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Baihang and the Eight Personal Credit Programmes: A Credit Leap Forward

“The personal credit era has arrived,” some netizens say.

Manya Koetse

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Baihang Credit has received ample coverage in Chinese press recently as it was launched as “the first unified personal-credit information firm” of the PRC. It joins forces with Alibaba, Tencent, and six other big companies in further building on China’s credit-based society. What’s on Weibo provides an overview of the developments that have led to the formation of this powerful credit platform.

Three years after eight commercial firms were granted permission by the People’s Bank of China (PBOC) to start their pilot programmes in operating personal credit systems in 2015, none of them have received a license.

Instead, they’ve now become shareholders and active contributors to a new unified platform that has access to an enormous number of personal credit data. At the so-called ‘trust alliance’ (信联) Baihang Credit (百行征信), state level and commercial organizations join forces in further developing China’s credit systems.

How they can share data without harming Chinese recent laws on privacy, however, remains vague.

Some background

An important moment within this development started over twelve years ago (to be precise: on March 20 of 2006), when the People’s Bank of China (PBOC) began operating its own independent Credit Reference Center. The goal of the brand-new center was to set up the reliable credit checking platform which China was still lacking at the time.

At its core, it was tasked with managing a national commercial and consumer credit reporting system, to enable financial institutions to assess borrowers’ creditworthiness.

Screenshot of The Credit Reference Center website.

In November of 2013, during the Third Plenary Session of the 18th CPC Congress, new plans were adopted to also “establish and improve a social credit system to commend honesty and punish dishonesty” (USC 2013), putting more pressure on the formation of a solid credit checking system in China.

Months later, in 2014, the Chinese State Council issued an official notice concerning the construction of a nationwide Social Credit System that was to be rolled out by 2020 (Creemers 2014).

 

Three Years of the “Credit Leap Forward”

 

It is perhaps no coincidence that not too long after the formal announcement of these plans, that would lead to a more credit-based Chinese society, the PBOC Credit Center opened its doors to eight Chinese companies to work on trial programmes to prepare for operating their own personal credit information businesses.

At the time, in 2015, the PBOC’s Credit Center had been around for nearly a decade, yet still ‘only’ covered 25% of the Chinese population, leaving ample risks in the control process of Chinese financial services (Yang 2017).

You could say that 2015 was an important year in which competition for China’s multi-billion personal credit investigation market really began, along with the flourishing of China’s Internet population and the growing demand for personal online data information (Jun 2015). A recent Caixin column by Xinhai Liu (刘新海), associate researcher at the Credit Reference Center, even calls the 2015-2018 period the “Credit Great Leap Forward” (“征信大跃进的三年”).

Besides that new personal credit rating tech firms started to pop up, the year 2015 was also the year when misconceptions arose in foreign media regarding these existing credit systems.* ACLU called it “nightmarish,” falsely claiming that all Chinese would be “measured by a score between 350 and 950, which is linked to their national identity card” and that “the government has announced that it will be mandatory by 2020.”

As explained in our recent article about this issue, these discussions – that continue in foreign media to this day – often blur the lines between the national Social Credit system and a number of private programs. (To understand more about the difference between the government’s Social Credit system and the commercial ones, please read the previous article we featured on this topic.)

These misunderstandings partly come from the fact that both the government’s plans on introducing their ‘Social Credit System’ (社会信用体系) and the Central Bank’s endeavors to build a stronger personal credit industry (个人征信行业) were major developments in the period from 2013-2015 up to the present.

 

The Eight Programmes

 

With such a strong demand for solid credit rating systems, why have none of the eight approved tech firms received their license, over three years after starting pilot operations?

One of the main problems with commercial services such as the well-known ‘Sesame Credit’ is, according to PBOC spokesperson Wan Cunzhi, that they are all “isolated islands” (“信息孤岛”) of non-shared data, that they are lacking in independence, and that their data management is not strong enough (Yang 2017).

The coming-together of these “islands” solves this problem and forms one solid platform under the ‘Baihang’ label. Which eight companies does this concern? An overview:

1. Sesame Credit (芝麻信用)

This is the best-known commercial personal credit score programme, implemented by Alibaba’s Ant Financial. Sesame Credit already had 520 million users as of 2017.

