This chapter aims to provide readers with a comprehensive historical context surrounding the phenomenon of Chinese consumers’ nationalism, shedding light on the distinct characteristics exhibited by each wave throughout time. By delving into pivotal moments, such as the renowned narrative of “The Shop of the Lin Family,” which vividly portrays the eruption of nationalistic consumer boycotts in China back in 1932, to the more recent events like the fervent public backlash against South Korea and its impact on Lotte Mart in Beijing's Wangjing district in 2017, this chapter offers a captivating journey through the evolution of consumer nationalism in the country.

Within the pages of this chapter, readers will find answers to pressing questions regarding the transformations witnessed in Chinese consumer nationalism in recent years. By examining the changing dynamics, it seeks to unravel the multifaceted nature of this phenomenon and explore the various factors that have contributed to its evolution. Specifically, the chapter endeavors to shed light on the role played by the government and state media in each wave, deciphering their influence and exploring their motivations. This chapter also contemplates the ramifications that may arise from the emergence of a new wave of consumer nationalism. By drawing upon historical insights and analyzing current trends, it endeavors to provide a forward-looking perspective on the potential consequences of this evolving phenomenon. As society navigates through this new wave, it becomes increasingly crucial to understand the implications it may have on various aspects, including politics, economics, and social cohesion.

Ultimately, this chapter serves as an invaluable resource for readers seeking to grasp the intricate tapestry of Chinese consumers’ nationalism through-out history. By examining each wave's characteristics, unraveling the role of government and state media, and anticipating the potential outcomes of a burgeoning new wave, it invites readers to engage critically with this complex and ever-evolving aspect of Chinese society.

History of Chinese Consumers’ Nationalism

Consumer nationalism emerged as a recurring theme in the dynamic relationship between China and the Western world, gaining notable prominence during the late nineteenth century and reaching its zenith between the 1900s and the 1940s. Throughout this period, several pivotal instances of consumer nationalist movements unfolded, leaving a lasting impact on Sino-Western relations.

This chapter delves into a crucial aspect of the existing research on nationalism in China, highlighting a notable issue that has emerged. The prevailing approach has tended to examine Chinese nationalistic sentiments as a unified whole, neglecting the inherent complexity and diversity within this phenomenon. Taking such a holistic perspective is overly simplistic and fails to account for the multifaceted nature of Chinese nationalists’ motivations and actions.

To rectify this oversight, it is imperative to categorize the various manifestations of consumer nationalism in China based on a range of indices. By doing so, we can gain a more nuanced understanding of this complex phenomenon. Therefore, this chapter aims to explore the distinct types of consumer nationalistic actions observed in China and elucidate the varying consequences associated with each type. In order to substantiate this argument, the chapter will present several illustrative cases.

The central contention put forth in this chapter is that contemporary consumer nationalism in China can be effectively classified into three distinct types, each engendering a different level of consequences. By differentiating these types, we can discern the specific motivations, behaviors, and outcomes associated with each category. This nuanced approach not only enriches our comprehension of consumer nationalism in China but also contributes to a more comprehensive analysis of nationalism studies in general.

Mapping the Field

Nationalism, as a widely acknowledged sentiment shaping both public and private spheres, has been prevalent since the late eighteenth century. Its influence on global politics can be understood through the concept of identifying the state or nation with its people. However, to grasp the concept of “consumer nationalism,” it is essential to differentiate it from related terms such as economic nationalism, commercial nationalism, consumer ethnocentrism, political consumerism, and consumer nationalism.

Economic nationalism

The term “economic nationalism” has a historical origin that can be traced back to the early twentieth century. It gained recognition through the works of notable economists and scholars who examined the concept in depth. One of the earliest instances of using this term can be attributed to American economist Alvin Johnson in 1917, who is renowned as one of the cofounders of the New School for Social Research.

