China's enterprises go virtual for sustained development
Once just a pastime for young people, live streaming has now turned into a hotly contested avenue where big names in the real economy are exploring new growth engines after the emerging industry has created innumerable online celebrities and a huge consumer market.
Zong Qinghou, in his signature attire of a light blue shirt and black cloth shoes, became the latest tycoon to show up in a live stream show. The 75-year-old is known as the "king of beverages" for chairing Wahaha Group and was listed several times as among the richest entrepreneurs in China.
His three-hour live broadcast attracted over 1 million viewers and received more than 5.27 million likes. He played games, shared his entrepreneurial experiences, sent out gifts during the live stream and talked freely with young netizens.
Not long ago, Dong Mingzhu, chairwoman of home appliance giant Gree Electric Appliances, sold an astonishing 310 million yuan (about 43.4 million U.S. dollars) of products in a three-hour live stream show.
For most Chinese entrepreneurs who entered the studio, their ultimate goal is not just to increase the sales, but to gain young consumers' recognition of their brands. "My first live streaming was not aimed to drive up sales, but to communicate closely with Internet users and understand their needs," Zong said.
Zong gave 3 million yuan worth of products free of charge to viewers of the live broadcast. "We hope to collect customers' feedback on our products, so we can provide better products that meet their preferences and are of higher quality," he said.
"The price of the cloth shoes I am wearing is about 30 yuan. They are very comfortable; I've been wearing them for years," said Zong, while interacting with viewers.
Zong represents a batch of China's traditional industrial enterprises that have begun to embrace live broadcasting to adapt to the surging tide of the Internet economy.
Data from iiMedia Research, a consulting agency, showed that China's live-streaming e-commerce market has grown rapidly from 19 billion yuan in 2017 to 433.8 billion yuan in 2019, and is expected to exceed 960 billion yuan in 2020, a year-on-year growth of 121.53 percent.
Wu Xianfa, 46, has been selling wrenches, screwdrivers and other tools for more than 20 years in the city of Yiwu, Zhejiang Province, known as the "World's Supermarket."
Frustrated at his sales performance last year, he began to try live streaming on Douyin, the Chinese version of TikTok. He also plans to hire a full-time online host, offering a basic salary of 4,500 yuan plus commission.
Zong also took advantage of the show to recruit start-up talent. "We plan to recruit 100,000 young people to work at our newly-established e-commerce platform. I will provide them with a subsidised loan of 50,000 yuan to 100,000 yuan as their initial capital," he said.
But the booming livestream economy has also created problems such as low-quality products and false publicity.
The "entrepreneur anchors" therefore called for better oversight from the authorities as they believe live streaming is just a channel to lure customers but sustainable development of a company still depends on technology, quality and honesty.