Find here the China paradigm episode 59. Learn more about Dominic Johnson’s story creating a design apparel company in China and find all the details and additional links below.
Full transcript below:
Mathieu David: Hello everyone I am Matthieu David, the founder of Daxue Consulting, a strategic marketing research company in China and its podcast China Paradigm and today I am finally with Dominic Johnson here – I am saying finally because we had to reschedule two times and I was very excited actually, two times to have you in the show and finally it’s the third time it’s working.
Why I was excited is because you are a veteran entrepreneur in China you have been in China since 1995, and you started Plastered which is a design apparel company in China, but it’s more than this and I think what we need to discover it’s more than this that’s why I found out through your website and by doing more research – since 2006 so before the crisis, before when we found out that China was becoming a big country, a big economy you were in already China. You are selling not only in Beijing because it didn’t mention but you are very Beijing located you are in Nan Luo Gu Xiang, the place to be in Beijing, the place you visit when you go to Beijing, and now you are selling in more than ten locations worldwide. You have also been a TV presenter, you have written a book for entrepreneurs “China Dream,” and you have been spoken in many, many MBA – eMBA’s sixty Chinese Universities as I read online. Thanks, Dominic, for being with us.
Dominic Johnson: Hey, thanks, that’s a hell of an intro. First of all, I didn’t like the word veteran at all, which makes me sound very old but maybe a war veteran. I have been in China for 25 years now, but thanks for that. Yeah, I mean you know what – as anyone who has lived in China knows, it’s the land of opportunity, the economy has been booming since I got here in – well 1993 I essentially arrived and so much about entrepreneurship is being in the right place at the right time. I see so many great ideas fall flat just because of timing and for me, I arrived at the right time and there are opportunities everywhere, so I ended up ceasing a lot of opportunities and just being very fortunate to start my design apparel company in China in the right place at the right time.
Matthieu David: That’s something actually I’d like to talk about , later on, to be at the right place at the right time. I see a lot of entrepreneurs say – who are in China say now that they could not do the same right now, but that’s something I’d like to talk about later on. First, about what you do now, what’s your business of design apparel company in China, could you describe it in more details. so, you are selling clothes in specific location which is in Nan Luo Gu Xiang in Beijing for those who are in Beijing, I guess they all know Nan Luo Gu Xiang that’s the core business. It’s designed apparel and I think for the ones who are watching the video they can see some of the designs behind you, but could you tell us more?
Dominic Johnson: Right, so it started off very simply. Nan Luo Gu Xiang is very famous in Beijing but I moved to live there in 2003 with my family into an old shared courtyard house with my family and 5 other Chinese families and then one day I had a random idea which was to create some Beijing T-Shirts and just with a very small amount of money I designed and printed a small collection of some quirky T-Shirts, and I opened the very first shop on the street. There used to be a residential street but then I opened a shop there the rent was cheap and it was close to home, I didn’t have much money, and you know ten years later it became the busiest retail street in Beijing and public holidays it gets a hundred thousand people a day, so it’s one of those kinds of crazy Chinese stories.
And so, it started off very much as quirky T-Shirts, taking iconic objects and things that were Chinese elements in art design, like old subway tickets, old mugs, old thermoses – I made them into images and created a kind of an iconic Beijing T-Shirt brand. At the beginning, as the brand is about foreigner’s view of Chinese aesthetics, it was mostly foreigners who were buying my stuff but then as I started to attract media attention I slowly moved into the Chinese consumer market and then as the brand grew instead of just taking iconic objects I started to work with more artists and then I became a conceptual artist and I provided ideas and concepts to artists you know in China and now around the world to create much more detailed and technical illustration artwork as we grow the brand, and then the business also grew to become an agency so now we do interior design and art installations and sculptures for other brands. Yeah, so my design apparel company in China kind of started very small and very simple, I invested a tiny amount of my own money which is all I had at the time to open this little shop and then it’s kind of grew organically and so all this opportunity came my way and – yeah right place right time.
Matthieu David: Could you tell us more about how you design your brand? Is it yourself who designed the T-shirts initially or you partner with artists? Could you tell us more about you foreigner’s view of Chinese aesthetics?
Dominic Johnson: Right, so the creation is I am the conceptual guy so I can’t draw, I can’t paint. I can’t even use design software – but I have a lot of ideas and those ideas come from really, I’ve lived in China for so long, I am a very visual person. I didn’t do very well at school, and I left England when I was about eighteen and traveled around the world and eventually arrived in China as a backpacker.
And so, I never thought I was creative or even had a design skill, I just decided to try designing by working with other people. So the design process now is very much – I have ideas and concepts, I write them down then I look for talent online and at events, and as soon as I find the artist who I think has right aesthetic or has a certain skill set that I think will work with the concept, and then I put the concept and the artist together and I work with them very closely to create Chinese elements in art design. The design behind me is a Japanese artist and the concept is very simple it’s a Chinese revolutionary ballet girl, it was an art form the 1960s – 70s when they banned western art influence in China and instead of having ballet they had girls doing ballet but in Mao suits and guns, and so I turned that into a sort of a pop – you know a piece of artwork. So that’s basically what we do, we create pop artwork, comic book artwork, this type of illustration artwork and I work with artists all around the world from North Korea, Japan, Venezuela, Spain all over Europe, Britain to create Beijing centric artwork.