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This chapter argues that China's emergence as the world's number two economy presenting complexities for multinational businesses to navigate. Drawing on the author's own experience in training multinational businesses in China, the chapter highlights the rising tide of nationalistic sentiment in recent years, which has led to heightened outrage toward foreign brands for perceived offenses against China and Chinese interests. This wave of nationalism has reached a fever pitch, resulting in a climate of extreme caution among many multinational firms, including certain Chinese domestic companies that have partnered with foreign brands. As a result, these companies find themselves navigating a complex landscape when operating in the world's second-largest economy. They face pressures from various quarters, including the Chinese government's increasingly nationalistic stance, which seeks to tighten its governance and exert a direct role in business operations.

History of Multinational Business Development in China

China, as one of the world's largest economies, has emerged as a highly attractive investment destination for numerous multinational companies (MNCs), both Western and from other regions. Since its opening up in 1979 and the subsequent adoption of free market principles, China has experienced remarkable economic growth and transformation, becoming a prominent player on the global stage. Its vast market, abundant resources, and skilled workforce have made it an enticing prospect for businesses seeking growth and expansion opportunities. Over the years, China has established itself as a hub for manufacturing, technology, and services, attracting investments from a wide range of industries. The country's favorable business environment, improved infrastructure, and government initiatives to promote foreign investment have further contributed to its status as one of the world's most well-known and sought-after investment destinations.

However, the history of multinational business development in China extends far beyond the recent decades. In fact, it can be traced back to the late nineteenth century when foreign firms first set their sights on establishing a presence in the country. At that time, China's vast market and untapped potential presented an alluring opportunity for MNCs seeking avenues for growth and expansion. These early endeavors were primarily driven by the desire to access the Chinese market and cater to its burgeoning consumer base. The early twentieth century posed significant challenges for foreign firms operating in China.

The COVID-19 pandemic has left a significant and lasting impact on the Chinese consumer market and real-estate sector. While initial recovery efforts began in late 2020, the revival of consumer spending has been slower than expected due to persistent concerns about the virus and economic uncertainty. As a result, Chinese consumers have become more cautious in their spending habits, with a shift toward health-related products, e-commerce, and digital services. This shift has affected various industries and has been particularly challenging for small and medium-sized enterprises.

In the real-estate sector, the pandemic led to a severe downturn, with declining property sales and investments. Government regulations aimed at curbing property speculation and controlling housing prices have further complicated the situation, making it difficult for developers to recover. Overseas corporations operating in China, especially those in the real-estate and construction sectors, have also faced challenges, with declining property values, increased regulatory scrutiny, and a slower economic recovery affecting profitability and expansion plans. The road to recovery for both the consumer market and the real-estate sector in China appears to be long and challenging, requiring adaptation and strategic planning to navigate the evolving economic landscape.

This chapter delves into the profound implications of the book's discussion by placing it within the broader context of current events. In recent years, the world has witnessed a noticeable surge in nationalism, a trend that has been further accelerated by the advent of the COVID-19 pandemic. Governments have resorted to actions such as imposing border shutdowns, engaging in fierce competition for essential medical supplies, and engaging in blame games, attributing the origins of the disease to one another. These actions have collectively propelled the wave of nationalism to new heights on a global scale. As a consequence, we find ourselves amid renewed geopolitical uncertainty and pervasive social unrest that show no signs of abating. The continuous presence of these challenges poses a considerable dilemma for policymakers and business operators alike, as they strive to navigate an increasingly complex landscape.

The chapter undertakes a comprehensive examination of these challenges, shedding light on their multifaceted nature. It particularly emphasizes the rise of nationalism and the interference of governments in markets, both of which pose significant threats to the stability of the global economic system.

Consumerism has undeniably emerged as a prominent aspect of contemporary Chinese society, permeating various facets of modern life. The proliferation and immense popularity of social media video channels such as Douyin, Billibilli, and WeChat have played a pivotal role in reinforcing and amplifying this consumerist trend in recent years. This phenomenon has been ideologically labeled as “consumerism as economic individualism,” signifying the intertwining of consumerism with notions of personal economic pursuits and individual aspirations.

