China’s education sector: Lessons in business agility
The number of viewers ticked upwards of 100,000 on New Oriental’s livestreaming channel as the man onscreen peppered his steak-selling session with nuggets of English language tips.
Was it a livestream sale? Or was it an English lesson?
In truth, it was a bit of both happening on the Douyin app, TikTok’s sister app in China. The charismatic figure online was Dong Yuhui, a former English tutor at edtech company New Oriental. From tutoring about 500,000 students in the eight years he had been at the company, he is now a salesman. And a pretty successful one at that.
However, he is not just any peddler. The effectively bilingual Dong squiggled on the whiteboard in his hands, spelling out “299”, “12 pieces of steak” and “24 bags of seasoning” as he went through the numbers in English – and implored his rapt audience to spend RMB299 on the offerings.
Such sales techniques are raking in millions for New Oriental – an 18-hour-long live stream on June 11 recorded a staggering RMB19.9 million in sales.
Despite the tremendous success, it wasn’t always meant to be this way for the private education company founded in 1993. Laying off 60,000 of its 100,000 staff earlier this year was not part of the plan as well. The ban by the Chinese authorities on for-profit tutoring came as a bombshell in July 2021, causing firms in the US$100 billion sector to scramble to find new sources of revenue.
A select few like New Oriental survived, but are not quite thriving just yet. While its stock price is rising steadily, levels remain far below the highs before the clampdown. Many, however, have lauded the business nous of founder Yu Minhong, who has piloted a way through the regulation rubble. Besides selling products, he has also been trying to explore businesses in other sectors not impacted by the new rules, such as dancing and drawing classes and teaching Mandarin to foreigners overseas.
Like New Oriental, we have also been trying to be nimble with our portfolio company, UBI Business School, which offers programmes in Marketing and Business Administration at levels ranging from a basic degree to a doctorate.
While our teaching faculty are not quite hawking wares on Douyin, the last few years have brought a couple of lessons in being adaptable, whether the forces of change were emerging from the COVID-19 pandemic or regulatory overhauls.
Lesson 1: Connecting online and offline
The recent two-month lockdown in Shanghai, as part of China’s zero-COVID policy, has forced us to be creative. A big part of a business school is indubitably the in-person networking. For us, it has been a fundamental shift to transit to a primarily online teaching model.
How do we continue to provide platforms for connecting people, even if it cannot be done over a handshake at a physical networking session?
Setting up the tech infrastructure for online meetings is just the first step. But we have also provided the human touch by tapping our extensive alumni base and ensuring that there is purpose to the platform.
In light of the pandemic restrictions, UBI has embarked on a lecture series featuring experts, many of whom used to pass through the halls of the school. A range of topics are available: From how to list a company, fashion business and fengshui, to hot button issues such as the Ukraine war and cryptocurrencies.
These lectures are freely available to anyone interested, as our way of extending our expertise to a society that is still reeling from the effects of COVID-19. By featuring alumni speakers, we are also strengthening the UBI social compact, igniting connections between our 3,000-strong alumni and current students.
Lesson 2: Going global
Just as New Oriental had to pivot to teaching foreigners, UBI has always looked further afield for opportunities given our partnership with Middlesex University London. With 35 student nationalities, we need to have an international mindset.
Besides Shanghai, we have UBI campuses in Brussels, where many multinational headquarters are located, as well as Luxembourg, one of the official capitals of the European Union.
The decision to be a global business school is twofold. First, it exposes our students to a world of opportunity as the locations are regional hubs. Second, from a strategic standpoint, it also diversifies business risks, preparing us for unforeseen legislative changes like the one we saw in China.
We intend to further broaden the reach of UBI by entering Southeast Asia, which is brimming with opportunity in the technology sphere. Last year, the region’s start-ups raised over US$8.2 billion in capital and by 2025, they are forecast to achieve a combined value of US$1 trillion. The sheer numbers in untapped markets indicate tremendous potential: There are 655 million people, many of whom are prospective consumers.
China’s tech titans – the Big Four of Alibaba, Bytedance, Tencent and iQiyi – have set up regional headquarters in Singapore. UBI will also capitalise on this rising tide by opening a campus next year in the Lion City.
Who knows, we might just offer a course in livestream e-commerce while teaching English.