On Markets

This is an essay on marketing

You ever read those novels where there are eight characters in five different stories? Each story gets cut up into pieces and spliced into chapters, intersected with other stories? A pretty famous book written this way is Cloud Atlas.

Example: Story A is about a lawyer in court. Story B is about an astronaut orbiting Mercury. Story C is about a warlock in some tribe on a clearly different time period. Story A is covered in chapters 1, 3, 7, and 12; Story B is covered in chapters 2, 4, 8, and 10; Story C is covered in 5, 6, 9, and 11. All these stories are going somewhere and you have a gut feeling that they’re gonna intersect. Then BAM Chapter 13 hits and here comes the revelation: they’re all part of the same overarching story all along.

I’ve always thought those stories sucked.

Not that they aren’t interesting; but usually they could be told in a much more straightforward way while preserving the intrigue. It’s stylistically prone to being messy, and few novels could pull it off elegantly.

Well, this essay is going to be that.

Messy.

I’m mostly just writing my thoughts as they come and do not plan on giving them much of a structure. This is almost entirely an anecdotal reflection on my experiences in China, Japan, and the US. These thoughts are framed very vaguely about consumer mindsets, market scale, cultural market differences, how money is spent by civilians, the concept of “consumer”, …and TikTok.

Not data-driven. Zero accountability.

And off, we go.

In 2016 summer, I stayed in China for three months, visiting my parents and working for various jobs.

Shenzhen was all the hype then. A year earlier, Li Keqiang (Chinese Premier, #2 in rank, important man.) made speeches during the Two Sessions (plenary conferences of China’s two congressional bodies) about something called “Internet Plus”. It was stylized as “Internet +”, and coming from the Premier during the Two Sessions, it was important indeed.

It was both an official approval of the progress the internet economy has made thus far, and an explicit signal for regional officials to act. The concept of Internet + defined a sweeping goal for the integration of the internet into traditional sectors — Finance, Government, Agriculture, Manufacturing, and Healthcare. Unmentioned was the Military, but it was far from neglected. “Internet + Military” has already been in progress for a good while then, first as the Great Firewall cyber defense framework, then as general cyber warfare.

These six goals were almost entirely the only policy priorities of the administration, as it has been for decades. Since the time of Deng Xiaoping (Chinese Leader 1978-1992), those six words have practically been the national identity of China. Each administration agreed that the simultaneous improvement of these six sectors is essential for the stability of the regime.

And so, by coupling them with simply “Internet”, the Politburo was giving its clearest directive to its subordinate State and Regional governments. The impact was swift and vast: tech startups sprang all across the country, with regional officials rubber stamping every form of entrepreneurial approval possible. Cities across the tier-system smeared giant slogans across sidewalks and buildings for “innovation” and “internet economy”. Tier-3 Cities like Guilin, with its small population of 5 million, proclaimed its goal of becoming “the tech hub of the world” — a goal promptly echoed by hundreds of other cities — only for most of its tech workers to flock to Shenzhen.

Tech IPO was rampant and almost immediately triggered a government clamp-down, but other aspects of tech startup was unimpeded.

By the time I landed in Beijing in the summer of 2016, 15 months had gone by since the “Internet +” speech; the economy was almost unrecognizable, yet so thoroughly Chinese.

Thousands of companies have appeared in the Tier-1 cities (Beijing, Shanghai, Guangzhou, and Shenzhen). These were being written about by tens of thousands of Wechat and Weibo blog accounts, with millions of other blog accounts covering facets of life.

I took a cab from the airport to my home. The driver had three phones arranged in an array propped up on the dashboard, with two accounts on Didi (Uber has already sold its Chinese operations to Didi) and one from a random competitor which Didi will eventually outspend.

On the second day, I was educated by my mom on the wonders of Meituan. More specifically, it was the product it offered — dianping.com. My mom had wanted me to reserve a family dinner on there. It was basically Yelp with Groupon functions. Users were able to review the restaurants, like you would on Yelp. Its main draw was the coupon feature: restaurants would offer vouchers and reservations for a specific set-course meal. It was kind of like Groupon, except restaurants and customers actually wanted to use it. It was the strangest thing: I went on a morning jog and was quickly reduced to a brisk walk in the smog, which freed me up to look up every single restaurant I walked by on dianping.com. (I was bored and the scenery was clouded.)

34/39 restaurants were on the site, with dozens to thousands of reviews to each, in a six block distance.

A day later, we arrived at the restaurant, the waiter came and scanned a QR code from our app, dishes began arriving on the table, we ate, then left.