Sesame Credit example scores explained, from 385 being in the low range to 731 being in the ‘good’ range.

Sesame Credit was launched in 2015. Because it is part of the Alibaba family, Sesame Credit has an enormous amount of data at its disposal, from e-commerce sites to finance products (Taobao, Tianmao, Alipay, etc), through which it compiles users’ own scores, going from 350-950, for those who have opted into the program. The scores are based on a number of things, including people’s payment history, their contacts and network, and online behavior.

2. Tencent Credit (腾讯征信)

Since the Tencent company currently hosts 55% of China’s mobile internet usage on its platforms (Marr 2018), it has also an enormous amount of data at its disposal. Similar to Sesame Credit, Tencent Credit works with a 300-850 score system. It officially launched a trial of its score programme in January of 2018, but then took it down shortly after.

3. Kaola Credit (考拉征信)

Koala Credit is an independent third-party credit company established by the Shenzhen-based Lakara (拉卡拉) financial services company. Koala Credit was launched in May of 2015, around the same time as Sesame Credit launched its program. Lakara has strategic and powerful partnerships with China Unionpay, five major banks, and hundreds of other financial institutions. Lakara and Koala Credit jointly founded a pioneering lab in China that focuses on big data models. The University of the Chinese Academy of Sciences is involved in this project (Zhuo et al 2016, 299).

4. Pengyuan Credit (鹏元征信)

Established in 2005, Pengyuan Credit is amongst the oldest personal credit investigation firms of the eight selected by the PBOC. The company states on its website that its main goal since 2005 has been to “create a credit reporting ecosphere on the Internet,” shifting from traditional credit rating systems to online credit rating methods.

5. Sinoway Credit (华道征信)

The Beijing Sinoway Credit was established in 2013 by four large financial companies. As explained by BJReview (2016), Sinoway is among those companies (such as Zhima and Tencent) that accumulate data from their business rather than using traditional algorithms to collect financial and public data. They have exclusive access to enterprise data (Zhuo et al 2016, 299).

6. Qianhai Credit Service (深圳前海征信)

Qiu Han, CEO of Qianhai.

Another company established in 2013, Qianhai Credit is based in Shenzhen. It was launched by financial giant Pingan. The current CEO is the female big data specialist Qiu Han (邱寒).

7. China Chengxin Credit (中诚信征信)

The Beijing-based China Chengxin Credit company was founded in 2005, established by the China Chengxin Credit Management group. The firm provides personal credit information and companies and market research services. As described by the China Money Network, its database is connected to local administrations for industry and commerce, police, courts, telecom service providers to provide comprehensive credit information.

8. Intellicredit (中智诚征信)

Intellicredit is a Beijing-based independent, third-party credit registry. CEO Li Xuan (李萱) has previously expressed the company’s goal to handle any loopholes that let scammers get away with fraud in China’s online financial environment. The company is experienced in credit industries both in China and abroad, and its team has also worked on the establishment of the credit reporting system of the PBOC (Zhuo et al 2016, 299).

 

Baihang & Allies: An Abundance of Personal Data

 

The formal launch of Baihang Credit (百行征信), the “first unified personal credit information firm” of China, has become big news in Chinese media, with some calling it a personal credit industry game changer.

Lauch of Baihang Credit, May 23 2018 (photo via Weibo).

Baihang Credit is a joint establishment of the aforementioned eight and the China Internet Finance Association.* It received its license in February of this year. The firm officially opened for business on May 23rd of 2018.

While the China Internet Finance association reportedly holds 36% of the Baihang firm, the other eight shareholders each hold 8% (Zhang & Liu 2018).

^

The eight companies are not just financial investors, but also active contributors and sharers of technology, resources, and data for the Baihang firm. The launch of this joint establishment means that both state-level institutions and commercial enterprises combine their efforts in building a strong personal credit investigation and service platform; the new system now links data collected by these powerful firms such as Tencent to the state-level China Internet Finance Association, which in itself is an initiative by the People’s Bank of China.

