The Big Yam
Headquarters was worried. Complaints were flooding in from the Chinese countryside about the quality of the new Haier washing machines. The water pipes were defective, the peasants told the Chinese manufacturer. But when the Haier team went to investigate, they were surprised to discover that the pipes were not broken or poorly fitted. Rather, they were clogged with yam skins. The peasants had been washing their dinner ingredients, not their clothes. An American manufacturer might have lectured the consumers about the proper uses of a washing machine. Haier's CEO, Zhang Ruimin, decided instead to design a machine with wider pipes that could wash both clothes and large root vegetables. He called it the Big Yam, and the machine became a big seller in the Chinese countryside.
The Big Yam is only one of several stories that have accumulated around Zhang Ruimin. On another occasion, Haier's larger-than-life CEO ordered seventy-six defective refrigerators sledgehammered in front of workers rather than submit to the usual practice of covering up the snafu and palming off the merchandise as low-level bribes. Zhang videotaped the incident as an example of Haier's commitment to quality control. Then there's the story of the Little Prince, a cheap little Haier freezer that Chinese urbanites bought in droves because they no longer had time to shop for groceries every day but also didn't have the money for a whole new fridge.
Haier is the face of the new China. As a global company and one of the largest appliance manufacturers in the world, it has helped transform the slogan "Made in China" into "Made by China." It maintains a cooperative rather than antagonistic relationship with the Chinese state. It has developed products that serve the specific needs of the Chinese consumer. And it is part of a new wave of branding and advertising that has explained, shaped and translated market economics for more than a billion people.
In some ways, Zhang is the Mao of consumer goods. He thinks big, makes bold pronouncements, attracts acolytes, trumpets his Communist Party membership and attends to the specific attributes of Chinese society. On the other hand, he's a running-dog capitalist who makes a lot of money. It's an open question as to whether Zhang and his cohort of Chinese CEOs are either spreading American-style capitalism across the country or participating in a substantially different economic reform "with Chinese characteristics." Similarly, it's not certain whether China is advancing a state-centric "Beijing consensus" at the global level to counter the more laissez-faire "Washington consensus" or simply following the West's cues by joining the World Trade Organization and acceding to the general trends of globalization.
In Brand New China, Jing Wang uses Chinese advertising as an optic through which to scrutinize this tension between Eastern and Western approaches to the market, between the Haier of the Big Yam and the global company that many Americans don't even realize is Chinese. A professor of Chinese cultural studies at MIT, she is well situated with one foot in each camp: straddling not just China and the United States but also advertising and academia. Her book is a thoroughly enjoyable and well-written tour d'horizon of branding and advertising strategy informed by her knowledge of the field and summers spent at the advertising firm Ogilvy & Mather Beijing. She tells great stories about Haier, Lenovo, Wahaha and other Chinese firms that may or may not be building a new type of market economy. But in her eagerness to identify a uniquely Chinese approach to the buying and selling of things, Wang underestimates some of the deeper structural forces that drive capitalism in both East and West.
The ideal Chinese consumer has dazzled foreign companies for at least two centuries. The prospect of selling every Chinese person a pair of pants, a soft drink or a new car has prompted transnational corporations to invest heavily, time and again, in prying open the Chinese economy. Over the past two decades, the arrival of powerful transnational corporations with sophisticated advertising campaigns should have wiped out all the local Chinese goods and services.
But this didn't happen. First of all, the Chinese government has tilted the playing field to give the home teams an advantage by establishing laws that restrict the activities of foreign companies. Wang, however, is less interested in these top-down strategies than in the particulars of how local firms and global giants compete for Chinese hearts, minds and pocketbooks by redefining desires and creating new ones.
She cites, for instance, the Chinese search engine Baidu to demonstrate how culture can trump market power. Baidu created viral video ads that were as hilarious as they were untranslatable and revolved around the nuances of the Chinese language that their unnamed competitor (Google) could not capture. Libo beer, meanwhile, pitched itself as a distinctively local brew that could compete against not only foreign brands (Budweiser) but also powerful national brands (Tsingtao). "The beer brand, the campaign says, witnessed all the growing pains of Shanghai throughout the reform era," Wang relates. "Libo...has been with 'us' through thick and thin."