WP4 rough draft
Since the 2010s, the short video industry has boomed globally. According to the 47th “Statistical Report on the Development of China’s Internet” released by the China Internet Network Information Center (CNNIC,2021), as of December 2020, the number of Chinese netizens reached 989 million, of which the number of short video users was 873 million. From a global perspective, Tiktok, becoming one of the most famous short video platforms in 141 of 155 countries, comes in 39 languages now. TikTok becomes the only app besides Facebook to reach the 3 billion downloads milestone (Brian 2022). The rise of the short video industry is inseparable from millions of creators who post video on the platform. According to a report from SignalFire, a venture capital company, ten millions of people around the globe consider themselves creators (Taylor,2021). Influencers created a $10 billion marketing industry in 2020(Haenlein et al, 2020). The income of these influencers mainly comes from the likes they gain from the users, advertisement payment from brands, and profits from the sales of products to their followers. Such a revenue model makes some influencers choose to sacrifice the benefit of their followers. They try to earn more profit by deceiving the consumers. In China, the government tries to solve this problem by asking the platforms to have supervision on the influencers. However, this method fails for the reason that the short video platform lacks the power to constrain the influencers because the deep profit connects between them. In this essay, I am going to argue that the short video platform in China should learn from other countries to increase the power of supervision on influencers and create a better online environment for the users.
In order to promote the healthy development of China’s e-commerce economy, the People’s Republic of China promulgated the E-commerce Law to regulate the market order. The E-commerce Law of China(2018) requires short video platforms to supervise influencers as well as bearing joint and several liability with the influencers. However, the practice of requiring platforms to supervise their influencers didn’t work efficiently.For example, Xinba, a influencer who had 70 million followers on one of the most popular short video platform Kuaishou, and sold products worth 125 million yuan in summer 2020, was found selling fans fake bird’s nests, an expensive Chinese delicacy, to his followers(Qu and Zhang, 2018). The local Market Supervision Bureau fined Xinba’s company 900,000 yuan. However, Kuaishou’s punishment for Xinba’s behavior of selling fake products is only to block his platform account for 60 days (Deng 2021). Xinba knelt down to apologize to his followers and paid good effort to recover his image during the blocking days. After a brief hiatus, he announced his return and continued his sales on the platform. In the first sales event after his return, the value of the goods he sold exceeded 2 billion yuan. In addition, his followers exceeded 80 million, about 15 percent higher than before (China Marketing Insights). Compared with the sales of goods and the number of fans before the Xinba scandal was revealed, the existing punishment did not bring him a great negative impact. He is still active on short video platforms in China, and is able to profit from selling products to followers.
Kuaishou companies take little measurement on punishing Xinba’s illegal behavior because the company has lots of common interests with influencers like Xinba. In other words, the profit of the platform is closely related to the profit of influencers. According to Kuaishou’s 2020 annual report, Kuaishou’s total annual revenue is RMB 58.8 billion, of which selling products to users accounts for 56.5%. Moreover, the value of products sold by influencers who have a large number of followers accounts for the majority of the total sales transactions on the platform. For example, influencer Xinba and his family accounted for nearly a third of the platform’s gross merchandise transactions in 2019. For the Kuaishou platform, sanctioning Simba’s counterfeiting will have a great impact on the platform’s own interests.
The reasons why influencers like Xinba have the ability to against the platform may surprise people. Xinba’s followers, who were cheated by him before, support him. According to a report by Deng Guoji, an associate professor at the School of Sociology at Nanjing University, 74.9 percent of Kuaishou users are younger than 25 years old. 87.6 percent of them have not attended college, are unemployed or engaged in manual labor. These people lack the right to speak in society and are eager to get the attention of society. Unlike celebrities in the traditional sense, who will still have a sense of distance from their fans no matter how easy-going they are, influencers on short video platforms build a strong emotional connection with their followers. For instance, Xinba promotes himself as the “son of peasant”. He publicized that he dared to challenge capital to gain the lowest price of products for his followers, though it is hard to confirm that this is only the sales skills he used to sell more products. From Xinba’s short video account, followers feel respect from him and consider themselves family or friends. The emotional bond that audiences form with influencers, have a positive effect on the followers’ purchase (Hwang and Zhang, 2018).Out of trust to family and friends, followers of Xinba are willing to buy products from him. Also, after knowing the deceiving behavior of Xinba, the followers forgive him easily because of their closed emotional relationship. By utilizing the emotional need of the followers, influencers like Xinba gained lots of loyal followers and earned a lot of profit for the platform. The loyal followers help enforce the profit connection between short video platforms and influencers.
Creators’ influence on followers are not limited in China. According to a report, influencers are considered as trusted opinion leaders, their recommendations are considered as more trustworthy than traditional forms of advertising(Driel and Dumitrica,2020). The promotion or selling of products on short video platforms increases people’s willingness to shop online. 67% of the tiktok users say that they are inspired to shop even though they are not looking to do so (TikTok for Business,2022).Moreover, “63% of consumers agree that they prefer to trust the word from a friend, a relative, or an influencer, instead of trusting the advice that comes directly from a brand (Wilhelm,2021).
However, Situations like cheated followers on short video platforms happen globally as well. For instance, In 2020, amazon sued two influencers Fitzpatrick and Kelly-Krejci for selling counterfeit goods on TikTok (Palmer,2020). Fitzpatrick and Kelly-Krejci buy counterfeit wallets, bags, which are falsely labeled as luxury goods from brands like Gucci. They promote these fake products on short-video platforms by posting photos and videos, and guide consumers to use “hidden links” to buy products instead of official channels. In this case, followers receive fake products instead of regular products. After the scandal was exposed, Kelly Fitzpatrick and Kelly-Krejci are forbidden from selling and are banned from promoting, or advertising products that already exist on Amazon (Palmer,2020). Their career as influencers were deeply influenced by the punishment. Also, as a lively example, the consequence of Fitzpatrick and Kelly-Krejci sends a strong message to people who would be bad actors that they will be fully accountable for what they did. A better platform environment was contributed in this case.
Kuaishou companies can learn something from the success of punishing Fitzpatrick and Sabrina Kelly-Krejc’s actions. To be specific, there is a small profit connection among amazon, tiktok and the influencers. The influencers are not strong enough to influence a large portion of the profit of the platform. In this case, the platform does not need to make a choice between the benefit of the company and the benefit of profit. The platform is powerful enough to supervise the behavior of influencers and take actions to punish them after finding their false behavior. In the short term, it may be hard for the platform to manage the behaviors of millions of followers who have deeply emotional connections with the influencers. Working on increasing the power of constraint on influencers will be a good way to shape a better environment in the short video industry. Hence, for Kuaishou Company in China, it is necessary for the company to adjust their relationship with the influencers. For example, it is better to cultivate 10 influencers that each of them have 1 million followers than a single influencer who has 10million influencers. For influencers, numbers of likes and followers make them visible to the platform and brands, and earning money. However, after reducing the impact of influencers with large followings on company profits, the platform’s ability of supervision on influencers will increase a lot. In this case, both platform and users’ benefit will be protected. The platform can build a better economy and provide a safer environment for their users.
In conclusion, current Chinese laws and short-video companies are not strict enough to regulate influencers. In addition, in the short term, the psychological impact of influencers on followers is difficult to completely change. China needs to learn from foreign cases and increase the power of companies to regulate influencers. Effective management can create a healthier network environment for people.
Work Cited
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