save money.

This makes the corn incident all the more bizarre.

Since Dongfang Selection did not choose to significantly increase the price in most cases, why did corn alone adopt a different strategy?

According to the consumption records posted by some netizens, as early as March 2022, the price of corn from the Northeast Nongsao was still 5.3 yuan, but in the recent Douyin live broadcast room of the Northeast Nongsao, the price has dropped to 3.6 yuan. I don't know if it's a sudden price cut for the sake of popularity, or there are other reasons.

But in the end, the sudden low-price sales of the Northeast Nongsao directly led to the criticism of public opinion.

"Factory direct sales" is business, "deeply digging supply chain" is fun

Not only Dongfang Selection, but also many brands including Three Squirrels, BESTORE, and Li Ziqi have adopted the OEM and OEM model.

Searching for the word "OEM" on Xiaohongshu, you can see that almost all the big names in consumer categories, including clothing, shoes, food, home furnishing and even toilets, have been "picked" out of the foundry.

It is a well-known "secret" that KFC's fried chicken comes from Sunnong Foods. In the past few years, when live broadcasts have risen, consumption has been downgraded, and goods have been stockpiled during the epidemic, Sunnon has completed the transformation from supplier to brand. Its Tmall flagship store, Dudu Wings, Crispy Fried Wings, and Crispy Fried Chicken, all have monthly sales exceeding 1W—these are also KFC’s ace products.

Fast food products are also the main field of OEM, especially the sub-categories such as fast food snail noodles and hot and sour noodles that lack well-known brands with dominant positions.

The well-known Liziqi Hot and Sour Noodles and Xiaolongkan Hot and Sour Noodles are all manufactured by Akuan Foods. Akuan Foods also succeeded in branding by going beyond the brand and factory direct sales, and its net profit increased by 1,200% in three years. In addition to OEM for Internet celebrity brands, Akuan's own red oil noodles have also sold very well.

The three squirrels are from Chen Jiwangfu twist, the MUJI plum cake is from Fuyi Food Co., Ltd., and the BESTORE snacks are from Junzai Foods, etc. These manufacturers supplying well-known brands are among the best in sales on e-commerce platforms.

Factory direct sales can still be listed, which makes many small factories envious. It seems that there is a better way to abandon OEM direct sales. In fact, it is not. It is understood that Akuan Food is already a good supplier. Among the nearly 200 million revenue, there are more than 96 million yuan in promotion and marketing expenses. Such a high promotion fee has made some factories that are not as large as Akuan Foods discouraged from direct sales.

But the development of the Internet has made it easier and easier for factory direct sales.

Only in Xiaohongshu, there is a marketing model of "experts on behalf of people", that is, advertisers find agencies and provide a large number of amateur accounts to publish massive notes, creating the effect of "dominating the screen".

(Source: First Finance and Economics)

Through the mouths of Internet celebrities, many foundries quickly completed the transformation from suppliers to direct sales. Due to problems such as cooperation, these small actions can only be carried out quietly, thus forming a "gray area" in the industry.

The larger-scale factory direct sales platform is 1688 under Ali.

After discovering that foundry and factory direct sales are new e-commerce opportunities, Ali quickly made deployments and pushed 1688 factories. Ali provides training, traffic support, and more for the factories on the list. At the same time, Ali also adjusted 1688's strategy from serving sellers from factories to serving buyers from factories, forming an M2C model, that is, "no middlemen to earn the price difference", and factories directly connect with ordinary consumers.

On the consumer side, it is not only the "foundry" that has 180W+ notes in Xiaohongshu, but also a group of consumer groups calling themselves "1688 girls" have appeared on the Internet - this gives Ali a strong confidence to expand factory direct sales the way.

Today, not only 1688, but also Taobao and other platforms have formed the trend of "factory direct sales".

In the first quarter of 2022, Alibaba achieved a revenue of 204.05 billion yuan, an increase of 8.9% year-on-year, the lowest growth rate in the past five years, but the operating income of Chinese wholesalers increased by 30% year-on-year, the highest growth rate among all Alibaba businesses. One. By the end of 2021, the average growth rate of GMV of 1688 in the past five years was over 30%.

It can be said that whether it is a dark alley or a bright road, it is commonplace in the e-commerce industry for brands to find factories for OEMs and factories to bypass brands for direct sales.

Why are the Northeast Nongsao and Dongfang Selection both accused?

In the current business environment, the common "factory direct sales", why in the "corn incident" caused both Dongfang Selection and Northeast Nongsao to be criticized by public opinion and fall into a "lose-lose" situation?

Let’s talk about the Northeast Nongsao first, who obviously have customers from 16 countries and have accumulated user reputation over the years, but this time they jumped out at the cusp of the storm to do live broadcasts and bring goods. This can only be said that the brand operation of the Northeast Nongsao is “not smart enough” and lacks "Wisdom" in the face of consumers and negative public opinion.

Regardless of whether it is Shengnong or Akuan, or Beiding and Xiaoxiong in the field of small electrical appliances, before the Northeast Nongsao, no brand has jumped out and said, "I am an OEM for a big brand", and will not take advantage of others' dangers. Instead, it tells consumers a "secret" through the traffic of various platforms and "the mouths of others" - "a certain brand is the OEM of a certain big brand".

(Beiding's self-operated products)

Such an approach not only satisfies consumers' mentality of snooping on "industry secrets" and attracts consumers, but also does not affect cooperation and brand reputation.

In contrast, there may be more issues to think about in the selection of the East.

After the truth that Oriental Selection was also OEM was made public, it caused a lot of influence on the consumer side. Many consumers believe that this is not in line with the "high-end product" attitude of Dongfang Selection. There is only 100g of grilled sausages, and the brand has increased by three times, which makes them rebellious.

"He (Dong Yuhui) went to the rice fields to inspect and drink the mountain water, which made me feel that the blueberry puree they sold was all squeezed by myself. When I knew it was OEM, I didn't want to place an order in the live broadcast room. Even if I know that OEM is a common thing, I still can't accept that they use exquisite displays and words to package a OEM product, it's better to sell the goods honestly." A person who has purchased agricultural products in the Dongfang selection live broadcast room several times The reporter told Chopped Pepper TMT.

Xiaohongshu netizens commented sharply: "I only look at the underlying logic, business is nothing more than buying and selling. You position your products as high-end, as long as someone pays the bill, it doesn't matter. But don't take feelings and helping farmers as a problem. Under the guise, don’t say that you are not profiteering.”

To put it simply, consumers do not have any doubts about the quality of Dongfang Zhenxuan's products, but they have conducted a lot of discussions on how to really benefit farmers in terms of helping farmers and "low-cost grains hurting farmers" that Dongfang Zhenxuan said.

As Dongfang Zhenxuan, whether selling OEM agricultural products can be equated with "helping farmers", this may be the real question behind the public opinion turmoil.

As a strong channel brand, Dongfang Selection can do a lot, such as establishing more standardized industrial standards on the planting, breeding and production ends, providing agricultural training to farmers that meet the requirements of Dongfang Selection, and even building a "fair" Trade" system, which requires suppliers to give high-quality agricultural products a fair purchase price, etc.

Or, referring to the practice of Pinduoduo, directly drive the baler to the field, and truly realize direct supply from the origin and factory, instead of simple OEM sales today.

If it really takes "helping farmers" as the company's original intention, there are still many things that Dongfang Selection needs to do.