Chinese citizens have noticeably embraced the role of self-managing consumers, adopting consumer values as a defining characteristic of China's modern culture. The pursuit of material goods, lifestyle upgrades, and the constant pursuit of the latest trends have become deeply ingrained in the mindset of Chinese consumers. This conspicuous manifestation of consumerism has not only transformed the economic landscape but has also brought about profound social and cultural changes. Within this context, it becomes imperative to explore the relationship between consumerism and nationalism in China.

This chapter focuses on the examination of nationalistic behaviors exhibited by Chinese citizens, shedding light on how consumerism intertwines with and shapes nationalist sentiments. By delving into the intricacies of the younger consumer base and scrutinizing their evolving consumer preferences, this chapter seeks to answer the compelling question: How is nationalism embedded in consumerism in China? Understanding the complex dynamics between consumerism and nationalism is crucial for comprehending the broader sociocultural and economic landscape in China. By unraveling the interplay between these two powerful forces, we can gain valuable insights into the multifaceted nature of Chinese society and its ever-evolving relationship with consumerism, ultimately shedding light on the intricate tapestry of modern Chinese culture. Consumerism in China (from Big Three to Luxury)

Consumerism, as a phenomenon, extends far beyond the borders of any single country. Nevertheless, it is in China that the scale and rapidity of its development have made it a remarkable case study for exploring the history and dynamics of this universal trend (Gerth, 2015). The embrace of consumerist values has sparked passionate debates, with proponents highlighting its ability to empower individuals by providing a means of self-expression through consumption—an attribute scholars often refer to as “agency.” On the other hand, critics of consumerism argue that it fosters a narcissistic culture, placing excessive emphasis on material possessions and superficial desires.

The current geopolitical context presents significant challenges for multinational companies (MNCs), especially those operating in countries that have disputes with their home country. This complexity is further intensified for MNCs in China or those heavily reliant on the Chinese market. The recent joint statement by G7 leaders emphasized the need to “de-risk” from China, acknowledging that completely “decoupling” any major economy from China is nearly impossible (Lee, 2023). As a result, there is now a widely recognized consensus on the importance of “de-risking” strategies when engaging with China across a wide range of countries (Gewirtz, 2023).

However, the interpretation and application of the term “de-risk” vary among different nations due to the inherent ambiguity of the concept and the varying levels of geopolitical tension each country has with China (Gewirtz, 2023). Consequently, for MNCs, it is crucial to possess comprehensive knowledge in two key areas related to China: a deep understanding of current policies governing foreign businesses and entities in China and a thorough comprehension of consumer cohorts in the Chinese market.

This book delves into both aspects, with a particular focus on comprehending the evolving landscape of consumer nationalism in China and providing guidance on how MNCs can effectively manage their public relationships within the Chinese market. By gaining insights into the dynamic policies and consumer sentiments in China, MNCs can formulate robust “de-risking” strategies that align with the unique challenges and opportunities presented by this complex environment.

The central focus and argument of this book revolve around the increasing risk that nationalist consumer outrage poses to businesses in China and those engaged with the Chinese market. As China faces growing diplomatic challenges on the international stage, MNCs will need to navigate these complexities with heightened caution by implementing strategic communication and public relations plans. Existing academic works on consumer nationalism in China primarily explore two key aspects: the delicate balancing act it presents for China's leaders and how the discourse of national pride and dignity reflects the complex interplay of China's ambivalent relationships with certain countries. While previous publications have provided valuable insights into the concept of consumer nationalism, its processes, participants, and initiatives, they have often overlooked the crucial analysis of its consequences.

What are the key principles of designing organisational structures and leadership challenges for business model innovation? This chapter examines the leadership challenges, as well as the organisational design issues, for business model innovation. In particular, it discusses how senior management could lead the business model innovation process and the organisational design issues to consider driving change within the firm. The chapter also considers the design principles for management information systems to enable business model innovation. The chapter introduces the Business Model Coherence Scorecard (BMCS) as a means to manage the congruence of the components of the business model in order to achieve efficiency and effectiveness.