Who Are We
We are a marketing service provider in China, focusing on outdoor marketing for fast-moving consumer goods (“FMCG”). In doing so, we utilize our broad network of vending machines with interactive marketing functions across China, which, by combing with our technology-backed online platform, allow us to provide target consumers with convenient and interesting experience in testing and accessing FMCG that we served, while successfully soliciting and completing necessary interaction and feedback. In particular, we have developed, and equipped our vending machines with various modules to facilitate technology-driven interactive functions that are crucial for successful marketing events, including scent emitting, movement recognition and voice interaction, making interactive machine-based marketing services possible. According to CIC, FMCG outdoor marketing market accounts for 6.4% market share of the FMCG marketing market in 2023. The FMCG outdoor marketing market is highly fragmented with numerous industry players, resulting in fierce competition within this industry. We are the fourth largest FMCG outdoor marketing service provider in China in terms of revenue in 2023, with a market share of approximately 1.2%, while the largest market player had a market share of 14.3%.
Capitalizing on our technology capacity to deliver marketing services and our ability in responding to dynamic market demands for various marketing resources, such as third-party media resources, we have achieved business growth during the Track Record Period. In particular, we enhanced capability of utilizing social media platforms for our marketing services and began offering short video platform traffic acquisition service to our brand customers in 2023. In addition, since late 2022, the lifting of COVID-19-related restrictions has led to the revival of outdoor FMCG marketing market, contributing to our growth. Our revenue generated from marketing service increased from RMB376.7 million in 2021 by 7.5% to RMB404.8 million in 2022 and further increased by 99.6% to RMB808.0 million in 2023.
We merge offline and online channels with a complete and integrated system in the way to offer consumers an interesting experience on FMCGs, and to provide brands with multi-channel marketing services, all of which are driven by our technology capability to achieve efficiency and accuracy. Placed at strategically chosen locations, the network of our vending machine with interactive marketing functions serve as the offline touchpoints for consumers to get aware of, encounter, and/or pick up FMCG goods that we served, as well as the terminals to complete certain game-based tasks in order to obtain related FMCG goods. In the meantime, our online platform, which comprises a mobile app named “Quna (趣拿)” and WeChat mini programs, allows us to attract and retain target consumers, where they can conveniently receive information on our most recent FMCG marketing events, complete designed online tasks, place order or pay a try-me discounted prices, prior to picking up relevant goods.
We believe that our marketing services offered an effective solution for FMCG brands to reach target consumer groups, especially the tech-savvy young consumers, represented by “Gen-Y/Z”, who generally prefer FMCGs that bring continuous fresh experience and represent their personalized life style, and are well adapted to machine-based consumption and interaction experience that does not involve much human interference. As a result, on one hand, by continuously launching and introducing new FMCG products through our marketing services that involve on-line program and offline machine-based tasks, we are able to attract and retain more and more active consumers, while offering brand customers quality feedback and analysis they need. On the other hand, brand customers are willing to cooperate with us taking into account our growing consumer basis, technology capability and efficient performance, in particular, our ability to launch large scale marketing event, as well as continuously showcase and promote public awareness of served FMCG products through wide spread vending machines at well-selected locations.
As of December 31, 2023, we operated 7,543 vending machines in 22 cities in China including all the tier one cities, namely Beijing, Shanghai, Guangzhou and Shenzhen, many new tier one cities including Hangzhou, Chengdu, Chongqing, Tianjin, Xi’an, Wuhan, Zhengzhou, Nanjing, Suzhou, Wuxi, Ningbo, Xiamen, Dongguan, Foshan, Hefei, Jinan and Qingdao, as well as Yantai. Substantially all of our vending machines are located in commercial properties with an aim to cover the major consumer groups of FMCGs.
Our Service
During the Track Record Period, we derived revenue primarily from offering brand customers with marketing services that feature machine-based distribution through immersive and interesting game-themed interactions. By effectively combing our offline network of vending machine with interactive marketing functions and online platform, we are able to offer brands with multi-channel marketing services, all of which are driven by our technology capability to achieve efficiency and accuracy. In addition, during the Track Record Period, we also derived revenue from merchandise sales, mainly include good of high consumption nature, such as beverages, snacks and instant food. We consider that merchandise sales effectively supplement our marketing service business segment, as it not only enhances the attraction of pedestrian flow to our vending machines with interactive marketing functions, which lays a foundation for our continuous expansion and market penetration, but also enables us to accumulate valuable comparable sales data of relevant FMCG goods that are useful for our marketing services.
In managing our marketing service business segment, we mainly offer the following two categories of service:
‧ Standard Marketing Service. Our standard marketing service consists of marketing campaign service, multi-channel media promotion and FMCG product promotion, which further comprises FMCG product distribution and FMCG product shelving. Multi-channel media promotion service further includes various service modules, such as LCD display, online platform display, vending machine shell display, consumer traffic direction, social media platform posts and third-party media resources procurement. We charge clients for standard marketing service that mainly comprise designing and launching tailor-made marketing campaign for FMCG brand customers, where image and value of served FMCG products get published at different types of media. In doing so, we place our own offline vending machine network and online platform at the core value position for overall services provided, where we may effectively serve the key requests of FMCG brand customers by effectively attracting and encouraging target consumers to pick-up served products and leave meaningful feedback and behavior information.
‧ Value-Added Marketing Service. Besides standard marketing services, FMCG brand customers may choose our value-added marketing services, where we design and launch interactive and immersive game-themed events that can serve the marketing purpose to promote and/or enhance sensation of consumers towards relevant FMCG products, while carrying technology-backed interactive and immersive features. In addition, we also charge brand customers for data strategy services, where we provide FMCG product review and analysis based on our evaluation of various perspectives of served FMCG products, including design, packaging, formula, flavor, scent, pricing and consumption scenario, based on which, relevant brand customers may improve their future strategy on market positioning, promotional content design and activity planning, and other marketing- related decisions.
We successfully distinguished us from industry peers by realizing convenient delivery of physical FMCG goods to target consumers, which plays a significant value to brand customers, as the access to and experience of physical products is an important step to build consumer awareness, which can hardly be replaced by online marketing approaches. For details, please also see “Business – Our Business – Marketing Service” in this document.
As exhibited by our proven track record, we are well positioned to utilize our technology capabilities and industry experience to capture growth opportunities. Backed by our technology capability, we could group vending machines placed in a large geographic region to quickly launch or upgrade city-wide FMCG marketing campaigns that may effectively draw vast public attention in a short period of time, which can hardly be achieved by purely offline marketing methods in terms of speed, scale and cost-efficiency. As a result, our technology-driven marketing campaigns, combined with the trend of consumers’ preference in acquiring and sharing consumption experience through digital forms, allow us to enjoy a recognized market position as a marketing service provider for FMCG brands. Furthermore, capitalizing on our strategic network of vending machines that are equipped with technology features, including IoT and automated interactive components, we are able to facilitate cost-efficient FMCG product promotion and multi-dimensional product experience.
Source: Qunabox Group (00917) Prospectus (IPO Date : 2024/05/17) |