Came across another article, it’s in Chinese, there’s nothing...

Came across another article, it’s in Chinese, there’s nothing new really, mainly same complaining about management, etc, but from information provided one can see how much potential a2 have and how much it can grow if things are done the right way. I think there’s huge potential in offline in smaller cities for a2. I would like to see them launching some new line of products in to those areas. So, would be interesting to hear what they have to say in their strategic review in coming months.

“According to data previously released by the National Bureau of Statistics, comparing the population of the first-tier and second-tier cities , which accounted for 18.1%, the population of third-, fourth-tier and lower cities and rural areas accounted for more than 80%. This also means that the third-tier and lower-tier cities and rural towns The number of residents in the region exceeds 1 billion . At the same time, it is learned from the analysis report of iResearch that the average annual growth rate of per capita consumption expenditure of rural households is 7.5 percentage points faster than that of cities; the growth rate of per capita disposable income is not less than 8 percentage points.

Based on this, Nestlé, Danone, Mead Johnson and other foreign dairy companies have launched related products in an attempt to seize market shares. A2 is also aware of this. Its Greater China CEO Li Xiao once said: "The growth point of a2 lies in doing a good job. Core products, seize opportunities in offline channels."

However, the dream is full, but the reality is very skinny. When the offline market of imported milk powder is sinking, it is generally unacceptable. a2 publicly stated that by the end of March this year, the number of maternity and baby stores the company entered has increased to 22,600. However, according to a2 Milk’s official presentation data, the brand’s distribution channels are still mainly concentrated online and in first- and second-tier cities. Including domestic e-commerce companies such as JD.com and Baby Tree, cross-border e-commerce companies such as Koala, social e-commerce companies such as Xiaohongshu, and purchasing agents active on platforms such as WeChat, but offline only baby-friendly rooms, Kidswant and other maternal and child store chains, and RT-Mart and other supermarket channels.”

”a2 milk, which has a 12-month rolling market value share of only 2.4% in material and child stores”

https://zhuanlan.zhihu.com/p/384986872