In a turn of events, Chinese live-streaming e-commerce giant East Buy has ousted its CEO, Sun Dongxu, following a public dispute with one of its top influencers, Dong Yuhui. The move comes amidst a broader trend of e-commerce platforms in China reassessing their reliance on individual influencers.
East Buy, originally an online tutoring platform created by Michael Yu Minhong as part of the New Oriental Education Technology Group, transitioned into live-streaming e-commerce after the outlawing of private tutoring in 2021. This shift in focus led to the emergence of Dong Yuhui as a prominent influencer on the platform, with a massive following on social media platforms like Weibo and Douyin.
Trouble began brewing when Sun Dongxu publicly supported a social media post that suggested Dong was taking undue credit for his success, claiming that his scripts were actually the work of a team of writers. This sparked outrage among Dong’s followers and was seen as a mishandling of the situation by Sun, damaging East Buy’s brand and reputation.
In response to the fallout, East Buy swiftly removed Sun from his position, with Michael Yu Minhong stepping in as the new CEO. The company cited the need to protect shareholder interests and ensure effective management as reasons for the leadership change.
The incident highlights the delicate balance that e-commerce platforms in China must strike when working with influential personalities. While these influencers are crucial for attracting consumers and driving sales, platforms are now seeking to reduce their reliance on any single individual to avoid such public disputes.
For both Dong Yuhui and East Buy, there is a lot at stake. Dong’s massive following makes him a valuable asset for the platform, while East Buy provides him with a platform for his live-streaming activities. According to industry experts, the two are mutually reliant on each other, making their relationship crucial for their respective success.
Despite the controversy, East Buy remains a significant player in the Chinese e-commerce industry. The company’s successful transition into live-streaming e-commerce has proven to be a lucrative move, with sales in this sector experiencing substantial growth in recent years.
Following Sun’s departure, East Buy announced Dong’s return to live-streaming as a senior partner of the company. Additionally, Dong has been promoted to the position of assistant of culture to chairman Michael Yu Minhong and will serve as vice-president at New Oriental Culture and Tourism Group, the parent company of East Buy.
The market responded positively to these developments, with East Buy’s shares rising over 21% following the announcement of Sun’s departure. This indicates investor confidence in the company’s ability to navigate through this challenging period and continue its success in the competitive Chinese e-commerce landscape.
(Source: Ben Jiang | SCMP)
