THE DREAM OF THE TRIUMPH
OF ECONOMIC NATIONALISM
In 1911, emboldened by his success with "Western" Ailuo Brain Tonic, Huang Chujiu began to make an imitation of a Japanese-made medicine called Humane Elixir (a two-character name pronounced Jintan in Japanese and Rendan in Mandarin). Eventually, during an anti-Japanese boycott in China four years later, Huang began to compete with the Japanese manufacturer of this medicine by introducing nationalistic "buy Chinese" advertising, but initially he viewed it as a model for his own business.
Huang's Japanese Model: Humane Elixir. From Huang's point of view, Japanese-made Humane Elixir was the obvious choice as a model for his own product because it was by far the most popular foreign-made medicine in China. According to the American consul general in Shanghai at the time, Humane Elixir's sales in China were nearly equal to those of all other foreign-owned pharmaceutical companies combined. Its popularity was not traceable to its therapeutic efficacy, at least not according to an analysis done at the time by the American Medical Association, which concluded that Humane Elixir "possessed no material potency" because it lacked "potent alkaloids" and consisted mostly of sugars that were "highly aromatized, suggesting ‘breath perfumes' like ‘sen sen.’
Humane Elixir's Japanese founder, Morishita Hiroshi, had an eye on China even before opening the company at Osaka in 1893. Throughout his life he had been interested in "Chinese medicine" (kanpo in Japanese), and while serving with the Japanese army in Taiwan he had conceived the idea of making Humane Elixir. After consulting a Japanese sinologist and a Japanese journalist specializing in China, he chose for the product a name deeply rooted in Chinese tradition—humaneness was the very first of the five Confucian virtues (followed by righteousness, propriety, wisdom, and faithfulness), and elixir was the term long used to describe Daoist potions and other traditional Chinese tonics—and soon set up a distributing system for it in China.
By 1908, Humane Elixir maintained sales offices in three Chinese cities (Shanghai in the lower Yangzi, Hankou in the middle Yangzi, Tianjin in north China) and made each of these offices responsible for distribution in a sales territory encompassing five or six of China's provinces. At the Shanghai office, it established Toa and Company, capitalized at 500,000 yen, to serve as its headquarters in China. Through Toa it lured Chinese-owned drugstores away from rival Western pharmaceutical firms and convinced them to sell Humane Elixir exclusively by granting them seven to ten months' credit (compared to only three months' credit from Western companies) and by protecting them from fluctuations in market prices. Whenever the market rose above the agreed-upon price, it allowed them to keep surplus profits, and whenever the market fell below the agreed-upon price, it allowed them to pass their losses along to it. By using this strategy, Humane Elixir distributed its goods throughout China before Huang Chujiu entered the market at Shanghai. As the American consul at Shanghai remarked about Humane Elixir at the time, "This company has spared no pains, either in canvassing or publicity campaigns, to exploit thoroughly and systematically the whole of China, so that even in remoter interior sections it is difficult to escape the familiar poster extolling the virtues of ‘Jintan’ [Humane Elixir]."
As suggested by these references to Humane Elixir's "publicity campaigns" and its "familiar poster," the Japanese company armed its large-scale distributing system with a full arsenal of advertising weapons. By 1910 it was already the numberone advertiser in Japan,  and it set its sights on the same goal in China. While sending its message through a wide range of media—newspapers, magazines, billboards, posters, handbills, calendars, and parades—Humane Elixir focused attention sharply on a single image: its trademark. This trademark was well designed to reach illiterate as well as literate Chinese consumers, according to an American advertising analyst who was sent by the United States Department of Commerce to spend eighteen months in 1919 and 1920 surveying advertising in China, Japan, and the Philippines. "The best ‘chop’ is nearly always pictorial, supplemented in most cases with a few easily read Chinese characters," he observed
In the second decade of the twentieth century, Humane Elixir made its trademark familiar to illiterate as well as literate Chinese by featuring it in outdoor advertisements over and over again, especially on billboards and in parades of sandwich-board carriers. In fact, it eventually made the Humane Elixir man's face on its trademark so familiar that he had an effect on men's fashions in China. Adopting his heavy black mustache as their model, many Chinese men grew similar mustaches and were seen wearing this kind of mustache in China's cities (including Beijing, as noted by novelist Lin Yutang) and in China's countryside (as portrayed in Wu Zuxiang's short story "Fan Village"). Even today, long after the image of the Humane Elixir man has ceased to occupy a prominent place in China's landscape, the term "Humane Elixir mustache" (rendan huzi) continues to be used to describe mustaches worn by Chinese men in China.
