Weekly #20: The art of movie scheduling rate 🎥, Tesla lowers its stance 📉, Tmall Global’s incubation efforts 🐣| Following the yuan

One of every 3 passenger cars sold in China is an electric vehicle, thanks to discounts and subsidies.

Today's headline has to be China's decision to stop publishing youth unemployment data, which hit a record-high rate of 21.3% in June. This news has gone viral on Twitter (at least within my circle) and within private WeChat groups.

Fu Linghui, National Bureau of Statistics spokesperson, warned last month, "[The rate] might rise next month as young individuals and graduates join the workforce." [Chinese] We perhaps anticipate another record-high and explanations, but the sudden suspension would only invite more scrutiny.

A college student at a job fair in March. China News Service via NBC news

A Weibo user remarked, “This is the only effective policy addressing the high youth unemployment rate so far.” Meanwhile, many on Bilibili, a popular video streaming platform facing young users, shared personal experiences. One commented on china.org video on the platform, “I was unemployed for most of last year and only started working recently.”

I empathize with the statisticians, journalists, economists, and lawyers who remain committed to their professions. Yet, in this new era, they're faced with a challenging choice between that and political loyalty.

1. The art of movie scheduling rate 🎥

Following our discussion on data, another intriguing dataset that has caught my attention is the movie scheduling rate 排片率.

A couple of issues back, I highlighted how the Barbie movie had a dismal scheduling rate, representing the percentage of screenings in China. The scheduling rate for Barbie on its debut day was only 2.4%, prompting some users to voice their complaints on Weibo.

Scheduling rates are determined by cinema managers based on their experience and anticipation of viewer responses, which in turn dictate a movie's exposure across China's over 80,000 film screens.

A week after its release, No More Bets 孤注一掷, a two-hour film about international cyber fraud, grossed over 2 billion yuan. Featuring renowned actors from Greater China, the movie narrates stories based on real-life incidents. It centers on a software engineer and a model who are drawn into a scam operation in northern Myanmar, and a family devastated when their only son becomes addicted to online gambling.

Actress Jin Chen plays the model-turned-croupier. Image: Douban

Dip Deeper: I'm convinced that scheduling rate deserves its own in-depth explainer piece, and it’s a dataset that shouldn't be overlooked.

This film wrapped up production around two years ago, timing its release perfectly: a post-Covid summer when consumers are eager to indulge in affordable entertainment. Moreover, it aligns seamlessly with China's national anti-fraud initiative – a campaign receiving considerable police resources, even incentivizing people with perks like petting police dogs for downloading an anti-fraud app.

This happened in Nanjing in 2021. Image: The Paper

Following the success of movies like Wolf Warrior (2015), there's a growing trend of investing in films that resonate with the state media's “main melody”. As defined by The China Media Project, this refers to “activity in the cultural sphere, including media and journalism, that sticks to the main political line of the CCP”.

2. Tesla lowers its stance 📉

This Monday, Tesla announced price reductions in China for its vehicles: the Model Y Long Range now starts at 299,900 yuan (US$41,180, which means it’s ~9k cheaper than its price in the U.S.), down from 313,900 yuan, and the Model Y Performance has been adjusted to 349,900 yuan from 363,900 yuan.

Some middle-class families are seizing the opportunity to benefit from tax waivers and to afford purchases that would otherwise be beyond their budget, thanks to central and local subsidies that pushes EV adoption and such discounts that aims to drive individual brand’s market share.

Earlier this year, BMW offered a generous discount of 100,000 yuan on its EV model i3, which was then sold at around 250,000 yuan. This pricing strategy enabled it to rival sales numbers of local EV manufacturers like Zeekr, NIO, and Xpeng. Other competitors, including Zeekr, NIO, Leapmotor, and Neta Auto, have also announced discounts this August.

People gather in a Tesla showroom. Image: via Sohu

Dip Deeper: Promotions in H1 have disrupted the auto market's usual pricing trajectory, according to the China Passenger Car Association, and some market segments are anticipated to continue offering discounts. But as asked in my last piece about changed consumer habit, the key questions here are: If every brand is discounting, will consumers still value the regular retail price? Moreover, the central government’s subsidy on EV was going to end in 2022 before being extended. How much longer can that go?

EVs currently account for over 1/3 of all passenger cars sold. Image: CPCA

3. Tmall Global’s incubation efforts 🐣

Recently, Tmall Global unveiled their "Supernova Creation Camp", pledging a substantial investment in brand growth initiatives like annual fee waivers and complimentary live streaming slots. The objective is to bolster 1,000 emerging global brands over three years.

Post the initial surge during Covid, e-commerce giants like Alibaba’s Taobao and Tmall, JD.com, and TikTok’s sister app, Douyin, find themselves vying for new brands in an increasingly saturated market with consumers who face discount fatigue. In the latest June quarter, Alibaba released the revenue of Taobao and Tmall Group (also includes 1688.com and Xianyu) for the first time after reorg, which reported a 12% increase to US$15.85 billion.

Image: Alizila

Dip Deeper: This isn't a novel strategy. Tmall Global launched a similar incubation scheme targeted at beauty and perfume brands in 2020. Given the lack of self-congratulated news, it’s speculated that previous attempts might not have fared too well.

In an article earlier this year for Glossy, I covered beauty brands including Too Faced and Huda Beauty that have exited China’s $7.4 billion beauty and skincare market, and they were both involved in Tmall Global’s incubation program. I’m not saying that Tmall is directly responsible, but if brands want to take the leap, they really should value the window into China and its consumers before its failed experiment made headlines. 🔚

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One more thing:

Oh dear I swear this is my favourite comment on the masked number 🤣:

“#No More Body Fat Data from Me

Starting this August, I will cease publishing data regarding my body fat percentage and weight. The reasons for this decision include: the ever-evolving nature of society and economy, the need for enhancing statistical methodologies, and the pursuit of better data calculation and optimization techniques.”