Besides basic data including personal information, education level, salaries or employer, companies such as Sesame Credit or Tencent also have access to a rich collection of consumer data, ranging from social media, e-commerce purchases, online travel data, to location, phone records and even social connections.

The eight firms will also play an important role in Baihang’s management. Sesame Credit, Tencent Credit, Qianhai Credit, Sinoway and Koala Credit have all entered the company’s board of directors. The other three companies will join the board of supervisors (Sina Finance 2018). The 57-year-old Zhu Huanqi (朱焕启) will be Baihang’s CEO and president; he previously worked at Huida Asset Management.

The PBOC told Caixin Global that all parts of the eight companies that previously dealt with personal credit ratings will now be incorporated into Baihang. The other parts can continue to operate as data service providers. In the future, Sesame Credit, for example, will continue to research commercial credit services.

 

Many Questions Linger

 

While the recent alliance has received ample attention in Chinese media as an important moment in China’s transforming alleged ‘credit-based’ society, many questions still linger.

One Nanjing research institute writes on Weibo: “The joining of these companies means they can share big data. This also means that if a person is behind [in payments] on one platform, they will also have no access to loans on any of the others.”

But is it all about sharing personal financial credit information, or is this about the sharing of other data as well? What are the legal implications of Baihang operations? And to what extent, if at all, will the system link to the upcoming nationwide Social Credit System?

Caixin Global noted that Baihang Credit will face challenges regarding Chinese Cybersecurity Law, which imposes strict limits on ‘secondary uses’ of data beyond its original purpose, and requires individual authorization when personal data is transferred from one institution to another (Sacks 2018; Zhang & Liu 2018).

In this Caixin article, the PBOC’s spokesperson would not elaborate on how Baihang will collect and use personal data. He was only quoted in saying only that contributions to Baihang will be handled “according to market rules.”

 

“Personal Credit Era has Arrived”

 

Despite the many articles about Baihang in Chinese media, it has not become a much-discussed topic on social media; netizens discussing Chinese credit systems seem more concerned with the height of their Sesame Credit score.

One Weibo user, however, did write about the Baihang alliance, commenting: “The personal credit era has arrived” (“个人信用时代到来”).

Other people worry about the impact of this alliance, saying: “You’ll see that if you have a negative balance on your bank account, you won’t be able to use the public bathroom anymore.” (Recently, various cities in China are upgrading their public toilets, integrating AI features such as facial recognition for people to receive free toilet paper.)

Some commenters simply call the companies that have joined under Baihang “a pile of trash.”

Although Sesame Credit will not receive a license to operate its personal credit investigation business, it is highly probable that users of their credit programme will still be able to enjoy the perks of, among many other things, entering libraries for free or riding rental bikes without deposit with a high score.

“I’ve just arrived in Hangzhou and can do many things for free,” one person wrote: “I feel like my Credit Score is omnipotent.”

Baihang’s recent alliance is about to make Chinese personal credit scores even more omnipotent – the ‘Credit Leap Forward’ is well underway.

By Manya Koetse


Directly support Manya Koetse. By supporting this author you make future articles possible and help the maintenance and independence of this site. Donate directly through Paypal here. Also check out the What’s on Weibo donations page for donations through creditcard & WeChat and for more information.

 

* In an article from December of 2015, for example, The Independent suggested that “China has created a social tool which gives people a score for how good a citizen they are,” describing how “China” had put forward “a concept straight out of a cyberpunk dystopia” named Sesame Credit.

* The Chinese Internet Finance Association, also known as the NIFA (National Internet Finance Association) was established in March of 2015 upon approval by the Chinese State Council and Ministry of Civil Affairs. It is a state-level organization.

References (others linked directly within text)

Creemers, Rogier. 2014. “Planning Outline for the Construction of a Social Credit System (2014-2020).” China Copyright and Media, 14 June China https://chinacopyrightandmedia.wordpress.com/2014/06/14/planning-outline-for-the-construction-of-a-social-credit-system-2014-2020/ [10.6.18].

Creditchina. 2018. “百行征信入场,8家股东剥离个人征信业务.” CreditChina.gov, 4 June http://www.creditchina.gov.cn/gerenxinyong/gerenxinyongliebiao/201806/t20180604_117132.html [10.6.18].

