In recent years, China’s economy has been on a downward trend, leading even the once cash-rich major companies to streamline their structures and cut costs. Giant companies like JD, Alibaba, and ByteDance have started dissolving their “brand departments” and integrating their functions into marketing and public relations departments. According to a professional research report, survival is the most important aspect in the economic winter. Over the past two years, nearly 80% of Chinese enterprises have implemented organizational changes, with almost 50% streamlining the back-end support services.
Chairman Zhou Hongyi of 360 recently stated in a video that “I am planning to shut down the entire marketing department of 360, which could save the company tens of millions of dollars in a year,” and claimed that its efficiency is too low compared to investing resources in product research and development.
JD has also initiated restructuring by dismantling the group’s brand department, integrating its functions and personnel into the platform marketing department under the marketing division to streamline the structure and improve service efficiency.
In fact, in recent years, many top companies have been implementing organizational restructuring, with the dissolution of brand departments being a typical case. Most companies are not completely “disbanding brand functions,” but rather dispersing or reorganizing them, such as integrating them into marketing departments, user operations, or growth teams, according to public data.
According to the media outlet “36 Kr,” in the past year, major internet companies such as Tencent, Alibaba, ByteDance, Meituan, Baidu, and Kuaishou, underwent at least 12 organizational structure adjustments.
Behind Zhou Hongyi’s bold statement of “shutting down the entire marketing department of 360” lies the necessity of reducing costs due to declining revenue and sustained losses for the company. Recently, 360 released a performance forecast for the first half of the year, expecting a loss ranging from 240 million to 320 million yuan in net profit attributable.
In recent years, 360 has been struggling with declining revenue and continued losses. From 2021 to 2024, 360’s revenue has continuously declined to 10.886 billion yuan, 9.521 billion yuan, 9.055 billion yuan, and 7.948 billion yuan respectively, with corresponding year-on-year decreases of 6.28%, 12.54%, 4.89%, and 12.23%. The net profit attributable to the parent company was 902 million yuan, -2.204 billion yuan, -492 million yuan, and -1.094 billion yuan.
In reality, Zhou Hongyi has long been targeting the marketing department. A former marketing department employee of 360 revealed to “Wanlengjing” that he was laid off in April this year, stating that “Previously, the entire marketing department of 360 praised Zhou Hongyi, but in the end, it was still the marketing department that took the blame.”
According to a report by the professional organization Mckinsey & Company on the “2024 China Enterprise Platform-based Organizational Construction,” in the past two years (2023-2024), 79.8% of enterprises opted for organizational reforms, with 48.9% of them choosing to streamline the back-end. The data also indicates that many enterprises have undertaken actions to streamline the middle tier.
Front-end refers to the customer-facing, providing direct interactive interfaces and functions; back-end is internal management and data processing, offering support services; while the middle-tier connects the front-end and back-end, integrating shared services to enhance efficiency.
The decision to dissolve the brand department by JD, as AIGG Business Consultants points out, reflects the deep transformation in the business world from “building brands” to “using brands”.
Blogger “Knife Doc” believes that brand building must be closely tied to growth. In the new structure, branding is no longer a department solely focused on image packaging but becomes part of marketing operations, serving metrics such as conversion rates, click-through rates, and repeat purchases, becoming a part of the growth funnel.
“Tie Media” analyzes that this foreshadows a trend of transformation in the middle and back-office. As these departments grow larger, they become more abstract and increasingly consume enterprise resources, without effectively supporting the front-line operations.
Besides streamlining the structure, internet giants like ByteDance and Ant Group have begun modifying employee travel policies and tightening control over employees’ travel expenses.
Several netizens on social media disclosed that the finance and security department of Ant Group has recently begun strict monitoring of business trips, discouraging non-essential trips for employees below level 16 (equivalent to the original P8), with the inspection of hotel orders dating back at least six months. In the face of increasing uncertainties, “cost reduction and efficiency enhancement” have become a shared choice for many companies, with bloated travel expenses becoming a target for cost-cutting efforts.