For a lucky coincidence, on the 8/8 of last year, I receive an email from one of my old university friends inviting me to join the 10 year anniversary of my master program in Shanghai. The last time I have been in China was in 2010, and, as it might have happened to you, work gets in the way and you end up postponing the travels you want to do the most. Needless to say, I thought about it for a long 10 minutes, and, inspired by the famous quote of Richard Branson, I said “Screw it, let’s do it!“. Ok, maybe I did not say it with a British accent, but replace it with a thick Italian accent and you will get the picture.
Long story short, I book my tickets, scheduled meetings with 4.cn (big thank you to Simon Cousins, CEO of Allegravita), 62.com and XZ.com, and I’m off to the airport. Little did I know that the Chinese market would start shaking before Chinese New Year, and I found very different market conditions that I expected. A lot of people are questioning what is happening in China and I hear too many theories in the West that just do not make sense. What follows here is a short photo report of my trip, with some personal reflections about what I heard from the CEOs of these companies and from what I observed in the mean streets of Shanghai, Hangzhou and Shenzhen. Hope you will enjoy it.
[headline type=”type2″ color=”#999999″ size=”h1″]SHANGHAI[/headline]
Shanghai, view from the bund. On the background you can see the Jin Mao, the World Financial Center and the Shanghai Tower, the 2nd tallest building in the world (if you are not afraid of heights, watch this video here). To give you some perspective, the land underneath these building was in the 1990s a swamp, which was then bonified and built on. This how explosive economic growth looks like.
You thought 8 digits .com domain names would never be picked by an end user? 62580000.com is a popular taxi company in Shanghai. This is not an exception and just one of the many examples of how numeric domain names are used in China. 5, 6 and 7 digits .com domain names with the best combinations (good numbers and memorable patterns) are often used by companies.
This was one of the most interesting presentations I have attended in the past few years. Christine Xu (lady in the middle), CMO of McDonald China and an alumnus of Fudan University, gave a talk about how Chinese consumers are engaging with digital marketing. You would be surprised by how many use digital payments with apps like WeChat. Even the local farmers are using digital machines to get mobile payments. Need to pay for a plane? Just go on the website, scan a QR code and the payment is billed automatically to your credit card. Customized, location based, push mobile marketing is the future of marketing in China, and this is how big companies think about obtaining market shares.
Party time – catching up with some old friends who work in China. Talking about the economy, I got to hear their unbiased perspective. Kelvin, who recently started a company in Guangzhou, said that people can feel how much the economy slowed down. There are not too many options to invest in, since the average Chinese think that both the real estate market and the stock market are too prone too manipulations. Damiano who is the CFO of a shipping company based in Hong Kong and Mainland China, said how Chinese suppliers are starting to delay payments and lowering their storage prices.
The man who is inspiring a nation. Jack Ma, chairman founder of AliBaba. People watching Jack Ma speaking on TV in a bookstore inside Shanghai railway station. You can see Jack Ma around at the same level as you can hear about Elon Musk anywhere in the English speaking world.
[headline type=”type2″ color=”#999999″ size=”h1″]HANGZHOU[/headline]
Thanks to an introduction of Simon Cousins, the CEO of Allegravita, I was welcomed at the 4.cn office by Michael, who manages the quite large 4.cn brokerage team. I was impressed by how many people work in the office, on several e-commerce projects started by John Xu, the former CEO of 4.cn.
Did I say Chinese food is delicious? Here is Michael from 4.cn carefully picking the food to be served.
Dinner with the 4.cn team. According to Michael, the market tanked because too many people started registering domain names. He is still shocked about the 5L.com buyout: “No end user will ever use a five letter .com domain names for their brand“. Will the market pick up again? According to Michael, one of the best indicators to look at is the number of hand registrations. If funds continue to flock over new and unknown extensions, the .com market might continue its downturn.
[headline type=”type2″ color=”#999999″ size=”h1”]SHENZHEN[/headline]
According to a post by James Iles on Namepros.com, LE.com rumoured to have sold for $10M USD. Is it true? Well, for sure they must have spent quite a bit to rent this prime ad space in Shenzhen airport.
You spend $17,000,000 USD buying a domain name (you might have heard the 360.com story), and then what? Well, you have to match it with a very cool billboard, like this one in Shenzhen airport. If you translate the writings on the banner, it says: “Man, did I really overpay for that domain?“.
Yes, this translation is a joke.
Were are all the fours? All the 4s, the numbers containing a 4 (e.g. 14, 24, etc) are removed. This is quite common in buildings accross Mainland China and Hong Kong. This is just one of the many examples in an elevator in Shenzhen. If elevators and end users do not like fours, why should you?
With Kasen (on my left) and Raymond Liu (on my right), respectively owner and CEO of 62.com. I had one a very interesting conversations about the status of the industry. What surprised me the most is how many people in China bought domain names using credit. Interest rates up to 24% were the norm in 2015, while today they offer 14% interest rates and there are no takers. According to Kasen there are a lot of people with funds available, but they are all waiting on the sidelines before making their move.
In a China Mobile store, on of the most popular phone carriers, you can download apps simply by scanning QR codes on a wall. You might notice on the top left the icons of WeChat and QQ, both developed by Tencent, China tech giant. QR codes are very popular and used just about for everything in China. One of the most common objections to the future value of domain names raised by Chinese investors, is that apps will slowly replace the need for domain names.
Great books are everywhere. Here is a copy of Zero to One, by Peter Thiel, the cofounder of PayPal – I have seen it in several bookstores accross different cities airports. A new generation of startups and tech companies is already on its way in China. Which domains will they use?