Zhong Shanshan, chairman of Nongfu Spring and China’s “bottled water king,” has an axe to grind with two of the country’s biggest tech companies.
Zhong slammed Pinduoduo, a Chinese e-commerce platform owned by PDD Holdings, at an event in Ganzhou in Jiangxi province on Tuesday, according to media reports.
“Pinduoduo’s pricing system is a huge harm to Chinese brands and Chinese industries,” Zhong said at the event, according to local media.
Pinduoduo’s aggressive pricing strategy helped it take market share from larger platforms like Alibaba and JD.com, but it has also helped spark a broader price war that’s eating into margins.
At another event the next day, Zhong targeted another one of China’s tech companies: ByteDance. Zhong said he’d hoped to get an apology from Zhang Yiming, ByteDance’s founder, for not stopping a social media campaign targeting Nongfu Spring.
“I hope Mr. Zhang Yiming, Douyin, Toutiao, and all the media that have hurt me personally with rumors will apologize,” Zhong said, according to local media. Douyin is the Chinese version of TikTok; Toutiao is a social news and information platform. Both are owned by ByteDance.
Both PDD Holdings and ByteDance did not immediately respond to Coins2Day’ s request for comment.
Zhong’s tough year
Zhong Shanshan is China’s richest person, according to the Bloomberg Billionaires Index. Yet he and his company, Nongfu Spring, have had a tumultuous year.
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In March, Chinese nationalist internet users accused Nongfu Spring of using Japanese-style imagery on its bottles. That sparked a social media campaign against the bottled water company: Users filmed themselves pouring its water into the toilet, or using it to clean the floor.
The campaign hit Nongfu Spring’s shares, crashing its market value by about 30 billion Hong Kong dollars ($3.85 billion) between late February and mid-March, the height of the controversy.
Then, in July, Zhong picked a fight with the Hong Kong Consumer Council, the city’s consumer protection watchdog. The council alleged that Nongfu Spring’s bottled water neared a European threshold for bromate, a chemical dangerous when consumed in large quantities.
The Consumer Council, following complaints from Nongfu Spring and some Hong Kong politicians, rescored the company’s bottled water, using less stringent standards for “drinkable natural water.” It also acknowledged that Nongfu’s product complied with safety standards set by mainland China, the World Health Organization, and the European Union.
Nongfu’s share price is down 29% so far this year. Its half-year report showed a considerable slowdown in both revenue and profit growth, compared with the year prior. Nongfu blamed increasing competition, online attacks, and “malicious defamation” of the company and its founder for the sales slowdown.