Imitating the Japanese Model. Favorably impressed by this Japanese company's success, Huang Chujiu tried to make a new medicine indistinguishable from Humane Elixir. He named his new medicine Human Elixir, which was pronounced exactly the same as Humane Elixir (Rendan in Chinese and Jintan in Japanese); even the tones used to say the two names were identical. To make Human Elixir, Huang founded the first Chinese-owned foreign-style mechanical pharmaceutical manufacturer, the Dragon and Tiger Company (Longhu gongsi) and assigned it the task of duplicating Humane Elixir. According to the Dragon and Tiger Company's analysis, Humane Elixir turned out to contain peppermint, borneol, cloves, and catechu, which were all readily available in China. So Huang used these ingredients in his effort to make Human Elixir resemble Humane Elixir as closely as possible.
In advertising, as in manufacturing, Huang initially made his product appear to be similar to its Japanese counterpart. In July 1911, his first advertisement for Human Elixir in Shen bao, one of China's two biggest newspapers, established his theme by emphasizing his product's universal applicability. It should be "in every person's pocket and in every family's medicine chest," this advertisement proclaimed. In it and subsequent advertisements during the next four years, Huang made no effort to differentiate his product from Japanese-made Humane Elixir, no mention of his product's Chinese origins, and no appeal to his Chinese customers' patriotism. In fact (following the example of Huang's Ailuo Brain Tonic), his advertising included un-Chinese, Western images such as an orchestra that featured brass horns and a bass drum (known in Chinese as foreign instruments, yanghao and yanggu).
Using this strategy of imitation, Huang made a poor start with Human Elixir. Initially he was unable to raise sales above a hundred cases per year. Nonetheless, he stayed with the same strategy until 1915, when Japan imposed on the Chinese government the Twenty-one Demands—a wide-ranging set of economic rights and privileges for Japanese in China—which provoked Chinese protests, including a boycott against Japanese-made goods.
Selling "National Goods." On March 23, 1915, less than two months after the Twenty-one Demands were made public, Chinese leaders of Shanghai's twenty major guilds formed the Society for the Use of National Goods (Quan yong guohuo hui) and started a boycott against Japanese-made goods that was largely devoted to the promotion of Chinese-made substitutes. Though officially banned by the Chinese government in Beijing, this organization quickly extended its reach, opening offices at seventy locations in China by May 1915. As the boycott spread, Huang Chujiu tried to capitalize on it by advertising Human Elixir as one of the "national goods."
Between May and August of 1915 Huang filled his newspaper advertisements with nationalistic slogans in support of Human Elixir. These advertisements exhorted Chinese consumers to "Stop the Economic Drain [Abroad]" (louzhi), "Restore Economic Rights [to Chinese]" (wanhui liquan), and "Buy 100 Percent National Goods" (wanquan guohuo). Conceding that Huang's Human Elixir had once tasted less good than his foreign rival's product did, his advertising insisted that it had been worth buying even then because it had always been an effective medicine and had always been a 100 percent national product. Besides, as of 1915, Human Elixir tasted "not a bit inferior to foreign goods [waihuo]," his advertising claimed, because he had improved it by combining raw materials from China with "the most upto-date manufacturing techniques from the West." To enhance their visual appeal, Huang's newspaper advertisements contained nationalistic drawings along with nationalistic slogans. One advertisement from 1915, for example, employed the emotionally charged imagery of the flag and flagpole: the Chinese character for country (guo) formed the flagpole's base; the character for China (zhong) was the pole; and a flag emblazoned "Human Elixir" flew from the top of the pole.
While adopting the rhetoric of modern nationalistic competition, Huang did not abandon the imagery of traditional Chinese harmony. Instead he blended the two together. In 1915 he revised Human Elixir's trademark so that it contained representations of both nationalistic competitiveness and traditional harmony. To signify nationalism, he highlighted in circles Chinese characters meaning Chinese national goods (Zhonghua guohuo); and to invoke tradition, he pictured a dragon and a tiger, which, according to traditional Daoist symbolism, produced a divine elixir by bringing together yang (the dragon) and yin (the tiger) in a harmonization of opposites. This trademark gave the impression that Human Elixir was an official product as well as a nationalistic and traditional one by declaring that it had received
Even while Huang used nationalistic and traditional imagery to differentiate his product from his Japanese rival's, he adopted more of his Japanese rival's financial and promotional techniques to strengthen his company's distributing system. In 1915 he converted his business into a limited liability company and recruited several Chinese investors to help him raise its capital to 100,000 yuan. With this backing, he began offering exactly the same credit to Chinese distributors as his Japanese rival had offered them, allowing them to hold goods up to ten months before they were required to make any payment. To supply these distributors with advertising, he followed step-by-step in his Japanese rival's tracks, sending out advertising teams to put up posters wherever Humane Elixir's advertising appeared in Shanghai and dispatching another four or five teams to do the same in other cities, towns, and villages outside Shanghai. These teams hired local children to parade around in tall hats and white gowns while marching to the beat of drums and handing out leaflets.