Matthieu David: Sorry to use this word which is not artistic at all, but what’s the business model behind your design apparel company in China? Do you partner with your artists sharing the profit, do you hire them and then it’s your own creation, your own your brand? If an artist is listening to us, what kind of deal we’d have with you?
Dominic Johnson: Yeah. I am pretty much a bricks and mortar retail business, that’s where we make most of our money is in stores, and so my fixed cost is very high you know with the retail, your net profit is usually pretty low, because of all your fixed cost rents in Beijing is very high. So, I don’t do profit sharing with artists. I make that very clear with them at the beginning that this collaboration is that I came up with the concept, I guide you with sketches to help you create the artwork in the Chinese apparel market. When the artwork is done, I then own it, and I am very clear with artists before we start, with that model.
When I started out, I wasn’t – and I threw myself into a lot of collaborations with creative people and then at the end they kind of like everyone gets pissed off with each other because no one was clear at the beginning. So I learned my lesson early on, so now before I work with an artist I make it very clear that you get a payment to execute this artwork this concept for me and then I own it, because we also license our artwork to other territories, and if the artist isn’t happy with that then generally I just won’t collaborate, so I had to make that very clear at the beginning otherwise the business doesn’t make sense.
Matthieu David: Alright, I see, I understand better now. You mentioned that you see your business as an agency because you are doing as well what I would call interior design. You have painted a wall with your design opposite OWLS you have worked with Lu-Lu Lemon, which could be a competitor in some way I mean they are in the clothing industry and it’s a very established brand. You have worked with Hilton; you have worked with a lot of very iconic bars and places in Beijing. So could you tell us more about how you step by step switch and what I am even more interested is I feel that people went to you to ask you to design for them because you have a very strong identity, which is to be able to put Chinese elements in art design, that very few people do. But I am happy to listen to you if I am correct.
Dominic Johnson: Yeah, I think you know Matthieu it’s very important in life to understand one’s own sandpit, as we call it in business which is the area that you play in better than anybody else. To define your niche so that you can have – you can be competitive and have a market. Now, for me this is even not been in China for a long time it’s in a waiting game I am competing with these Chinese entrepreneurs, who are if not the best entrepreneurs in the world, and it’s a waiting game. I really need to understand my niche, my niche is – I create Beijing-centric pop- art and I am very good at that, because what I do is presenting foreigner’s view of Chinese aesthetics;is that I look at Beijing from a foreigner’s perspective with a fresh set of eyes, and that’s very interesting and so my niche is really that kind of pop Beijing and I don’t leave that, and so it’s very much my aesthetic and I don’t really have anyone that competes with me on that.
So, as the artwork grew, and I became better and I had more money and I spent a lot of money working with the better and more skilled and famous artist. The design apparel company in China went from a daily t-shirt brand to an art brand, and that was very much my goal. I wanted people to take it seriously I was fed up with them saying you are the guy with the T-Shirt shop, I wanted it to be more than that. So, as we became more well known, I just one day had an opportunity. A friend of mine was starting a cafe chain called Moka Bros, they were opening their first outlet and the founder said to me – I have got this huge wall and I don’t know what to do with it, and I just saw an opportunity to develop print design business in China and I said give me that wall and I am going put a big piece of artwork on it and I am going give you that for free, and then you are going to put my logo on that wall so people know it’s my artwork and then elements from that artwork are going go in your staff’s t-shirt so I thought I could make money on the T-Shirt, I get this amazing advertising in this public space and it really worked, and it worked mostly because Moka Bros is an awesome brand and they created a lot of buzzes, they have an amazing product and a team service, so the people felt it was a really good combination of this artwork, this experience and so Moka Bros took off and now grew to seven or eight locations around China.
My artwork became more and more visible and from there. That’s how I got Lulu Lemon, you know that then led on to another collaboration that led on The Opposite House, The Hilton and all of these other places around China. Now we are doing an apartment block in Luxemburg and it’s crazy but we have this niche and no one else really does it as well as we do. I know I am the best at print design business in China, and that’s what I stick to, I just do Beijing, and so it was Moka Bros that started it and then people took – as soon as it was onto a wall, people were like okay – this is a whole new medium, it’s not just a T-Shirt anymore. People were like t-shirt’s are T-Shirts – it was on a wall and then I started doing – covering all of their walls with huge installations and people were getting inspired by that and then my phone started to ring and I was getting WeChat’s and emails with people who wanted to collaborate. Private collectors, people who just wanted the prints, and so that changed everything and it became a win-win because then people started paying us to put our artwork up in their locations and it was branded.
We put Plastered 8 into the artwork subtly somehow, so I was being paid to advertise and then I was owning the artwork so you go to the Opposite House, there’s this huge roll of water ski ladies and the people were like wow! that’s incredible, and you see in the corner, ah! by plastered and then that artwork is owned by me. So, you can go to my store, and you can buy that artwork on merchandise and products. So, I am getting paid to advertise the only artwork that I can then put on products. So, it happens organically, but it turned out to be a really big win for us.
Matthieu David: I see, very interesting. Then comes the question of the trademark. You are in the country; we are in the country where a trademark is not very well respected and I think it was even worse before than now. So, your business is using Chinese elements in art design, it’s based on the trademark is based on the fact that people should not copy you. So how did you deal with that? I mean was it an issue maybe it wasn’t.
