Coconut Palm, Criticized for 'Borderline' Content, Sells 5 Billion Yuan

Coconut Palm Sells 5 Billion Yuan a Year

In Coconut Palm's livestream, female hosts wear tight outfits and shorts, while muscular male hosts wear tank tops and shorts. Many say Coconut Palm's hosts embody 'sunny, healthy beauty,' but some accuse the brand of 'borderline' content. Amid this mixed style, Coconut Palm has mastered the traffic code, and sales have followed. In February, Coconut Palm Group held its 2024 New Year Kickoff Meeting, where it reported 2023 performance: total sales volume of 700,000 tons, up 10.26% year-on-year; sales revenue of 5 billion yuan, up 3.08%; taxes paid of 682 million yuan, up 15.39%. For over a decade, Coconut Palm has ranked second in output value and third in taxes among industrial enterprises in Haikou City. In the coconut juice sector, Coconut Palm has been the leader for many years. In 2023, Coconut Palm's revenue hit a record high. The two major A-share plant-based protein beverage giants—Yangyuan Beverage and Chengde Lulu—have not yet released their 2023 annual reports, but in 2022, their revenues were approximately 5.9 billion yuan and 2.7 billion yuan, respectively. It's clear that in the plant-based protein beverage industry, Coconut Palm is also a giant. Coconut Palm stated that although its livestream doesn't sell products directly, it does boost product sales. In January, at an event, a Coconut Palm livestream official said that livestreaming drove offline product sales, 'up 20%.' Coconut Palm's marketing, from its packaging design and the endorsement by 'Sister-in-Law' Xu Dongdong with the slogan 'I've been drinking it since I was young,' to the recent livestream style with handsome men and beautiful women, has been consistent. Behind Coconut Palm is Wang Guangxing, who is about to turn 84. Employees call him 'President Wang Guangxing.' He is the 'soul figure' of this long-established Hainan company. Like the packaging of Coconut Palm coconut juice, the office building of Coconut Palm Group is covered with slogans and Wang Guangxing's unique calligraphy. Throughout Coconut Palm Group, there are displays emphasizing how Wang Guangxing led Coconut Palm from the brink of bankruptcy to glory. For example, 'It was absolutely Wang Guangxing who saved Coconut Palm; no one can deny that.' At the 2024 Coconut Palm Group New Year Kickoff Meeting, the handsome men and beautiful women from the livestream came to the venue to walk the runway with products, and the walls and pillars were inscribed with 'Without Wang Guangxing, there would be no Coconut Palm,' 'Coconut Palm lost money for 7 consecutive years, from a bankrupt 'five olds' mess to creating 'five news',' and 'Wang Guangxing's contribution is great'... Wang Guangxing, born in July 1940 in Qiongshan, Hainan, is about to turn 84. According to Coconut Palm's official website and internal publications, as well as Wang Guangxing's own statements, the predecessor of Coconut Palm Group was Haikou Canned Food Factory, which 'lost money for five consecutive years from 1981 to 1985, changed four factory directors without turning around, and was only 20,000 yuan away from bankruptcy, causing 5 of 6 deputy general managers to leave, and those sent from above or hired externally dared not come, and those promoted internally dared not take the position.' Wang Guangxing was transferred in January 1986, signed a contract to turn losses into profits, and boldly reformed, strictly fighting corruption, 'not afraid of threats or complaints, overcoming difficulties and resistance.' The factory continued to lose money for two more years before finally becoming profitable. Under President Wang Guangxing's heavy rewards, Coconut Palm coconut juice was successfully developed in 1987. Looking back, coconut juice is the key to Coconut Palm Group's development. Coconut Palm's official publicity states that in the late 1980s, to overcome the life-or-death challenge of 'developing natural coconut juice,' Wang Guangxing led a group of secondary technical workers, formed four task forces, and after 8 months of arduous research and 383 experiments, finally solved the problem and mastered the oil-water separation technology for producing natural coconut juice. At that time, there were few players in the domestic plant-based protein beverage market. Wang Guangxing wanted to open the market, so he took Coconut Palm to Beijing and held a press conference at the Great Hall of the People for 'World's First, China's Unique' natural coconut juice. For consumer goods to sell well, advertising and marketing are key. In 1999, Coconut Palm's advertisement appeared on the Spring Festival Gala: a scantily clad woman, holding a can of Coconut Palm coconut juice in one hand and a glass in the other, said to the nation, 'One cup a day, fair and tender.' 'After so many years, Coconut Palm's marketing and the boss's aesthetic have never changed,' a netizen joked. After restructuring, Coconut Palm Group is employee-owned, with Wang Guangxing at the helm. Tianyancha App shows that Coconut Palm Group is 100% indirectly controlled by Hainan Coconut Palm Employee Shareholding Association, registered in 1996. Currently, its legal representative is still Wang Guangxing.

