Battered by China’s tutoring clampdown, one of the country’s top education tycoons decided to pivot to the lucrative livestreaming sector by pitching agricultural products. But he was in for a rude awakening.
Yu Minhong debuted as a grocery salesperson on Douyin’s e-commerce platform Tuesday but many of his live audiences dismissed gift sets containing fruits and vegetables as “too expensive,” domestic media reported. During the three-hour broadcast, the CEO of New Oriental Education and Technology Group offered a variety of products ranging from rice and beef to apples and oranges — at higher prices than average market rates.
The CEO made about 5 million yuan ($785,000) in sales, a disappointing result compared to popular livestreamers.
New Oriental is among several tutoring companies pivoting to new business ventures after China’s “double reduction” policy targeted after-school tutoring centers to reduce the academic burden on students on weekends and holidays. Last month, Yu announced that the company would sell agricultural products to compensate for the losses from closing tutoring centers.
Yu’s much-hyped event aimed to spotlight Oriental Select, New Oriental’s new venture, which so far only has 72,000 subscribers on Douyin, compared with the company founder’s 7.4 million followers on the short-video platform.
New Oriental’s shares dropped by 20% on the Hong Kong Stock Exchange the day after the livestream.
Before his first sales session Tuesday, Yu previously appeared on livestream platforms to discuss education. Earlier this year, he advised teachers on honing their skills and later offered life lessons to students sitting for the gaokao, China’s college entrance exams.
China’s “double reduction” policy, announced in July, has dealt a heavy blow to New Oriental’s business. Founded in 1993, the education powerhouse has closed several branches and dismissed employees en masse since July, while its market value has shrunk 90% this year.
Editor: Bibek Bhandari.
(Header image: Screenshots show Yu Minhong selling angriculture products during a livestreaming. From Weibo)