The “goose factory” may not have geese, but the “pig farm” does have pigs.
Tencent is called “Goose Factory” because Tencent first used Tencent QQ with the red collar penguin as its logo to penetrate people’s lives, so everyone used “Goose Factory” to refer to Tencent. And Netease different, called “farm” because it really pig.
This comes from a “wonderful idea” by NetEase founder Ding Lei in 2009, and with his extremely high right to speak within the company, he formally established the NetEase Weiyang project. According to a 2012 report in Southern Metropolis Weekly, NetEase’s agricultural division responsible for pig raising had only a dozen individuals, but its status was equal to that of the other three core businesses—mailbox, portal, and game division. The determination of the pig.
So now that 12 years have passed, what is the progress of NetEase’s “big pig raising plan” now? What are the differences between NetEase Weiyang and the current pork listed companies? Central pork flavor future will enter into one thousand million in the basket?
“The Internet and pig raising have something in common”, Ding Lei made a decision to raise pigs
Why does NetEase raise pigs? This topic is really difficult to get around Ding Lei, the founder of the company.
In the eyes of the outside world, Ding Lei is somewhat unique, and his business behaviors are imaginative, but in the end many projects have achieved low investment and high returns, such as the NetEase mailbox, NetEase Cloud Music, NetEase Yanxuan, etc., which he strongly promotes. The birth of Netease Weiyang Pig is also closely related to Ding Lei.
In 2008, Ding Lei and his friends ate hot pot together . When the waiter poured a dish of suspiciously colored pig blood into the pot, Ding Lei insisted on replacing the entire bottom of the pot, and from this he developed his own thoughts on raising pigs.
This absurd story was confirmed by Zhou Jiong, who would later become one of the “Netease Pig Raising Trio”, but he also stated that Ding Lei had the idea of getting involved in agricultural products before that, just wandering between planting and breeding. .
But raising pigs is a worthwhile business. my country is the world’s largest producer and consumer of pork. There are 10 A-share listed companies born from this, among which Muyuan shares, with the highest market value, exceeded 300 billion yuan at one time.
Although it is a bit strange for Internet companies like NetEase to raise pigs across borders, in fact, the breeding industry has long needed Internet technology to explore new models of agricultural production.
At the end of 2012, Netease Weiyang’s first pig farm was completed and put into production in Anji. Its green and efficient breeding methods provided a replicable solution for the new agricultural model at the time. Pork production can also be industrialized, informatized, and controllable. Therefore, Ding Lei believes that “the Internet and pig raising have something in common.”
Take the pig farm in Anji as an example. With the assistance of intelligent feeding systems and various automated equipment, in theory, 6 people can complete the feeding, immunization, production management, environmental protection, and breeding of 200,000 pigs. Moreover, each pig will have its own serial number, and the pork products can be traced to the source.
However, it was not until the end of 2016 that Netease Weiyang Pork was publicly sold. In previous Internet conferences, Ding Lei invited a group of Internet tycoons to recommend their own pork meat, which drew everyone’s appetite. When Weiyang Pork was first released, a 42kg Weiyang black pig was sold at a sky-high price of 277,000.
In fact, this is just adding to the flames of the Weiyang brand. After the successful debut of Weiyang Pork, it has been launched on Tmall, Yanxuan , Koala, JD.com and other platforms for sales. In addition, since 2017, Weiyang and Century Lianhua have entered 16 supermarket counters and gradually tested offline channels. .
However, no matter which channel, we can find that the unit price of Netease Weiyang’s pork is much higher than the market price. According to statistics from the Ministry of Agriculture and Rural Affairs, in the fourth week of June, the national average price of pork was 24.6 yuan/kg. According to Netease Weiyang’s official website price calculation, the price of pork belly is 84 yuan per kilogram, which is far higher than the industry average. Why?
The same is to raise pigs, why does Netease Weiyang sell so expensively?
As one of the important meat foods on the table, pork is inseparable from our lives. In a populous country like China, the price of pork has, to a certain extent, assumed an important indicator of the happiness level of residents. Therefore, the domestic pork market has always been regulated by an “invisible hand”.
Even so, why is NetEase Weiyang able to sell pork that far exceeds the industry average? Combined with its breeding, production and sales, we may be able to glimpse one or two:
1. Different breeding species and high cost of breeding
Pig farms with a certain degree of automated breeding are generally released for slaughter within 5-8 months, while Netease Weiyang uses Taihu black pigs and adopts a slow breeding method of 300 days. The reason for choosing Taihu black pig breeds and the slow breeding method, Ding Lei said in the previous interview, he hopes to “improve the problem of pork quality and poor safety on the basis”.
In addition, Weiyang’s pig farm has very little peculiar smell, which has changed the past “dirty and smelly” breeding environment. This change is mainly based on the “pig toilet” developed by Weiyang, and the staff has tirelessly taught black pigs to excrete at a fixed point. Together with the environmental protection treatment system, it can efficiently recover manure and conduct centralized treatment.
Moreover, Weiyang is full of “pig care” for piglets, living in “apartment”, listening to music, playing “toys”, eating “snacks”… Netease Weiyang has also become a “alien” in the pig farm, and the cost of breeding is high. If not lower, the selling price is therefore difficult to reduce.
2. Netease brand blessing
Looking at all the agricultural products on the market in my country, there are very few brands that have both topicality and popularity. After Chu Cheng, it is NetEase Weiyang. Relying on NetEase’s brand influence and celebrity endorsements, once Weiyang Pork was launched, Ali, JD.com, NetEase’s Yanxuan, Koala and other platforms immediately supported it.
In addition, NetEase also uses its own multiple channels to promote the Weiyang brand. For example, during the Dragon Boat Festival this year, Netease Weiyang collaborated with the well-known RPG game “World of Warcraft” to launch the “Black Pig Fragrant Rice Dumpling Dragon Boat Festival Gift Box.”
