CHINA’S richest man lashed out at two of the country’s biggest tech giants for fanning online vitriol targeting him earlier this year and instigating a price war that wiped out tens of billions of market value for his bottled water empire.
At an event in Jiangxi province earlier this month, Zhong Shanshan, the founder of Nongfu Spring, accused online budget shopping platform PDD Holdings of disrupting a pricing system it has worked hard to uphold. “The price system such as Pinduoduo’s does great harm to Chinese brands and industries,” Zhong said, according to local media reports.
The next day at another event, Zhong demanded an apology from Zhang Yiming, founder of TikTok owner ByteDance, for tolerating online trolls that wrongfully pitted him against the late founder of rival company Hangzhou Wahaha Group in online posts. He also criticised the company’s algorithm for amplifying the negative publicity around him.
“I hope Mr Zhang Yiming, Douyin, Toutiao and all the media that have hurt me personally with rumours will apologise,” he said. “I am waiting for your sincere apology! I’m waiting.”
Douyin and Toutiao are social media companies owned by ByteDance.
Zhong’s unexpected outburst comes after he has faced a series of public relations challenges for much of the year. He first came under fire after the February death of Zong Qinghou, the founder of key rival Hangzhou Wahaha, with China’s online army of nationalist citizens drawing unfavourable comparisons for everything from Nongfu Spring’s water quality and packaging to Zhong’s business tactics.
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The fallout saw Nongfu’s shares take a battering, which lost the company more than US$20 billion in market capitalisation since the beginning of the year and cost Zhong his seat atop China’s rich list in August. He has since recovered his position as the nation’s wealthiest person with a net worth of US$52.2 billion, according to the Bloomberg Billionaires Index.
In videos circulating on Chinese social media, Zhong even criticised the Chinese government “for negligence” for allowing e-commerce platforms to foster the low-pricing trend among companies and consumers.
Brutal price wars have erupted among consumer brands over the past two years in efforts to attract budget-conscious Chinese consumers. Businesses from car makers to chain restaurants have engaged in price-cutting battles, prompting even Nongfu to release a new cheaper bottled water amid fierce competition. In August, Nongfu posted the slowest half-year profit growth since its listing in 2020, dragged down by the performance of its drinking water products.
As one of the older generation of self-made billionaires who made their fortune from more traditional sectors such as manufacturing, Zhong has always been dismissive of the Internet industry. The harm caused by people using science and technology is more vicious than that caused by ordinary people, Zhong said earlier this month, in criticism of how tech firms use algorithms to tailor the information users can see. He has also expressed his scorn of businesses that sell their products via livestreaming, calling them companies with no roots. “I will never do that,” he said. BLOOMBERG
