Hello everyone, I’m Yao Yi, co-founder of Honestbite. After leaving P&G, we ventured into entrepreneurship.
Our initial efforts—ranging from social apps to service-oriented and content platforms—proved difficult, largely because they were outside our core competence in fast-moving consumer goods (FMCG). Still, those years gave us valuable lessons: how to build viral content, develop software products, and manage cash flow in startup conditions—skills not typically covered in corporate settings.
In 2020, we returned to our roots and launched Honestbite, a pet food brand grounded in FMCG principles. Our approach combines P&G’s strengths in brand building with entrepreneurial speed and adaptability.
A Blue Ocean Market: Building a Brand Portfolio
Here are some core statistics about the pet industry:
20%: approximate pet ownership penetration in China in 2023. Over 60%: pet ownership rate in North America—meaning roughly two out of every three households have a pet. China’s pet sector is still in its “infancy.”
RMB 100 billion: our estimate of the size of China’s pet food market. Despite having only one-quarter of China’s population, North America’s market is likely worth over USD 150 billion, highlighting a substantial gap—and considerable potential—for growth in China.
30%: China’s pet market CAGR from 2010 to 2020—a remarkably rapid growth rate.
65%: the share of pet food sales conducted online in China. In the U.S., the number is less than 30%. Notably, a decade ago China's offline share was nearly 70%. Its current surge to nearly 65% online underscores that the decisive battleground is digital, not traditional retail.
18%: market concentration of the top 10 pet food brands in China. By contrast, in the U.S.—a mature FMCG market—the top 10 brands account for 85%. China’s market remains fragmented and fiercely competitive, which presents ripe opportunities for emerging players like us.
10–15%: estimated market share held by multinational companies in China.
From these figures, we can draw three clear conclusions:
- This is a high-potential, rapidly growing industry.
- Multinational corporations do not enjoy an insurmountable competitive edge.
- Online is the strategic front in this market.
Importantly, this is a category resistant to economic downturns. Even in times of crisis, global pet markets have continued growing at 5%+ annually. This reflects a "lipstick effect" dynamic—pets offer emotional value at a relatively low cost. In Tier 2 cities, it costs just over RMB 100 per month to keep a cat, yet the companionship they provide is irreplaceable.
Another key insight: the rise of the pet economy is closely tied to urbanization. As cities densify and living spaces shrink, many young people delay having children. Yet as emotional beings, humans still seek connection—often fulfilled by caring for cats and dogs.
We’re building more than just Honestbite. Since 2021, we’ve launched four additional brands:
- Ge Wu An (a pun on “canned food” in Chinese), is now the top domestic brand in the wet food category.
- Dongbian was born from a core insight: Chinese pets typically get less exercise than their Western counterparts due to lifestyle differences. This affects digestion, so we tailor nutrition to local needs.
- Suxing is our value-oriented brand, designed to serve consumers in lower-tier cities with more accessible price points.
Each brand targets a distinct consumer segment. Our brand architecture draws on a classical P&G framework—start with the who, define the what, and optimize the how to improve conversion and retention. This structured thinking has allowed us to build a portfolio at relatively low cost.
Core Capabilities: Content & Supply Chain
Brand-building talent is no longer scarce in China. Decades of foreign FMCG presence have cultivated a mature talent pool. So we focus on two core capabilities with long-term strategic importance:
First, content.
In 2024, our content regularly reaches over one million views across WeChat, Douyin, Bilibili, Xiaohongshu, and Video Accounts. Comments often come from real customers expressing genuine appreciation.
This reflects a fundamental shift in marketing. Twenty years ago, the formula was simple:
Mass Brand = Mass Media × Niche Channel
Owning key shelf space in hypermarkets and a few mainstream ad slots meant locking in annual sales.But today, both media and retail are fragmented. Traffic once held by big-box stores now flows to specialized channels like snack shops and beauty retailers. Online, infinite shelf space means consumers often make up their minds before searching.
Media, too, is now decentralized. Every user sees a different feed; each has their own influencers. For emerging brands, this opens doors: rather than buying a 15-second national ad, we partner with KOLs and KOCs whose content sparks conversations.
Another advantage of emerging Chinese brands is their data-driven approach, which also represents the future direction of consumer goods companies.We often say: "The future is already here—just unevenly distributed." Many traditional multinationals still struggle to access or leverage internal data effectively.
As a digital-native company, we started from a clean slate. Our data team oversees all performance metrics and conducts regular ROI analysis via multi-source regression modeling. While traditional firms may take two years to collect actionable insights, we operate with hourly data on visits, conversions, and more. This enables rapid iteration—cutting inefficiencies and amplifying what works, every quarter.
Second, supply chain and R&D.
While China has an abundance of manufacturing capacity, high-quality capacity is rare. Building our own supply chain moats is critical to long-term competitiveness.
A New Marketing Methodology Will Be Born in China
Having worked both as a corporate manager and as a founder, I want to close with a personal view:The next generation of marketing methodology will be born in China.
Foundational theories—who, what, how—remain universally applicable. But the how is evolving rapidly in the Chinese market.
China is leading the evolution from ecommerce to interest-based commerce and livestreaming. Where new channels emerge, new solutions follow. Ultimately, the most advanced consumer marketing strategies will be developed here—and perhaps even exported.
For example, two years ago, I wouldn’t have mentioned livestreaming. Today, it’s a crucial brand-building tool. How to leave a lasting impression and build brand awareness through livestreaming is a new frontier for future marketing.
In this fast-moving environment, new marketing theories will emerge—and Chinese brands may one day lead the world in defining them.
