In the film Pulp Fiction, Vincent Vega (John Travolta) recalls the experience of eating McDonalds in continental Europe where fries are drowned in mayonnaise and the metric system reigns supreme.
Creative businesses are experiencing similar feelings of disorientation as they figure out how to prosper in some of the world's fastest-growing economies like China and India.
With growth engines spluttering and stalling in the West, the siren call to go global has become louder than ever. But what many discover on arriving on foreign shores is not a modern day El Dorado but a series of daunting challenges -- from market institutions that are missing, fragile or slow to mature, to tastes and preferences that are difficult to observe let alone drill down and decipher. When MTV went global in the 1980s, it assumed that a-lop-bop-a-doo-bop-a-lop-bam-boom was the same in every language, learning the hard way that history, geography and culture continue to matter. Today, MTV and its local subsidiaries dance to a more eclectic tune.
This is a bracing prospect for the UK's creative industries and helps explain a seeming paradox: why despite enjoying a number of advantages, most obviously the popularity of the English language, they punch below their weight in countries like China. According to UNCTAD (490) statistics, in 2010 the UK's share of creative goods exports to China was just 1.4 per cent, compared with a 4.8 per cent share in world creative goods exports. UK exports of creative goods to China totalled $140 million (£89.6 million), lower than not only Japan, the US and Singapore, but also France, Germany and Italy. With the exception of Japan and Germany, UK exports of creative goods grew at a slower rate than in all these countries between 2002 and 2010.
A degree of scepticism is a refreshing contrast to the breathlessness and bullishness that surround emerging markets. But is this a sensible strategy in the long-run? We don't think twice about investing in new technologies and ventures which promise large and rapidly growing customer bases but have not yet worked out a watertight business model. But the UK's creative industries may be ignoring the Chinese market for similar reasons. A leap of imagination is required with too many entrepreneurs assuming that risk is an enemy not something that can be tamed and turned into an opportunity through more informed decision-making.
On a recent visit to Beijing, we met a group of dynamic entrepreneurs at a social network for film, music and literature fans called Douban. Established in 2005 by Bo Yang, a former IBM research scientist and a cult figure in the capital's bustling IT scene, Douban has grown from a humble book review site into a fully-fledged recommendation engine and online store for creative content. What makes Douban such a distinctive proposition is not only its scale -- it has more than 100 million users -- but its fierce independence, exacting taste and urban swagger. In a market where the temptation -- and sometimes the smart money -- is to think short term and over-diversify, Douban has resisted blatant attempts to cash in on its growth or chase quantity, a commitment that is hardwired into its everyday actions.
What does this mean for UK creative businesses? For decades, predicting consumer behaviour was a hit-and-miss game of guessing individual wants from crude markers such as age, gender and cod-psychology. Today, powered by cheap, plentiful bandwidth, businesses can observe how consumers think and behave in real-time and make decisions accordingly. By providing deep and dependable insights into consumer preferences, Douban can unlock similar value for creatives while raising brand awareness and easing distribution bottlenecks.
Thus, we were surprised to discover that Lock Stock and Two Smoking Barrels was the highest ranking British film on Douban's top 250, that TV programmes like Sherlock had hundreds of thousands of fans (despite never having been aired in China) and that writers as diverse as Jeanette Winterson, Bear Grylls, SJ Watson and Richard Wiseman had such loyal readerships in China.
Beyond this, Douban offers a treasure trove of insights into the hopes, fears and motivations of Chinese young people. An interesting example is the mini groupAnti-Parents which has attracted over 50,000 kindred spirits since its establishment in 2008. The site has free-wheeled over a range of topics -- from the ways in which members have been ignored or hurt by their parents to the afflictions of rote learning, causing waves in a country reared on a time-honoured diet of filial obedience. Just as interestingly, the group was inspired in part by Nick Hornby's 2005 black comedy A Long Way Down and the novel's translator, Zhang Kun, was invited to administer the group in its early days.
Douban's influence and popularity are underpinned by several other features -- some unique to it, some unique to the Chinese market: lack of trust in formal institutions and the low standing of the professional critic; the inability of rivals like IMDb and YouTube to assail the Great Wall of Chinese censorship and the fact that as a genuine interest group, unlike networks such as Facebook or more ad hoc review sites, Douban pro-actively encourages users to speak freely, bluntly and accurately about creative content.
One consequence is that Douban exercises real sway over purchasing decisions. When the UK hit StreetDance was first screened in China, around five per cent of the 500,000 Douban users who had read the movie review went on to click on the ticket purchase facility. About one per cent of users who read the user reviews clicked on details about the original soundtrack.
Like many budding ventures, challenges remain. Efforts to liberalise the creative industries are likely to rub up against periodic angst about opening up and a zero-sum desire to coddle domestic champions. Likewise there are limits to how far Douban speaks for all consumers, in particular, the hundreds of millions that live physically and metaphorically at the margins of China's digital revolution.
But Douban is a live experiment. It is crossing the river by feeling for stones, to use the hardy Chinese expression, learning and improvising as it goes along. We should not just be sitting on the sidelines, but reaching out. The benefits of action and the costs of inaction are substantial and only likely to increase.
This is a guest post by Hasan Bakhshi and Philippe Schneider. Hasan Bakhshi is director of creative industries in Nesta's policy & research unit. He's also a research fellow at the ARC Centre of Excellence for Creative Industries and Innovation at the Queensland University of Technology. Philippe Schneider is an independent researcher based in London.
Image: Flickr / cbcastro