Debra Li

debra_lidan@163.com

CURTAIN drew on the drama surrounding strife between Dong Yuhui, poster boy of New Oriental’s e-commerce unit East Buy, and its former CEO Sun Dngxu on Saturday after news came that the former will stay while the latter is ousted from his post.

The incident, a top-trending topic in the past week on Chinese social media, again highlighted the power of China’s fan economy and a truth of the business world, as per a quote of Chen Xiangdong, CEO of East Buy’s competitor Gaotu, “clients are the hands that feed us.”

The online controversy erupted Dec. 6, triggered by a seemingly innocuous statement from East Buy’s official Douyin account. It clarified that the promotional content attributed to Dong was a product of team effort rather than solely his endeavor. This revelation sparked fervent reactions from Dong’s predominantly middle-aged female fan base, jokingly referred to as “mother-in-laws.” Many questioned the sincerity behind this disclosure and expressed discontent over the perceived lack of adequate compensation for Dong’s contributions. The situation escalated when Sun openly criticized China’s “fan culture” and disclosed Dong’s substantial annual salary, further enraging his devoted supporters. Some even went as far as to unfollow East Buy’s Douyin account and threw their allegiance behind its competitor, Gaotu, an online education tech firm currently pivoting towards livestreaming e-commerce.

This furor refused to dissipate, leading to apologies from both New Oriental founder and chairman Yu Minhong and Sun on Thursday for the “improper message” conveyed by the Douyin account handlers and acknowledged “deficiencies in internal management.” However, this conciliatory gesture did little to quell the storm, ultimately culminating in Sun’s ousting from his CEO post just two days later.

At the center of this conflict stands Dong, a self-professed “teacher-turned-salesman” who ascended to stardom last summer. Within a mere 20 days, he amassed over 20 million followers on Douyin, emerging as the platform’s premier influencer. Dong, an unexpected idol with unassuming features, captivated audiences with his bilingual narrations, quick wit, and profound knowledge. Viewers resonated with his charismatic and composed demeanor, often describing his livestreams as unexpectedly enriching lectures rather than typical sales pitches.

East Buy has tried to replicate his success by recruiting other livestreamers with good education backgrounds and various talents. Unlike the regular online salespeople who shout at the top of their voices to push sales, East Buy’s livestreamers sing, dance and play the Chinese instrument zheng as they narrate in elegant, cultured and eloquent styles. But none have managed to replicate Dong’s astounding success. Industry insiders reveal that Dong’s sales contributions currently constitute roughly half of East Buy’s total sales, underscoring his irreplaceable position within the company.

In the world of livestreaming, there’s an undeniable element of the impromptu, even of serendipity, in the journey to success for individuals like Wei Ya and Li Jiaqi, who came before Dong. Being the first of their kind and offering something new is important, being a likable personality is a must, and establishing a strong connection with the right audience is akin to hitting the jackpot.

Even as Dong stays with East Buy and continues to flourish, there remains the inherent risk that his fan base might eventually tire of his content, leading to a decline in viewership. East Buy has astutely acknowledged the perils of relying solely on Dong’s appeal and implemented strategies to mitigate this vulnerability. This includes promoting other livestreamers and bolstering the sales of private label products.

As per the company’s website, East Buy has 65 private label products, including black pork sausage in different flavors, Wuchang rice, and blueberry puree. Their commitment to maintaining “strict control over the whole process from product development to sales and after-sales services” reflects a clear-minded, product-focused strategy. Livestreaming e-commerce is fundamentally a retail business, where enduring success, as exemplified by stalwarts such as Walmart, hinges on delivering quality, cost-efficient products, and dependable services.

Throughout the 11-day saga, Dong’s response was commendable, characterized by his customary restraint and humility. Notably, he revealed that many of the promotional texts were crafted by himself, with acknowledgment extended to his team for their contributions. He also encouraged his fans to offer rational and constructive feedback. Intriguingly, while expressing disapproval of the frenzied “fan culture,” Dong was careful to emphasize his objection to stigmatizing anyone for being a devoted fan.

Despite East Buy’s concerted efforts to pivot towards a more product-centric approach and diversify its pool of livestreamers, the recent incident underscored the enduring influence wielded by Dong’s “mother-in-laws.” This highlights an irrefutable reality — at its current stage, the company remains reliant on this dedicated fan base.

(The author is a Features editor of Shenzhen Daily.)