Huang, Zhiling. 2016. “Six Obstacles to Producing Reliable Big-Data Credit Reports.” BJ Review, 15 December http://www.bjreview.com/Business/201612/t20161212_800074419.html [9.6.18].

Jun, Wang. 2015. “Road to Credit.” Beijing Review, 3 August http://www.bjreview.com.cn/business/txt/2015-08/03/content_698269.htm [9.6.18].

Marr, Bernard. 2018. “Artificial Intelligence (AI) In China: The Amazing Ways Tencent Is Driving It’s Adoption.” Forbes, 4 June https://www.forbes.com/sites/bernardmarr/2018/06/04/artificial-intelligence-ai-in-china-the-amazing-ways-tencent-is-driving-its-adoption/#5130d54b479a [10.6.18].

Sacks, Samm. 2018. “New China Data Privacy Standard Looks More Far-Reaching than GDPR” CSIS, 29 January https://www.csis.org/analysis/new-china-data-privacy-standard-looks-more-far-reaching-gdpr [9.6.18].

Sina Finance. 2018. “百行征信揭开面纱 芝麻信用腾讯征信等五家入董事会.” sina Finance, 4 January http://finance.sina.com.cn/money/bank/bank_yhfg/2018-01-05/doc-ifyqinzs8775295.shtml [10.6.18].

USC. 2013. “Decision Of The Central Committee Of The Communist Party Of China On Some Major Issues Concerning Comprehensively Deepening The Reform, November 12, 2013.” USC, 12 November https://china.usc.edu/decision-central-committee-communist-party-china-some-major-issues-concerning-comprehensively [10.9.18].

Yang, Felix. 2017. “Is Xinlian the answer to the Individual Credit Checking System in China?” Kapronasia, 25 Aug https://www.kapronasia.com/china-banking-research-category/item/886-is-xinlian-the-answer-to-the-individual-credit-checking-system-in-china.html [10.6.18].

Zhang, Yuzhe, and Liu Xiao. 2018. “Launch of Unified Platform Boots Private Firms From Personal Credit Business.” Caixin Global, May 28 https://www.caixinglobal.com/2018-05-28/launch-of-unified-platform-boots-private-firms-from-personal-credit-business-101258187.html [10.6.18].

Zhuo Huang, Yang Lei & Shihan Shen. 2016. “China’s personal c>edit reporting system in the internet finance era: challenges and opportunities.” China Economic Journal (9:3): 288-303.

Spotted a mistake or want to add something? Please let us know in comments below or email us.

©2018 Whatsonweibo. All rights reserved. Do not reproduce our content without permission – you can contact us at info@whatsonweibo.com.

Manya Koetse is a sinologist, writer, and public speaker specializing in China’s social trends, digital culture, and online media ecosystems. She founded What’s on Weibo in 2013 and now runs the Eye on Digital China newsletter. Learn more at manyakoetse.com or follow her on X, Instagram, or LinkedIn.

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China Brands, Marketing & Consumers

Quack Like a Goose: Why Beijing Street Vendor “Auntie Goose Legs” Sparked a Nationwide Debate

After the first complaints surfaced, Auntie Goose Legs admitted the truth about her business: she ha been selling duck legs all along.

Manya Koetse

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🔥 Originally published in Eye on Digital China.
My premium newsletter covering the stories, memes, debates, and viral moments shaping online conversations in China. Subscribe here to receive future editions.

If it walks like a duck and quacks like a duck, it might still be a goose – or the other way around. That, at least, is the takeaway from two stories that recently went viral on Chinese social media.

The woman at the center of it all is Beijing street-food vendor Chen Xiufeng (陈秀凤), better known as “Auntie Goose Legs” (鹅腿阿姨). Over the years, she became something of a local celebrity in Beijing’s university district. Originally from Jiangsu, the migrant vendor had been selling her famous roasted goose legs to students since 2011.

She skyrocketed to national fame in 2023 , but became the target of widespread criticism last week after it was revealed that her celebrated goose legs – sold for 16 yuan ($2.20) per piece – were actually duck meat all along.

