14 Nov 2014
Digital Duck Dispatch Proves Online Success
Jiaoge Yazi is the first company to sell roast duck online. Launched in March this year, its market valuation reached Rmb50 million in just a few months. Its remarkable success has come from its ability to harness the latest trends in digital marketing.
Jiaoge Yazi (literally - "order a duck") was founded in 2014 by several young entrepreneurs, all born in the late eighties/early nineties. They all had successful careers in the internet/media industry and were passionate about traditional gourmet food.
As its name suggests, the company’s lead product was roast duck, but one specially prepared to a secret recipe. Now, though, the business has branched out, offering a number of other dining options. On 26 October, Jiaoge Yazi’s first shop - where customers can actually collect the product, as opposed to having it delivered - was opened at Jianwai SOHO in Beijing. Plans are now afoot to open four to five such shops within a year, with sites earmarked in Dongcheng, Xicheng and the Asian Olympic Village areas. Each self pick-up shop may also have three to four distribution points.
Jiaoge Yazi was the first company to sell roast duck online. Qu Bo, its principal, was born in Beijing in 1985 and was, formerly, a marketing manager with Baidu, one of China’s leading web services companies. The groundwork for the business was laid in March this year, with the operation going live in May.
Its initial marketing operation was extremely straightforward and utilised many of the founders’ existing media connections. After giving away 100 promotional samples to contacts in the internet and media community, the company then relied solely on word-of-mouth promotion. As it transpired, a number of celebrities posted photos of Jiaoge Yazi on their own social media accounts.
Now valued at Rmb50 million, the business secured Rmb6 million in financing by the end of July. As of 12 August, there were more than 5,000 "user buddies" in Jiaoge Yazi’s WeChat personal account. The company now boasts a repeat order rate of 60% and more than 100 daily orders. At a single-order package price of Rmb145 and a double-order package price of Rmb288, its daily turnover is around Rmb20,000.
According to Qu, the five "angel" investors who contributed a combined Rmb6 million in equity shares on a personal basis were Li Mingyuan (Vice-president of Baidu); Wang Zhonglei (CEO of Huayi); Zhu Yonghua (of Tiantu Capital); He Chang (founder of Huangtaiji); and Zhang Wei (CEO of Van Entmt Works). Qu admits that - except for Wang Zhonglei who approached him - the remaining backers were all old friends.
He says: "My background was in marketing for Baidu but, as a matter of fact, I haven’t done a lot of marketing for Yazi - it has been mostly word-of-mouth promotion. Internally, our focus has been on the flavour of the food. We are now developing a number of new product lines, but if they fall short of our standards, we will not launch them.
"On our first day of business on 16 May, we already had a few orders in place. After the first week, our business volume was 45 ducks a day. During the subsequent World Cup period, business was brisk for take-outs and midnight orders. We had also pushed "share" among our friends. As a result, by the quarter-finals of the World Cup, our daily sales had increased to 100 ducks."
Capitalising on online awareness, Jiaoge Yazi gained instant popularity through the various means it chose to target consumers.
The name Jiaoge Yazi, alone, has proved a good way of attracting attention. According to Qu, the reason why Wang Zhonglei first chose to invest in the company was because it had an intriguing name. Wang reportedly told Qu: "You know what, every day lots of people invite me to invest [in their projects], but after hearing many of them out, I didn’t find them interesting at all. Then, one day, I heard about Jiaoge Yazi and I was laughing hilariously."
According to Jiaoge Yazi, part of its brand culture is to continually joke about ducks. To this end, it ultilises the Chinese character for "duck" (Ya) in every conceivable way. Its number one delivery guy, for instance, has been dubbed "duck king" and the names of all of its product lines contain the character Ya. The idea is to thus foster strong brand awareness among consumers.
At the beginning, the company chose to take orders through personal WeChat accounts and phone calls, with the public account only being added after the number of friends on its personal account reached the 5,000 limit. Typically, businesses prefer public accounts as they have the facility for group messages. Personal accounts, on the other hand, allow interaction with fans among circles of friends on an interpersonal level. Interaction among circles of friends can increase user "stickiness", while "shares" can more easily go viral.
As 90% of its customers are women, August 15 saw Jiaoge Yazi launch a month-long "selfie with product" promotion. Selfies represent the content that circles of friends like to share the most, so the contest allows users a chance to play and share with their friends. In a further move, the company never neglects those who have applied to work for it. No matter whether they are offered a job or not, each applicant is given a cash coupon redeemable against future duck purchases. These applicants tend to be pleasantly surprised and so tell others, creating something of a buzz about the brand.
There is no doubt that, in the high-speed information era, Jiaoge Yazi has succeeded in taking full advantage of consumers’ desire to explore and to share. The company also has plans to establish a community to effectively attract fans. The aim is to bring products and services together to make consumers more receptive to the brand. It is hoped that while Jiaoge Yazi can maintain the excellent taste of its duck, it can also come out with more products that are equally fun and delicious.
Shelly Yang, Beijing Office