Dominic Johnson: Well, one thing I will say Matthieu is when in Rome – which is when I started my brand, I started it all based on stolen IP which was you know I took the old sub tickets from subway commission, and they didn’t trademark them. They had this whole collection of beautiful tickets, and I am a collector of vintage so I collected tickets and I got these beautiful subway tickets and then I put them on T-Shirts and so I went down to trademark office and trademarked them. So, I actually stole them from the subway commission and all of these all thermoses and all-metal bowls that people got as wedding gifts with these beautiful patterns inside. I took out those patterns, I went down to trademark office and trademarked them. So really, I started my brand from stolen IP and then as my brand became popular – now if you take some of my more popular images, you go to Taobao, the Chinese eBay and you can do an image search. You’ll see my products they’re on all kinds of clothing and products. You’ll see them on coffee mugs, you’ll see them on kids’ clothing, you’ll see them on women’s fashion. The more popular I become the more I get stolen and it’s very hard to deal with. Generally, I don’t put a lot of time and effort into following up on that stuff, I have a lawyer who works on commission so I don’t pay him. He’s a real dragon. He goes after people. If he sees a company that’s got a lot of money and they’re using my artwork, he’ll go after them and sue them, he’ll get some money and share some of the profit with me. I leave that to him.
Me, I concentrate on innovation which is – our brand doesn’t do seasons, we just come up with new artwork in the Chinese apparel market all the time, and we are constantly changing and innovating and trying to stay up with a very fast-changing market. Our core customer is 27 years old, three years ago they were 33 years old. Now we are redefining it, our customers are getting younger, our artwork needs to change with them, and so I just concentrate on innovation. IP – my shit gets stolen all the time, I don’t think about it too much I leave that to the lawyer, I get on with the innovation.
Matthieu David- But does the lawyer gets result in China and is he able to get a result, to get information?
Dominic Johnson: Yeah, you know it’s a funny game, very rarely do I get results from that. But what I do find with the lawyer is that when a big company, like a big hot brand, opened up in Chongqing, somewhere down in china and they opened up their new store, this big investment and they’ve got my artwork all over the front of the store and someone sent it to me on WeChat, I forwarded it to the lawyer – he is rubbing his hands and he’s thinking “I am going after them” so, I leave that to him. I’ve not received any considerable amount of money from this, but you know what it’s a waiting game here. It’s a different country, it’s a different culture, things move very fast here. IP isn’t respected yet; it will be in the future – right now I can’t spend time thinking that it’s just it’s a waste of time for me. I have the people that can deal with that, I get on with what’s important.
Matthieu David: So the first question, you are in a country where the trademark is not very well respected, and that’s the key of your design apparel company in China and the second question is that you are in a country where censorship is strong, and you are dealing with Chinese elements in art design, including icons of Beijing, sometimes leaders of China. Could you tell us a bit of your – some stories of censorship? You are in the place as well Nan Luo Gu Xiang where it’s a strange place where you can see officials with a civilian, not far from where you are and at the opposite – hipsters and very trendy café at the same time. It’s not a neutral location, it’s a very, very visible location.
Dominic Johnson: Yeah, yeah that’s an interesting question, Matthieu. I think that every culture has its unique eccentricities and I remember being in Myanmar a few years ago to film a TV show, I am also a TV presenter and when I was there a guy from museum got locked up because he created a flyer for a party and it was a Buddha with headphones on and he got put in prison, and you think how many flyers you see in the world for like Buddha power and Buddha party and it was very simple Buddhist face with headphones on, and I think he is still imprisoned three quarters later, although I haven’t checked on news you know China has its own eccentricities too on that front and it’s a very – you have to play very carefully. I do play with icons and sometimes they might be political icons or people who are involved – I made a stain glass window of Deng Xiaoping, which is very much celebrated there. And yeah, the political climate also changes very quickly here so you just have to be very careful, but at the end of the day I am not trying to be political. I don’t know – I am just celebrating my eye on Beijing, but one has to tread carefully.
It’s not of my culture and I have to keep up to date with things as they change here. Maybe something that wasn’t sensitive five years ago is now, but it’s not my goal to upset it’s my goal to celebrate and so creativity is at its best when its unfettered, when it’s not you know sensitive of course, but here in China it’s a different game, so I think we have to respect the local culture and play around those rules and get creative in other ways and that’s part of the game and I very much enjoy it.
Matthieu David: How do you know the parameters then of censorship, of what you can, what you cannot, what’s the lead – what cannot be seen as friendly. How do you know, how do you select?
Dominic Johnson: I think you need to have one ear to the ground or you need to be carefully watching what’s going on, and I live here and all my team is Chinese and my life is very much surrounded by Chinese people, so I hear their daily conversations and you might know what hot topics or sensitive topics and things to stay away from. For me, I’m just trying to celebrate Chinese elements in art design that I think are fun. I mean I just came out with a piece of artwork in the Chinese apparel market, which was about – it was like a comic book here, punching and destroying a guy who is doing a live broadcast. I try and take topical things. The live broadcast is very popular in Chinese, people in cafes are doing it. Live broadcast. Here I am having my coffee and these KOL’s – and I just think it’s totally ridiculous though I do a funny bit of artwork where a superhero is killing a live broadcaster, that’s just a bit of fun. But then maybe that will get posted on Chinese twitter and some will say this is disrespectful and then you got to take it down.
