---
title: "A Prophecy Seven Years Ago: If Only Wahaha Had Known Then, Why Not Now?"
description: "This article, originally published in 2010, argues that Wahaha's core strategic problem is the lack of a signature product comparable to Coca-Cola, which is essential for achieving global brand status. It suggests that despite its success, Wahaha's product portfolio lacks a product with universal appeal, and without solving this, the company may face stagnation."
author: "史贤龙"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2017-05-06"
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# A Prophecy Seven Years Ago: If Only Wahaha Had Known Then, Why Not Now?

> This article, originally published in 2010, argues that Wahaha's core strategic problem is the lack of a signature product comparable to Coca-Cola, which is essential for achieving global brand status. It suggests that despite its success, Wahaha's product portfolio lacks a product with universal appeal, and without solving this, the company may face stagnation.

**First, a few clarifications:**
1. Wahaha is an excellent company, and Zong Qinghou is a deserving industry hero;
2. We oppose the argument that "since they are better than you, you cannot criticize them";
3. Posting this old article from October 30, 2010, published on "First Marketing Network," without changing a word, is not to prove who is wiser, but to illustrate: all things have their principles, and anyone who studies can see them.
The ancients said: Heaven's way is constant; it does not exist because of Yao, nor perish because of Jie. Does today's business logic change according to who has more money?
Note: Wahaha is not a listed company, so this data can only show a general trend and may not be precise.
Original title:
 _"Can the Richest Man Last? What is Wahaha's Core Strategic Problem?"_ __
**What exactly is Wahaha's core strategic problem?**
Zong Qinghou becoming China's richest man in 2010 on both the Hurun and Forbes lists can be seen as a recognition of Wahaha under his leadership after the "abnormal divorce" with Danone: the market has accepted Chinese-style entrepreneurs.
Under this halo effect, Zong Qinghou is entering the state Ma Yun described: when you succeed, everything you say is truth.
But the halo not only represents achievement and glory; it also makes the "black hole" (worries) outside the halo more conspicuous.
Luo Jianxing, a former assistant to Zong Qinghou, published the financial book "Zong Qinghou and Wahaha: A Deep Study of a Famous Chinese Enterprise" and wrote on October 29, "Peak Again or at the End of Its Tether: Reflections on Zong Qinghou of Wahaha Again Becoming China's Richest Man," pointing out:
In 2010, Wahaha's performance growth was sluggish; in the main markets of Jiangsu and Zhejiang, Wahaha's sales began to decline, with some regions down more than 30%. This year, neither the Wahaha Group report nor public reports have any news about Wahaha's performance growth. Not to mention 70 billion yuan, even 50 billion yuan is hard to achieve.
Wahaha's strong products in recent years, such as Nutri-Express and Shuang Wai Wai, have reached the mature stage of their life cycle with no growth potential; last year's star product HELLO-C has declined significantly; bottled water and barreled water are also gradually declining. Since this year, they have launched more than ten new beverage products, including Shanlihong, Blueberry Black Tea, Winter Melon Tea, etc., but none have sold well. The heavyweight product for 2010, the newly launched Wahaha Edison milk powder, is struggling due to a series of errors in positioning, pricing, and promotion, with a market share of less than 0.5% (AC Nielsen retail data). It is said that due to poor sales, Wahaha even assigned each employee the task of selling 6 cans, and a simple calculation suggests that this year's sales of Wahaha Edison milk powder will be less than 100 million yuan, a fraction of what was expected!
Zong Qinghou seems to see the bottleneck of the company's development (he once revealed that Wahaha beverages could reach a limit of 50 billion yuan), but he has not continued to improve and innovate in the organizational structure reform and human resources reform of the beverage main business to solidify modern corporate management systems. To achieve his "100 billion" dream, his solution is to lead the company onto a path of diversification. Zong Qinghou has clearly stated that his diversification will mainly focus on three areas: resource-based industries, retail, and high-tech industries.
Luo Jianxing also pointed out problems in Wahaha's joint sales system, fast marketing media communication model, shareholding structure, group management, succession, and corporate culture, all of which have practical value.
Luo Jianxing's article triggered my ongoing thinking about Wahaha: what is Wahaha's true "strategic" problem?
If we must choose "one" core problem from all the issues Luo Jianxing raised about Wahaha and Zong Qinghou, as the most important factor for Wahaha to reach the 100 billion scale, what would it be? That is Wahaha's real problem.
