Recently, the young health brand JUZTLAB Herbal Future received 10 million yuan in angel round financing from leading brand management company Ruohuchen (003010.SZ). This round of funding is mainly used for supply chain layout and team building.

JUZTLAB Herbal Future is a high-value-added health and wellness brand based on the same origin of traditional Chinese medicine as food. With traditional Chinese medicine herbs as the core, it provides health product solutions for the lifestyle scenarios of young people aged 25-34. Focusing on the concept of “the same origin of medicine and food”, JUZTLAB Herbal Future was founded by the Cornell University team at the end of 2021. Together with the Zhejiang University Tea Research Institute and Zhejiang University of Traditional Chinese Medicine, it is committed to promoting traditional Chinese recipes and using innovative national patents to effectively solve problems such as the time-consuming and laborious preparation of traditional Chinese medicines and poor absorption effects. The brand seed round is exclusively invested by Xiaoyi Venture Capital. Currently, a diversified sales network has been established, and a brand moat has been built with a strong upstream supply chain and downstream channels. Within less than a year of launch, sales have exceeded 10 million.

As an exclusive investor in this round, if Hatsumi has many years of experience in consumer goods brand management, has a leading edge in the health field, has a deep understanding of multi-category business growth models, can deeply empower brand development, and help brands quickly build development barriers with R&D and innovation as the core driving force.

Luo Yu, general manager of Ruohuchen's strategic investment department, said, “The company is optimistic about the development potential of the health sector, and will continue to focus on this core field, explore the entire industry chain, and find high-quality partners. The Chinese herbal medicine field, where the future of JUZTLAB Herbal Medicine is located, has a strong consumer awareness base, and the company has been initially verified in terms of innovative scenarios, differences in brand positioning, scalability of commercialization capabilities, and stability of the supply chain system, providing an excellent consumer experience for the younger generation. At the same time, the team led by the two post-95 founders who graduated from Cornell University is also extremely dynamic and has outstanding market adaptability and execution, and is expected to become the backbone of Chinese consumer brands.”

Young people insist that “good medicine is not bitter”, and the new Chinese style of light health drives the “same origin of medicine and food” 100 billion market

Currently, “new Chinese wellness” has become a popular lifestyle attitude, and the audience is gradually showing a youthful trend. According to the “2023 Douyin White Paper on a New Paradigm for Healthy Living”, Douyin created more than 100 million short videos related to healthcare from January to June 2023. Among them, Chinese wellness is very popular. #药食同源 #、 #去中医馆买酸梅汤是什么体验 #等相关话题频上热搜。 In Taobao Live's “New Health Consumption” category, the share of post-90s and Gen Z sales also increased from 34% in 2018 to 50% in 2020.

“The health awareness of young people continues to rise, yet there is a shortage of health products for young people on the market. In particular, although Chinese health products have a long history, they are not suitable for young consumers in terms of dosage form, dosage, or brand design. On the contrary, many young brands of compound health products have done a good job, and the “same origin of medicine and food” light health concept continues to be sought after by young users. The market has broad prospects, but there are still many unsatisfied pain points and pain points. What people think about traditional Chinese medicine is that the treatment is long and the effects are slow, but in fact, there are many good recipes that have immediate results.” Exploring the rejuvenation of Chinese health products and reshaping traditional Chinese medicine recipes that have been settled over time through modern science and product design to become Chinese health products suitable for young consumers is the starting point for Kevin, the future founder of JuztLab Herbal Products.

“JUZTLAB Herbal hopes to grow together with consumers and develop good products that can really solve their pain points and meet their needs in response to their various life scenarios.” Kevin said.

According to relevant industry data, in 2022, China's per capita consumption expenditure on health products was only 33.94 US dollars, lower than the global per capita consumption of 38.80 US dollars, about 8 times the gap compared to 270.70 US dollars per capita in the US. The industry has huge potential for growth. However, the “homologous medicinal and food” traditional Chinese medicine market that JUZTLAB Herbal Future focuses on reached 300 billion yuan in 2013, and continues to grow at a rate of 14% per year. Based on the characteristics of the health food industry's high gross profit and high repurchase rate, as domestic per capita income continues to rise, China's health food penetration rate will gradually converge with Europe and America, and the market size is expected to grow exponentially.

In the future, JUZTLAB herbal medicine will be further processed and developed using the same medicinal products produced in the second and third generation, and classic Chinese herbal medicines will be innovated and upgraded according to market demand. For example, green tea kudzu root tablets are based on the immediate characteristics of young consumers' health claims. Through adjustments to ancient ingredients and flavors, and a younger brand packaging design, it became the brand's first popular product.

The ancient recipes used in the JUZT series of products currently on the market all come from medical titles such as “Shennong Materia Medica Sutra”, “Guidelines for the Treatment of Typhoid Fever”, etc., to ensure that the final functional products for users have extremely high safety and complete efficacy.