You have to be careful; I don’t want to upset people but at the same time I like to be naughty and silly and ridiculous and that’s really the characteristics of my design apparel company in China. It’s an extension of my personality. So, the goal is never to upset, but certainly my goal is to have fun, and sometimes you might tread on the wrong toes, so you have to be careful.
Matthieu David: You mentioned you are also working in Luxemburg on some design and I witnessed when I went to Europe, that China is more and more trending, there is more and more an attraction to China pop culture, a bit like we saw in the past with South Korea. Not to the same degree, but do you find some elements like Bubble Tea, like the culture of China. Do you feel that and do you think that you could play in this area as well actually as a foreigner within- between- The China and the west?
Dominic Johnson: I think you know there is huge potential for what we do because we are doing an east-west, which is much about foreigner’s view of Chinese aesthetics. A lot of what I do is taking western elements like comic book artwork and then adding in Chinese elements, and so it does the bridge. I was very fortunate to attend the Crack illustration festival in Rome last year with my team, and we set up a pop-up shop. That illustration festival is predominantly European artists and so we were the first Chinese brand to go in there and we set up a pop-up shop. It was a four-day event and within two days we sold everything. It was all gone and the reason was it was so exciting for the Italians to see the Chinese pop artwork and so surprising and they had never seen anything like that and when you stand there and tell them the story of the artwork and even the collaborations I did with North Koreans artists – they were just completely blown away and that was very exciting for me to realize the potential of the brand and aesthetical Chinese elements in art design – so yeah of course I think you know a lot of people have real intrigue towards China.
It’s the country that is shaping the world right now and is literally shaping the world and so people are slowly coming to understand China and have intrigued and taking interest in it. And so, I think our artwork is very much part of that. The building they are working on in Luxembourg is a six-storey apartment block for Yapese and the developer went to The Opposite House in Beijing, saw our artwork on the wall and said wow ! this is stunning and he contacted me and said listen I need six floors of artwork and I think your aesthetic would be brilliant, and that’s how it happened. So, these kinds of projects are really exciting and it makes me very proud as well to be able to take our artwork and put them in Europe. So yes, I think by the sheer amount of emails and demand I have from people who want to work with us, you can see that obviously, the whole Chinese elements in art design is becoming very popular. But having said that, I am not out to build the biggest design apparel company in China, Matthieu, I keep my business small for a reason. I see too many businesses die because they are growing. And I have always kept my business smaller, growing it organically and I own it 100%.
And so, I am out to build the best not the biggest and with the agency, I only take on probably 8-10 projects a year and so I can choose which ones I think will work well with the brand. Generally, I would say the 3Fs which are the Fun, Financial and Fame. And it’s going to be two of those F’s you know if it’s just financial. You know if it’s fun and fame that’s great, sometimes people give you an incredible mural or wall to create. The money is not that good, but they give you absolute creative freedom but you want to do it for the Fun and the fame because a lot of people are going to see that wall but sometimes it’s in the corporate office no one is going to see it but they give you a lot of money. So, then it’s the financial and maybe the fun but it’s got to be two of the three Fs and then sometimes the fourth F I always say is just Fuck off!
Matthieu David: So, we talked about censorship and I feel that actually, you can play the role of improving the image of China through giving another image of China. Just a slight comment on what we said before. You mentioned emails, you receive emails but when we looked into your business online on Taobao and so on we don’t feel that, maybe we are wrong we didn’t do our analysis correctly, but we didn’t feel that online was a key driver for you. We didn’t feel that sales online were a key point for you, are we correct?
Dominic Johnson: Yes, my online business is very small compared to my retail. I love creating an experience, so our stores in Beijing it’s all about the experience. You know all of our stores are run by retired old Beijing ladies and we do incredible Murals and artwork and everyone gets a free gift. And the stores are all street-level stores and it’s all about the experience. Online is a tough market, especially in China. Taobao is so much noise. There are millions of T-shirts, not to mention many of the T-shirt’s are copying mine and they are extremely cheap and so it’s very hard for me to compete on Taobao which is a big Chinese e-commerce site. I have plastered.com and it’s a niche design apparel company in China so I had never spent money on trying to get the world to see my brand yet. so, I concentrate on my retail stores and the agency side of my business, that’s what brings me the most profit. I do understand online has huge potential but the way I have – a basic day by day strategy is how I work and it’s working for me right now. I haven’t put a lot of money online. I have had people come and I want to buy huge wholesale. The margins are very small, you can’t control the experience. So, I really control the brand and keep it small, keep it profitable, have a great lifestyle that comes with it and I get to create and enjoy things.
Matthieu David: Did your experience in Italy with a pop store change your mind on getting more visibility online?
Dominic Johnson: No, it didn’t. Yes, I just concentrate right now on what we are doing well. I think you know if I am going to put money into a better online store, it would probably be towards the end of next year. This year we have another possible two store openings in China and that’s – I have a small team a small core team of six people and we are concentrating very much on getting that done and executing that well. I know pretty much if I get a store and a good location with good foot traffic, I know I can convert, I know I can guarantee I can convert on that. With online, there is no guarantee and it’s a long tale for me online. So, I don’t have the patience or the time to invest in that right now.
