In a striking example of the growing influence of top sellers in the e-commerce sphere, East Buy, a Chinese live-streaming e-commerce website, recently made headlines by firing its CEO. The move came after a controversy involving one of the platform’s most popular influencers, Dong Yuhui, highlighting the intricate relationship between e-commerce platforms and their star personalities.
The conflict began when Sun Dongxu, the now-former CEO of East Buy, endorsed a social media post suggesting that Dong Yuhui, a prominent figure on the platform, was overly credited for his success, which was actually a product of teamwork. This statement sparked outrage among Dong’s fanbase, leading to a significant backlash against the company.
In response, East Buy, listed in Hong Kong and initially part of the New Oriental Education Technology Group’s online tutoring arm, announced Sun’s dismissal in a stock exchange filing. The company cited the need to protect its brand and reputation and to align with shareholders’ interests as reasons for the decision. Chairman Michael Yu Minhong will now assume the role of CEO.
This incident underscores the delicate balance e-commerce platforms must maintain with influential sellers. Dong Yuhui’s vast following, with 1.5 million followers on Weibo and approximately 22 million on Douyin, dwarfs that of East Buy’s official accounts. His absence from the platform’s streaming schedule, following the dispute, led to a revolt from his supporters, demonstrating the leverage top influencers wield in this sector.
The mutual dependence between East Buy and Dong Yuhui reflects the complex dynamics in the world of e-commerce. While platforms rely on popular personalities to attract and retain customers, there’s a growing need to diversify and reduce over-reliance on individual influencers.
East Buy’s transition from an online education service to a live-streaming e-commerce platform is part of a broader trend in China, where live-streaming sales have surged to 2.2 trillion yuan in the first ten months of 2023. This mode of selling now accounts for a significant portion of online shopping revenue in the country.
Following the CEO’s dismissal, East Buy confirmed Dong Yuhui’s return to live-streaming and announced his promotion within the parent company, New Oriental Culture and Tourism Group. This decision led to a notable increase in East Buy’s share prices, further emphasizing the impact influencers have on the financial health of e-commerce businesses.
This case serves as a pivotal example of the evolving e-commerce landscape in China, where influencer power continues to reshape the industry’s dynamics, challenging traditional corporate structures and strategies.
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