Nongfu Spring and the Turbulent History of China’s Bottled Water Industry

The story of Nongfu Spring (农夫山泉) is as much a tale of entrepreneurial resilience as it is a chronicle of the fierce and often chaotic evolution of China’s bottled water market. From humble beginnings in the scenic Thousand Island Lake region to becoming the nation’s leading water brand, Nongfu Spring has navigated scandal, fierce competition, marketing controversies, and even modern “cancel culture.”

From Cultural Revolution Survivor to Billionaire Entrepreneur

Founder Zhong Shanshan was born in Hangzhou in 1954 during a period of immense political upheaval. Like millions of others, the Cultural Revolution disrupted his education, forcing him into manual labor at just twelve years old. After the reopening of schools, he graduated from what is now the Open University of China and began his career as a journalist. This period gave him exposure to the country’s emerging class of entrepreneurs, fueling his own ambitions (Barnes & Cao, 2013).

In 1988, when Hainan became a Special Economic Zone, Zhong moved there, dabbling in ventures ranging from newspapers to mushroom farming—both of which failed. His first real success came through the Dang Curtains Company, which capitalized on the province’s booming real estate sector by selling imported textiles.

From Turtle Pills to Bottled Water

The early 1990s saw China enthralled by Coach Ma Junren’s success with the women’s national athletics team. His athletes’ dominance at the 1993 Stuttgart World Championships was credited to rigorous training and an unusual traditional Chinese medicine remedy: soft-shelled turtle soup, believed to replenish “yin” energy (Li et al., 2011). Sensing an opportunity, Zhong launched his own supplement—Yangshengtang Turtle Pills—marketed as more convenient and just as “health-enhancing” as the soup.

When a competing turtle essence product was exposed as fraudulent in 1995, Zhong seized the moment, highlighting the authenticity of his own. By 1996, his brand had expanded into other supplements, but China’s bottled water market was beginning to explode—spurred by rapid urbanization, pollution of natural water sources, and growing middle-class health concerns (Argentieri, 2019).

The Rise of Nongfu Spring

Foreign brands such as Evian and Perrier entered China in the late 1980s, but their high prices left room for domestic competitors like Wahaha (娃哈哈) and Robust. Wahaha, founded by Zong Qinghou in 1987, first made its mark with dairy and nutritional drinks before entering the bottled water market in 1995 (Weijie, 2025).

Zhong, inspired by a trip to Thousand Island Lake (a man-made reservoir renowned for its clarity), launched Nongfu Spring in 1996. The name—meaning “Farmer’s Mountain Spring”—was designed to evoke purity and natural origins. Early success came from memorable marketing, such as the slogan, “Nongfu Spring tastes a bit sweet” (Pallone, 2018).

The 2000 “Water War”

In April 2000, Nongfu made a bold move—announcing it would no longer produce purified water, claiming that natural water’s mineral content was essential for health. This was supported by studies from Zhejiang University, though critics accused the company of pseudoscience, noting that the body’s mineral needs are met primarily through food (Minghui & Chelliah, 2022).

The company’s ad campaign, showing flowers wilting in purified water but thriving in natural water, provoked outrage from rivals. Sixty-nine purified water companies issued a joint statement accusing Nongfu of defamation. The so-called “Water War” ended in a mediated truce, but not before cementing Nongfu’s position as a top-three player.

Strategic Pricing and Market Domination

The bottled water business in China is extraordinarily profitable, with gross margins exceeding 60% (Barnes & Cao, 2013). Recognizing this, Nongfu adopted an upscale strategy from 2010, raising retail prices while keeping wholesale costs stable—ensuring distributors earned more and prioritized Nongfu products. By 2012, Nongfu had captured the top market share, a lead it maintained for years (Vitali, 2023).

Scandals and Cancel Culture

In 2013, Beijing Times accused Nongfu of having lax quality standards, leading to lawsuits. In 2021, rumors falsely claimed its peach soda used radioactive Fukushima peaches. But the most severe blow came in 2024, after Wahaha founder Zong Qinghou’s death. Online narratives cast Zhong as an unethical opportunist and accused Nongfu of being “pro-Japan” due to alleged design similarities with Japanese imagery—a charge that had little factual basis but resonated with online nationalist sentiment.

The result was devastating: daily online sales plunged by nearly 90%, and annual sales fell 21% year-on-year (Argentieri, 2019).

Return to Purified Water

In a strategic reversal, Nongfu re-entered the purified water market in April 2024, competing directly with C’estbon (怡宝), which dominates urban markets. Despite Zhong’s continued skepticism about purified water’s health value, the move reflects the need to defend market share amid stagnating industry growth and intensifying competition (Minghui & Chelliah, 2022).

Conclusion

Nongfu Spring’s history is not just the story of one brand—it is a window into China’s modern consumer economy, where marketing ingenuity, public perception, and political sensitivities can make or break billion-dollar empires. Zhong Shanshan’s trajectory—from Cultural Revolution dropout to China’s richest man—underscores both the opportunities and perils of entrepreneurship in one of the world’s most dynamic markets.

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References

Argentieri, G. P. (2019). Upgrading in Chinese bottled water market: The case of Italian San Pellegrino. Università Ca’ Foscari Venezia. https://unitesi.unive.it/bitstream/20.500.14247/17600/1/847982-1226573.pdf

Barnes, A., & Cao, W. (2013). Muddy waters: The public health risks and sustainability of bottled water in China. Vermont Law Review, 38. https://www.vermontlaw.edu/wp-content/uploads/2024/07/Abi-Barnes-and-Wei-Cao-Bottled-Water.pdf

Li, L., Xia, L., Liu, M., & Ling, Y. (2011). The Hangzhou Wahaha Group: An insight into diversification strategy of China's private enterprises. Emerald Emerging Markets Case Studies, 1(4), 1-21. https://www.emerald.com/insight/content/doi/10.1108/20450621111186156/full/html

Minghui, B., & Chelliah, S. (2022). Marketing strategies and export performance among bottled water manufacturing in China. Global Business and Management Research, 14(3s), 94–110. https://www.gbmrjournal.com/pdf/v14n3s/V14N3s-94.pdf

Pallone, A. (2018). Bottled water market in China: The Acqua Filette experience. Università Ca’ Foscari Venezia. https://unitesi.unive.it/bitstream/20.500.14247/13131/1/865510-1224232.pdf

Vitali, G. (2023). Western food and beverage companies in the Chinese market: Challenges and strategies. Università Ca’ Foscari Venezia. https://unitesi.unive.it/bitstream/20.500.14247/24534/1/TESI%20GIULIA%20VITALI.pdf

Weijie, Z. (2025). Research on brand construction and marketing of Wahaha Group in China. Universitas Pendidikan Ganesha. https://repo.undiksha.ac.id/23676/