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.

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.