Eliza Wong
Executive Summary
– Marketing consultancy Huayu Hua (华与华) issued private apology to prominent entrepreneur Luo Yonghao (罗永浩) following public dispute over Xibei’s (西贝) pre-made meal controversy
– Incident exposes vulnerabilities in China’s “Super Symbol” marketing methodology and raises questions about consulting fee structures in Chinese consumer sector
– Xibei reportedly paid over 60 million RMB in consulting fees to marketing consultancy Huayu Hua during their decade-long partnership
– Controversy highlights growing scrutiny of marketing claims in China’s consumer sector amid rising regulatory oversight
– Episode may impact investor confidence in marketing-driven growth strategies among Chinese consumer stocks
The Spark That Ignited a Marketing Firestorm
The recent controversy surrounding Xibei’s pre-made meals has unexpectedly dragged marketing consultancy Huayu Hua into the spotlight, culminating in a rare public apology to technology entrepreneur and live-streamer Luo Yonghao. What began as consumer complaints about Xibei’s pre-made dishes evolved into a broader examination of marketing practices in China’s consumer sector.
The conflict escalated when Hua Shan (华杉), founder of marketing consultancy Huayu Hua, publicly supported Xibei chairman Jia Guolong (贾国龙) and labeled Luo Yonghao as an “internet troll.” This intervention backfired spectacularly, drawing criticism from consumers and ultimately forcing marketing consultancy Huayu Hua to retreat from its aggressive stance.
The Pre-Made Meal Controversy
Xibei found itself at the center of a storm when consumers discovered that the restaurant chain’s broccoli dishes had a 24-month shelf life, leading to social media jokes about “children eating broccoli older than themselves.” The marketing slogan “Close your eyes and order, every dish is delicious” created by marketing consultancy Huayu Hua was ironically reinterpreted by netizens as “Close your eyes and order, every dish is pre-made.”
Luo Yonghao’s Live-Stream Criticism
On September 14th, Luo Yonghao used his popular live-stream platform to directly attack marketing consultancy Huayu Hua, stating that “any company that hires Huayu Hua must have something wrong with their thinking.” The blunt criticism from one of China’s most influential business personalities significantly increased pressure on the marketing firm.
Marketing Consultancy Huayu Hua’s Business Model Under Scrutiny
The apology to Luo Yonghao has raised broader questions about the business practices and effectiveness of marketing consultancy Huayu Hua. The firm, founded by brothers Hua Shan and Hua Nan (华楠) in 2002, has built its reputation on the “Super Symbol Theory” which emphasizes creating memorable, easily recognizable marketing symbols and slogans.
Lucrative Consulting Arrangements
According to disclosures from Dook Publishing (读客文化), a company controlled by Hua Shan, Xibei paid marketing consultancy Huayu Hua consulting fees of 4.8 million RMB in 2017, 3.6 million RMB in 2018, and 4.2 million RMB in 2019. Over their decade-long partnership, total fees reportedly exceeded 60 million RMB, representing significant financial commitment from the restaurant chain.
Hua Shan had previously expressed confidence in the ongoing relationship, stating that marketing consultancy Huayu Hua hoped to “take one or two hundred million more” from Xibei over the next decade. The recent controversy casts doubt on whether this ambitious target remains achievable.
The Super Symbol Methodology: Strengths and Vulnerabilities
Marketing consultancy Huayu Hua’s approach centers on creating what they term “super symbols” – easily recognizable marketing elements that become synonymous with brands. Their most famous success remains the蜜雪冰城 (Mixue Ice City) jingle “You love me, I love you, Mixue Ice City sweet sweet” that became ubiquitous across China.
Previous Campaign Controversies
Despite notable successes, marketing consultancy Huayu Hua has faced several previous controversies regarding their marketing claims:
– For Zaoyang Steamed Buns (早阳肉包), the slogan “Zaoyang Steamed Buns, using only hind leg meat” resulted in a 20,000 RMB fine when products were found to contain other pork parts
– The “Sun-dried for 180 days” claim for Chubang Soy Sauce (厨邦酱油) was challenged when investigations revealed actual sun-drying time was only 84 days
– Marketing for Zuliy Shoes (足力健) as “non-slip in rain and snow” led to lawsuits from elderly customers who experienced falls
– Publishing controversies involving misrepresentation of “The Little Prince” book series damaged credibility in literary circles
Financial Performance and Market Position
Despite these controversies, marketing consultancy Huayu Hua has maintained strong financial performance. According to Head Leopard Research Institute’s 2025 brand marketing consulting industry forecast, the firm ranks among few consultancies capable of handling large order volumes, serving primarily clients with 1-5 billion RMB in revenue.
Premium Pricing Strategy
Marketing consultancy Huayu Hua commands premium fees in the industry, with annual consulting contracts typically starting at 6 million RMB and often requiring minimum three-year commitments. Numerous listed companies disclose payments of several million RMB annually for their services, reflecting the perceived value of their marketing approach.
