---
title: "P&G, the \"Whampoa Military Academy\" of New Consumption: Elite Exodus and the Lost Eight Years"
description: "In the booming new consumption sector, many brand operators are closely linked to a business \"clan\"—the P&G alumni network. Behind P&G's reputation as the \"Whampoa Military Academy\" of new consumption lies its comprehensive talent development system and unique position in China's commercial history. This year, new consumption has become so hot that investors exclaim they can't afford to invest."
author: "AI财经社"
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published: "2021-11-02"
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# P&G, the "Whampoa Military Academy" of New Consumption: Elite Exodus and the Lost Eight Years

> In the booming new consumption sector, many brand operators are closely linked to a business "clan"—the P&G alumni network. Behind P&G's reputation as the "Whampoa Military Academy" of new consumption lies its comprehensive talent development system and unique position in China's commercial history. This year, new consumption has become so hot that investors exclaim they can't afford to invest.

Source: AI Finance and Economics (ID: aicjnews)

In the booming new consumption sector, many brand operators are closely linked to a business "clan"—the P&G alumni network. Beyond brands well-known to young people like Perfect Diary, Jane, RELX, and usmile, this list is continuously expanding.

Behind P&G's reputation as the "Whampoa Military Academy" of new consumption lies its comprehensive and systematic talent development system over the years, as well as its unique position in the magnificent history of Chinese commerce.

This year, new consumption has become so hot that investors exclaim they can't afford to invest. Surprisingly, many of these operators are closely connected to a business organization—P&G.

As a global daily chemical giant, P&G has long been a talent powerhouse, often regarded as the fifth largest talent "reservoir" in China's internet industry, alongside Huawei, Microsoft, Google, and Alibaba. Examples include former eLong CEO Cui Guangfu, Mobike co-founder Wang Xiaofeng, and Liepin founder Dai Kebin, not to mention executives scattered across major enterprises.

Now this talent wave is surging into the new consumption sector. From Ximuyuan founder Liu Shichao to PMPM founder Shan Shuo, from WonderLab co-founder Liu Le to Plant Professor founder Zhao Xiangjun, from Jane Yogurt co-founder Liu Ruizhi to RELX e-cigarette founder Wang Ying, from Perfect Diary founder Huang Jinfeng to usmile founder Chen Jianqun, P&G has become the "Whampoa Military Academy" for China's new consumption entrepreneurship.

This talent flow benefits from P&G's comprehensive and systematic talent development system, but is also constrained by the suppression of innovation due to its massive structure and rigid internal communication.

With the flow of people, P&G's mature methodologies accumulated in the market are also spreading across various fields. For example, when evaluating Florasis, a P&G alumnus also venturing in the beauty sector expressed optimism, citing that the company fully follows P&G's brand-building playbook.

In the 33 years since entering China, P&G has witnessed the magnificent history of China's commercial transformation; even after its glory faded, it continues to participate in new business processes in a new way.

**The Mysterious CMK Department**

Over a decade ago, foreign companies were among the most desirable places for college graduates. P&G, with its comprehensive training and job rotation system, became a talent "harvester" among foreign companies. Today, P&G is regarded as the Whampoa Military Academy for China's new consumption entrepreneurship, also related to the industry vision and talent development mechanisms brought by its market position.

Recalling joining P&G over 20 years ago, Xie Zhen, founder and CEO of Maitao Qinqin, vividly remembers the scene. In 1997, P&G conducted campus recruitment at Nanjing University where Xie studied; out of more than 800 applicants, only 7 were hired, and that year P&G recruited a total of 200 fresh graduates.

P&G's training methods surprised them: first, three months of training at the Guangzhou headquarters to learn communication management skills and organizational principles, followed by a year of on-the-ground training.

Xie Zhen was assigned to Xiangyang, Hubei, where he pulled a tricycle loaded with goods daily, visiting over a hundred mom-and-pop shops in the streets. "The contrast was huge; a group of top students stayed in five-star hotels, earning over 10,000 yuan a month, but went out to do manual labor every day. It was very interesting."

When asked if he could adapt to this contrast, Xie Zhen told AI Finance and Economics that P&G was also screening talent, preferring those with high goals and resilient personalities. "My three years at P&G helped me develop good professional habits, accumulate communication skills and connections, which also helped in my later entrepreneurship."

It is precisely with this invincible talent pool that P&G's brands such as Rejoice, Head & Shoulders, Pantene, Whisper, Tide, Ariel, Olay, Pampers, and Gillette were able to rapidly open up the Chinese market.

(P&G's personal care products; Image source: VCG)

However, when it comes to P&G's talent development methods, the CMK (Consumer and Market Knowledge) department must be mentioned. This department acts as the company's strategic brain, responsible for analyzing, monitoring, and predicting consumer behavior and market changes, thereby endowing P&G people with strong data and strategic analysis capabilities.

