China’s brands must outgrow diaspora bubble to hit soft power potential

China’s soft power is usually associated with state-sponsored propaganda, but its more effective cultural ambassadors might be its private companies’ consumer products now ubiquitous across streetscapes and digital feeds in the Global South. Viral footage shows crowds queuing up for the latest Labubu collectibles, but a closer look reveals a more nuanced picture: many of those in line are overseas Chinese consumers. Chinese bubble tea maker Mixue has more stores globally than McDonald’s. In recent years, pushed abroad by domestic involution and fierce competition, Chinese brands from fast fashion to boba have expanded rapidly. While cultural proximity is an asset in the initial stage, it can also become a trap: the idea that Chinese brands are global could itself be a diaspora bubble. Further, as Beijing increasingly mobilises overseas Chinese to support broader geopolitical objectives, the line between private commerce and state ambition blurs. To achieve lasting popularity and generate genuine, organic soft power, these companies must protect their commercial independence. When Pop Mart first entered global markets, its strategy of prioritising markets that are geographically and culturally “closer to China” reflected a broader playbook. A strategy relying on culturally fluent ethnic Chinese communities allows Chinese brands to bypass many operational bottlenecks. In this initial phase, the diaspora evolved from a receptive audience base into a powerful short cut around two of the hardest problems in global expansion: generating demand and building operations. Chinese brands benefit from the influence of Chinese digital platforms among overseas Chinese communities. Consumers fluent in Chinese and familiar with RedNote – also known as Xiaohongshu – and Douyin are often the first to pick up on domestic pop trends and learn about overseas launches. When Chinese beverage start-up Heytea expanded to Singapore in 2018, for example, its domestic virality on Chinese platforms built momentum that translated into long queues. On the operational side, diaspora networks provide the cultural knowledge, capital and local logistics required to scale retail quickly. As Mixue’s mascot Snow King appears on streets beyond China, the franchise system behind the spread is tied to the overseas Chinese community. Local Chinese franchisees offer immediate advantages that foreign corporations usually spend years acquiring: access to commercial real estate, familiarity with local labour laws and the upfront capital required for rapid store deployment. Because these partners can communicate directly with headquarters in China and operate fluently in the local market, they can reduce bureaucratic friction and cross-border delays. However, the diaspora can also be a liability. For customers who are not ethnic Chinese, such hype diminishes after the initial launch. Consumers might not view the brand as a cultural icon, leaving it vulnerable to price-based competition that erodes its staying power. This creates a soft-power illusion as the brand wins local market share but fails to build enduring influence across the broader host society. Politically, diaspora-based global expansion can also collide with the sensitivities of host nations. As Beijing frames overseas Chinese networks as strategic national assets and promotes using overseas Chinese networks in commercial expansion, the distinction between a private and a state-directed company has already blurred. The recent controversy in Singapore over the Teochew dialect film Dear You illustrates this friction. Promoted as a celebration of the shared bloodline of the global Chinese community, the film has faced backlash. Some mainstream Singaporean media outlets expressed concerns about possible United Front undertones, viewing the film as an attempt to undermine Singapore’s independent, multicultural identity. Food and beverage brands that use traditional Chinese culture as a selling point could be viewed through the same lens, especially in countries with large ethnic Chinese populations, and particularly when these brands are leveraged as sponsors for overseas diplomatic events. To escape this trap, some Chinese companies have begun to pivot towards deeper localisation. For example, Mixue reportedly plans to build localised supply-chain infrastructure in Southeast Asia and Latin America and source fresh ingredients locally. In Indonesia, Mixue stores were certified as halal by the Indonesian Ulema Council in 2023, addressing long-standing concerns over food suitable for Muslim consumers. In Brazil, it created acai-flavoured ice cream for local consumers. Pop Mart has also designed regional limited-edition Labubus, such as the Merbubu in Singapore, which blends the character with Singapore’s iconic Merlion. By localising supply chains and embracing local needs and culture, brands can ease the tension between commercial expansion and host-country concerns over Chinese influence. Chinese consumer brands have rapidly established a major footprint by using ethnic networks as a commercial bridge, but a bridge is meant to be crossed, not lived on. True international influence must be built from the ground up through practical commitments and broader public trust. In addition to becoming developmental partners – for example, by shifting supply chains into local markets, employing local labour, adapting to local needs and tastes and respecting host countries’ political and cultural identities – they must become valuable local stakeholders. Maintaining distance from the state is tricky; brands must be careful not to parrot political or ideological lines. They must also be careful about accepting propaganda support lest political strings be attached, and they must respect host-country data and privacy laws, along with other regulations. There is nothing inherently limiting about the soft-power potential of Brand China. It is only by insisting on commercial independence and localising deeply that Chinese companies can generate the durable, organic soft power that Beijing seeks but official policy cannot manufacture.

China’s brands must outgrow diaspora bubble to hit soft power potential

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Only through commercial independence and deep localisation can Chinese firms abroad forge a durable soft power that state policy can’t produce

Only through commercial independence and deep localisation can Chinese firms abroad forge a durable soft power that state policy can’t produce