Matthieu David: You mentioned you are opening two new stores and actually I was certainly mistaken in it. But I read that somewhere you opened in Shanghai and you closed in Shanghai and decided to focus on in Beijing, but I feel I am wrong on it; you are still opening locations in China, right?
Dominic Johnson: Yes, we are only in Beijing. Yes, right now we are purely in Beijing, I am looking at possibly setting up a store in a second-tier city, in another spot in China later this year. But Beijing’s 23 million people, we are a Beijing-centric brand, we are concentrating on Beijing. We do have people who carry our products in other places we have sold in. In Germany, in France, in Singapore and other territories, but that is a very small part of our business, that wholesale side. For me, if the cash flow is good and I have got a good location, and I can have a solid legal standing on that location.
Otherwise, I can have a proper business license, so I have to do a lot of due diligence. If the location is good, then I will go for it. but only if I put the money to do that. As I said, I grow organically. I don’t have investors. And I like to grow slowly and keep the business lean. And that can be very difficult in China because there is so much opportunity. People come to you all the time. I had a guy come to the store yesterday. I was just going to the store to inspect a new installation that I was putting in, the guy standing there, he’s just like I do IP for Chelsea and he was speaking big, he was like I want to meet with you now because I want to do like a boutique hotel that’s all related to your print design business in China and of course you’re like – oh that’s very exciting, and then you go meet with him and he talks very big and then you know what, I don’t want to commit to that right now. so, you need to know when to say no, especially in China you need to know when to say no and it can be very, very tough. And so, it’s a constant effort for me. If I see an opportunity, I want to pounce on it but then I think that might stretch our resources we won’t be able to deliver our core product. Well, so it’s a struggle.
Matthieu David: How big is your team now?
Dominic Johnson: So, I have around 20 employees.
Matthieu David: Okay. Basically, within your shop, right?
Dominic Johnson: So, the shop staff makes up around 14, and the other 6 are my core team of designers, accountant, inventory production, that kind of stuff
Matthieu David: I see, What’s the challenge of managing your shop? What can you share in terms of challenges, the rent is the challenge I think it’s increasing a lot for the last 13 or 14 years, what are the challenges you face?
Dominic Johnson: Yes, there are so many challenges in running any business and retail business is tough. Cash is king in businesses and we produce a lot of ideas. A lot. I am a very impulsive guy, I have an idea I create it, that’s very much a life goal for me. And sometimes the ideas get out of control and suddenly I have no cash because everything is caught up in the store. You know there is 2 million RMB in store and then I have got half a million RMB in the cash flow. You know that’s the real challenge, controlling and curtailing the ideas. Rent is obviously a huge challenge which is a big factor in paying into the net profit. Frontline staff is one thing we have done very well is that you know we only hire ladies above the age of 50 to work in our stores and so our retention is extremely good. Generally, the retention in retail is about 6 months in China, my retention is – I have one old lady, she has worked in my store for 13 years.
I have got another one, she has worked for 11, I have got Li I who has been with my brand for 8 years. They’re local matriarchs, they’re very much part of our experience, they live in the areas where the stores are, so that’s been a big win for us, So, the challenges are huge and I was saying about due diligence. I don’t open the shop anymore so; I work in the street-level stores. A lot of streets level stores have been bricked up and closed down in Beijing because Beijing is trying to move people out of their center of the city because it’s overcrowded they close down businesses. You can lose your design apparel company in China overnight. I mean my flagship store provides a huge amount of our revenue and three years ago they decided to close down the whole street to renovate it. And they closed down a lot of the smaller business that didn’t have business licenses but I was basically closed for three months and I lost a huge amount of money. So, policy, those things can change very quickly here, so the challenges are huge but the opportunities are also huge here in China, just because of the sheer amount of people and just how excited they are by creativity.
Matthieu David: From the management perspective, when you have an idea. How many items do you produce of the T-shirt, I thought you are very creative but on the other hand, you need to produce those T-shirts and predict a bit in how many items you are going to sell. how do you manage that?
Dominic Johnson: Okay, so fortunately with T-shirts are quite easily controlled you can produce blank T-shirts in bulk. We have data on our stores so we have a very POS system, so when we have a new design, I can print 30 if I want or I can print 1000. They are all screen printed by hand just outside Beijing and so we do an initial test print of let’s say 60 and then we monitor that very closely.
All the ladies who work in our store, the old ladies they use WeChat and they take pictures of our customers and so there is a close relationship you put on a T-shirt and she says can I take a picture of you – sure! She takes a picture and she shares it in our WeChat group with all my core team and then we can see our customers are changing and underneath that picture she has to leave a story because our brand is all about story. You know we are selling a story, so this customer came from Xiaoping and he came in such a car, he is about to get married this year. It’s his third time in Beijing and he works at Volkswagen or whatever that story is incredibly powerful for us because we can understand our customer and so with these small prints we see who is buying it, we see who is not buying it, we realise what the market is for this, what the market is for that and then we have internal meetings and decide you know what kind of route we should go down artistically, which type of Chinese elements in art designs we should maybe make more or less of and at the same time we need to take big risks.
