Ged Carroll

Category: china | 中國 | 중국 | 中華

Ni hao – this category features any blog posts that relate to the People’s Republic of China, the Chinese communist party, Chinese citizens, consumer behaviour, business, and Chinese business abroad.

It is likely the post will also in other categories too.  For example a post about Tong Ren Tang might end up in the business section as well. Inevitably everything is inherently political in nature. At the moment, I don’t take suggestions for subject areas or comments on content for this category, it just isn’t worth the hassle.

Why have posts on China? I have been involved in projects there and had Chinese clients. China has some interesting things happening in art, advertising, architecture, design and manufacturing. I have managed to experience some great and not so great aspects of the country and its businesses.

Opinions have been managed by the omnipresent party and this has affected consumer behaviour. Lotte was boycotted and harassed out of the country. Toyota and Honda cars occasionally go through damage by consumer action during particularly high tensions with Japan.

I put stuff here to allow readers to make up their own  minds about the PRC. The size of the place makes things complicated and the only constants are change, death, taxes and the party. Things get even more complicated on the global stage.

The unique nature of the Chinese internet and sheltered business sectors means that interesting Galapagos syndrome type things happen.

I have separate sections for Taiwan and Hong Kong, for posts that are specific to them.

  • Hair Growth Helmet + more things

    LG Launches Hair Growth Helmet to Combat Hair Loss | HYPEBAE – this looks totally legit. NOT. Yes, the FDA has certified other hair growth helmet treatments, but that was to indicate that they wouldn’t harm you or interfere with medications. It doesn’t validate the hair growth helmet actually working. But on the other hand lasers in the helmet….. More beauty category related content here.

    Why loneliness fuels populism | Financial Times – depicting loneliness solely in terms of how connected we feel to our friends, neighbours and colleagues risks occluding its other potent forms. Loneliness is political as well as personal, economic as well as social. It is also about feeling disconnected from our fellow citizens and political leaders, and detached from our work and our employer.

    “Buy British”: The viability of a nationalist commercial policy | VOX, CEPR Policy Portal – attempts by successive UK governments in the 1970s and early 1980s to initiate such import substitution policies were fraught with economic and legal difficulties. Indeed, accelerating globalisation and the rapid growth of imports in intermediate products for assembly into ‘British’ goods raise significant problems in defining a ‘national’ product – and the growth of tradable services (such as insurance, education and healthcare) presents an even more intractable problem

    Arkady Bukh: Man in the Middle | CyberScoop – go-to lawyer for hackers

    China bans Australian academics in apparent tit-for-tat retaliation | South China Morning Post – this has followed soon after a good report by Alex Joske and book by Clive Hamilton on China’s influence activities abroad

    Facebook removes fake accounts with links to China and Philippines | The Guardian – Facebook says it has removed hundreds of coordinated fake accounts with links to individuals in China and in the Filipino military that were interfering in the politics of the Philippines and the US – not very surprising. More details in the South China Morning Post – How a Chinese network of fake Facebook accounts influenced online debate on South China Sea, US politics | South China Morning Post 

    Ebay ex-CEO, PR head shared texts about taking down critics: DOJ – Business Insider – probably one of the most disturbing and bizarre things that I’ve read in a while

    China has the upper hand in corporate proxy wars with US | Financial Times – Mr Trump gave Mr Xi what he wanted on ZTE — a reprieve in the form of a new US commerce department settlement that allowed it to stay in business — and mistakenly assumed that this concession would smooth over the other matters. China quickly pocketed the ZTE present but continued to withhold approval of the Qualcomm-NXP deal. When the trade talks later started to unravel, Mr Xi let Qualcomm-NXP languish in regulatory limbo, where it eventually died. – Trump gave a concession too early

    How a local messaging app defeated WhatsApp in Vietnam – messaging app Zalo has been taking the country by storm for nearly a decade now. Zalo’s got a pretty firm grip on Vietnamese consumers. And now that it’s integrated mobile payment service ZaloPay into its messaging app, there’s plenty of potential for it to expand beyond being just a means of communication.