Therefore, under NetEase, especially the founder Ding Lei’s Amway , the Weiyang brand quickly opened up its popularity in the early stage of its sale.
3. Excellent marketing methods
Most agricultural product brands have very little interaction with users, but NetEase Pig has its own topic, and it is very good at “nothing to do” to attract users’ attention, and mobilize resources to close the relationship between consumers and their products.
Ding has been launched such as live pig farm, all-round display farm environment, even he tasted pig feed, drinking water after waste treatment, so that high-tech safety and taste properties of the central core product brand concept deeply rooted .
In addition, NetEase Weiyang also took advantage of the opportunity to launch a series of plans such as emoji packs, NetEase Cloud Music Weiyang Black Pig and the same playlist, to store water for the brand’s attention from different channels, and the Weiyang brand has successfully detonated the Internet circle many times .
4. Weiyang’s output is insufficient and escapes into the high-end market
Even in the above-mentioned aspects, Netease Weiyang may be ahead, but after all, pig raising does not only look at the brand and marketing, but more importantly, it depends on its slaughter volume. Taking the listed company Wen’s shares as an example, its vice president and secretary of the board of directors Mei Jinfang stated on July 14 that the number of Wen’s pigs for slaughter this year is about 12 million.
Although Netease Weiyang’s “Internet + agriculture” model has been recognized by the industry and local governments, its output is far less than that of leading enterprises like Wen’s. According to related reports, Netease Weiyang’s third breeding base is currently under construction in Shengzhou, Shaoxing. It is expected to be completed in 2024. Netease Weiyang’s black pig production is expected to reach 670,000 heads after it is put into production.
These 670,000 Weiyang black pigs, under the impact of many listed companies, may not even make splashes if they are sold at a fair price. Therefore, the Weiyang brand can only enter the high-end market and work hard on health and taste. Attract users.
Where does Netease Weiyang evolve as the wave of cross-border pig raising is re-emerged?
It is worth noting that the price of live pigs rose fiercely in 2019. At that time, many players were also eyeing this track, such as Tianyu Ecology, Zhenjing, Wuhan Iron and Steel, Shanghai Fosun , Zhongshi Real Estate, Demei Chemical, and even Internet companies such as JD.com, Alibaba, and Huawei have also entered across the border. Although NetEase Weiyang has a certain first-mover advantage, it should not be taken lightly and needs to consolidate its position.
First of all, Netease Weiyang will increase investment and increase production. Pig raising is a long-term investment, and it takes at least 3-5 years to produce stable finished pigs for slaughter. Although in 2019, after NetEase sold koalas for US$2 billion, it greatly expanded the scale of pig farming. However, this scale is still far from insufficient compared to listed pork companies. Therefore, Netease Weiyang still needs to continue to increase investment, and the “weiyang model” is promoted and replicated across the country.
In addition, getting help through external financing is also a way NetEase Weiyang can consider. According to public information, in April 2017 completed 160 million yuan Netease taste of central A round of financing, investors, including US group reviews , Jingdong and so on. For NetEase, which is not bad for money, it pays more attention to the rich resources brought by investors. Nowadays, under the pig raising boom, Netease Weiyang may be able to explore the “big pig raising plan” with more partners through financing.
Secondly, the pork market has not yet formed a brand effect, and Netease Weiyang can further expand its brand influence. Compared with the United States, my country’s pork market is relatively fragmented, and the industry concentration is low. In 2020, my country’s pig breeding companies have a CR10 of only 12%, of which Muyuan, which has the highest market share, is only 3%.
The concentration of the US industry has reached about 30%. The concentration of the industry has allowed the pig industry to get rid of the “pig cycle” caused by retail investors chasing the rise and the fall, and ushering in the era of stable pork prices. This development is also in line with Regulation of my country’s national conditions.
At present, my country’s pork market is far from mature. Since Netease Weiyang is out of the circle with its topic, it is very likely to break out in this melee. Therefore, Netease Weiyang needs to firmly grasp its loyal users. Form repurchase behavior.
Finally, Netease Weiyang still needs to continue to explore in the consumption scene to accelerate the penetration of consumers. Prior to NetEase online at consumer taste has been the central scene to do a lot of attempts, such as joint grandmother opened to black pork-based play creative Hangbangcai restaurant “Zhuba”, and public review launch of the Black Pearl restaurant guides and so on. “
These measures have enabled Netease Weiyang to build a complete industrial chain around pork in the breeding end, e-commerce channels and offline catering . However, under the needs of consumers for a healthy life and quality life, Netease Weiyang’s penetration is still insufficient, and it is still necessary to further explore more consumption scenarios.
In addition, Netease Weiyang will also ensure cold chain transportation on the online platform. Due to its limited output, the Weiyang brand currently only launches the delivery mode of “slaughtered on the same day, and fresh meat delivered on the same day” in Hangzhou . Other areas can only be delivered by express delivery. In order to ensure the quality of products, Weiyang must do a good job in cold chain transportation, not because of small problems affecting its own “signature”.
I still remember the uproar caused by the cross-border pig raising of Internet giants at that time. Netease Weiyang, a project that started from Ding Lei’s “doing nothing in business”, has now passed 12 years safely and has become a sample of Internet companies entering the field of agriculture, rural areas and farmers. It has general reference significance in the domestic rural revitalization strategy. However, Netease Weiyang can’t be satisfied with this, and then how to promote the “weiyang model” to the whole country is its key consideration.
In addition, pork is oriented to the broad consumer market. Netease Weiyang still needs to lay out more sales channels, at least it needs to increase its supply, so that many long-awaited consumers will enjoy themselves.
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