The controversy came up after the vendor ventured beyond the university area into Beijing’s business district. At the universities, she enjoyed a loyal customer base and dedicated WeChat groups. In her new market, however, customers proved more skeptical. Some noticed that the meat looked suspiciously duck-like; others complained that the color seemed off.

In the university district, Auntie Goose Legs she enjoyed a loyal customer base and dedicated WeChat groups.

After the first complaints surfaced, Auntie Goose Legs admitted the truth on WeChat on June 9.

“The ingredients I originally used were goose legs,” she wrote, “but they have been out of stock for more than fifteen years. The current ingredient is duck legs.”

It turned out that she had only sold goose legs, the product that made her famous, for two months back in 2011 before switching to the much cheaper duck. “Did geese become extinct without us knowing?” some netizens joked.

The revelation quickly exploded online. The hashtag “What Auntie Goose Legs is Selling Turns Out to be Duck Legs” (#鹅腿阿姨卖的是鸭腿#) became the top trending on Weibo for an entire day, with millions of people discussing the topic.

 

Why did millions of people become so outraged over a single Beijing street vendor selling duck instead of goose?

 

Piggybacking on the debate, Anhui-based commentators pointed out that a beloved regional specialty has the exact opposite ‘problem.’ Wuwei smoked duck (无为板鸭) is branded as duck, but is usually goose. According to local standards, however, goose products may be sold under this name, prompting discussions about “hanging up a goat’s head, while selling dog meat“ (挂羊头卖狗肉): advertising one thing while selling another.

Because geese are more expensive than ducks in China, and generally considered tastier, the Anhui duck-is-goose story, unlike the Auntie Goose Legs controversy, did not provoke online anger. Instead, many people saw it as an example of sellers prioritizing flavor over cost. Auntie Goose Legs is seen as doing the exact opposite.

But why did millions of people actually become so outraged over a single Beijing street vendor selling duck instead of goose, especially when there were no indications that anyone became ill? The answer has little to do with poultry and everything to do with trust.

Auntie Goose Legs during the prime time in Beijing’s University District in late 2023 (image via Lianhe Zaobao 联合早报).

Food fraud and mislabeling have been longstanding concerns in China. Earlier surveys found that food safety worries even outweighed concerns about public security and environmental issues, and while China’s food safety record has improved in recent years, public trust remains fragile.

Part of these concerns are immediate and practical. Major scandals in the past involving melamine-tainted infant formula or recycled “gutter oil” have posed serious risks to public health. But the issue goes beyond health risks alone.

 

If a goose can be a duck, then what exactly is the duck?

 

Whereas food safety concerns in many Western countries often focus on contamination, Chinese consumers are frequently just as concerned with economic deception. It is unfair to pay for a more expensive goose and receive a duck. Even if no one gets sick, Chinese consumer law still treats it as fraud.

More important, however, is what such deception does to confidence in the broader food system. If a goose can be a duck, then what exactly is the duck?

As a major 2023 college canteen scandal demonstrated, the build-up of deceit can reach a breaking point among the public. During that somewhat Kafkaesque “rat head or duck neck” (鼠头or鸭脖”事件) controversy, officials insisted a rat head found in a student’s rice was merely a “duck neck,” even though everyone could clearly see the snout and teeth of a rodent.

This kind of gaslighting shatters social trust and reinforces a generalized sense that, as a consumer, you are entirely on your own. When regulators fail to step in honestly, even a seemingly isolated incident comes to symbolize more dangerous forms of systemic food fraud.

And this is where the Auntie Goose Legs story stings the most.

People did not come to her simply because her food was good. Over the years, she had become part of local student life, and she felt safe and authentic. Her pink scooter helmet, which she continued to wear while working, became an iconic symbol of her no-nonsense and humble image. Her success was built on word of mouth and, above all, on the trust her customers placed in her.

That this particular “auntie” deceived her customers by selling a different product than the one she advertised is no longer really about her. If duck is goose, goose is duck, and your local auntie has deceived you for years, then who can you trust anymore?

 

  • Read more about how Auntie Goose Legs rose to fame in 2023 here.