A 'Coconut Palm Wind' Blows from Hainan

'Calling it borderline on a whim; long-term persistence is corporate culture.' Someone summarized Coconut Palm's style this way. From the black-background, large-character product packaging, to the office building covered with promotional text, to the unconventional marketing and livestreams with handsome men and beautiful women, Coconut Palm has always stuck to its own style, creating a 'Coconut Palm Wind' in marketing. This 'Coconut Palm Wind' from Hainan can be described as both 'earthy' and 'sweet'—the rustic marketing is often ridiculed, but Coconut Palm has tasted the sweetness of traffic. A company's style and culture are inseparable from the founder's personality. Wang Guangxing is a former art designer. After starting work at 17, he worked as a business art designer at Haikou Workers' Cultural Palace, and later as an art designer at Haikou Canned Food Factory. Reports say the contrasting color layout of Coconut Palm's packaging is his work. Regarding Wang Guangxing's marketing strategy, He Yichang, a veteran employee of Coconut Palm Group, mentioned in a 2017 article titled 'Interpreting President Wang Guangxing's Marketing Strategy Layout' (from Coconut Palm's internal publication 'Coconut Palm People'). Wang Guangxing has always emphasized that marketing must understand TV advertising and advertising planning. In a market where supply falls short of demand, distributing products to distributors completes sales. But in a market with oversupply, advertising to introduce product features and benefits effectively drives consumers to buy. 'Ad copy should be straightforward and easy to understand; ad visuals should be clear, bright, and attractive, so consumers know at first glance that it's our product. In today's competitive market, traditional thinking no longer fits the current marketing situation; we must focus on advertising planning.' Over the years, Coconut Palm Group has adhered to its own 'Coconut Palm Wind.' After ads like 'One cup a day, fair and tender,' in 2009, buses in Haikou carried ads with slogans like 'Wives like husbands drinking Coconut Palm pomegranate juice,' 'Papaya full, I'm full,' and 'Afraid of failure? Drink Coconut Palm pomegranate juice,' sparking controversy. In 2012, Xu Dongdong became the spokesperson for Coconut Palm coconut juice, with a photo of her posing with her hand behind her back next to the slogan 'I've been drinking it since I was young.' This combination of packaging design and promotion also sparked controversy. In 2023, Xu Dongdong revealed in Xiao Yangge's livestream that because she created that slogan, Coconut Palm has kept her as spokesperson all these years. In October 2022, Coconut Palm Group officially started livestreaming on Douyin. Unlike other brand livestreams, Coconut Palm's livestream featured curvaceous female hosts in tight outfits and shorts dancing. In March 2023, Coconut Palm's livestream introduced muscular male hosts, forming a pattern of handsome men and beautiful women dancing together. On Coconut Palm's calendar, there are also pictures and text, with captions like 'Coconut Palm Livestream: Men strong, women full.' Netizens joked that over the years, Coconut Palm hasn't changed its borderline nature. But everyone loves to watch, whether online or offline, always drawing crowds. On the evening of March 10, Coconut Palm Group's Douyin livestream started again, with handsome men and beautiful women, and over 100,000 concurrent viewers. However, it was soon cut off, showing 'Room banned.' Netizens left comments under Coconut Palm's videos: 'I only watched for 2 minutes, why is it banned again?' 'Coconut Palm's aesthetic is quite good.' 'They're not showing skin, and the dance is nothing; why was the livestream banned? I'm so angry I immediately placed an order.' 'How is this borderline? If this is borderline, then many livestreams should be banned.' Despite complaints about 'earthy' and 'borderline,' it still drives sales. In the livestream e-commerce world, Coconut Palm is truly a 'mudslide,' finding its own characteristics and achieving clear differentiation. Moreover, the livestream focuses on 'talent' performances, with product display and promotion on the side, rarely linking products or selling, only adding links for a few new products near the end as a token. According to a February report by E-commerce Online, Yin Dandan, head of Coconut Palm Group's livestream, explained the style: 'Men have a masculine charm, women have a feminine charm, and coconut juice has its own taste, emphasizing the original flavor.' 'On the first day I said we would livestream, the boss said Coconut Palm can livestream, but cannot sell goods. Selling goods via livestream would squeeze distributors' living space, which goes against our corporate tradition. Coconut Palm doesn't do e-commerce now; there are no direct stores on Tmall, JD, or Pinduoduo,' Yin Dandan said. Online for traffic, offline distributors sell well, and everyone is happy. Coconut Palm's official livestream is positioned as brand promotion; 'Our group's assessment is not based on sales; our most important metric now is exposure.'