Perfect Diary founder Huang Jinfeng even wrote an article titled "P&G CMK in My Eyes," revealing the unique charm of the CMK department: **"Even as a newcomer, you can gain recognition and respect through analyzing valuable insights, which makes you feel responsibility and improves your business acumen and analytical skills."**

Zhao Qingping, a brand service provider for P&G a decade ago, told AI Finance and Economics that at the time, P&G was a "god-like existence" in the FMCG sector, attracting many talents and leading in consumer trend observation, marketing tactics, and industry research. When she first came into contact with P&G in 2012, she found they were already conducting market research on the post-90s generation, when the oldest post-90s were still in school.

P&G's talent development system also emphasizes leadership and systematic thinking training. Liepin founder Dai Kebin recalled that P&G taught him to work with skill, rhythm, and thought, forming a closed loop, clarifying what to do next, and defining what "task completion" means.

This unhurried, long-term employee growth approach also brings nourishment and warmth to P&G alumni's later lives. Qiuyue joined in Shanghai in 2015 when the company had only three floors. The company held weekly workshops, and after leaving to join a VC and a startup, she continued this practice.

"At first, my boss thought I was strange, but after two sessions, he noticed the office atmosphere changed. I was willing to slow down and 'waste time' doing this, which is good for corporate culture and employee growth." Qiuyue also regards this as the second most important change P&G brought her, besides enhancing her understanding of the consumer market.

Amplifying this workshop is the P&G (China) Alumni Association. Over the past 20 years, the association has regularly held events to provide resources and career development opportunities for alumni who left P&G. This goal has connected over 3,000 P&G alumni. In 2013, the association even established the Baojiehui Venture Capital Fund to support new consumption entrepreneurs, especially P&G alumni.

In choosing entrepreneurial directions, the forward-thinking mindset endowed by P&G's system plays a role. For example, in 2015, P&G alumnus Chen Jianqun perceived the consumption upgrade trend in oral care products and the pain point that international electric toothbrush designs were not suitable for Asians, finding a breakthrough for domestic electric toothbrushes. He founded usmile, which became a dark horse in the domestic electric toothbrush field.

In other FMCG areas, from Hua Xike in 2011, HFP in 2014, to Ximuyuan in 2019, P&G alumni entrepreneurs captured the demand for natural ingredients and efficacy skincare.

From Haose Pai Salad in 2014, Jane Yogurt in 2018, Wonderlab in 2019, to Plant Professor in 2020, another group of P&G alumni entrepreneurs spotted the demand for functional healthy food.

In the beauty sector, beyond Perfect Diary, P&G alumni entrepreneurs also created the national style brand Twelve Yards.

Li Lun of Panda Capital shared a new discovery in 2018: "The best entrepreneurs now might be those who worked at companies like P&G for five years in their first job. They were systematically trained and know how to grow wildly. If the industry they later enter matches their previous experience, they also have a group of former P&G brothers and friends who can help, with abundant resources available."

**Spending a Year Explaining What WeChat Is to the Boss**

These new brands are all outside P&G's territory, and there are reasons for that.

As personnel increased and the structure became more complex, communication costs rose, P&G's sensitivity to market changes declined, and internal innovation became difficult. Helplessly, many young people with ideas began to leave.

According to China Business Network, in the decade or so after 2000, P&G's structure became so massive that reporting relationships became complex. New product launches in the Chinese market required approval from the US team before implementation, but the US team couldn't promptly understand the rapid development of the Chinese market, so too much time was spent internally on communication.

On the other hand, Chinese local enterprises and the entire e-commerce internet channel were rapidly rising.

Qiuyue still remembers the trigger that made her leave P&G after just one year. In 2015, Weibo was in a transitional period between "public intellectuals fading and influencers not yet rising," with many complaining about rampant fake followers and poor activity, while WeChat public accounts were about to rise.

But Qiuyue's team spent a year failing to convince the American boss to accept WeChat, directly missing the best advertising channel. Shortly after, the brand she was responsible for was cut.

"He insisted on comparing WeChat public accounts to something abroad, but it wasn't Twitter or Facebook, nor was it like Instagram, which hadn't taken off for seeding at that time. Showing him data didn't give him a perceptual understanding, and there were no big KOLs then; self-media like New World was still small, so the boss didn't want to take risks," Qiuyue recalled.

This made her "very painful." She spent four quarters grinding, repeatedly making PPTs, including one over 120 pages, just to explain "what WeChat is." The boss couldn't understand. He came to China every four months, and the first thing he did was eat Din Tai Fung dumplings, saying he wanted to understand what Chinese people were thinking. "I was speechless; he was understanding the China of Chinatown in the 1980s."

Looking back now, Qiuyue believes the problem was putting people who don't understand China's national conditions in high positions. According to unwritten rules, "Chinese people can almost never reach Band 5 at P&G; above Band 4 are mostly foreigners. I was at Band 2. If this couldn't be pushed through in a year, I couldn't spend my whole life climbing slowly here." She felt it was better to work in teams led by Chinese people, "because Chinese people move too fast."

This confidence was also related to the entrepreneurial environment at the time. The "Mass Entrepreneurship and Innovation" initiative in 2014 ignited coffee shops in Beijing and Shanghai. Entrepreneurs poured in from all directions, holding an Americano, chatting with investors all day about whimsical ideas or disruptive innovations.