 

By Manya Koetse
(follow on X, LinkedIn, or Instagram)

Spotted a mistake or want to add something? Please let us know in comments below or email us. First-time commenters, please be patient – we will have to manually approve your comment before it appears.

©2026 Eye on Digital China/Whatsonweibo. All rights reserved. Do not reproduce our content without permission – you can contact us at info@whatsonweibo.com.

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Chapter Dive

“Going to Town to Handle Business”: How Adidas Went from Hated in China to a Chinamaxxing Brand

Why has Adidas regained cultural relevance in China while Nike is struggling despite its global strength?

Manya Koetse

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🔥 Originally published in Eye on Digital China.
My premium newsletter covering the stories, memes, debates, and viral moments shaping online conversations in China. Subscribe here to receive future editions.

A viral meme about “going to town to handle business” helped Adidas pull off one of the most successful brand turnarounds in China—and highlights why Nike is struggling to keep up.

Just five years ago, Adidas was one of the most criticized foreign brands in China. Now, it seems to have become one of the most celebrated. Ironically, the brand’s biggest success in China yet started with a mistake it made last month.

In 2021, Adidas – along with Nike and other foreign brands – faced severe backlash and boycotts in China for participating in the Better Cotton Initiative (BCI) move to stop sourcing cotton from the Xinjiang region, which Chinese consumers viewed as a hostile anti-Chinese political stance (and was framed that way by state media and official channels).

Chinese livestreamers for the brands were scolded online, Adidas employees were brought to tears, and stores across the country saw their sales drop. People began posting videos of themselves burning their Nike Air Jordans on Weibo. For the brands involved, it became a marketing nightmare.

Screenshot of SCMP report about the Nike sneakers being burnt, Adidas employees facing backlash back in 2021.

But now, Adidas has managed to completely turn its image around in mainland China, where it is being praised for its top-of-game PR skills.

 

Adidas: Heading to Town to Take Care of Business

 

Over the past few years, Adidas has increasingly embraced “New Chinese Style” (新中式), a design direction that blends Chinese aesthetics with contemporary fashion. The October 2025 launch of its “Chinese New Year Jacket”—combining tang suit-inspired elements with classic Adidas sportswear—became a huge hit, not just in China but globally.

The Adidas Chinese New Year collection became a huge hit in 2025. On the left: American influencer Hasan Piker wearing the jacket while visiting Tiananmen Square in Beijing.

 

But that was only the beginning of Adidas’s social media success in China.

In late May, some netizens spotted a machine-translated text on the Adidas website that immediately went viral for its unintentional humor.

A jacket promoted in English with the unremarkable phrase “pair it with jeans for errands around town“ appeared on the Chinese website as the clunky “pair it with jeans to handle business in the city“ (搭配牛仔裤,在城里办事 zài chénglǐ bàn shì).

The original English text and the clunky machine translation on the right.

More than a simple mistake, it was a cultural mistranslation. Running some errands is not the same as 办事 bàn shì in Chinese, which is more formal, bureaucratic language for handling affairs, such as going to the bank, notary, or police station—not a quick run to buy some eggs and milk.

For many Chinese netizens, the phrase evoked an image of an old villager cycling into the county town for official business, all while wearing an Adidas jacket.

Although the website was quickly adjusted, the meme was already snowballing and evolved into the more playful “off to town to take care of business” (进城办事 jìn chéng bàn shì).

One popular comment played on the rural-to-city associations of the phrase:

💬 “While you’re back in the village talking trash about me, I’m already wearing Adidas and heading into town to take care of business.”

Adidas responded with surprising speed and wit.

Instead of apologizing for the mistake, they posted a video showing their own “off to town to do business” T-shirt, which quickly became available for sale online and at flagship stores in Beijing, Shanghai, and Chengdu.

Chinese actor and Adidas ambassador Li Xian (李现) was later spotted wearing a “handling business” T-shirt, and the comment sections exploded.

 

Adidas read the room and went on to launch a marketing campaign featuring China’s popular possum meme wearing one of its jackets alongside slogans such as “Wear Adidas, Handle Serious Affairs” and “Wear Adi, Handle Big Things“—a nod to the original mistranslation and a series of viral wordplays built around the brand’s Chinese name (including “穿Adi办大事” and “穿Adi, 办das”, with das meaning dàshì 大事, “important business” here).

