The world has already changed, just not everyone has noticed it yet
Ivan Sinitsyn is the CEO of the Russian-Chinese marketing agency Solver. Graduated from the Faculty of Public Administration of Moscow State University in 2003. For over 12 years he worked and was a partner in marketing and advertising agencies, for 4 years he managed an IT company. In 2015, he summarized his previous experience and created his own marketing agency.
What did inspire you to start doing business with China?
This China-related business came up organically and quite unexpectedly. The turn to the Chinese market happened when we made a consulting project for one of our clients. We were starting the first Russian online-supermarket on Tmall Global – the main Chinese platform of the e-commerce, which is owned by the Alibaba Group. Initially it wasn’t the main project for us, but because everything was so new and unexpected, I had to visit China frequently. After a year it was obvious, that the experience and knowledge that I got when entering the Chinese market was in demand by a lot of companies. It is no secret, that many sectors of the world economy are growing yearly because of the Chinese customers. After all, they are making up 1/6th of the world population. Besides that, Chinese digital technologies, advertising models and e-commerce solutions impact the world greatly. So, seeing the difficult and long-lasting situation in which Russian economy had found itself, I understood, that working with the Chinese market is one of the few niches which are developing dynamically, where marketing and consulting services might be in demand. That’s why it was decided, then, to separate a part of our Russian and Chinese teams of the previous project and put them into a different business unit – marketing agency “Solver”.
What difficulties have you met with when you started your business with China?
I think, that these problems aren’t unique in a sense, that all of the Westerners, who start doing business with China, face them. One can be prepared for the cultural differences, rely on the stories, which were told many times before and the stereotypes, that are widely known, but in the reality, everything is so much more complex.
There are problems with communication, even if you have reliable interpreters. There are specifics in terminology and business diplomacy, which are understood differently by all of the sides of the negotiations. There are huge differences in our mentalities. However, and it was rather surprising, there’s a lot more in common between Russians and Chinese, than I thought before. Government control is similar in Russia and China. But it is stricter in China, because everything has been already digitalized many years ago. I had to accustom myself to the fact, that Chinese never say “no” even if they mean it, and it is an important key to working with China. But everything falls into place, when you eventually understand, that Chinese genuinely live in the “China = the world center” paradigm. For them China is the center of the world. The rest of the world have either already understood and accepted this fact, or still haven’t accepted it yet, because of various reasons (which include ignorance), but they inevitably will. The majority of Chinese people genuinely live like this, and act according to this paradigm, and they care little about the rest of the world. It doesn’t mean, that we have to accept it. But you have to remember about it still. An inflated ego of the representatives of the Russian and the Western business worlds causes serious problems as well. If you want to work with China, you have to tone down your ego for a bit, especially so, because nobody cares about it in the first place – since you aren’t a Chinese.
The international model of your business means, that you have staff both in China and in Russia. How do you manage such a team?
It’s not easy. You have to manage it, remembering a lot of other circumstances. Such as, differences in time zones, differences in establishing work processes and relationships. We are lucky, that we had started our marketing business with a small group of people, taking small projects. Especially so, that the initial projects were of different orientation. Opening a store on the main Chinese e-commerce platform meant not only marketing work, from research to promotion, but also logistics, taxes, managing the Chinese staff, even managing trade representatives.
Even though the Russian and Chinese teams have mostly learnt to understand and support each other, we still, sometimes, stumble upon new difficulties, and are constantly changing processes “on the go”. But the people are same everywhere. No matter the cultural differences, our basic values are mostly the same. Thus, if you see your team as a group of people, and not simply as a “tool”, every problem can be solved.
Even before coronavirus your business has worked on online and distanced basis. Does it mean, that you weren’t affected much by the COVID-19?
In terms of shifting onto distanced working, COVID-19 really hasn’t impacted us much. From the moment the pandemic started, we have been working in the online-only regime for the few years already. Because all of the key communication happens online between the Chinese and the Russian staff, we don’t care much if the Russian part of our staff is located in one place (an office, for example). Moreover, the fact that we have people working from different cities in Russia, which have lesser time differences with China, compared to Moscow, allowed us to mitigate the time zone related problems in case of some projects. So, we were totally prepared for the distanced working, and now we are going through this period, when for our clients the online discussions of the important problems become the norm as well. In this sense the pandemic really helped us, because now we don’t have to explain to our clients that you don’t have to spend 2 hours in a traffic jam for a face-to-face meeting, but we can solve all of our problems on a video call, thus saving time.
