Chinese edtech company sidesteps Beijing’s ban through livestream steak sales

Chinese edtech company New Oriental has discovered a workaround to survive Beijing’s ban on companies profiting from teaching school curriculum subjects by combining language classes with product sales.

Teachers using English lessons to sell steaks have become a viral hit, with clips of classes offered by New Oriental teachers jumping to the top of ByteDance’s Douyin app, TikTok’s sister app in China.

Data from Douyin’s research platform showed that New Oriental’s live streaming channel gained more than 1.5mn followers between Thursday and Saturday. Teachers increased their goods sales by Rmb19mn ($2.8mn) over the three-day period, according to Chinese media.

During a recent session, New Oriental teacher-come-tout Dong Yuhui taught viewers how to count steaks and seasonings in English.

“Hurry up and buy!” the teacher peppered into his livestreamed English class, pushing his audience to spend Rmb299 on 12 steaks, 24 seasonings and a bonus frying pan.

Videos of Dong’s class have ricocheted across Chinese social media, earning him the moniker of “steak bro” and engendering the hashtag “I never thought I could learn English through a live broadcast” on Douyin. More than a 100k viewers tuned in as Dong sold steak on Monday.

Livestreaming ecommerce shows are popular in China, where viewers are keen to tune in for live product demonstrations. New Oriental is struggling to shore up sales after Beijing’s sweeping overhaul of its $100bn private education industry last year.

Shares in New Oriental’s unit testing livestreaming ecommerce, Koolearn, jumped 40 per cent on Monday, after rising 39 per cent on Friday.

New Oriental’s stock price rose as much as 25 per cent on Monday, but still remains more than 90 per cent below the highs seen last year before Beijing banned profit making in teaching school subjects as part of a broader government effort to reduce childcare costs and boost the country’s low birth rate.

Beijing’s new rules for the sector forced New Oriental to dismiss 60,000 employees and shut down about half of its 1,700 learning centres. The company’s revenue in the three-month period to February 28 fell 48 per cent from a year earlier, swinging the company to a loss of $122mn.

Along with livestreaming ecommerce, New Oriental has pushed further into education-adjacent businesses, including offering consulting services to Chinese students applying to schools overseas and test preparation for foreign examinations.

The stark reversal of fortunes for founder and chair Yu Minhong has turned him into a sympathetic hero for many Chinese entrepreneurs.

Yu on Friday praised New Oriental teachers for their “key transformations from teachers in classrooms . . . to agricultural products live streaming”.

Additional reporting by Nian Liu