Rebirth in Hong Kong: From Dessert Shop to Industrial Empire

Chapter 167 Endorsement (Seeking monthly votes, recommendations, and subscriptions!)
After leaving the Chenji Weiye Building, Robert Miller and his entourage went straight back to their hotel suite. As soon as the door closed, the legal representative, who had been silent until now, finally couldn't help but speak: "Robert, these terms are practically robbery!"

Who does that Chen Bingwen think he is?
How dare a small business owner from Hong Kong Island demand that we fully open our core channels?
The board of directors will absolutely not agree!

Miller loosened his tie, slumped onto the sofa, rubbed his temples, and demanded, "You disagree?"

Then tell me what to do.
Coca-Cola has taken more than 3 percent of our market share this quarter thanks to that damn non-slip bottle cap!
Supermarket and convenience store purchasing managers complain daily about how hard it is to open our bottle caps, and consumer complaint letters are flooding headquarters!

He sat up abruptly, staring at the legal representative: "Do you think I enjoy coming here to be at the mercy of that young man?"
But the truth is, the threat from Coca-Cola is immediate and deadly!

And Chen Ji. Ah,

Miller scoffed and said dismissively, "Even if we open up channels to him, what can his 'pulse' do?"

This energy drink from the East has a unique flavor, but its brand awareness is almost zero.

The acceptance of energy drinks by North American consumers is already uncertain, let alone by an Asian brand.

Even if given the best shelf space, its sales in the short term will absolutely not be comparable to our core product.

Its scale is too small; at most, it's a supplementary item in the distribution channel and won't shake our foundation.

"And Coca-Cola is our century-old nemesis."

Once they seize the opportunity to widen the gap, it will be difficult for us to catch up.

"Using distribution channels to acquire key weapons to counter Coca-Cola—the old guys at headquarters know how to do that."

At this point, Miller instructed his assistant, "Call headquarters immediately and connect to the emergency board meeting line."

Tell them this isn't a multiple-choice question, it's a survival question.

Either accept Chen Bingwen's terms, obtain the patent, and immediately stop the bleeding and launch a counterattack;

Or we can just wait and see Coca-Cola continue to erode our market share, and in that case, we'll lose far more than just distribution rights!

That afternoon, just four hours after the morning's meeting, Robert Miller reappeared in the conference room on the top floor of the Great Wall Building.

“Mr. Chen,” Miller said, cutting straight to the point without any pleasantries, “After urgent consultations with headquarters, PepsiCo accepts your terms in principle.”

Chen Bingwen smiled, showing no surprise.

Pepsi's reaction was exactly what he expected.

For him, the most difficult and uncertain part of the negotiations was forcing PepsiCo to accept the fundamental strategic exchange of "trading core channels for patent licensing."

Once the other party bows down on principle and acknowledges the true nature of the transaction, all remaining details and terms become mere technical additions within this established framework.

The biggest obstacle has been removed; all that remains is to fill this framework with numbers and words that both sides can accept.

“Very good, Mr. Miller. This shows that Pepsi has made a wise, forward-looking decision,” Chen Bingwen said with a smile.

“Then, we can begin to discuss the specific terms of cooperation.” He turned to Fang Wenshan and Gu Yongxian, indicating, “My team will handle the specific business and legal details with you.”

To save time, we can refer to the framework of the patent licensing agreement previously reached with Coca-Cola.

Fang Wenshan immediately understood and replied, "Mr. Miller, based on our company's existing agreement with Coca-Cola, the patent licensing part mainly includes two aspects: a one-time licensing fee of $80, and a patent royalty fee of 0.02 cents for each bottle cap using the patent that is subsequently produced."

We hope our partnership with Pepsi will adhere to the same standards.

This clause was presented so smoothly and naturally, as if it were a self-evident industry standard.

Chen Bingwen specifically pointed out the "agreement with Coca-Cola," which was a subtle way of putting pressure on Pepsi: Your arch-rival has accepted the price, are you going to refuse?

Robert Miller's eyes twitched slightly when he heard the number, but he did not object.

He knew that after accepting the most demanding strategic conditions, getting bogged down in these relatively "minor" financial terms would not only be futile, but would also make Pepsi appear lacking in vision and efficiency.

$80 and 0.02 cents per bottle cap is nothing compared to the tens of millions of dollars Pepsi loses each year due to market share.

“Acceptable.” Miller nodded and responded decisively. “Our focus is more on the specific scope of channel authorization.”

Gu Yongxian opened the draft he had prepared: "Regarding the distribution channels, our requirements are Chen Ji Food's 'Pulse' functional beverage and any new products that both parties will agree on in the future."

