3 Pillars of China’s Creator Economy Success

Growing up as a kid, my weekends were non-existent as my mum always made me study. But as she often reminded me - I had it easy compared to kids in China.

Having spoken to many creators and entrepreneurs in China I unearthed how China became the global creator economy’s driving force (beyond the obvious fact that its a huge market).

🍜 Culture eats strategy for breakfast… even if it’s as tasty as a Chinese breakfast.

China is very competitive with a lot of people competing for one spot. Whether that’s for a university place, a corporate job or space on your social media feed.

Creators in China are incredibly hard-working and spend a long time perfecting their craft. Longer than their investment banking or consulting peers. They do not do this because they want to but because they have to.

The result - many high quality creators.

It also helps that the population love social media (more disproportionally to the global average). 72% of China’s population uses social media compared to 60% of the global population and 98% of all internet users in China use social networks monthly.

🛍 Shop 'til you drop… at least until you get thumb cramp

Chinese social media platforms are designed with creators first. Leading platforms such as Xiaohongshu (’Little Red Book’) and Douyin (Domestic name for Tiktok) seamlessly integrate e-commerce functionalities.

Creators can monetize their content through livestreaming sales, influencer marketing, and direct product sales.

What about the demand side from consumers and fans?

Firstly, Douyin boasts a massive user base in China, with over 800 million daily active users (Ok i had to reference China’s large market at least once).

More importantly, China’s leapfrogging in tech and logistics has meant that Gen Z in China never knew the struggle of waiting days for packages to arrive or clunky checkout processes. They expect next day delivery and one click buys via Alipay - and they like shopping that way. Social platforms like Douyin offer chinese consumers that convenience.

84% of Chinese consumers have shopped on social media platforms. The highest in the world.

And it’s not just Chinese goods they’re buying via social. XiaoHongShu is a major e-commerce actor in China, especially for foreign brands looking to enter the Chinese market. The platform allows Chinese users to buy foreign brands directly from the app.

I am a politics nerd and so we can’t ignore the elephant in the room. China’s government has often been criticised but western critics but since the reforms in the 70s post Mao Zedong China has lifted 500 million people out of poverty and thrust most of them into China’s middle class - including my parents. Ultimately, it is this macro trend that has allowed both creators and consumers to thrive.

🔥 Adding fuel to the fire: Agencies

Creators in China (like with a lot of young people) lack independence. This is derived from a conservative sentiment that a good education and stable job is considered more valuable than entrepreneurship - especially from parents POV.

This is where influencer agencies come in.

Agencies offer a great middle ground that gives creators a sense of autonomy whilst providing the resources and stability of a ‘typical’ job.

I’ve often criticized the creator economy for having many people (creators) who simply do not know how to operate a business - especially a media business which content creation is.

These agencies have not only helped launch China’s social media stars of today by taking on their operational burden but they are at the forefront of ecommerce in China. Ruhnnn is the leading agency in China - and raised an 125M USD IPO in 2019. The company’s core offering is enabling influencers to sell through e-commerce - and they have dominated the fashion industry.

During Alibaba’s 11.11 Global Shopping Festival, Ruhnn’s top influencer brand sold over $24.6 million in a single day. In the same event for women’s fashion stores, it had similar sales volumes to H&M and UNIQLO.

Without these agencies. There is no creator economy (at least not as thriving).

Can other markets replicate China’s success?

China and its creator economy is often deemed ‘5 years ahead’. Others have tried to replicate and failed (e.g social commerce in Europe). But for me, the creator economy has evolved in different markets as a result of culture - and there is no catching up in culture. Each market is as unique as its people.

I’m curious how large emerging markets with unique cultures such as LATAM and India for example will grow.

I want to learn what’s unique about your region - feel free to drop a comment!