And yet, despite all of this fanfare, Huang did not earn high profits. At the end of the boycott against Japan's Twenty-one Demands in August 1915, he was so disappointed in the sales of Human Elixir that he sold it to two Chinese publishers, Lufei Bohong and Shen Zhifang, the president and vice-president of the Zhonghua Book Company. A year later, after these new owners fared even less well and lost all of the 60,000 yuan they had invested in order to improve Human Elixir, Huang bought it back from them for 20,000 yuan, half as much as they had paid him for it.
Thereafter, Huang continued to sell Human Elixir, with results ranging from poor to mediocre. In average years, he sold 200–300 cases of it. He regularly underpriced Human Elixir by 20 percent and at times by as much as 80 percent and, as a result, frequently suffered losses on Human Elixir and covered them by dipping into profits from Ailuo Brain Tonic. He recorded his highest sales, 1,000–1,260 cases per year, in conjunction with two anti-Japanese boycotts, one during the May Fourth Movement of 1919 and the other during the National Salvation Movement of 1931. But even selling at these levels Human Elixir was no match for its Japanese rival. During the boycott of 1919, it yielded profits of 20,000 yuan—less than half of the average annual profits on Huang's Ailuo Brain Tonic at that time—and during the boycott of 1931 its sales amounted to no more than one-thirtieth of its Japanese rival's sales in China (1,260 cases compared to 37,800 cases).
Popularizing Economic Nationalism. Why was Huang's advertising for Human Elixir not as effective as advertising for his other products? As with Ailuo Brain
As with Ailuo Brain Tonic, Huang devised an advertising campaign using ideas and images that had been introduced by members of China's intellectual elite. Since the turn of the century, Liang Qichao and other Chinese thinkers had advocated nationalist causes, and during the first third of the century Chinese intellectuals and students led an extraordinary number of Chinese antiforeign boycotts—each sparked by a political or diplomatic incident—that were directed primarily against Japan (in 1908, 1909, 1915, 1919–21, 1923, 1925–26, 1927, 1928–29, and 1931–32) and secondarily against Britain (in 1909, 1925–26, and 1927). Undoubtedly Huang adopted and continued to use "national goods" slogans because some of these boycotts were effective. As C. F. Remer has shown, when one of these boycotts spread widely and lasted more than a year in China, it reduced the sale of foreign-made goods by as much as 25–40 percent in the lower Yangzi region and south China and by 10 percent in north China. Citing this evidence, economic historian Chiming Hou has gone so far as to conclude that economic nationalism gave Chinese-owned businesses a major advantage over foreign-owned rivals in their battles for China's market. But perhaps this conclusion overestimates the extent to which consumers' preferences were based on a sharply defined Sino-foreign dualism in Chinese popular thought.
The rivalry between Huang's Human Elixir and his Japanese rival's Humane Elixir provides additional evidence to show that Chinese consumers practiced "medical pluralism" rather than choosing between Chinese medicine or Western medicine as distinct alternatives. In the case of Ailuo Brain Tonic, as noted in the first part of this essay, Huang took advantage of the lack of a sharp distinction between modern Western medicine and traditional Chinese medicine by advertising his supposedly Western product in familiar, unWestern, Chinese terms. In the case of Human Elixir, he tried once again to mix seemingly contradictory ideas and images: new, unfamiliar notions of Western-style competitiveness (in the nationalistic rhetoric of boycotts) and old, familiar representations of Chinese-style harmony (in the traditional images of the dragon and the tiger). Since a similar strategy had worked with Ailuo Brain Tonic, it might well have worked with Human Elixir too, but this time Huang had met his match. In competing with Japanese-owned Humane Elixir, not only did Huang have to contend with a company whose production and distribution were superior to his own, but he also had to compete with a foreign rival that advertised successfully on Chinese terms (as none of Ailuo Brain Tonic's Western rivals did). So the outcome of Huang's rivalry