The Role of Digital Transformation in High-Quality Development of the Services Trade

Abstract

China’s economy began as one of high-speed development and has since advanced into a period of high-quality enhancement as driven by the services trade. Data elements are important for promoting services trade. In this paper, we present a literature review of the digital services trade and its development, as well as the main mechanisms of the data factors influencing the services trade. Second, by adopting methods for the combination of qualitative research with quantitative research, we summarize the main advantages of China’s high-quality services trade and identify the key data elements involved. We find data elements play a key role in China’s services trade development. Third, we analyze the main path of data affecting services trade development at the micro level. We then examine the specific case of the Meorient digital innovation service through a case analysis method. From this analysis, we conclude that digital internal and external dual wheels drive enterprise development and that the digital platform unlocks a new business model for the exhibition of science and technology investment to build a digital ecological symbiotic group. These findings provide a reference for the digital transformation of other service trade enterprises. Finally, we propose a means by which to strengthen digital infrastructure by consolidating the industrial foundation of the services trade and by improving the tradability of service products, domestic digital supervision, and the governance system.

1. Introduction

The 2019 World Trade Organization World Trade Report “The Future of Trade in Services” predicted that services trade will rise by 50% by 2040. At present, more than 50% of global trade in services has been digitized [1], thus overturning traditional industries through a scientific and technological revolution and industrial transformation [2]. Data elements have broken through non-trade and the separation of services trade and are leading a breakthrough leap in the new services trade era [3]. According to the United Nations Conference on Trade and Development, China’s digital delivery of services trade in 2021 was estimated at USD 3605.2 billion, accounting for 43.9% of the total services trade, thus launching a period of new growth. Digital services in manufacturing are not only expanding but are also advancing rapidly as evidenced by the growth in remote data services, cross-border e-commerce, and service outsourcing, which are all seeing double-digit growth. At the China International Fair for Trade in Services, President Xi Jinping noted that the strong rise in digital technology conforms to the general trend of global development and provides an indication of the means for promoting development and prosperity in the global services trade. Thus, the integration of data elements is a key production factor not only for enhancing China’s trading power in the digital economy but also improving the high-quality development of China’s services trade.

However, how data factors work in services trade has not been clearly addressed [4,5,6,7]. Most current studies are theoretical studies at the macro level and lack further analysis at the micro level. For example, Zhu et al. [8] investigated the impact of digital services trade on within-country income inequality, covering 100 countries from 2005 to 2019. The research problem for this paper regards how to realize the digital transformation of service trading enterprises. This article attempts to combine data and digital technology to explore the digital transformation paths adopted by service trade enterprises in different stages of development so as to realize the value of enterprises. With the aim of elucidating the concepts of digital service trade and the high-quality development of service trade, this paper first finds the main driving forces of digital trade to be data and digital technology. The impact of digital factors on service trade is mainly contingent on mechanisms such as those that reduce transaction costs, expand the trade scope, and create new services and business opportunities. Second, this study uses data from recent years to analyze the current development status of China’s service trade development based on the dimensions of service trade volume, trade structure, trade pilot project, and trade platform and finds that data elements have become the key force promoting the high-quality development of China’s service trade. Then, using the exhibition service enterprise case of Meorient and examining its organization process, business model, and ecosystems, this study explores the paths by which service trade enterprises can achieve a digital upgrade through data empowerment and digital technology application. It points out that the digitalization of business organization processes is the micro-foundation for the high-quality development of service trade enterprises; the digital platform business model of digital technology application is a means to realize the high-quality development of service trade enterprises; and digital ecological symbiosis and cross-border integration are the support and guarantee for the high-quality development of service trade enterprises. Finally, the application of digital technology is put forward as a way to strengthen digital infrastructure construction, consolidate the industrial foundation of service trade, improve the tradability of service products, and improve the domestic digital supervision and governance system.

This study makes two contributions to the research field. First, it expands the digital element of the research field: We apply the digital sector to service trade enterprises and the theories behind them, integrating new trade ideas covering digital factors into ecological theory, innovation theory, and transaction cost theory. Second, the main paths by which data and digital technology may act as service trade enterprises are summarized at the micro level. This study finds that the digital organization process, digital platform business model, and digital ecological symbiosis system are the three main paths by which data elements act as service trade enterprises.

The rest of this paper is arranged as follows: Section 2 provides a literature review covering the concepts of digital services trade and the high-quality development of services trade as well as the mechanism by which digital elements influence services trade. Section 3 analyzes the main advantages of the high-quality development of China’s service trade. Section 4 analyzes the main paths by which data factors affect the high-quality development of service trade. Section 5 uses a case study to specifically analyze the above paths. Section 6 provides this study’s conclusions and presents some policy implications.