They also put up signs labeling some of their stores as “Adidas Errands Office” (阿迪办事处).

Rather than distancing itself from the joke, Adidas amplified it, becoming even funnier than the netizens themselves.

Other brands in China, from Lays to Alipay, saw the hype surrounding the meme and also started incorporating the “handle business” phrase into their online campaigns, referencing Adidas.

Various Chinese brands incorporated the Adidas meme into their own campaigns.

Because Adidas’s response felt effortless, authentic, and on-brand, it greatly boosted the brand’s popularity and appeal among young Chinese consumers.

 

Nike’s Grass is No Longer Greener

 

Sportswear giant Nike also became a major trending topic in China over the past week, but for entirely different reasons. Nike hasn’t been doing all that well recently, and the brand’s decline went viral in the same week that Adidas’s success was evident.

Nike became a top trending topic under the hashtag “Chinese consumers are abandoning Nike faster than anyone expected” (中国消费者抛弃耐克比想象中更快) after reports that a pair of sneakers originally sold for 899 yuan (US$132) are now selling for 429 yuan ($63) and still failing to attract buyers.

Nike’s decline is noteworthy because the brand was once booming in China. As with many other Western brands, it symbolized quality, prestige, and a cosmopolitan future for much of the 1990s and 2000s.

In a 2011 study of Chinese consumer aspirations, one respondent imagined a future in which she would drive a Mercedes-Benz, wear Nike, and eat KFC—a vision of modernity built around foreign brands. Another person dreamt of wearing “Nike clothes and Nike shoes (…) on the green grass, swinging golf clubs under the golden sunshine.”[1]

But Nike’s grass is no longer greener. Chinese commenters largely agree that much of the trust and desire surrounding the brand has eroded.

Many former Nike consumers now prefer Chinese brands such as Anta, Li-Ning or ERKE. Multiple posts on Chinese social media cite the Xinjiang cotton controversy as a turning point from which Nike never fully recovered.

 

The Localization Dilemma: A Strategic Catch-22?

 

The contrasting fortunes of Nike and Adidas reveal something important about the position of foreign brands in China today.

As domestic brands improved and narratives of national rejuvenation and the “Chinese Dream” gained prominence under Xi Jinping, consumer sentiment toward Western brands shifted dramatically, especially amid a growing number of controversies involving them.

From a Dolce & Gabbana campaign deemed racist to a witch hunt for Western brands listing Hong Kong and Taiwan as separate countries, international brands increasingly started struggling to find their place between politics, patriotism, and consumers who are choosing “Made in China” over global consumer culture.

As Zhihong Gao[2] observed as early as 2012, the rise of cultural confidence and renewed appreciation for Chinese traditions created a dilemma for foreign brands.

They find themselves caught in a strategic catch-22: if they localize too much, they risk losing the distinctiveness that made their brands attractive in the first place, while also reinforcing consumer preference for local cultural elements; yet if they remain too foreign, they risk appearing culturally tone-deaf and disconnected from Chinese consumers.

This is where Adidas appears to have found a sweet spot.

Unlike Nike, which seems to be living off its past success while showing little urgency in adapting to the Chinese market, Adidas has fully embraced Chinese digital culture, local humor, wordplay, and youth trends without abandoning its own identity.

Rather than pretending to be Chinese, Adidas is participating in Chinese culture as a distinctly foreign brand. By celebrating the unique elements of Chinese culture, both in tradition and modernity, it is boosting both its own image and the cultural pride it is tapping into. That is Chinamaxxing in a nutshell.

 

  • Read more about Chinamaxxing here.
  • Read more about the rise of ‘proudly made in China’ here.
  • Read more about Nike vs ERKE here

 

[1] Kelly Tian and Lily Dong, Consumer-Citizens of China: The Role of Foreign Brands in the Imagined Future China (London: Routledge, 2011), 70–71.

[2] Zhihong Gao, “Chinese Grassroots Nationalism and Its Impact on Foreign Brands,” Journal of Macromarketing 32, no. 2 (2012): 184–185.

 

By Manya Koetse
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