Herd mentality: a Chinese cultural trait

人类往往倾向于“跟风”行为, 即让个人的行为受到其他人的影响,而华裔人士似乎更容易受到这种心理因素之左右。

While human beings tend to adopt a herd mentality – allowing the individual behaviours to be deeply influenced by others, Chinese people seem particularly vulnerable to this phycological trait. 


Take their behaviours in the GTA housing market as an example. Prior to the government housing measures to cool down the markets, home buying frenzies were prevalent in many Chinese communities.  In 2016, frantic buyers bid up purchase prices in GTA to the point where even surging rental prices could not cover home maintenance costs. These frenzied buying activities barely involved any meticulous business planning, but rather are driven by the fear of being missed out. In other words, they jumped into the market, simply because their friends, neighbours and/or colleagues participated in it.


The same herd mentality has brought the market to a sudden standstill, as Ontario housing measures has turned a flood of reckless buyers into a group of fence sitters. As a result, home sale activities dropped significantly since the Ontario housing policies came out in April. 


The herd mentality has led to a spike of entities with the same business model in the Chinese community – particularly the newspaper companies. As some trailblazers set their sights on the media landscape in Canada – which is under the tight control of the Chinese government and is not licensed to private businesses in their home country, a flood of community businessmen had followed suit – they rolled up their sleeves and brought piles after piles of newspapers to grocery stores, only to see a big chunk of them being dumped into garbage or used as food wipers.  


Two years ago, there were about 40 different types of newspapers in the Toronto Chinese community, serving a readership only 1/10 of the Toronto population. A similar press frenzy appears in Chinese communities across all North American cities, with many newspaper editors being ignorant of either media responsibilities or Canadian journalism. Again, they did it because some else was doing it.  


But unfortunately, it has turned out that they’ve followed the wrong herd over this time. Just in a few years, the newspaper business turned abruptly into a sunset industry. As a rising tide of digital wave swept through, mainstream newspapers faced financial troubles and the community papers were in survival nightmare. As a result, many newspapers surrendered their ink and papers and left the market in droves. 

这种商业跟风现象更是席卷中国的生意商场。 根据“环球邮报”报道,自从一位中国企业家在1月份成功经营了一个通过应用软件租赁自行车的生意以来,至少有20家自行车租赁公司似乎一夜之间在中国涌现,一个好的企业商机被一窝蜂跟随者糟蹋殆尽。此外,有二百多家中国企业顷刻间做起了电动汽车业务,同时市场上涌现出大约2000个移动健康应用软件。预计涌向市场的下一个跟风狂潮的将是模拟现实之软件产品。

The rush to jump into same business activities has also been amplified in the marketplace in China. According to the Globe, ever since a Chinese entrepreneur enjoyed a booming app-managed bike renting business this Jan, at least 20 bike-sharing companies have emerged in China seemingly overnight, turning a business idea into a business stampede. Also, over 200 Chinese companies leaped into the electric-car business; About 2000 mobile health apps flooded the market; And the next wave in the line will be virtual-reality products. 


According to psychological analysts, the herd mentality of modern Chinese people can be traced to the famines and social upheavals of the 20th century, when financial hardship created a survival crisis and food scarcity led to panic buying. Despite rapid economic growth over the decades in China, the psychology trait has passed on genetically and this Chinese characteristic has remained, leaving people to feel that they must always be at the front line and get something before someone else. 


But undoubtedly, the herd mentality can hardly survive the modern business world or the global marketplace. It will eventually eradicate the independent critical thinking, turning them into idiots and setting them up to fail in the competitive global markets.

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