Ending Poverty in China, One Loan at a Time

Wokai is a non-profit organization operating in China under a similar model to Kiva’s (May, 2009, para. 3). It was founded by two Americans Casey Wilson and Courtney McColgan after they met at Tsinghua University in China (Flanagan, 2009, para. 3). Wokai has been devoted to poverty reduction since its birth. Over the years, Wokai has drawn increasing attention and funds to its cause, and has helped fund a number of income families in China. In this blog, I seek to match Wokai’s success to the criteria given out by Jennifer Aaker and Andy Smith in the book the Dragonfly’s Effect (2010) because the book provides a comprehensive and compelling guideline for harnessing social media technology in promoting a worthy project.

According to the book, four wings of the dragonfly need to operate well and in harmony before the bug can take off. Wing 1 is Focus. Wing 2 is Grab Attention. Wing 3 is Engage. Wing 4 is Take Action. Let’s examine two aspects Wokai is extremely good at.

Wing 1: Focus. What Wokai’s goal is? It is clear on its website’s homepage: “Ending Poverty in China, One Loan at a Time”. Wokai has never changed its goal of poverty reduction in China and has always strived hard to achieve it. Obviously, the goal to alleviate poverty in China sounds intimidating given China is such a huge country with not a small percentage of its rural population under the poverty line (Flanagan, 2009, para. 2). How can we achieve this goal? Wokai divides this “impossible” project into numerous small actions: “one loan at a time”. This strategy is extremely important in attracting people to and keeping people around Wokai’s long term project. According to the Dragonfly’s Effect, “goals that are too easy to reach will not satisfy participants and will underdeliver for your cause. Goals that feel out of reach can discourage people, leading them to quit easily or not to try at all” (Aaker & Smith, 2010, p. 26). Wokai has done a good job to set its “macro goal” (Aaker& Smith, 2010, p. 26) of poverty reduction along with achievable “micro goals” (Aaker& Smith, 2010, p. 26) of making small loans.

Moreover, Wokai further divides its project into making loan contributions as small as 20 dollars to a group loan typically no bigger than 800 dollars. Hence, only 40 people are required to fill a group loan and a 20 bucks contribution is manageable for many people.

Wing 3: Engage. One principle used to engage people is to tell them a story, because we have a basic human need for stories (Aaker & Smith, 2010, p. 82). Wokai follows this guideline well and its website features numerous different stories.

In this loan request, the borrower Tunumula shares her story that last year she was not able to restock her clothes business before the Chinese New Year and failed to make money from the opportunity. As a result, she wants to pledge a loan to restock her clothes shop this year. This story is short but has achieved several goals. First of all, it’s straightforward and authentic. You probably get it the first time. Second, the background information about a five year old daughter might hook a lot of audience members who love children. Moreover, this women described in the story is confident and ambitious, trying to “expand my business” and “make more money”. Instead of showing lenders how miserable the borrowers are, Wokai typically use stories like this to confirm borrowers’ status as grassroots entrepreneurs and try to earn them lenders’ respect (Aaker& Smith, 2010, p. 94). In the end, the picture next to the story enables lenders to see the borrower as a fellow human being instead of another set of computer data, which increases empathy greatly and enhances her chance of getting the loan.

The story about how Wokai was founded is another one that enjoys a great amount of attention. Wokai’s founders, Casey Wilson and Courtney McColgan met in a language program in China and both were inspired to empower poor Chinese people to liberate themselves from the poverty cycle. Anecdotes went that, one of the founders had a migrant worker friend in Beijing, whom the founder wanted to help by teaching her migrant worker friend English for free. However, after several classes, the founder’s friend told her that she could not take her classes any longer because the migrant worker had to go back home to get married as a result of her parents pressure. Making a living in the capital is too hard especially because the migrant worker did not have any start money. Although she appreciated the Wokai founder’ efforts in teaching her English, learning English did not really improve her life. The founder was shocked and since then has been inspired to help low-income people in China. Although this story is only an anecdote, it is highly memorable and sticky (Aaker & Smith, 2010, p. 50). It resonates with many people’s experience especially when more and more college students get a chance to study abroad. Its plot is unexpected but authentic and compelling. Most of all, this story is so personal that many of us only share its kind with good friends; thus, a feeling of closeness is established as the story unfolds.

Another important aspect of engagement is facilitation (Aaker & Smith, 2010, p. 80). Companies or NGOs need to “act[…] as a caretaker of brand development rather than attempting to control it” (Aaker & Smith, 2010, p. 80). Wokai allows anyone to set up a team on its website and team members have great flexibility with regards to the design of their team’s webpage. Teams have their own front page, their location, and their own team descriptions. New Wokai supporters can request to join existing teams or start their own teams as they wish.

And this is my chapter. My friend Kaiyan started it last semester and we only have two members right now. I did not choose to use my photo for privacy reasons. But it’s weird that our impact point is still zero because I have made two loans and received at least 130 point.

Besides these could-be-random teams, Wokai have a bunch of formal chapters featuring the orthodox hierarchy of presidents and VPs. In some very active chapters, members hold a variety of different events. In addition to these teams and chapters, Wokai also utilizes Facebook, Twitter, and owns a Youtube channel as means of engaging a larger audience. Theoretically, according to the Dragonfly Effect, matching different media to different people will draw a broader audience and encourage a greater number of people to act (Aaker & Smith, 2010, p. 97). However, Wokai is kind of lame with these social websites. It has only a little short of 2000 friends on Facebook, around 1500 followers on Twitter, and its Youtube channel only has 15,000 views in total. The strategy Wokai seems to use is more about fostering community-based teams and chapters (although they can be as small as two people) than to build a huge Facebook and Twitter follower group.

In conclusion, Wokai demonstrates its mastery of the techniques illustrated in Jennifer Aaker and Andy Smith’s book the Dragonfly Effect and has successfully attracted considerable support for its project of poverty reduction in China. If you are interested in Wokai, you might want to check out its website http://en.wokai.org/—and you are more than welcome to join our Wokai Berkeley Team!     

References

Aaker, J., & Smith, A. (2010). The Dragonfly Effect. San Francisco, CA: A Wiley Imprint.

Flanagan, E. (2009, July 28). Role-reversal: Americans provide loans to Chinese. In NBC News. Retrieved April 9, 2012, from http://goo.gl/4aBqy

May, M. (2009, April 13). Tiny loans, big difference at Bay Area Web site. In SFGate. Retrieved April 9, 2012, from http://goo.gl/QWxNn