On 17 September, the market regulation authorities in the Heifei High-Tech Industry Development Zone announced that top livestreamer “Crazy” Little Brother Yang’s Three Sheep Group (三只羊集团, Sanzhiyang) is under investigation for “misleading consumers”. On Weibo, China’s Twitter equivalent, the topic “Three Sheep under investigation” topped the Hot Search list with a whopping 140 million views.
The controversy began in mid-September when Yang, his brother Big Brother Yang and Hong Kong actor Eric Tsang, head of the Hong Kong branch of Three Sheep, were selling mooncake gift boxes on livestream. These supposedly high-end mooncakes from “Hong Kong Meisun” (香港美诚) were later found to be made in Guangzhou and Foshan. Despite Meisun being registered in Hong Kong with its team from Hong Kong, having been made in China is widely seen by netizens as a false advertisement. Many also find the name Meisun to be an attempt to sound like Maxim’s MX (美心, or “Meixin” in Mandarin) brand, one of the most desirable Hong Kong mooncake brands.
Yang is having a bad September. As early as the month began, another top livestreamer Xinba attacked Yang and his Three Sheep Group over their malpractices. As a gesture, Xinba promised to pay, out of his own pocket, 100 million RMB (14.10 million USD) in compensation to those who bought controversial goods from Three Sheep as Yang’s company only offered a refund but no compensation. Xinba’s planned livestream of the payoff was shut down as Kuaishou suspended the livestream function of Xinba’s channel on 12 September. It seemed Yang had weathered the storm for a few days before the mooncake saga began.
As Double 11 approaches, top streamers are facing pressure like never before. It’s not just Yang or Xinba, Dong Yuhui and his old employer Oriental Selection (EastBuy) are both in hot water for different reasons. Now faced with celebrities, CEOs, buyer streamers or even an “evil” cat, how these once-sales generating powerhouses face off the new phase of social commerce is worth watching.
