Positive Reviews: The Rise of Zhong Xue Gao as an Innovative Model for New Consumption Brands
Although Zhong Xue Gao’s seven – year history ended in difficulties, its early success still provides a highly valuable innovation model for new consumption brands. The market insight, marketing innovation, and brand positioning ability demonstrated during its rise remain typical cases for industry research to this day.
Firstly, Zhong Xue Gao accurately identified a market gap. When it was founded in 2018, the Chinese ice – cream market was “polarized”: traditional brands like Yili and Mengniu dominated the mass market with products priced at 3 – 5 yuan, while foreign brands such as Haagen – Dazs monopolized the high – end market above 30 yuan. The price range of 10 – 30 yuan in the middle was long overlooked. Zhong Xue Gao entered this gap with a positioning of “Chinese ice – cream” as a domestic brand. With its tile – shaped design, unique selling points like “no added water” and “premium fruits”, it successfully created an image of a “high – end domestic brand”. This “dislocation competition” strategy not only avoided direct price wars with traditional giants but also stimulated consumers’ curiosity through the wave of patriotism towards domestic products. The case of its classic product “Ecuadorian Pink Diamond” selling out 20,000 units at a unit price of 66 yuan within 15 hours became a model of “social currency” in the new consumption era – the product was not just food but also a cultural symbol for consumers to share and discuss on social media.
Secondly, Zhong Xue Gao’s marketing combination promoted the brand to quickly break through the circle. Lin Sheng, the founder with an advertising background, understood the communication logic in the era of social media well: he laid out a large number of product – promoting notes on Xiaohongshu, creating a “real – experience” atmosphere through ordinary users’ sharing; set sales records in the live – streaming rooms of top anchors like Li Jiaqi and Luo Yonghao, achieving explosive growth with the help of traffic; and launched a “liquor ice – cream” in collaboration with Luzhou Laojiao, attracting young people to check in through its scarcity and topicality. This “content + traffic + cross – border” marketing model was once regarded as the “standard template” for new consumption brands and was even summarized as the “Zhong Xue Gao – style marketing” in the industry. The capital recognition it received, with four rounds of financing completed from 2018 to 2021 and a valuation approaching 4 billion yuan, was a direct affirmation of its marketing innovation ability by the market.
Finally, Zhong Xue Gao’s exploration of high – end domestic brands has industry – enlightening significance. Before it, domestic ice – creams were long labeled as “low – price” and “low – end”, and consumers’ acceptance of high – priced domestic products was limited. Through product design, raw material promotion, and cultural empowerment (such as the pun on “Chinese ice – cream”), Zhong Xue Gao successfully made some consumers accept the price range of “over 10 yuan” for domestic ice – creams, and even inspired high – end attempts by brands like Zhongjie 1946. This breakthrough in “domestic brand premium” provides a reference path of “cultural confidence + product innovation” for subsequent new consumption brands (such as Cha Yan Yue Se and Yuanqi Forest).
Negative Reviews: Multiple Mistakes Accelerated the Brand’s Collapse, Reflecting the Fragility of the New Consumption Track
Although Zhong Xue Gao was once a benchmark for new consumption, its fall from being a “capital favorite” to facing “bankruptcy review” exposed multiple weaknesses in public – opinion management, strategic decision – making, and trend adaptation, and also reflected the “high – growth, high – risk” fragility of the new consumption track.
Firstly, improper public – opinion management shook the foundation of brand trust. The “non – melting” incident in 2022 was a crucial turning point for Zhong Xue Gao. When consumers questioned the safety of additives in the ice – cream, the brand only issued a simple statement emphasizing “compliance”, without providing scientific explanations for the “non – melting” phenomenon (such as explaining the reasonable use of thickeners) or actively establishing emotional communication with consumers. This “passive defense” response was interpreted by public opinion as “guilt”, directly leading to the collapse of brand trust. Lin Sheng, the founder, later admitted that “failing to fight back effectively” was his biggest regret, and the cost of this mistake was a sharp drop in the annual compound growth rate from over 100% to 50%. In the era of social media, the spread speed and destructive power of negative public opinion far exceed those of traditional media. If a brand lacks a public – opinion strategy of “quick response + emotional resonance”, it is likely to fall into a vicious cycle of “the more you explain, the more negative it gets”.
Secondly, the high – price strategy and channel conflicts led to the label of “ice – cream assassin”, over – exhausting the brand’s reputation. There was nothing wrong with Zhong Xue Gao’s high – price positioning in itself, but there were serious loopholes in its offline channel management – its products were mixed with ordinary ice – creams in convenience – store freezers without clear price labels, resulting in consumers being “stung by the high price” when checking out after casually picking one. This “information asymmetry” in the consumption experience solidified the label of “ice – cream assassin”, pushing the brand from a “high – end domestic brand” to the opposite of “ripping off consumers”. In essence, Zhong Xue Gao confused the relationship between “high – end positioning” and “channel adaptation”: high – end products need to match high – end scenarios (such as independent freezers and boutique supermarkets), rather than competing with mass – market products. The out – of – control channel management made its high – price strategy lose its reasonable support and ultimately damaged the brand image.