They will have unconditional access to all of PepsiCo’s sales channels within the agreement area, including but not limited to large supermarkets, chain convenience stores, catering channels and vending machine networks, and will enjoy the same shelf space, promotional resources and delivery services as PepsiCo’s similar products.

During the agreement period, PepsiCo is prohibited from introducing any product in the energy drink category that directly competes with 'Pulse'.

Gu Yongxian's proposed "unconditional access" and "exclusivity clause" made Pepsi's legal representative's face even uglier, but just as he was about to argue, he was stopped by Robert Miller with a stern look.

Miller took a deep breath; he knew there was no point in dwelling on these details.

Having already made core strategic concessions, Pepsi's current attempts to haggle over shelf space and promotional resources would only make it appear indecisive and slow down its efforts to acquire patents and retaliate against Coca-Cola.

“Okay.” Miller agreed readily. “The standards and exclusivity clauses for channel access will be handled as you suggested.”

We hope the agreement can be signed as soon as possible.

A satisfied smile appeared on Chen Bingwen's face.

That's exactly the effect he wanted: to use Pepsi's most pressing needs to obtain the most thorough and unambiguous terms.

"Mr. Miller is indeed a man of great things; efficiency is his top priority."

Chen Bingwen nodded, praising Miller's decisiveness.

Soon, Chen Bingwen and Robert Miller, representing Chenji Foods and PepsiCo respectively, signed their names on a thick stack of agreement texts.

When the two shook hands, Miller's smile was slightly stiff, but deep in his eyes was a hint of relief as if a heavy burden had been lifted.

In any case, the key weapon against Coca-Cola has finally been obtained.

After the signing ceremony, Robert Miller left immediately with his team. He wanted to take the agreement back to headquarters as soon as possible and start the production line transformation for the new bottle caps, hoping to reverse the market disadvantage as quickly as possible.

After seeing Miller and his group off, Chen Bingwen returned to his office, pondering how to maximize the value of this hard-won agreement.

He knew that the agreement was just a piece of paper; the key was how to make good use of it.

“Pepsi has readily available distribution channels and prime shelf space, but simply putting ‘Pulse’ on the shelves is far from enough.”

Chen Bingwen muttered to himself.

A new functional beverage from an unfamiliar brand in the East, without strong market promotion, could easily be lost in the vast ocean of products in the North American market, ultimately becoming a slow-moving product that no one cares about in the corner of the distribution channel.

Simple, relentless product advertising is costly and its effectiveness is unpredictable, posing too much risk for a new brand.

Functional drinks, commonly known as the "magic weapon of the king," are popular in regions like the "Four Asian Tigers," where the economy is in a period of rapid catch-up and a "struggle" mentality prevails in society.

Working long hours and studying late into the night are almost the norm.

Energy drinks are essential for survival here, used to combat fatigue and continuous consumption; the demand for them is intrinsic and direct.

North America has a developed economy, with a per capita GDP far exceeding that of Asia. Most people there do not need to engage in extreme "involution" just to survive.

Therefore, functional beverages are more of a lifestyle choice than a necessity.

Therefore, for American consumers, it is definitely not advisable to force the single function of "energizing and anti-fatigue" on them. Instead, it is necessary to create diversified consumption scenarios for "Pulse".

However, educating the market and cultivating consumer habits is a long and expensive process.

Chen Bingwen didn't have that much time and money to waste; he was going to take a shortcut!
Using celebrities to endorse product advertisements to attract consumers' attention.

When he thinks of celebrities, one name that cannot be ignored from the 1980s almost instantly comes to mind—Michael Jackson.

At this time, Michael Jackson was at an extremely delicate and crucial juncture in his career.

He has just left Motown Records, where he had worked for many years, and signed with Epic Records. His debut album, "Off the Wall," has been recorded and is awaiting release.

The media has begun to release news that Michael will release a new solo album, but the public's general expectation is still at the level of "the best singer among the Jackson 5 brothers", and they have not yet fully realized that a groundbreaking superstar is about to emerge.

His commercial value is currently in a window of opportunity before it is about to experience explosive growth.

It wasn't until 1984, when he signed a $5 million endorsement deal with Pepsi, that he officially began his era of exorbitantly priced endorsements.

In 1979, his commercial fees were still largely based on the Jackson 5, with a solo appearance fee of about $5 to $7, far lower than that of top rock bands at the time.

Therefore, signing him before "Off the Wall" completely takes the world by storm is a once-in-a-lifetime opportunity to "buy at the bottom."

Chen Bingwen knew that with the success of this album, MJ's commercial value would skyrocket, and signing him again would cost ten or even dozens of times more.