    The landlords are back – The families of China’s pre-Communist elite remain privileged | China | The Economist – The old elite began to suffer almost as soon as the Communist Party won the Chinese civil war in 1949. China’s new rulers quickly set about seizing land from people in the countryside, redistributing it among the landless, confiscating private businesses and executing many rural landlords and people who had worked for the overthrown Nationalist regime

    Listen to an unheard Steve Jobs NeXT keynote from 1988 – “But why it matters is that those explorations and that fun were in the end quite significant. It’s always useful to look back and to realize that even though the tech itself might seem quite primitive today, the people were already sophisticated. We know a lot more facts, and we can do more things, but I’m not sure we have gotten that much wiser.”

  • Hidden Hand by Clive Hamilton & Mareike Ohlberg

    Hidden Hand is written by two academics. Clive Hamilton is an Australian academic, who is currently professor of public ethics at Charles Sturt University in Canberra. Mareike Ohlberg is a senior fellow in the Asia Programme of the German Marshall Fund. Prior to that she worked for the German think tank; the Mercator Institute of China Studies.

    Hidden Hand by Clive Hamilton and Mareike Ohlberg
    Hidden Hand by Hamilton & Ohlberg (US hardback edition)

    Hidden Hand interest piqued

    Both of them are seasoned China watchers. China is a popular subject and Hidden Hand would have just gone into my Amazon wishlist but for the 48 Group Club. The 48 Group Club is a British China-orientated association that fosters cultural and social ties. It had threatened legal action over content that they alleged was incorrect or defamatory. My interest in Hidden Hand was piqued.

    So What’s it like?

    Hamilton and Ohlberg have pulled together an account of China’s relationships with various elites in countries around the world and intergovernmental bodies such as WHO. Having kept an eye on China for over a decade, little of the content was new for me.

    What I found was new, was the the way it is woven together in a cohesive pattern of activity in the Hidden Hand. A sustained, pervasive bid for global influence on a scale that most people couldn’t imagine. And those that could imagine would likely be thought of as excessively paranoid.

    One thing that immediately comes across is the depth of research that the Hidden Hand contains. The index and bibliography are a big chunk of the book. The facts come thick and fast, but delivered in a dispassionate manner.

    The reframe

    This book wouldn’t be as well received if it had been published 12 months ago. A split between Wall Street and manufacturing company CEOs, COVID and the steady drip of diplomatic clashes that China has had with western countries have reframed the view for Hidden Hand. Now you have an audience that is more receptive. They are more willing to take an objective, critical analysis of China rather than give them the benefit of the doubt like an errant teenager.

    Missing answers

    Hidden Hand tries to come up with starting points for answers. Holding elites accountable. Engaging members of the Chinese diaspora. Taking a multilateral stand. All of which are hard to do. There are changes happening to espionage related laws in the UK. The EU is taking a more policy-based approach and Trump administration officials have talked about US CEOs as being unregistered foreign agents. This is a long term battle, something that will go for decades.

    The Wall Street CEOs will be hunkering down; hoping to out wait Trump. In Europe and the UK, the root and branch work required to inoculate their countries are not yet underway.

    The final missing piece is understanding the first generation Chinese diaspora. In particular the way the communist party has successfully grafted itself into the very centre of what it means to be Chinese. And then thinking carefully about how to decouple that idea. It’s happened already in places like Taiwan (and young Hong Kongers), yet many first generation diaspora and older Chinese Malaysians are wedded to the idea.

    I think that would take a lot more research. China must be doing some things right in order to get that level of belief. But there was obviously a problem with the opportunities that China offered. Otherwise why would they come to the West? It must have offered more advantages; how are they opportunities highlighted and put in conflict with the belief in party/ Understanding this will then help the work on protecting the liberal democratic system from infiltration, subversion and exploitation.

    An example of that might come from Singapore, which managed to forge a distinct Singaporean identity, whilst still holding the best bits of cultural background. Though there are risks in trying to replicate the Singapore process. More China related content here and more book reviews here.

  • Easy growth trap + more things

    Luxury Brands Must Avoid This Easy Growth Trap | Jing Daily – China has been reporting significant growth rates in the luxury sector recently, and many global luxury brands have been counting on China to be their silver lining. However, this recent growth has, to a large extent, been driven by repatriation (meaning sales that customers would otherwise have made during overseas travels). With travel routes to Europe and the US closed, Chinese luxury customers have been shopping domestically, which has driven the luxury demand inside Mainland China. Yet, this strong increase in demand in China could not offset the drastic decline in demand in both Europe and the US, at least during the second quarter of 2020. As such, many brands across categories like luxury cars, high-end jewelry, watches, and luxury fashion are sitting on enormous inventories and are looking at empty stores – Jing Daily were warning of the easy growth trap in discounting but their description of the market at the moment is very interesting. I suspect that the luxury sector is already well aware of this. The have seen department stores fall into the easy growth trap. Luxury brands have historically gone to extreme lengths to avoid the easy growth trap. Reputedly, during the last recession Rolex is alleged to have bought excess products from its dealers and the grey market to recycle, rather than discount. More on luxury and retailing.