Second Growth Curve, Long Overdue

Yin Dandan previously said: 'As an old company, we face a problem: the post-80s and post-90s know this brand, but what about the post-00s? Our livestream doesn't have to sell; it's more about brand promotion. If post-00s or even post-10s can see us, we're satisfied.' This statement also reflects the problems Coconut Palm has faced over the years: brand aging, with no new blockbuster product to take over. In fact, despite mastering the traffic code with 'borderline' livestreams, this is far from giving Coconut Palm new sustained growth. According to data from Food Industry, from 2019 to 2022, Coconut Palm Group's revenue was 4.328 billion yuan, 3.989 billion yuan, 4.616 billion yuan, and 4.719 billion yuan, respectively. But in fact, as early as 2013, Coconut Palm's revenue exceeded 4 billion yuan, reaching 4.477 billion yuan, then fluctuated, only achieving consecutive growth in the last three years. Even in 2023, with the handsome men and beautiful women livestreams, Coconut Palm Group's sales grew only 3% year-on-year. The aging Coconut Palm Group has regained some popularity through Douyin livestreams in recent years, but it's only reclaiming past glory. Coconut juice is the core support of Coconut Palm Group. However, coconut juice is just a niche segment in the beverage track, with a limited market size. Headfish Research Institute analysis shows that from 2017 to 2021, the market size of China's coconut liquid beverage industry grew steadily, from 10.28 billion yuan to 14.44 billion yuan. After 2020, the development of freshly made tea and coffee markets introduced coconut beverages into new consumption scenarios, with 'raw coconut latte' as a highlight, driving overall market growth. By 2026, the market size is expected to reach 21.36 billion yuan. In a market still under 20 billion yuan, due to strong regional characteristics, leading companies lack motivation to innovate, but smaller players keep emerging, causing the leading companies' market share to shrink. The plant-based protein beverage sub-sectors are fully competitive, and coconut juice is no exception. According to Headfish Research Institute data, in the coconut juice segment, Coconut Palm's market share has dropped from being dominant to about 30%, with Special Forces (Susa) in second place at about 7%, and Happy Home in third at about 5%. In addition, many food brands have entered the coconut juice track, including Dongpeng Beverage, Wahaha, Bright, Yinlu, and Chunguang Food... The already narrow track is becoming crowded. In fact, Coconut Palm Group has also laid out other products, such as coconut oil, bottled water, and tea drinks. Coconut oil is an even narrower track, while bottled water and tea markets are vast but dominated by giants, limiting Coconut Palm's competitiveness. Coconut Palm's second growth curve needs a new blockbuster product. As for livestreaming, it can help boost spirits, but it's hard to change its fate.