The encyclopedia · Advertising & PR · Marketing decision · 2021–2026
Coconut Palm has been fined four times for suggestive ads — it keeps running them
Each fine is ¥400,000. Each round of coverage is worth more. After the 2024 penalty the brand posted a public statement saying it disagreed.
Coconut Palm Group · 2024-05
What happened
Coconut Palm Group (椰树集团), maker of China's best-known coconut juice, has been penalised at least four times by the Haikou market regulator for advertising that violates public morals. The 2024 fine of ¥400,000 cited copy including 'use coconut to rub breasts' and 'South Pacific women are rarely flat-chested', alongside the use of state officials' images in commercial marketing.
Three days after the 2024 fine, Coconut Palm posted a statement on its official website headed 'one worry, two disagreements'. It worried about destroying a national brand and the livelihoods of 20,000 employees and 500,000 coconut farmers. It disagreed that reposting content on its own website constituted commercial advertising, calling it 'science education', and cited the principle that what the law does not prohibit is permitted.
In early 2026, visitors to the group's factory tour photographed internal promotional material reading 'big big big' and 'Coconut Palm female employees have such big chests'. The Haikou regulator summoned the company and issued a fourth ¥400,000 fine. Cumulative penalties exceed ¥1 million. The regulator stated its principle: discover one, punish one.
Why it happened
- A ¥400,000 fine (roughly $55,000) is less than a single day's earned media from the controversy it generates — the penalty functions as a marketing budget, not a deterrent
- The brand's identity is built on provocation: its livestream hosts, packaging and factory tours all use the same suggestive register, so pulling one ad does not change the strategy
- The 'one worry, two disagreements' statement turned a regulatory penalty into a brand narrative of defiance, which the audience rewarded with more attention
- Chinese advertising law sets fines as fixed amounts rather than multiples of revenue, so a company with annual sales in the billions faces the same penalty as a small shop
The lesson
When a penalty is cheaper than the attention it generates, rational actors re-offend. A fixed fine on a billion-yuan brand is a line item, not a punishment.
Aftermath
Coconut Palm's coconut juice remains the category leader in China. The brand's livestream account continues to draw large audiences. The case is cited in Chinese advertising law discussions as evidence that fixed-amount fines fail to deter large companies, and in marketing circles as an example of controversy-as-strategy.
Sources
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