Given Wahaha's current corporate scale and Zong Qinghou's personal style, the probability of Wahaha having a Huang Guangyu-style personal problem or Gome-style shareholding dispersion is almost nil. Zong Qinghou holds control over Wahaha, is as diligent as Qin Shi Huang, has very few personal hobbies, and enjoys high prestige among upstream and downstream value chain partners.
If the leader has no problem, the governance structure (leadership and execution) has no problem, and the joint sales model has no problem, then what is the remaining problem?
We believe it is **the real problem that has never been solved during Wahaha's rise to a 43.2 billion yuan brand: products!**
In last year's sales, the three major product groups that contributed the most—water, tea, and Nutri-Express—showed a "stagnant" situation in 2010. Wahaha is currently maintaining its scale mainly by launching a large number of national new products and regional company products.
This is the problem!
Former richest man Ding Lei marveled: "In the beverage industry with little high-tech content, becoming China's richest man by selling drinks at one or two yuan a bottle is simply incredible." This exclamation reflects the ignorance of this IT person who is "playing" at pig farming (forgetting the wealth value of Coca-Cola), but it hits Wahaha's problem: in China, it is precisely selling drinks at 1 or 2 yuan that can make you the richest man. If selling Huiyuan juice made you China's richest man, then the Chinese people's standard of living would have "caught up with Britain and surpassed the United States."
Only by asking the right questions can you find the essence.
Wahaha's strategic problem is: Can Wahaha become a brand like Coca-Cola? If not, why? What is the strategic core of Coca-Cola?
The strategic core of Coca-Cola is not advertising, capital, joint ventures, or the secret formula, but why Coca-Cola has become a beverage product for "everyone."
What made Coca-Cola great are two core products: carbonated Coca-Cola and Sprite. And Coca-Cola's current "total beverage product strategy" has not changed the strategic essence of Coca-Cola: that is, without the Coca-Cola product, there would be no Coca-Cola empire today.
So, **which of Wahaha's products can be compared to Coca-Cola?**
No need to think; currently, none.
We have taken Coca-Cola for granted for so long that we have begun to neglect thinking at the most hidden level of "product strategy": why has a beverage like Coca-Cola become popular worldwide?
The secret formula, American GIs, and American culture are all "auxiliary elements" in product strategy; the core element is: what most essential need does the Coca-Cola product satisfy for consumers?
According to Coca-Cola's brand communication appeals, we see that the core benefit of cola is "quenching thirst," especially during/after exercise for thirst relief and refreshment.
But the most thirst-quenching beverage is water, and water is also the most consumed; why hasn't a water brand become a world-class super brand?
There are three reasons: 1. The supply of drinking water is dispersed; barreled water and home filtration systems divide half of the water market, but brand enterprises are heavily localized; 2. Mineral water is considered nutritious water, but limited by water sources, it can only support a few high-end brands like Perrier and Evian; 3. Worldwide, drinking water standards vary, making it impossible to have a "standardized" ordinary water product.
Using these three principles, we can examine **the characteristics of all "world-class beverage products consumed by undifferentiated people,"** such as cola, Sprite, beer (and also other food categories like chocolate and biscuits), and we will find the secret: 1. Such products cannot be made at home (formula-based); 2. Product ingredients can be standardized and costs controlled; 3. They can meet the basic needs of undifferentiated people (age, nationality); 4. Cross-regional/ethnic consumer taste adaptation can be cultivated.
Only products that meet these characteristics can support a super beverage brand. This is the fundamental point. Once this fundamental point is established, the company can concentrate all its firepower on cultivating the product's consumer market and brand culture.
**What Wahaha lacks most now is this "strategic product." If it solves this problem, Wahaha can become a world-class beverage giant; otherwise, it may truly be at the "end of its tether"!**
Wahaha's current product strategy problem is a unique topic. Among the three beverage companies of similar scale to Wahaha—Master Kong, Uni-President, and Jinmailang—only Wahaha is beverage-led; the other three are diversified categories. Nongfu Spring and Wang Laoji are taking the "value beverage" route, and there is a chance they could transition to Wahaha's product model, but they will not pose a short-term threat.
Therefore, this strategic product issue depends on whether Wahaha can recognize and solve it.
**If solved well, it will enter high-level volume growth; if not, it will struggle to maintain scale.**
The decline of Wang Laoji and the current stagnation of Wahaha and Master Kong all stem from this problem.
How to solve it?
That is not for this article to answer, but using a rule from the "treasure hunt" game, the secret is often in the most common places.
We wish Zong Qinghou and the Wahaha team success in solving this problem.
**Source: Bonarui Cheng (ID: chief-wisdom)**
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