The firm maintains strict business principles, refusing participation in competitive bidding processes and operating on a “pay first” basis. Their client portfolio includes over 100,000 retail locations, with more than 60,000 still active as of 2024, demonstrating substantial market penetration.
Broader Implications for China’s Marketing Industry
The very public dispute between marketing consultancy Huayu Hua and Luo Yonghao reflects larger trends affecting China’s marketing and consumer sectors. As consumer awareness grows and regulatory scrutiny increases, marketing claims face greater examination from both authorities and the public.
Changing Consumer Expectations
Chinese consumers increasingly prioritize transparency and authenticity over catchy slogans. The pre-made meal controversy at Xibei highlights how marketing messages that don’t align with actual product experience can quickly damage brand reputation. This shift presents challenges for firms like marketing consultancy Huayu Hua that built their reputation on simplified, memorable messaging.
Regulatory Environment Intensifies
China’s State Administration for Market Regulation (国家市场监督管理总局) has increasingly focused on false advertising claims, particularly in the food and healthcare sectors. Marketing consultancies must navigate stricter requirements for claim substantiation, creating additional compliance challenges for aggressive marketing strategies.
Investment Implications and Sector Outlook
For investors in Chinese consumer stocks, the marketing consultancy Huayu Hua controversy offers several important considerations. Companies relying heavily on marketing-driven growth strategies may face increased scrutiny regarding the sustainability of their business models.
Evaluating Marketing ROI
The disclosure that Xibei paid over 60 million RMB to marketing consultancy Huayu Hua raises questions about return on marketing investment. While Jia Guolong claimed the strategies generated at least 100 million RMB in additional revenue, the recent controversy suggests potential reputational costs that may offset financial gains.
Investors should carefully evaluate marketing expenditures among consumer companies, particularly those employing high-cost consulting arrangements. Scrutiny of whether marketing investments generate sustainable growth versus short-term sales lifts becomes increasingly important.
Sector-Wide Impact
The attention on marketing consultancy Huayu Hua may prompt broader reassessment of marketing practices across China’s consumer sector. Companies that have employed similar “super symbol” approaches may face investor questions about campaign effectiveness and potential reputational risks.
Moving Forward: Lessons for Marketers and Investors
The rapid resolution of the conflict between marketing consultancy Huayu Hua and Luo Yonghao – culminating in a private apology – demonstrates the power of influential voices in shaping brand perceptions in China’s digital economy. For marketing professionals and investors alike, several key lessons emerge from this incident.
Authenticity Over Slogans
The controversy underscores that catchy marketing slogans cannot compensate for product deficiencies. As Chinese consumers become more sophisticated, marketing messages must align with actual customer experiences. Companies investing heavily in marketing should ensure equivalent attention to product quality and operational excellence.
Crisis Management Considerations
Marketing consultancy Huayu Hua’s initial aggressive response to criticism exacerbated rather than contained the controversy. The episode highlights the importance of measured crisis response strategies, particularly when dealing with influential figures like Luo Yonghao who command significant public audiences.
For investors analyzing Chinese consumer companies, examining crisis management capabilities and past responses to challenges provides valuable insight into management quality and brand resilience.
Strategic Implications for the Consulting Industry
The challenges facing marketing consultancy Huayu Hua reflect broader evolution in China’s marketing consulting industry. As digital platforms transform marketing measurement and consumer engagement, traditional consulting approaches face pressure to demonstrate tangible business impact beyond creative campaigns.
Future Growth Drivers
Despite current challenges, marketing consultancy Huayu Hua has diversified revenue streams including high-priced training programs (99,000 RMB per person for Hua Shan’s brand course) and premium publications (1,499 RMB for their case study collection). This diversification provides some insulation from client-specific controversies.
However, the firm’s future growth may depend on adapting its methodology to accommodate increasing demands for data-driven marketing accountability and authentic brand storytelling that resonates with increasingly sophisticated Chinese consumers.
Final Analysis: Navigating China’s Evolving Marketing Landscape
The apology from marketing consultancy Huayu Hua to Luo Yonghao represents more than just resolution of a personal dispute – it signals shifting power dynamics in China’s marketing industry. As consumers and influencers gain greater voice through digital platforms, marketing approaches must evolve beyond simple slogans to embrace transparency and authenticity.
For companies operating in China’s consumer sector, the incident offers valuable lessons about balancing creative marketing with operational execution. For investors, it highlights the importance of scrutinizing marketing expenditures and evaluating whether brand-building investments create sustainable value versus short-term visibility.
The ultimate impact on marketing consultancy Huayu Hua remains uncertain, but the episode undoubtedly marks a significant moment in the evolution of China’s marketing industry. As one industry observer noted: “Long-term success requires authentic company substance, not easily packaged symbols.”
Market participants should monitor how marketing consultancy Huayu Hua adapts to these challenges and whether other firms employing similar methodologies adjust their approaches in response to changing market expectations.