COVID-19 impacted our business from a different angle. It had stopped all of the travel possibilities. In a long-term perspective the closure of the borders is beneficial for us as it has made it clear for our clients how important the Chinese tourists really are. In the short- and medium-term perspectives this situation directly impacts the profitability of our business. But we have decided, that we will use the Chinese model – instead of reducing expenses and firing staff, we have hired new people. Why? So that by the time the borders open, we will have the possibility of providing services to all of those clients, who want to work with the Chinese customers, and simply are waiting for the Russian\EU\Chinese borders to open. We will see what will come out of it.
In your opinion, what will be the consequences for business, which operate in service sphere?
For those small and medium businesses who will survive the main consequence will be the shift to e-commerce and online in general. And, of course, shift to the more flexible client service as a means of increasing your competitiveness. It also applies to the large companies, I think. Really, nobody knows what will the new reality will look like after the pandemic ends. I don’t dare to make assumptions. But I can say one thing – the world has already changed. However, only few noticed.
Your company uses a variety of social media. In your opinion, which Internet platforms are the most important when working with or in China? Why?
China had gone online in many areas earlier than others: the high level of internet access, online payments, online orders and deliveries have been the norm for the Chinese customers for many years now. Besides, the cultural code traits of the Chinese impact the verification of information processes – the Chinese are more used to verify information through the user services – what is called “word of mouth”. For the retail, obviously, the biggest and most important platforms are Tmall.com and JD.com. Search and information services, like forums and Q&A platforms belong to Baidu (百度) and the information services of this company.
Social networks – the key one here is WeChat (微信), that one super app, which includes the public services functions and social network functions, and now, even AppStore, basically. The social network side of WeChat resembles Facebook the most, but still, this is a more “chamber”-like platform for the user communication. There are also official accounts, and company and brands pages, interest groups and a usual user feed.
Weibo (微博) is a platform with the most reach, if we’re speaking about the bloggers and the numbers of subscribers. There you have an information flow consisting of short texts and photos. Chinese users follow the general information agenda through Weibo.
Before our eyes another new and important social network popped out – RED (小红书). It was created as a user service of recommendations, which had allowed the Chinese buyers to share their experiences and life-hacks - how to discern real and fake foreign cosmetics, for example. It also has advice where to buy things and reviews. Couple of years ago the RED audience was rather limited (in China’s sense) – around 30 million young women with a certain spending structure, with a high level of education and a focus for foreign cosmetics. Nowadays it is a large platform with +200 million users, shops integrations, advertising possibilities for brands, with a wide range of interests – lifestyle, travels etc. – though the “beauty and cosmetics” share is still a large one there.
We also must mention Douyin （抖音） – the original version of Tiktok, which had appeared as a result of the content formats evolution, and which had suddenly plunged into the TOP ratings of the social networks. There are also many niche information services and social networks – Toutiao (今日头条), news service, gamer social network BilliBilli (哔哩哔哩) and many others.
In your opinion, what are the most important qualities of a modern-day employee?
With the development dynamics of pretty much everything in the modern world, soft skills become more and more important. It sounds cliched, but it is really true. Interdisciplinary skills – the ability to think and to express your thoughts, to communicate (meaning being in contact with yourself and the one you’re talking to right now), the teamwork skills are also important. I would also like to mention the ability to learn new things and the ability to react to stressful situations in an adequate manner, as well as reasonably asses the volume of the work you’re given and your own abilities.
It was exactly the work with China, which showed the importance of being flexible, quickly acquiring new skills. The world changes too fast. What was important before, and is important now for the large corporations, where people are nothing but screws in a mechanism, now plays a much lesser role for the developing business. People who think, that they know enough or those, who think that they are “all good” and they don’t have the necessity to develop, in my subjective opinion, are in the risk zone.
The education system in our country, for example, had changed drastically in the past 50 years. In the past the school education methodology tried to answer the question “what should we teach?” After the fall of the planned economy fell, the necessity to answer the question “for what are we teaching?” arose, meaning the practical importance for getting an in-demand profession. Nowadays the important question is “how to teach?”. Because the self-education possibilities are endless now. And the most important skills right now are the ones working with information with the information – how to find it, how to filter it in accordance with your own or the given criteria, and, of course, how to analyze it if need be. To say shortly, for me the most important qualities of a team member are common sense, ability to study and striving to keep some personal integrity when doing a task – opposite to a well-known Chinese say “差不多” (“it’s good enough”).
This year was the first time you interacted with the Higher School of Economics. What is your opinion about the HSE?
I consider HSE to be a unique phenomenon in the sad market of education in Russia. In HSE they teach you to think independently. They teach you to study. This skill is rare and very precious. Cooperating with the HSE is an opportunity not to only share your knowledge and contribute to the development of a part of our society, but is a practical instrument of increasing of our team. After several students of HSE had joined our team this year, I decided to learn, how many HSE graduates of different years are working in Solver. Turned out, more than 30% of our Russian team are HSE graduates.