We need to create big outlook that is surprising for a customer because of we are only designing for your customer and I’ve worked with brands like that, they say Dominic can you create this for my shop, you’ve signed a contract, they’re like- can you just do us one first, we’ll send it to our customers and see if they like it – that’s a big mistake. Plastered was built on surprises and people like it when we come out with stuff they never expected, but if you are only designing for your customers, you become like every other brand. you become very boring very quickly. It’s like Matthieu your girlfriend or your wife telling you something to do and you always listen to her you know you always, always say- Yes to everything she can get bored very quickly and with us with the customer, we want to deliver surprises and at least 30-40% of our artwork in the Chinese apparel market has to be new, exciting and surprises. They can fall flat on their face or they can explode but you know our design apparel company in China needs to be innovative; we need to be creative. And that’s how we stay ahead of the other people who are trying to come in the market and copy us.
Matthieu David: So far what has been your best seller?
Dominic Johnson: Crickey, well we have a full print design at the moment which – Chinese are very bold when it comes to fashion, they’ll wear anything. We just came out with a pair of pajamas that are bright pink and have pixel designs all over them, but the people in China wear their pajamas out on the street. Very bold, our current best-sellers are a full print T-shirt. It’s just absolutely madness it’s red, it’s yellow, it’s blue it’s a whole collage of illustration of little ideas, old television sets, old bottles of washing-up liquids, cigarettes, alcohol. It’s like a whole collage of dreams put into a full print T-shirt.
When I saw that T-shirt first designed, I was like I am not sure that’s going to sell. We put it in the store and it all went crazy and we may be able to take that full print design and put it onto pencil cases, onto hoodies, onto tote bags it’s become our best-selling designs of all time. And its complete madness when you look at it. When the Chinese customers come in, they get drawn straight to it. It’s like a shining star in the store, foreign customers not so appealing, but foreign customers are only making the brand 10% or 5% of our business, but the young Chinese crowd comes in and they see that and are like WOW!
Matthieu David: Foreign customers. How many percentages did you say?
Dominic Johnson: About 10%
Matthieu David: 10%. Okay, so it’s mainly Chinese actually clients. Did you, I feel that to appreciate what you do we need to have a distance towards Chinese culture, Chinese history even literature, politics or whatever, especially a distant foreigner’s view of Chinese aesthetics. So, do you think Chinese have this distance or do you think it’s more about designing itself? Are they happy to find back some pictures of the past to play with it or it’s more about the design?
Dominic Johnson: I think No 1]- It’s about whether that design aesthetically can grab them. In terms of the colors and the layout. Aesthetics is number one. Number 2 is when they come in and discover the story and they look in and say Oh look there is that, from when I was young, I remember that from that book. And then your design needs to have meaning. The story is so powerful. You know we spend so much time and money training our frontline staff to be able to tell the story of the brand and tell the story of each design. So absolutely design needs to have meaning and we are selling a story of Plastered, and so aesthetically it grabs them, that’s very important. Then there needs to be the story in that and he needs to be able to have that experience in the store that your frontline staff can tell that story. And then you will find that your conversion rates are extremely high.
But also, we do mad window displays. Right now, we have a giant sculpture in our flagship store, which is an old Chinese toy. Everyone had it in the 1970s, very iconic toy and its face changes every three or four seconds it turns and it’s holding a knife behind its back. And so, people walk past and they see that and they get totally grabbed by it. When you are talking about the street, it’s 50000 people a day. The minute we put that sculpture in the window, our traffic increased by 15% coming into the store. So, to give you an idea February last year we probably had 15000 people that came into that store, February the next year with that sculpture we had almost 20,000 people come in. And so, then you convert on a percentage of that traffic. As you can work out mathematically, the value of that sculpture right away. I am not a big one on numbers, to be honest. I am not really good at numbers.
Matthieu David: I think you know them. You know your numbers.
Dominic Johnson: But I didn’t give you my numbers.
Matthieu David: You said 30,000 people on the street right and you have got 15000 people in your shop. That’s what you just said…
Dominic Johnson: 30,000 people a day on that street and I get 15000 people a month in the store.
Matthieu David: Oh. Sorry. Got it
Dominic Johnson: On the good month I get 32-33 thousand people in the store.
Matthieu David – Okay. I see – what about Beijing now and Beijing like 15 years ago, 20 years ago what do you feel about the city? How do you analyze the changes in the city? There is a lot of nostalgia I feel with expatriates who have been there for 20 years. What’s your opinion, what’s your feeling about the city and its evolution?
Dominic Johnson: That’s such a question that comes up a lot. People say, what’s the biggest thing that has changed and I never know how to answer that question. Beijing has 8 million people, it’s now 23 million people. When I arrived, it was a flat city. There was no high rises, there was not even a third ring road, now there are 7 ring roads I think about to be. Everything’s changing, people’s body shape is completely changed in the time that I have been here, their diets have changed. When I came here in 1993 if I’d met someone who even left China was surprising. If you met someone – oh I’ve been to America, you’re like -Wow you went to America! I think to myself as to why you came back, why didn’t you stay there? Now you look at your WeChat moments, the social element of it, on any public holiday, my Chinese friends who are in Turkey, in Alaska, in America, in Britain they are all over the world, so everything has changed. But I think the mistake that a lot of people think is Chinese is westernizing is It’s not westernizing it’s globalizing. It’s very much taking on its own character its own eccentric idea of how the world should be, or how they want to celebrate it. And you can see even just in design apparel companies in China, they put all kinds of things together you would never expect.