    AI in Marketing: Myths vs. Reality – Techerati – Johnny Bentwood articulates a more reasonable assessment of AI. Badging everything ‘AI’ wonder technology is the easy growth trap of the tech sector. We’ve been here before

    Teens are turning themselves into Gucci models on TikTok | Dazed – Luxury is interesting because here brands really have meaning. The Gucci brand has history and meaning that comes from their behaviours and their products – rather than merely from how they have spent their ad budget in the past. Their Northern Soul homage in 2017 is just one example of the brand’s authenticity, energy and creative eye. For Gucci, it’s vital their brand continues to be culturally relevant, so they need to participate in TikTok. First, their #AccidentalInfluencer Grans in fur coats (with 8m views) showed they understood the grammar of TikTok and then the #GucciModel Challenge invites – no, demands – people play along. As Gucci makes fun of themselves they convey strong messages and have 26m views already. One thing I particularly like is how they use the audio by Lachlan Watson, star of the Netflix hit ‘Chilling Adventures of Sabrina’. This is the antithesis of the glossy spreads Gucci and others place in the top magazines and balances their marketing with authenticity which suits TikTok so well – Simon over at Great TikTok creative

    ‘It’s Ridiculous.’ Underfunded FTC and DOJ Can’t Keep Fighting the Tech Giants Like This – Big Technology 

    China’s middle-class dream of a second home in Malaysia dashed by coronavirus and geopolitical tensions | South China Morning Post – “Most of these Chinese individual investors are not prepared – financially or psychologically – for the risks of overseas investment,” Zhao said. “They have experienced only economic growth and a booming property market on the mainland for decades, and they lack the funds and risk awareness to deal with the downside [of the economic cycle].” – the belt and road initiative isn’t all plain sailing

    ‘Funnel juggling’ is the answer to marketing effectiveness – Marketing Week – For the long work, in most Uber countries there are a series of brand campaigns that push the emotional benefits of travel. Inevitably and rather cleverly the focus is on the top of the benefit ladder; or, in Uber’s case, the end of the journey, when it delivers you to your destination and the emotional benefit that awaits. In the US, for example, the brand uses TV, outdoor and digital media to associate Uber with these moments. It’s mass-market, it’s emotional, it’s brand-focused and it asks nothing of the consumer other than to see Uber as more than a ride-sharing service. 

    I have no idea what the split in Uber’s marketing spend actually is but I will bet about half of the money in any country also goes on the short of it.

    Gucci’s Gaming Garments | Gartner for Marketing – Chinese princelings….

    Cinnabon in the Oven | Gartner for Marketers – processed foods are the new eating out

    Public Image Decline of South Korean Churches – The PeninsulaThe Peninsula – Pastors in South Korea claim that church-linked COVID-19 outbreaks have tainted the public image of churches in the country. Most recently, a church in Seoul emerged as the source of the country’s second largest infection cluster following a spike in cases associated with a religious sect in Daegu earlier this year. A 2015 Gallup Korea poll finds that more South Koreans, particularly those in their twenties and thirties, are moving away from religion.

    Hallyu Con 2020 | KCCUK – virtual festival on October 4th

    Ageism Is Not Just A Disease—It Is The New Business Model For Top Ad Agencies – the original statement inadvertently let the cat out of the bag about agencies’ cost cutting at the expense of clients: they are now inhabited by junior talent, inexpensive and inexperienced. And this is the main reasons for the decline of the advertising industry. The holding companies like WPP were formed in the eighties, and they started consolidating the industry by gobbling up independent agencies. To do so, they needed to issue debt and the industry mortgaged itself to bankers. Madison Avenue went from focusing on the clients’ business to focusing on their balance sheet. And that meant getting rid of “cost”: talented experienced people in their forties and fifties and replacing them with cheaper labor.