More importantly, MJ was seeking a complete breakthrough in his solo career and urgently needed funds and resources to produce high-quality music videos and conduct large-scale promotions in order to break free from the constraints of the group image.

At this time, a lucrative endorsement contract that could greatly enhance his international exposure would also be extremely attractive to MJ.

Moreover, MJ's image and the vitality contained in his music are highly compatible with the core of the "Pulse" brand.

If successful, MJ's superstar aura will instantly illuminate the "Pulse" brand, allowing it to shed its label as an "unfamiliar beverage from Asia" and leap into becoming a trendy drink associated with top pop culture.

Thinking of this, Chen Bingwen pressed Li Weiming's internal phone, "Come to my office for a moment!"

A few minutes later, Li Weiming knocked on the door and came in.

"Manager Li, I have an urgent task for you."

I need you to assemble a highly capable team immediately and fly to the United States.

Find Michael Jackson and find a way to sign him to endorse our functional product line.

Chen Bingwen made the arrangements straightforwardly.

"Michael Jackson?"

Li Weiming paused slightly upon hearing the name, a hint of confusion appearing on his face.

At this time, Michael Jackson was far from being a household name in Asia. It was mostly people in the music industry and those who followed Western pop music who knew him as the best lead singer among the "Jackson Five".

Chen Bingwen had anticipated Li Weiming's reaction, and he could not and did not explain MJ's future superstar status.

Faced with Li Weiming's confusion, he did not try to persuade him, but instead directly used his authority as the decision-maker.

He looked at Li Weiming and said, "I will tell you the reasons and strategic considerations at a suitable time later."

Now, you don't need to ask why; you just need to know that this is the company's highest strategic priority.

Regarding the budget, I'll give you full authority to negotiate up to a maximum of one million US dollars per year.

It could even go higher, but the key is to sign a long-term exclusive endorsement contract that covers at least his golden development period of the next three to five years.

What I want is to lock in future value, not to worry about this short-term premium.

Li Weiming was shocked when he heard the number.

One million US dollars a year!

This price is enough to hire the hottest Hollywood movie stars or rock stars right now.

Although I have countless questions in my mind.

However, as a subordinate and executor, he knew that what was needed at this moment was absolute obedience and action, not questioning the boss's decision.

"Understood, Mr. Chen!"

"Very good." Chen Bingwen was satisfied with Li Weiming's answer. "Be quick."

I received word that his new album, "Off the Wall," will be released this summer.

You must finalize the contract before the album is released, public opinion takes hold, and his commercial value is reassessed.

"Yes! I'll prepare immediately and try to depart as soon as possible!"

With Michael Jackson as his spokesperson in the European and American markets, he plans to find one or two more spokespeople for the Asian markets.

Especially in the core areas of the Chinese cultural sphere, such as Hong Kong, Taiwan, Singapore, and Malaysia.

What is needed here is a Chinese superstar with broad influence, a positive image, and the ability to transcend geographical boundaries.

Although Jackie Chan became a hot kung fu star overnight thanks to the popularity of "Drunken Master".

However, after careful consideration, Chen Bingwen believed that Cheng Long alone was not enough to perfectly support the brand upgrade and deep penetration of "Pulse" in the entire Asian market.

Especially for female and family consumers, as well as urban white-collar workers who pursue fashion and artistic flair, Jackie Chan's "kung fu kid" image has relatively limited appeal.

As a beverage suitable for all ages and genders, "Pulse" needs a spokesperson who can transcend gender, age, and interest groups and has a greater universality and sense of fashion.

Therefore, Chen Bingwen's goal was very clear: while employing Cheng Long to promote an image of "vitality" and "hard work," he had to find a female superstar who possessed both high popularity, a wide audience appeal, a fashionable temperament, and cross-regional influence.

Several names flashed through his mind:
Liza Wang, Deborah Lee, Teresa Teng, Cherie Chung, Brigitte Lin...

Liza Wang: The queen of television, her audience leans towards families and television viewers, and her sense of fashion is slightly weaker.

Deborah: She is famous enough, but her image is more traditional and comedic, which is a bit far from the fashionable and trendy feel of the beverage.

Teresa Teng: Her singing voice was sweet and her influence covered all of Asia, but her image was more gentle and graceful. The direct association with "function" and "vitality" needed to be cleverly grafted, and she would be banned soon, so she was not suitable to be a spokesperson.

Cherie Chung: She is just beginning to show her talent, and is fashionable and beautiful, but her influence is still accumulating. As a flagship spokesperson supporting the entire Asian market, she is still somewhat lacking in experience.

Ultimately, his gaze settled on Brigitte Lin.

(End of this chapter)