Meituan would later expand into third-party payment, then hotel, then car rental, then homestay, then food delivery, then ride-hailing, and IPO’d in between. In 2019, Meituan had 300 million monthly active users. During China’s 70th anniversary National Day parade, Meituan’s delivery bikes rode across Tiananmen Square as part of the ensemble. Under the watchful eyes of the Chinese Politburo members and over a billion televised audience (every TV channel was broadcasting the show; school halted so students can watch it on classroom TVs; what else was there to do anyway), its yellow jacket-wearing delivery workers rode their yellow bikes, after the tanks and before the missiles.

Here’s them:

My aunt had quit her cushy executive job at Microsoft and co-founded a CRM startup. The day I started working there was the first time I’ve heard of it.

During my interview, the sole HR person at the Beijing branch told me about a recent round of investment, led by Tencent. In fact, during telemarketing sessions, the company’s operatives would call their own product “Tencent (insert product name)” to increase brand awareness.

On my second day, enroute to the office, about 40 people and I crowded around the lobby, and waited for the elevators to arrive. While waiting, I noticed a new ad poster by the elevator doors. It was a CRM product developed by Tencent, the product name was not our product name.

As it turned out, Tencent had launched its own CRM product the night before. My coworkers were at first bemused, then shrugged it off and kept working. After all, it’s Tencent’s common practice to have several in-house teams and yet another several outside teams working on a similar product, in direct competition with each other. Tencent owns all the products while they’re competing, and will own the winners in the end.

WeChat, for example, had three internal dev teams across the country, all working on different products which could replace QQ (Tencent’s then-priority chat service). The team in Guangzhou was first to ship, and thus there was WeChat.

Most of my colleagues were the epitome of the urban migration phenomenon. They were educated locally in smaller towns, then moved to a giant metropolis; living more than an hour of commute away from their office, paying still-expensive rent.

Another thing of note was the breakfast-buying experience.

Both the street food carts and the 7-11 downstairs had a similar feature: a line would form at the cashier, we step forward with our phones held out, alipay or wechat pay at the ready, scan, then leave. Later, transactions would become even quicker, as the store would have a giant QR code pasted on a plaque, the customers would scan the code then leave with their grubs. This generally resulted in a transaction process lasting ~3 seconds.

Meanwhile in the West, another phone-centered phenomenon was taking place. Pokemon GO had just been released. While AR tech was setting off a storm in the US and Europe, Niantic (and Google) had no viable servers in China, and so I lived in a pokemon barren land.

A few years onward, mobile payment is still the norm in China, but app-based AR seem to have never quite taken off. Its usage so far are the drastically dwindled Niantic customers and emoji chat filters.

I traveled to Europe a month later, for an interpretation gig. Paying with coins to use restrooms at gas stops felt resolutely different. But Europe had its charms.

This was China in 2016. Things have really changed since then.

But that’s for later.

I traveled to Japan in 2017 November, with two college friends. It was my second time in the country.

I’ve thought a lot about that trip since then.

I’m not sure what Tokyo was like in the 90s, but I have a feeling it’s pretty much the same in 2017, with hyper-evolved fashion.

Streets are super clean. Pavements are super clean. Walls are super clean. The subway system is super clean.

In a lot of restaurants, there would be a vending machine-looking-type outside. I’d select what I want, push a few buttons, pay with a credit card or Suica (RFID card service for transit rides and other payments), and a slip of paper with the order number comes out of the slot. I’d then press a doorbell-looking button on the door frame, the door slides open, I enter the restaurant, hand a staff the paper, then wait for my gyudon meal.

The Japanese restaurant industry is perhaps the most codified I’ve ever seen. Waiters in every restaurant in every country say the same thing, but in Japan, they say it the same way.

Coins are prevalent. A lot of taxi is still cash only. Uber and Uber-type services exist but is rare. Amazon Prime is quick and a lot cheaper than the US for some reason (~40$ annually). Mobile payment … exists wherever Chinese tourists tend to go. Perhaps customers were rooted in cash payment, and thus while major Japanese banks offer credit cards, their cashback/reward programs are comparatively weaker than US offerings. Or perhaps it’s the other way around.

Perhaps China’s quick and massive adaptation of mobile internet was the result of two generations having completely skipped the PC revolution. After all, while broadband and fiber optics were still being laid in China, the iPhone was released.

But what of Japan? Japan led the world in 3G tech. A casual anime watcher might notice the prevalence of flip-phones in post-2000, pre-2013 anime. Characters in highschool would be sending “mail”, full with images and music, to each other; or browse the internet on some sort of text-image protocol. NTT Docomo released commercial 3G network for its phone services in 2001, the first in the world.

Which begs the question: does the Japanese people really need the conveniences of its neighbor?

We now go into the topic of Consumer Mindset.

A much-lauded phenomenon in China is the successful elevation of hundreds of millions into middle class.

After all the monetization schemes I’ve read about in the US, I still have not experienced a society more eager to sell and buy things than in China.