    GBA hurt by Cold War, pandemic and protests EJINSIGHT – ejinsight.com – Greater Bay Area (cities and Hong Kong around the Pearl River delta) that China envisages as kind of like Judge Dredd’s Mega City One

    Video encoders using Huawei chips have backdoors and bad bugs – and Chinese giant says it’s not to blame • The Register 

    Hard to pardon: why Tenet’s muffled dialogue is a very modern problem | Tenet | The Guardian – “Think about it: the first few Star Wars [films], we heard them all. We heard all the lines. Listen to Apocalypse Now – you hear everything.” Price agrees: “If you watch old movies, you might hear some sound effects here and there but now they go nuts: somebody’s walking across the room in a leather jacket, you hear the zippers clink and the creak of the leather and every footstep is right in your face.” When television became commonplace in the mid-20th century and challenged cinema’s dominion, cinema needed to distinguish itself; it needed to prove that it could justify people leaving the comfort of their homes. It did so partly by becoming bigger and louder. In an era – and a pandemic – in which home streaming dominates, cinema may be forced to pull out the stops once more. “I think we’re bombarded,” Paul Markey, a projectionist at the Irish Film Institute, says of modern films. “The more expensive movies have got, the more of a bombardment they become on your senses.”

    ‘The Devil All The Time’ Costume Designer On Its Style | Esquire – the world has never fallen out of love with American workwear; no split, no wandering eye. The only thing that has changed is who wears it. The plaid-clad men of The Devil All The Time wear clothes that are as tough and hardscrabble as their lives. Their ancestors still flock to the same brands – think Dickies, Levi’s and Carhartt – only now it’s because they’ve collaborated with Off-White. Still, context is context, but the fact that these classics still work is testament to their longevity, both in design and build – the timelessness of American workwear

  • Marketing, president, apocalypse – the good, bad and the ugly

    Marketing, president apocalypse – what’s going on Ged? Years ago I used to write a periodic section on this blog: Good, Bad and the Ugly. I have been doing ongoing maintenance of this blog in the background and was inspired to bring this back after visiting old posts.

    • This time I looked at marketing, president, apocalypse. Specifically: Marketing as practiced in agencies and clients
    • A president represented in media because the run up to the US presidential election in November means things are pretty strange.
    • A fictional apocalypse – because global warming, COVID19, populism, Brexit and the rise of China under Xi Jingping

    Good, Bad and the Ugly was originally inspired by my love of two magazine sections:

    • Wired magazine’s Wired, Tired, Expired – which used to be a great zeitgeist measure in a pre-brogrammer Silicon Valley. Back when the excitement of the new, new thing was conveyed through the written word and brave choices in neon and metallic inks with challenging typographic design. Wired, Tired, Expired inspired the spirit of where I wanted to go with it
    • UK motoring publication Car Magazine. Car was a pioneering publication. It invented the idea of a ‘car of the year’ back in the 1960s. As a spotty teenager I loved to leaf through its pages. The writing of the late great L. J. K. Setright who combined a love engineering and the written word in each of his articles. (Setright’s book The Designers is a particularly good read.) Beautifully photographed cars and adverts of luxury brands that I hadn’t heard of like Panerai. It was a heady mix of Esquire and petrol. I fell out of love with Car magazine as driving became less relevant to me. But the concept behind their Good, Bad Ugly classification of cars stuck with me
    GoodBadUgly
    Long and short term marketing thinking. In the past decade Les Binet and Peter Field’s IPA based research, together with findings from the Ehrensberg-Bass institute have shaken up marketing. No self respecting marketer now doesn’t thinking about the importance of brand marketing. Last touch attribution. Performance (digital) marketers have used last touch attribution to burn marketing dollars at the altars of Google and Facebook for too long. Mark Read of WPP – whose ill-considered comments on digital marketing and ageism in agency life showed an extreme dose of short term thinking. It probably explains the WPP share price….
    President Bartlet – The West Wing was a touchstone of political fiction for friends of mine who worked in public affairs. The West Wing captured the tension and excitement of a high functioning political machine. I had the pleasure to chat over dinner with Don Baer. Baer was a former Clinton staffer, whom the character Toby Ziegler was based on.

