---
title: "Xinchao Media Zeng Jian: Everything for Growth, Everything for Winning!"
description: "On August 18, at Xinchao Media's Shanghai headquarters, New Distribution interviewed Zeng Jian, co-founder and senior vice president of Xinchao Media. As China's largest community media platform, Xinchao Media serves as a barometer of the FMCG economy's prosperity. The interview provides a comprehensive perspective on the 2023 FMCG economy. Zeng Jian, a serial entrepreneur, led the company's expansion from regional to national, building the largest advertising sales team in China's offline media industry. Since 2020, he has built the KA team, serving nearly 300 well-known brands and creating several classic brand cases."
author: "陈思廷"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2023-09-05"
language: "en"
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# Xinchao Media Zeng Jian: Everything for Growth, Everything for Winning!

> On August 18, at Xinchao Media's Shanghai headquarters, New Distribution interviewed Zeng Jian, co-founder and senior vice president of Xinchao Media. As China's largest community media platform, Xinchao Media serves as a barometer of the FMCG economy's prosperity. The interview provides a comprehensive perspective on the 2023 FMCG economy. Zeng Jian, a serial entrepreneur, led the company's expansion from regional to national, building the largest advertising sales team in China's offline media industry. Since 2020, he has built the KA team, serving nearly 300 well-known brands and creating several classic brand cases.