So, it’s a country with a very long history. It’s just opening up I mean it’s only been open for 40 years that’s it. The economy has been open for 40 years, that’s nothing I mean. there is so far to go and the economy is not really slowing down. People are like Oh China’s economy is – it’s not really. I mean it used to be 10% of this and now it’s 6% of this. You know it’s adding to the world economy the size of the South Korean economy every year now it’s crazy growth when you go out to the second- and third-tier cities. So, opportunities -and it’s still exciting, at the end of the day, I am a very hyperactive person. I love things to be changing all the time, I like to get out and do things. China is a playground for an entrepreneur like me. I am a creative guy, I like to bring ideas to life, I can find any factory In China that can bring my foreigner’s view of Chinese aesthetics to life. I have got a whole wealth of customers in my stores who get excited about my ideas. If there are challenges here – for sure but generally this is an incredible country to be an entrepreneur. If you apply yourself and understand that people here are good people. They are brilliant entrepreneurs; they want to win the game too. But you can build relationships and you cannot lose your moral compass and you can be a good entrepreneur in this country if you ever apply yourself. I had an incredible journey. I have to be lucky for that, definitely, timing has been a huge part of it but another part of it has been understood by people and building relationships and friendships and I have incredible support over the years.
Matthieu David: One question I forgot to ask actually was about the creation of your products? How do you find inspiration? Do you have a pattern of working on the inspiration? do you have time slots where you read, you go through shops, you go through other parts of the city, or is it coming just like it’s coming within the day or in the night or whatever?
Dominic Johnson: Yes. You know what, I hate it when people say to me let’s have a creative meeting. It’s almost like a conundrum. They don’t go together. The more you try to make creativity efficient, the worst it works. You can’t make it efficient so you need to give it time. There is a great slogan which I love is- Your brand equals the sum of your life experiences. Which is life is an experience, so for me, I travel a lot and it’s a big part of my inspiration. The brand that I am is made of this young guy that left England traveled around Africa, South America, India, China and saw these incredible things and fell in love and ate incredible food and ended up in dangerous situations and ran out of money. You know it was a little bit silly. I am just celebrating who I am. I understand that life is an experience. And if I am going to have ideas, I need to have a rich filled life. If I need to be happy, I need to be enjoying artwork in the Chinese apparel market. And so, I try just to celebrate who I am, enjoy life and then the ideas seem to come very quickly.
But the importance in terms of execution ideas is Number 1- write them down, number 2- be brave, because of course sometimes you have an idea at the moment and after a couple of beers you feel high and excited, and then you start executing it and you lose all confidence in it. And you start second-guessing yourself and when you second guess it becomes totally water down and shits. So, for me creative is about keeping the purest side of it, getting excited about something, writing down the ideas, delivering it to my team and then trying to execute the correct, the purest form of it and then that’s creativity. And I am not trying to second guess myself too much. The more I think about the costumer the worst the design comes. Sometimes we realize we have to deliver commercial things like print design business in China and I sit down with my creative director, but the customer and then eventually something comes out and its absolute shit and we deliver it and the customer doesn’t even like it.
You know what I mean, so it’s important to be brave and at the same time, of course, there need to be systems in place. And you need to have discipline and continually create because it is very easy to get caught up and think I’ve got writers’ block or I didn’t have any ideas. you just have to work through those moments. And sometimes you produce shit and that happens.
Matthieu David: I feel a bit of – I feel process in what you described, you have an idea, you’re writing it down, you talk to your team. Do you work only on why the other time? Do you work on several ideas at a time? Do you stick to one idea until you know it’s finished and or you give up or you continue? Do you have a framework like this or it’s…?
Dominic Johnson: No, lots of ideas are floating around. So, you know I have an idea – and so quite often what happens is you have an idea to put this on the back burner. you are not quite sure if you want to execute it or if you can execute it but you keep it there. Then another idea comes together and then you stick the two together and realize suddenly it taking two things unrelated and sticking it together anyway. But in the design process a lot of things are floating around a lot and suddenly. This one popped out of them put with this one together and then it created and then I get this artist and it creates an absolute diamond. And in the chaos of my life Matthieu is where I find the diamonds for my design apparel company in China. And it’s important for my life to be chaotic. I believe that. I understand the structure of designing artwork in the Chinese apparel market can set you free. It can, of course, the more structured is my life the more time I have, but the same time with the two structures I have no ideas.
So, I need on one side to be chaotic. I also need to be systemized and balanced. And you got to find that balance and you know Nan Luo Gu Xiang was created on creativity in creative stores. But I am like the only one that’s left all the creative stores have closed down because they couldn’t keep up the rents and that’s because those entrepreneurs couldn’t keep up with the structure and finance side of things. I have been fortunate to surround myself with entrepreneurs in Beijing and members of the entrepreneur’s organization and so I’ve learned from them. I surround myself with smart people who understand systems that understand processes.
Matthieu David: You are a part of EOs?
Dominic Johnson: Yes, I am in a part of the entrepreneur’s organization in Beijing. Have been for 10 years.
Matthieu David: I see. I think I will have interviewed all of them by the end of the year
Dominic Johnson: Yes
Matthieu David: It’s very interesting.