**A new wave of internet entrepreneurship surged, and many P&G people joined in, further fueling the rise of new domestic brands and indirectly exacerbating P&G's predicament.**

Xie Zhen also noticed the difference in this wave of entrepreneurship. Twenty years ago, few of his peers started businesses, and those who did mainly went into advertising or consulting firms. Now, significantly more are starting brands. "The difference is that the infrastructure for entrepreneurship is now complete, such as flat channels, venture capital support, and standardized production processes."

Zhao Qingping revealed that the post-70s and post-80s still recognize big brands, but post-90s and post-00s prefer niche and personalized brands. "P&G will also face challenges from short, fast-paced new consumption models. Large companies are constrained by systems and inter-departmental entanglements, making decisions complex. When new opportunities arise, it's better to go out and start a business, replicating experience in new brands."

(Image source: VCG)

Perfect Diary CMO Sun Lei once recalled that when she joined P&G's skincare brand Olay marketing department in 2010, she noticed a trend of declining foot traffic in shopping malls. When she proposed developing e-commerce channels, her leader only gave her a "small amount of funds" for internal entrepreneurship.

Realizing that "the bottleneck preventing e-commerce success came from within P&G," Sun Lei left P&G in 2013 and joined Yixian E-commerce, together creating the rise of online beauty brand Perfect Diary.

An insider from a domestic skincare brand also told AI Finance and Economics that the founder couldn't push new ideas at P&G, so he left the foreign company where he had worked for over a decade. After starting his own business, he secured hundreds of millions in funding, and now his products rank high in Tmall's skincare category.

It can almost be said that no domestic brand can compete with the massive P&G Group, but they are coming from all directions, wrapping around P&G's "five major fronts."

In beauty products, there are Winona, Fuerjia, Juzi Biotech, and WIS; in grooming products, there is Xumi; in health care products, there are usmile and Saky; in fabric and home care, there are Bluemoon, Walch, and Liby; in baby, feminine, and family care, there are ABC, Zhihu, and Babycare.

This has indeed impacted P&G. Except for grooming products (like Gillette razors) where it dominates, and star products Olay and SK-II holding steady in skincare, other areas are being invaded. For example, a Guojin Securities report shows that in the household cleaning care category, P&G's market share in 2019 was 8.6%, only half of the leader Liby's share.

**P&G's Lost Eight Years**

"We have moved from the volume stage to the intensive cultivation stage. This era does not belong to P&G; P&G should decisively say goodbye to the times," Qiuyue said pointedly.

In her view, P&G's model is volume-based: quickly building multiple brands and distributing them widely. But now information is extremely fragmented, and both channels and traffic require precision. It's too difficult for P&G to transform because volume was its foundation.

For example, in channels, large supermarket chains have become walking paradises for middle-aged and elderly people. You see Carrefour selling out and Walmart continuously closing stores because young people have moved to online or convenience stores and other new channels. Many new domestic brands start online. This means that the supermarket channel P&G once prided itself on has lost its advantage.

In marketing, P&G still loves to talk about "product functions" with users, but this is no longer the era of material shortage. Young consumers value the connection between brand and self, as well as interesting interactions. You see new brands particularly enthusiastic about this, including attractive packaging and store design, while P&G seems to stick to the old frugal approach.

Stagnation has also pushed P&G into a vortex. From 2008 to 2012, P&G's annual revenue exceeded $80 billion at its peak. After 2013, global performance began to decline. In 2016, global sales even fell to a low of $65.3 billion, after which performance slowly recovered.

By 2020, global sales reached $70.9 billion, still more than $10 billion behind 2013. It can be said that P&G experienced "eight lost years."

In Greater China, P&G's second-largest market, development has almost stalled due to the rise of domestic brands and e-commerce impact. According to data from Southwest Securities research reports, P&G's net sales in Greater China from 2013 to 2018 only increased from $5.91 billion to $6.01 billion.

(Image source: VCG)

During the difficult period, P&G adhered to the "80/20 principle" and decided to focus on a few blockbuster products. In 2014, P&G began drastic brand simplification, cutting its 6,000 global advertising and PR agencies in half.

In 2015, P&G cut more than half of its sub-brands. By 2017, it had only 65 global brands, down from over 300 at its peak.

This strategy is understandable because the brands that create the most value are always the few top-tier ones at the pyramid's apex, making it easier to create flagship products. A typical example is SK-II and Olay, which achieved double-digit sales growth in 2018 and 2019, becoming key parts of P&G's profit pool.

However, this strategy of concentrating resources on "blockbusters" also imposes constraints on brand innovation. Many new brands and opportunities come from niche segments. They may not significantly impact overall sales in the short term, but they could become important antennas for P&G to understand young users' needs and capture young consumer groups.

**Holding onto its territory has, to some extent, suppressed internal innovation and driven away a group of insightful people.**

It can be said that P&G, as one of the earlier foreign companies entering China, once brought new trends to the market environment and was a part of enlightening minds in Chinese business society. **Now, as times change, P&G no longer enjoys its past glory, but it continues to participate in China's new business journey in another form—by allowing mature old P&G people to stand independently.**

(At the request of interviewees, Zhao Qingping and Qiuyue are pseudonyms)

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