It is worth mentioning that in order to better meet the diverse needs of consumers, in the future, JUZTLAB herbal medicine will also simultaneously select top raw materials and supply chains around the world, achieve more product functional innovation through cross-border e-commerce, and provide consumers with more high-quality products. At the same time, medicine and food are also in the blue ocean market, and the popularity of traditional Chinese medicine and herbal ingredients is increasing year by year. Based on global market insight, JUZTLAB herbal medicine will simultaneously expand overseas markets in the future. It has now laid out the North American market, and will continue to explore potential markets such as Southeast Asia in 2024.

At the marketing level, JUZTLAB Herbal Future also communicated with young people in a way they liked, and launched the “Tumbler Program” to promote user retention and repurchase through community operation, brand communication, and sales transformation. Currently, the brand's self-media followers have exceeded 10,000. While providing consumers with differentiated medicinal and food homologous young health products, the brand also satisfies modern young consumers' pursuit of health use scenarios and branding.

Focus on the healthy track and press the “fast forward button” for brand management strategies

The popularity of investment in the consumer market has declined in the past two years, and the amount of investment and financing in the consumer industry dropped sharply in 2023. According to Blue Shark Consumer Report data, there were only 683 cases in the whole year, a year-on-year decline of 30.4%. Institutions' attention to consumer trends has declined, A-share IPOs have been phased in, and it has become more difficult for consumer goods companies to go public, further exacerbating the chill.

The market is a collection of demands. What really determines the trend of the consumer circuit will always be a shift in consumer attitudes. After years of consumption upgrading and classification, consumers no longer blindly pursue brand effects or simple price advantages, but rather pay more attention to the cost performance, quality, and overall experience of products and services. This strengthening of rational consumption trends means that enterprises need to make fundamental innovations in product design, marketing strategies, and even supply chain management to meet increasingly diverse and sophisticated market needs.

Consumer goods companies and entrepreneurs must accurately understand changes in consumer mentality, grasp new trends in value-oriented consumption, and invest resources in product research and development, service optimization, and brand building to truly form a differentiated competitive advantage, so that they can find vitality in this cold winter of the consumer market, seize opportunities during market recovery, and achieve long-term stable development.

“If the macro environment is not optimistic, projects need to have greater viability. Some high-quality projects will also settle down in the midst of big waves. For Ruochen, the current market is a good time to invest and consume. You can see more good projects, get good resources, and get good valuations. Instead, it is a window of opportunity.” If Yu Chen bucked the trend and invested in high quality and emerging consumer brands such as Keyin, Brand, and Xieyou in recent years, this time JUZTLAB Herbal Future. According to Luo Yu, excellent latecomer entrepreneurs or brands need stronger market insight and more cutting-edge innovative ideas to meet the needs of consumers in more diverse scenarios. Only brands that truly create value for users and provide product quality and user experience beyond expectations can continue to develop in the cold winter and settle down in a cyclically adjusted investment market environment.

Since 2016, Ruohuchen has entered the cross-border health products industry, firmly grasped the first wave of opportunities for the development of overseas health products in the Chinese market, and accumulated sufficient professional human resources and deep knowledge reserves. In the core business team, the health care industry accounts for more than 300 talents, and has accumulated deep experience in more than 50 major health brands, 20 channels and 100 leaf categories to help many service brands successfully join the Tmall International 100 Million Yuan Club. If Yuchen continues to unleash the siphon effect in the industry, whether upstream or downstream of the industry or the brand side, Ruochen has become the preferred partner.

In 2020, Huachen incubated its own brand Blooming, and fully extended its capabilities to the entire brand value chain. Currently, the GMV of Huachen has exceeded 300 million dollars per year, and various products continue to lead the segment, once again successfully verifying Wakahachen's brand management ability at the 0-1 stage.

In the post-pandemic era, the big health industry has risen rapidly. According to forecasts from relevant agencies, China's nutritional and health consumer goods market has the highest compound growth rate in 2020-2025E, which is expected to reach 9%, which is far higher than the global average.Starting in 2022, Ruo Yu Chen will actively lay out new consumption, focusing on high-potential industries such as Big Health, etc., integrating high-quality resources and teams in the global health field through diversified capital operation paths such as internal incubation+external investment, mergers and acquisitions, and joint ventures, enriching the layout of the industrial chain, giving full play to resource advantages and full-link capabilities, and deeply empowering partners to achieve a comprehensive upgrade from a single brand operation model to a comprehensive and multi-level brand management model, and build an international and three-dimensional brand management system.

The market fluctuates, and the racetrack is hot and cold. As long as people look forward to a better life, consumption will always be an evergreen track. If Hatson bucked the trend and accelerated the development of brand management strategies, it would be a firm confidence in the development of the Chinese consumer market, as well as the persistence and implementation of long-term principles.