Dominic Johnson: Yes
Matthieu David: I’d like to talk during the coming 5 – 7 minutes because I know you have to leave in coming 7-8 minutes. About the, your other roles, your other experience you have. And You said that China is full of opportunities. And we saw that you had been a TV presenter… you have written a book, and you are speaking to MBAs and EMBAs often because you have been in 60 Chinese universities.
Could you tell us about this last experience I am talking about? What do you tell them? What do you talk about to those MBAs, Emba where they would come up with consumers’ eccentric thinking viz business model which is exactly the opposite of what you said.
Dominic Johnson: Yes, you know what, the story is powerful Matthieu. The story is so powerful and so when I talk to universities, I have been doing this now for 10 years talking to universities ever since I won the British Entrepreneur of the year award in China. I was asked to talk I was terrified about doing it. But then I exercised myself and I got better and every time I did a talk, I realized what made people laugh or kept people’s attention. Every time I finished a talk then I would tweak it and make it better. So, my talk is an ongoing process and I quite often base my success on my talks. I might add in new contents in my talk and then I’ll understand, am I actually getting shit done or am I doing interesting things?
So, my talk is constantly changing. But It’s a story – it starts with me leaving school and then I had a whole list of reasons why I was unsuccessful at school. I was impulsive, I was immature, I was a daydreamer, I was always getting up to dangerous things. These were the things that defined me at school and got me in trouble and why I was unsuccessful in school? Now I take those elements and I tell stories, immature stories. I was immature when I did this, but it led to success. I was impulsive, I didn’t have a business plan for design apparel company in China at that time, so I tell stories based on the reasons why I was unsuccessful at school and then it all comes to the beginning and then a middle and then a very dramatic end, and its all connected.
So, I built this store over the last ten years as I craft myself and craft my own story. And it’s very appealing to the people and it’s very tangible. I tell them how I got into television, how I became a television presenter and how I wore a T-shirt on a Chinese tv show saying I’ll buy your second-hand drugs with my telephone number on it. It is really immature silly stunts that I pulled off and product ideas. They get people excited about creativity. I just share that journey with people and it always goes down well. There are no numbers in it, there is nothing particularly exciting I am not going to tell people about how I’ve made millions of dollars. It’s purely about ideas, creativity, my journey taking what people see as your perceived weaknesses turning them into your strengths and celebrating yourself.
Matthieu David: What is the most often asked question asked to you?
Dominic Johnson: The university students? In China, a lot of them ask me how I can be creative, which are a very awkward question and I have never thought how to answer it without sounding too cocky or placing yourself on a too-high pedestal. The one-bit advice I always give is back to my saying of your brand equals to somebody’s life experiences. I said for me creativity comes from life and it comes from experiences I said I am sure you can afford a bicycle and so why not, you know we’re in chunk due you right now, I said why not get a new bicycle and ride to a city that’s 3 days away. Don’t make a plan, just get on the bike and go. See who you meet along the way, see the challenges that happen, see the inspiration that comes from there and I can almost guarantee that journey will inspire you. And for me that’s where creativity comes from. And so yes, I get a lot of that.
Matthieu David: Doing the last three minutes. Could you tell us more about the book you wrote “A foreign entrepreneur’s China dream” You wanted to call before – but the editor didn’t agree?
Dominic Johnson: Yes, publishing in China obviously – you know the publishing account is government-owned. And so, that was a ghostwriter. So, at that time, that book came out I was pretty famous. I was a judge of the Chinese equivalent of the apprentice for five years I had that role. So, I was on television twice a week of an audience of 10 plus million, and a bunch of guys came to me and asked me if I would do that book because I was famous. And so, it was very much the watered-down version of my life but because they had to cut this out and cut that out and that’s a little bit naughty or that’s this. I wanted to call it – which is Beijing dialect saying – piss off, in a kind of polite way.
But then they said no no let’s call it you know “A foreign entrepreneur’s China’s dream”. So that was the book, it was bizarre even having a book because I don’t read and it was nice that people enjoyed it, I get messages every now and then from people who get enjoyed by that book or get inspired by that book. Yes, it was a funny process understanding how publishing works in China.
Matthieu David: Yes. Where can we buy? Where can we buy the book? Only in China or…
Dominic Johnson: No, I don’t think you can. It’s only in Chinese and I think it’s already – I mean it was published four years ago. I mean it’s sold out and I am not sure if they republished it now. So yes, the book is gone.
Matthieu David: Okay. Last question. Do you wear your clothes? Do you wear your brand?
Dominic Johnson: Yes.
Matthieu David: Right now?
Dominic Johnson: Not always. No, not right now. No, I think I just wear whatever is on the top of my T-shirt pile. Sometimes I wear my own brand sometimes I don’t. It depends on the mood.
Matthieu David: Okay good. Thank you very much, Dominic, for your time. It was very inspiring, very refreshing, very positive as well. It’s good to listen to positive speech in this current world where we talk about negative views about trade war and so on. So, thank you very much for being with us, hope you enjoyed and hope everyone enjoyed the talk to. Thanks, Dominic.
Dominic Johnson: It was great talking with you.
China paradigm is a China business podcast sponsored by Daxue Consulting where we interview successful entrepreneurs about their businesses in China. You can access all available episodes from the China paradigm Youtube page.
Do not hesitate to reach out our project managers at dx@daxue-consulting.com to get all answers to your questions
