How tech and culture are linked in China

It has been a rollercoaster year for China. But chaos brought people cloer together and technology also became more humanised as a result. People became even more attuned to technology than before—further accelerating China’s world lead in the wide adoption of technological advancements.

China is at an interesting junction between a highly regulated society and an extremely active, people-centric digital world.

Let’s see how technology plays a role in shaping culture between these fine lines.

Power to the people

The proliferation of the digital world has allowed people to carve out a space for their own freedom to find a greater sense of self, gain power without relying on (or rebelling against) corporations or authority.

Austin Li started as a regular live streamer, and quickly became so influential that Hermès had to abruptly halt its lipstick launch in China for 18 months because of his bad reviews. YouTuber Li Ziqi made videos of traditional village life in as a hobby. Drawing attention to the beauty of Chinese traditions and the goodness of suburban food ingredients, she was appointed the cultural ambassador of the Sichuan Province. Now owning her own product lines, she makes US$ 24 million a year. Unlike 'power to the people' in the West, empowerment comes not from fighting or reacting to external circumstances, but simply by having a springboard to unlock new possibilities.

Lifecycle loyalty

As China’s ecosystem gets increasingly fragmented, people’s relationships with brands are becoming more transactional and unstable. As a result, many brands have made moves to reach consumers through the lens of a ‘lifecycle'.

One result of this is private traffic, which emerged as the top marketing buzzword in 2021. It became popular because by drawing new customers and establishing direct relationships with them, these connections also became brand assets for marketers to re-engage with them at a minimal cost.

A year later, as consumers are increasingly reluctant to be pushed into transactional relationships with brands, demand creation is then of paramount importance. Brands are building cultures, lifestyles, and even completely unrelated product lines around their core product proposition, which is then marketed with a sense of exclusivity creating a desire to be part of this world.

A brand in the spotlight is Shanghai-based EV NIO. Other than basic car services, NIO built a lifetyle hub to elevate the brand to one that builds cultural connections with people. Community spaces are built in different locations for car owners to come together. NIO Life serves as a co-create hub for extending their product lines collaborating with UK designer Hussein Chalayan, Shanghai Wine Exchange, etc. Developing entry level product extensions is their way to draw new consumers and identifying new leads. This forms a complete closed loop cycle of loyalty engagement plus lead generation, making it a true success.

In our turbulent environment today, it is important for brands to keep an ongoing two-way dialogue with consumers and provide an inclusive culture for people to stay connected to the brand.

The multiplayer internet

The paradox between a highly regulated society versus an evolving digital world as previously highlighted will have interesting implications on how the metaverse will play out in China. With various policies, virtual worlds in China have yet to become truly connected like they have in other markets.

However, an area with very promising growth is the development of virtual idols. Following the success of many Japanese imports, local tech companies saw this as a new money-making machine. Soon, they also received government subsidies as virtual human projects were considered complementary to the state’s digital transformation plans.

A telling tipping point was when brands started to suffer the huge financial losses from human  celebrity endorsers, when details of their controversial personal lives was leaked and were quickly in the hands of the government.

Immune to personal scandals, virtual humans became a more trustworthy alternative of human celebrities. Virtual humans have become so popular that corporations are now launching virtual employees. Real estate developer Vanke’ virtual debt collector Cui Xiaopan was even awarded with the title of “2021 Vanke Headquarters Outstanding Newcomer Award”.

China will be deploying more virtual humans not to act as idols, but to be in all walks of life and coexist with human beings. Brands can also explore how the use of virtual humans, which are evolving from an abstract object for admiration to a relatable figure close to the everyday lives of consumers.

The great escape

While the great escape seems to be predominantly a reflex from pandemic constraints, the idea of escape has always been in our daily lives in China. For some Chinese consumers, the desire to escape from the humdrum of everyday life stems from the cultural emphasis on personal achievements. Hence the enthusiastic and very early adoption of social media and gaming.

China now has the most advanced and sophisticated social media ecosystem and is the epicenter of online gaming globally. Despite state-imposed restrictions and parental concerns, esports has become a mainstream industry and, for some, a lucrative alternative career. Even mid-range esports teams in China now can earn up to US$300k a week through brand endorsements.

Like everywhere else in the world, travel is also a quick escape from everyday life. When outbound travel virtually stopped upon the outbreak of the pandemic, Chinese people found unexpected pleasures from domestic travel, not only could they just hop on a high-speed train to go almost anywhere, they soon discovered there is a lot more culture, nature and even infrastructure in China still to be explored. With regions at the borders of some of their favorite destinations like Myanmar or Vietnam, they were able to go far away from home without leaving the country.

Contrary to the West, there isn’t an emphasis on a 'great' escape in China, as the notion of escapism has and will continue to be part of our everyday lives.

Conclusion

Entropy in China is not simply a matter of a subsequent order—there is no 'before' or 'after' entropy. It is a continuous, multi-dimensional cycle between order and disorder, making China one of the richest and most interesting playgrounds in the world for brands and marketers, but at the same time burying landmines everywhere.

It is important to always be ready and prepared. Move fast, proactively stay close to the pulse of culture. While data is critical, never forget to understand consumers on a human level too.

As witnessed above, these trends are all manifested out of deeper human needs from the unique environment and ecosystem that they are in.

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Jocelyn Tse is chief strategy officer at UM China.