Why Has Relx Become So Dominant? Is It Really Because of Superior Products or Powerful Marketing?

Statistics from the domestic vaping market in the second quarter of 2020 show that (with some margin of error) RELX has risen from 63% in the first quarter to 74%. No other vaping brand has exceeded 5%, making it somewhat exaggerated to say: there are only two vaping brands in the domestic market, one is RELX, and the other is "other brands." Why has this situation occurred?

Domestic vaping sales ranking in the second quarter

Many people may be curious as to why this situation has arisen. This can be seen as RELX monopolizing the entire market. Is it really because RELX's products are far superior to other brands? Is there not even one brand that can slightly compete with RELX?

From the product perspective, there is actually no difficult technology involved in vaping; almost all brands have mastered the core technology of vaping, including ceramic atomization core technology, anti-leak design, prevention of burning, appearance patents, and waterproof technology. The flavors of the pods are already quite mature. Any factory producing vaping devices can produce them well. Therefore, while RELX may surpass other brands in product quality, other brands will not be far behind.

So why has RELX become the dominant player in a new industry like vaping in the domestic market?

The blogger believes it should be attributed to the brand's marketing and strong team (it can also be said that RELX has ample funds, which allows it to seize market share), as well as the immature and unstable market environment that has provided RELX with opportunities.

First, I must declare: I am a store owner of RELX and not trying to smear the brand; I just want to express some of my views.

RELX has ample funds. Since its establishment in 2017, RELX has received investments from Sequoia Capital, IDG, Source Code Capital, DST, and other institutions, conservatively estimated to be no less than 2 billion RMB. Having money makes things easier, allowing for increased brand awareness, team expansion, laboratory establishment, and service improvement. When many brands suffered heavy blows after the announcement of the Notice on Further Protecting Minors from the Harm of E-Cigarettes by the State Tobacco Monopoly Administration/National Market Supervision Administration on November 1, 2019, RELX instead invested heavily in the offline market, with sales not decreasing but increasing, indicating that while other brands were suffering, it was also the best time for RELX to seize the market.

RELX CEO Wang Ying

RELX has over a thousand formal employees (not counting factory workers), such a large team is unmatched by any other vaping brand. Many of the top vaping brands have only a few dozen employees, making it impossible for other brands to compete in terms of team size.

In terms of product promotion, when online advertising was not banned, RELX had already started aggressive marketing, similar to "Didi Chuxing," "Pinduoduo," "Used Car Network," etc., burning money to gain market share. This model has been effectively utilized by the elite team represented by Wang Ying, who was born at Huawei.

RELX products

RELX can be said to occupy the "timing," "people," and "geography" of the vaping market, so how could it fail?

At the same time, the immaturity of the market and issues with vaping products have contributed to RELX's current position.

Vaping is considered a consumable product, regarded as a smoking alternative. For the Chinese, this is a health-related issue, and people are more likely to trust the reputation of big brands, believing that well-known brands are safer and healthier. Therefore, well-known brands will become increasingly recognized, and the market will continue to improve. (I personally believe this is also related to the trend-following behavior of the Chinese people).

Vaping is a fast-moving consumer product, and analyzing from the perspective of fast-moving consumer goods, it is rare to see a monopoly situation, such as with bottled water or instant noodles. RELX's dominance is somewhat unique in the market, and whether other brands will emerge to compete with RELX as the market matures remains to be seen. However, I personally believe that other brands will definitely rise, as a monopoly does not conform to the market rules of fast-moving consumer goods. #p#Pagination Title#e#