Core Viewpoint - The recent controversy surrounding Sam's Club's decision to replace popular products with the introduction of the Korean brand Orion's Choco Pie has led to significant consumer backlash, questioning the quality of product selection at Sam's Club [1][2]. Company Overview - Orion, established in 1956, is one of South Korea's top four food companies and has been operating in China since 1995, with products like Choco Pie becoming nostalgic favorites for many consumers [2][4]. - The Choco Pie product, which has a history of 50 years, combines soft cake, marshmallow filling, and chocolate coating, appealing to a wide demographic [4][6]. Consumer Feedback - The introduction of the Sam's Club exclusive version of Choco Pie, priced at 49.9 yuan for 48 pieces, claims to have reduced sugar by 80% and increased cocoa content by 30%, but has received negative reviews for still being overly sweet and containing ingredients like partially hydrogenated oils and artificial sweeteners [6][8]. - Consumers have expressed dissatisfaction with Orion's pricing and ingredient discrepancies between domestic and international markets, leading to a perception of double standards [6][8]. Financial Performance - Orion's revenue from the Chinese market has been declining, dropping from 49% of total revenue in 2020 to 40% in 2023, with a notable 7.5% decrease in 2023, resulting in approximately 58.7 billion yuan [9][13]. - Despite a slight recovery in 2024 with revenue reaching about 68.65 billion yuan, it remains significantly below the peak of 77.18 billion yuan achieved in 2016 [13][16]. Market Competition - The competitive landscape in China's snack market has intensified, with local brands like Liuyin Puzhi and Three Squirrels gaining traction through product innovation and marketing strategies targeting younger consumers [18][19]. - Orion's initial success in China was aided by favorable market conditions, but it now faces challenges due to the rapid evolution of the snack industry and changing consumer preferences towards healthier options [18][21]. Strategic Response - Orion has recognized the need for a health-oriented product transformation and has initiated strategies to incorporate nutritious ingredients into its offerings, such as nuts and reduced sugar products [22]. - The company's future success will depend on its ability to effectively manage brand image crises and innovate in product development to align with consumer demands in the evolving market [22][23].

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