    Bartlet also contrasts sharply with the bland Joe Biden and president Trump. Unfortunately neither of them have the kind of dialogue coming out of their mouths that Aaron Sorkin could provide Bartlet    		While Bob Woodward and Carl Bernstein’s book All The President’s Men is justifiably famous. Their second book Final Days captures the implosion of president Nixon and makes a more tragic read on a presidential administration.The House of Cards quickly went from being sharp biting satire that thrilled, to repulsion. The story built up on and created something new from original UK source material. But the show rested too heavily on the shoulders to Kevin Spacey as president Underwood. When Spacey’s reputation fell, so did the show. Robin Wright did a valiant effort to resurrect it which is worthwhile watching.
    The Jackpot – in William Gibson’s books The Peripheral and Agency a key part of the plot line is the apocalypse. This is called the Jackpot. There is not one inciting incident. Instead the world is gradually eroded to just 20 per cent of its population. The causes are very familiar to us: climate change, pollution, drug-resistant diseases and other factors. Given that the world population is still heading upwards. The Jackpot is either a way off or still in its early stagesThe Atomic Wars – the atomic wars occur the back story of the Judge Dredd universe. The modern world is destroyed by the cold war going hot. Authoritarianism and large cities offer relative safety compared to the cursed earth outside.Avengers Infinity Wars / Endgame. Thanos has a malthusian world view. He unites the infinity stones, snaps his finger and half the universe’s population disappears. Endgame then tries to give it a happy-ever-after finish because Hollywood. Yes it conforms to the idea of an ‘end of an age’ but it just doesn’t feel that disastrous in the grand scheme of things

    Marketing, president, apocalypse choices, let me know what you think in the comments section. More versions of the Good, Bad and The Ugly here.

  • Tech cold war + more things

    The US-China tech cold war has turned hot – but would a Biden presidency change things for Huawei and others? | South China Morning Post – “No president will want to be accused of being soft on China,” said James Andrew Lewis, senior vice-president and director of the technology policy programme at the Washington-based Centre for Strategic and International Studies (CSIS). “Trump’s policies are disorganised, but consistently move to cut economic ties with China. Biden’s policies will be better coordinated, less abrupt, but move in the same direction.” – the tech cold war isn’t new. You could trace it back to the beginning with coercive IP transfer and massive industrial espionage. It kicked off in earnest with the Golden Shield Project 金盾 工程 censorship system. Where we are now was not a case of if, but when

    TikTok becomes a case study for Chinese companies planning global expansion | South China Morning Post – Zhang’s relationship with the ruling Communist Party is complicated. He must walk a fine line between keeping Beijing happy but not be seen as too close to raise concerns outside China. Zhang, who told Atlantic magazine in July that he was not a party member, was approached by Beijing a year ago with an offer to help when TikTok faced political troubles in India. However, Zhang sent mid-level staff to meet government officials, signalling he did not want Beijing to get involved – whether entrepreneurs like it or not, they’re likely to find the government inserted into the business like a helicopter parent. You’re likely to see coercive business development as part of Chinese diplomats wolf warrior patter; a la Huawei 5G network equipment and the Faroe Islands

    Allegations of deception dog Nikola’s lofty aims | Financial Times – my worst fear is that this will tarnish hydrogen fuel cells in the market. Hyundai are already doing interesting things with hydrogen fuel cell wagons

    Interesting report from Watches & Wonders (aka SIHH), Shanghai – Watches & Wonders Shanghai: The Future of Fine Watchmaking? | Luxury Society – more luxury related posts here.

    BJ Fogg on this old but good video explaining persuasion through technology in very simple terms

    FAA, Boeing Blasted Over 737 MAX Failures in Democratic Report – WSJ – really nice oral history of the Boeing 737 Max scandal

    Money-launderers use Chinese online shopping sites to funnel cash offshore | Financial Times – Money launderers have used some of China’s leading online shopping sites to transfer billions of dollars to offshore gambling sites, police raids have revealed. People wishing to evade China’s strict capital controls, for example to gamble on offshore websites, have been placing fake orders on the shopping sites, including on Pinduoduo, China’s second-largest platform by users. A corresponding sum is then credited to their gaming account.

    Kraft Heinz sells parts of cheese business for $3.2bn | Financial Times – surprised if more assets aren’t sold as the 3G Capital model isn’t working

    EU tests platform to link up coronavirus tracing apps | Reuters – really interesting development in interoperability