On August 18, at Xinchao Media's Shanghai headquarters, New Distribution interviewed Zeng Jian, co-founder and senior vice president of Xinchao Media. As China's largest community media platform, Xinchao Media can be considered one of the barometers of the prosperity of China's FMCG economy. Therefore, the interview with Mr. Zeng Jian can be said to be the best reference for us to judge the health of the FMCG economy in 2023 from an overall perspective. Mr. Zeng Jian himself is also an excellent serial entrepreneur. He led the management team to complete Xinchao Media's market layout from regional to national, creating and operating the largest advertising sales team in China's offline media industry. In 2020, he began to build the KA team, expanding and serving nearly 300 well-known brands such as Nestlé, P&G, Alibaba, Midea, Ausnutria Dairy, A2 Milk, Bright Dairy, Vipshop, Jingjiu, Oppein, etc., and collaborated with clients to successfully create more than a dozen classic brand cases such as David Mop, iFlytek AI Learning Machine, a1 Snack Research Institute, and Alpha Egg Dictionary Pen. The following content is narrated by Mr. Zeng Jian, recorded and organized by New Distribution, and reviewed by him.
**First Half of 2023:**
**Mostly Sea, a Little Fire** How did FMCG companies perform overall in the first half of 2023? To sum it up in one sentence, it is **"mostly sea, a little fire," with severe stratification and differentiation among companies. Most are struggling, while a few are doing well.** Specifically, companies that performed well in the past have now split into three states. **1) Revenue growth without profit growth.** The first type is revenue growth without profit growth; revenue may still be increasing, but profit growth cannot be maintained. This is a typical situation in the first half of the year. For example, in the children's cheese category, due to fierce competition, almost no one is making money. Another example is Yihai Kerry, which had revenue of over 110 billion yuan in the first half, but profits fell by more than half. These are often category leaders, with scale growing or maintaining, but profits declining.
> One reason is rising raw material costs, but terminal prices cannot rise due to competition; another reason is that market competition is a zero-sum game, and competitive expenses have risen significantly, so the product profits in the original structure are insufficient to support; the third reason is that downward economic pressure has increased, suppressing consumer enthusiasm, which in turn has intensified competition at the brand and channel levels.
**2) Many companies are beginning to face cash flow tensions.** Over the past three years of the pandemic, most companies and consumers have been in a state of continuous "bleeding," and now they are in a process of "recovering." However, after a brief growth in the first quarter of 2023, the overall operation in the second quarter and even July and August is not optimistic. In fact, the pandemic over the past three years is only one factor affecting our economic transformation and upgrading, but not the decisive factor.
If your brand and company have completed transformation and upgrading, then today is an opportunity for growth and overtaking. But most companies have not done so, believing that things will improve after the pandemic, but that is not the case.
Therefore, entering the second quarter, cash flow tension is an unexpected situation for many companies. After the pandemic, the "bleeding" continues for these companies, and the pressure is enormous.
This pressure has also been transmitted to our advertising industry. Xinchao is already in a good position, still growing year-on-year, but some types of advertising media have already disbanded. **3) Brands with mainly online revenue have encountered structural contradictions.** A core but unsolvable problem is that traffic costs have risen significantly and continuously. **Online brands have strong explosive power, but their biggest problem is that the brand is not independent.** Online brands must rely on internet platforms, and every bid traffic the platform gives you costs money. For example, an online brand with annual revenue exceeding 2 billion yuan has traffic costs of 800 million yuan. It can make money, but the profit margin is very thin. If traffic costs rise a bit more, it will not make money. It is not just your traffic that is tight; the entire platform's traffic is tight. Therefore, platforms encourage brands to attract traffic from outside, even offering special traffic rewards. But the mechanism of bid traffic determines that the cost of each traffic will tend to rise indefinitely until it is unprofitable. **Without offline channels, a brand has no roots. Many online brands are now making up for this offline lesson this year.** In the first half of the year, capital investment enthusiasm in the entire consumer industry has also turned cold. In the primary market, investment in the FMCG industry this year has been very limited, with few highlights. This has made it difficult for many companies that were doing well in the market to raise funds, forcing them to slow down their market pace. Even good companies find it hard to raise money, which is a special phenomenon this year. **What did good companies do right?** Although this year is tough, there are still companies that are doing very well. No matter how difficult the environment, such companies exist, and they often share several common characteristics. **1) First, there is an excellent founder or CEO.** I believe that running a business is not about democracy; it depends on the leader. Companies that can still maintain both volume and profit growth today have leaders with strong spirit, strategy, and comprehensive capabilities. We see brands like Snow Beer, Hsu Fu Chi, and a1 Snack Research Institute still achieving good growth this year, which is inseparable from their leaders. Excellent leaders, in addition to strategic vision and comprehensive abilities, often have extraordinary willpower. In this year's situation, it is understandable if one's willpower is a bit weak, if one lies flat a little, or allows a slower pace. But excellent leaders can still have the confidence and determination to set high goals and make their teams firmly believe they can achieve them, which is truly remarkable. Among the companies I know, Proya, Huang Tian'e, David Mop, Hsu Fu Chi, and a1 Snack Research Institute have all grown well this year. **2) Strong marketing capabilities that shine in times of crisis.** Good companies have strong marketing capabilities, but in the era of incremental growth, their strength is not always evident. Let me use the example of a1 Snack Research Institute to illustrate. The overall decline of traditional retail is obvious. In a1 Snack Research Institute's strategy, maintaining a position in traditional KA stores is sufficient. But in the traditional channel, its strategy is "grid-based city management." "Grid-based city management" means expanding the sales team, providing deep services to distributors, and leading distributors to manage cities in a grid, similar to "deep distribution." Terminal types focus on convenience stores and community stores around residential areas. The founder of a1 Snack Research Institute, Zhou Weiping, also summarized the twelve-character policy for "grid-based city management": "Generals brave, customers smooth, network wide, points deep, sound loud, momentum strong." The results prove that the "grid-based city management" strategy of a1 Snack Research Institute has brought significant growth. The Linyi distributor originally had monthly sales of only over 100,000 yuan, but with this new community-centered approach, revenue grew to 590,000 yuan in the third month. **As long as organizational capabilities and marketing capabilities exist, market opportunities will always exist. The true essential competitiveness of a company always lies in people; no matter how good the product or strategy, it must be realized by people. The harder the environment, the more important the human element becomes.** **Survival and Growth Strategies in the Worst-Case Scenario** The environment is already difficult today, but is it the worst? Not necessarily! **Have the strongest confidence in the future, but always be prepared for the worst.** Facing a potentially worse future, what should FMCG companies do? **1) Make resolute trade-offs.** The trade-offs and focus at the strategic level need not be elaborated; most companies have realized this and basically done it. Otherwise, survival would be impossible. The trade-offs I am talking about are at the tactical level: one is product trade-offs, and the other is channel trade-offs. **On the product side,** previously you might have had 100 SKUs, with 80% being supplementary. You need to consider whether to focus on 10 or even 5 SKUs. Resources are limited, and in difficult times, every resource is much more precious than in prosperous times. Focusing limited resources on the most productive products, consolidating the niche market, and temporarily shelving other products to wait for spring may be a necessary strategy today. **On the channel side,** focusing on productive and quality channels is also necessary. Although we talk about omnichannel operations, when it comes to individual channels, do not cover for the sake of coverage; it must have necessary value. Does it provide sales scale and thus marginal contribution? Does it provide new growth space? Does it provide profit growth? Does it prevent competitor attacks? If you cannot find the necessary value of a channel, you can consider trade-offs. One more point worth adding: **Many bosses have companies with revenue of over 1 billion yuan, and their product and marketing capabilities are excellent, but their financial capabilities are often lacking. In today's environment, lacking financial awareness and capability can lead to huge resource waste.** **2) All innovation is for "growth."** We make trade-offs in products and channels to focus and save resources. But saving resources is not to put them in your pocket, but to serve innovation. Similarly, innovation requires resources, and today's innovation still needs to be focused. Where should it focus? On "growth." The market always has growth points, but there may be a lack of awareness and courage for growth, or a lack of resources invested in innovation for growth. Today's innovation especially needs to pay attention to risk. **The principle of innovation that reduces risk is to focus on "growth."** Innovation that can bring growth is effective innovation today; innovation that cannot bring foreseeable growth may become a cost. Of course, giving innovation organizations sufficient authority, designing fault-tolerant spaces, error-correction mechanisms, feedback mechanisms, horse-racing mechanisms, and other strategies is still necessary and useful today. If we must add one more thing to today's innovation, it is to act according to your capabilities. Whether innovating at the brand, product, or channel level, you need to act according to your capabilities today. Spend every penny well, spend it in the right place, and spend it well. In such difficult times, you may instead gain new opportunities and seize new growth. One thing to remember is that **today, the starting point of all our work is for growth, and fighting is for winning.**


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