Thirdly, out – of – control expansion and capital – chain risks exposed strategic short – sightedness. After financing (accumulating over 1.3 billion yuan), Zhong Xue Gao accelerated its expansion, not only significantly increasing its staff size but also rapidly expanding its offline channels, attempting to reduce costs through “high – margin + scale”. However, this expansion was based on the assumption of “high growth”. When the growth slowed down in 2022 (the annual compound growth rate was halved) and the sales volume declined due to the public – opinion crisis, the fragility of the capital chain immediately became apparent. Yao Zhen, a partner at Head & Shoulders Capital, analyzed sharply: “It was too difficult to make money” – the ice – cream industry has high gross margins but rigid costs (cold – chain transportation, raw material procurement), coupled with high entry fees and inventory pressure in offline channels. Once the expansion speed exceeded the capital – bearing capacity, a chain of crises was inevitable. Zhong Xue Gao’s lesson shows that if new consumption brands are addicted to the capital game of “financing – expanding – refinancing” and ignore the cultivation of “self – financing” ability, they will eventually become prisoners of the capital chain.
Fourthly, the failure to adapt to the shift towards rational consumption led to the missed window period for transformation. The Chinese consumer market is transitioning from the “Third Consumption Era” (brand worship, personalization) to the “Fourth Consumption Era” (rationality, practicality, and cost – effectiveness first). Consumers are no longer willing to pay for “brand stories” and “packaging premiums”, but are more concerned about the “equivalence of price and value”. The core problem of Zhong Xue Gao is not the high price itself, but that the product value (raw materials, craftsmanship) fails to support the high price – when consumers find that the difference in taste and raw materials between a “10 – yuan ice – cream” and a “3 – yuan ice – cream” is not enough to cover the 7 – yuan price difference, the high – price strategy loses its rationality. Although Zhong Xue Gao later launched sub – brands like “Li Daju” and “Sa’Saa” to enter the affordable market and expanded its product categories by selling sweet potatoes and 3C products through live – streaming, these were all “passive responses” rather than “active transformations”. By then, traditional brands (such as Yili and Mengniu) had occupied the affordable market with their supply – chain advantages, and emerging brands (such as Mr. Wildman Gelato) had seized the mid – to high – end demand with their “health attributes”, and Zhong Xue Gao’s window period for transformation had long closed.
Advice for Entrepreneurs: Survival Rules Extracted from Zhong Xue Gao’s Rise and Fall
Zhong Xue Gao’s case is a “warning” for new consumption brands, and its experiences and lessons offer multiple insights for entrepreneurs:
Establish an Agile Public – Opinion Response Mechanism: In the era of social media, negative public opinion can destroy the trust that a brand has built over a decade within 24 hours. Entrepreneurs need to formulate a “graded response” strategy in advance: for general doubts, provide quick scientific explanations (such as explaining product ingredients); for malicious attacks, reserve legal means to fight back; for consumers’ emotions, actively show empathy (such as apologizing + compensating). The lesson of Zhong Xue Gao’s “non – melting” incident shows that “passive silence” or “mechanical compliance statements” will only intensify conflicts, while “transparent communication + emotional connection” is the key to resolving crises.
Balance Brand Premium and Channel Transparency: High – end positioning requires a channel strategy that matches the “appropriate scenario”. If the product price is higher than the mass market, independent display and clear price labels (such as price tags and electronic screens) should be used to reduce information asymmetry and avoid negative consumer experiences of “being deceived”. At the same time, the “price – value” match should be regularly evaluated. If consumers perceive the value to be lower than the price, the strategy should be adjusted by upgrading raw materials, optimizing craftsmanship, or launching smaller – sized products (such as mini – packs).
Strengthen Capital Risk Control and Steady Expansion: Financing is not the end but a “more rigorous beginning”. Entrepreneurs need to have the awareness of a “capital safety cushion”, and the expansion speed should match the cash flow and inventory turnover ability. It is recommended to adopt a “step – by – step” model: first verify the profitability of a single store/region model, and then replicate and expand; reserve at least 6 – 12 months of “emergency funds” to avoid capital – chain breaks due to slow growth or external risks (such as public – opinion crises and changes in the consumption environment).
Dynamically Adapt to Changes in Consumption Trends: The shift towards rational consumption in the market is irreversible. Entrepreneurs need to shift from “marketing – driven” to “value – driven”. On the one hand, continuously optimize product quality (such as improving raw – material quality and reducing additives) to support the “high price” with “high value”; on the other hand, adopt a multi – line strategy of “high – end main brand + affordable sub – brand” to cover different customer groups, or explore new demands such as health and functionality (such as low – sugar, low – fat, and probiotic – added products) to avoid being passive due to over – reliance on a single price range.
Zhong Xue Gao’s story is not only a sample of the life cycle of a popular brand but also a microcosm of the transformation of the Chinese consumer market. It tells us that in the wave of new consumption, marketing can quickly “create momentum”, but product quality, public – opinion management, and trend insight are the fundamentals of “maintaining momentum”. For entrepreneurs, perhaps the most important thing to remember is not Zhong Xue Gao’s “glorious moments” but its “multiple mistakes” during the fall – only by respecting the market, consumers, and risks can they walk more steadily and further in the changing wave.
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