Since the Opening and Reforming policy, China has changed enormously. In the IT Era, China has embraced never before seen fast and vast changes—changes that are shaping the future. This article offers a glance at today’s China.
A Wallet-less Country
“Smile to Pay”—a facial recognition payment system—finally became a reality at the opening of the first K PRO (KFC sub-brand) on September 1 in Hangzhou China, only two years after Jack Ma (the founder of Alibaba) demonstrated Alipay’s newest feature: authorizing payments via facial recognition.
Nowadays, a Chinese person can go shopping with only a phone, and the payment process takes just one second. Aaron Rockwell (MGM ’17) is traveling through China. He set up an Alipay account before leaving America, and his thoughts on it were that “simple things would be much more difficult without it, like renting a bike or buying street food.”
Mobile payment has become a cornerstone of China’s flourishing e-commerce, e-finance, and cloud technology during the past five years.
A Shared Yellow Bike
On a sunny afternoon, my friend Olivia Liu went biking with friends. They went to the sidewalk below their apartments, unlocked Ofo bikes via their phones, and rode around a lake in Beijing. When they were tired, they left the bikes on nearby sidewalk and took a Didi (Lyft’s Chinese partner) home. Bike rental was only $7 cents every 30 minutes, and their security deposit was waived thanks to their good credits, confirmed by Sesame Credit. They could pay whenever they wanted, via Alipay on their phones.
Born at Peking University, Ofo’s iconic yellow bikes captured college students’ hearts and quickly became a huge hit amongst young, white-collar workers. Founded in 2015, Ofo has entered 100 cities in China and 8 cities overseas.
The shared bike business has tested human nature and civilization. For instance, customers leaving bikes in traffic or in the street causes traffic threats, and the theft of bikes leads to loss of profit and even the bankruptcy of one company.
Fortunately, the current moment presents a great opportunity for these companies to exercise their creativity and establish rules of the game, as customers and regulators are currently excited, tolerant, patient, and environmentally conscious. In addition, competition constantly encourages companies to raise the bar higher.
Ofo cooperates with BeiDou Navigation system to accurately locate its bikes. Another startup, Mobike, partners with a renewable resources company to recycle bikes at the end of their lifecycle, and works with Baidu Cloud to determine popular bike stations in Beijing.
China’s sharing economy is booming and expanding to cars, smart phones, umbrellas, basketballs, and so forth. Last year, China’s sharing economy transactions were worth more than US $500 billion.
A Bite of China
After I left China, I realized the Chinese are spoiled by the accessibility of various dining options, as well as fast and affordable food delivery. Xi’an Daoxiao noodles, Henan Hui noodles, Xinjiang BBQ, Sichuan spicy Hotpot, Northeast hodgepodge, Guangzhou Dim Sum, Steamed Wuchang fish… All of these used to be only a block away, and available even late at night.
The accessibility and convenience matters, especially to Generation Y and Z that grew up with increasing abundance and affluence. The young generation possesses an incredible amount of purchasing power and are willing to pay premium for original and unconventional experiences that make them feel special and unique. Therefore, companies spend tons of resources to figure out what these increasingly powerful customers want.
Meituan, a group-buying company (like Groupon), has realized that a cheap price is not sufficient to attract and sustain its key customer segment. It introduced Meituan Waimai (delivery) service, with a guaranteed 35-minute delivery in 2013, which soon became the driving force for Meituan’s market expansion. Two years later, Meituan merged with its long-time rival Dazhong Dianping. Meituan-Dianping became the largest group-buying online-to-offline business, providing food, travel, hotel and entertainment services, with a market value of US$18 billion in 2016 and a forecast of $230 billion in 2018.
A Coin on a 210-MPH Train
A Swedish traveler uploaded on YouTube a video of a coin staying balanced on a Chinese high-speed train for 8 minutes. This inspired young Chinese Netizens (Internet Citizens) to run experiments of all kinds on high-speed trains with coins, credit cards, even thin cigarettes.
“To be rich, build roads first,” said Chairman Mao, which is a fundamental philosophy of Chinese economic planning and development. Infrastructure has improved tremendously in the past 30 years. For instance, the railway coverage increased from 49,000km to 98,000km, of which 22,000km is fast-speed train.
The Chinese underground metro system is playing a significant role in daily life. Metro lines transport millions of people every day, in 27 major Chinese cities. In Shanghai, 16 metro lines accommodate 24 million residents.
Benefiting from infrastructure development, China’s express delivery industry has expanded a great deal, with extensive networks that can reach remote areas in a short time at low costs. In 2016, over 30 billion packages were delivered, which supported over $600 billion online shopping transactions and created 200,000 new jobs.
These are just some of the changes that have shaped China in this decade. China is re-thinking business, and reshaping the future before our eyes. Tbirds, travel to China! Embrace all the exciting happenings and be part of the change!