2. Literature Review

As a new element of the services trade, the international scope of data flow attracts the attention of scholars at home and abroad. Ketels et al. [9] analyzed the new changes to global trade brought by digitalization, emphasized the importance of cross-border data flow, and put forward the concept of digitally enabled trade, believing that digital native enterprise has brought about new fully digital global services and that their value creation is rooted in the provision and analysis of data. Nguyen and Paczos [10] believe that cross-border data flow has become a key driving force of the global economy and explained the necessity for enterprises to transfer cross-border data, describing the scale and value of cross-border data flow and proposing the concept of “the global data value chain”. As a new business form and new model, digital service trade has gradually become an important branch of digital trade in the digital economy era [11]. This section discusses the concept of digital service trade, the connotation of the high-quality development of service trade, and the main mechanism by which digital data factors affect service trade.

2.1. Concept of Digital Services Trade

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The Definition and Extension of Digital Service Trade

At present, it is widely believed that international trade in digital services refers to trade in digital products and services delivered through network transmission, but the understanding of the specific categories and scope of services is not unified. The Development Trend Report of Trade in Digital Services released by the US Bureau of Economic Analysis (USBEA) [12] gives the definition of digital trade in services as that cross-border trade in services wherein information and communication technology plays a pivotal role. Similarly, UNCTAD [13] defines trade in digital services as all trade in services delivered across borders through ICT networks. Thus, digital service trade refers to the trade of digital products and services delivered through the cross-border transmission of information and communication networks. It is characterized by the digital knowledge and information of key elements as the core content and the transmission and completion of transactions with the help of the modern information network.

The OECD [14] constructs a framework of statistics that consists of three dimensions: delivery methods, products, and participants. Each dimension holds different indicators; for example, digital orders, digital trading, and the trading platform are indicators belonging to delivery methods, whereas products refer to traditional services and information data while participants include the government, enterprises, and individuals. The US Bureau of Economic Analysis (USBEA) [12] states that trade in digital services include copyright and licensing fees; financial and insurance services; communications services; and professional and the technical services. Thus, the specific formats of digital service trade mainly include three categories. The first category relates to the industry of data storage, computing, and transmission, such as via telecommunications, computers, information, and other formats. The second category relates to formats of digital content such as intellectual property and cultural entertainment. The final category pertains to those services closely combined with digital information technology, such as insurance and finance, management consulting, engineering research, and development, etc.

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The Main Driving Power of Trade in Digital Services

Research from the McKinsey Institute shows that for every 10% increase in data enhancement, GDP per capita rises by 0.5–0.62%. Oliner and Sichel [15] believe that informationization contributed to almost two-thirds of the labor productivity growth in America in the 1990s. With the rapid iteration of digital technology, Mei [16] pointed out that digital technology primarily has a significant impact on service trade based on two factors, the first being the digital upgrade of traditional service trade, and the second being the fact that digital technology makes more and more services tradeable. Yue and Zhao [17] further indicate that digital technology is the booster of service trade firstly because services can become stored and copied through its use, granting them more possibilities; secondly because it helps to build the standardization of both service content and the service process; thirdly because as service transactions migrate online, service time and space constraints are eliminated; fourthly because the digital platform becomes the service transaction hub, improving transaction matching efficiency; and finally because data creates new industries and services as well as improving the synergistic efficiency between mechanical hardware and economic subjects. Sun [18] pointed out that as a factor of production input, the transmission and transaction of digital knowledge and information strengthens market competition which flattens the commercial structure, resulting in the integration and complementarity of the scale and scope economies and driving the innovation and reform of the international trade mode as well as the explosive growth of the global digital economy. Thus, the ability to drive digital services trade is essentially reflected in changing the way cross-border trade is produced and delivered, leading to technological innovation.

2.2. The Connotation of the High-Quality Development of Service Trade

In the government work report at the first session of the 13th National People’s Congress in March 2018, Premier Li Keqiang made the first comprehensive plan for high-quality development, stressing the need to promote high-quality development in foreign trade through high-level opening-up. Immediately after this, in April, the Ministry of Commerce focused on the goal of the high-quality development of service trade with a conference planning new ideas for the development of services trade, and establishing a development index system for the development of high-quality services trade. In October 2021, the “14th five-year plan for trade in service” promoted high-quality development with the main subjects being services trade development, sustaining services trade reform and opening-up, accelerating the process of digital services trade, optimizing the industry structure of services trade, perfecting the services trade regional layout, strengthening the services trade market main body, deepening services trade foreign cooperation, and strengthening services trade security support. During this plan’s period, various scholars have thus far commenced research on the connotation of the high-quality development of service trade. Zheng [19] proposed that the high-quality development of services trade is a comprehensive expression of the indicators of the transformation and upgrading the development of service trade under the new normal, which means improving the level of quality in the service supply, government service capacity, and innovative development mode as well as achieving high-quality input–output and more balanced development. Tang and Xia [20] built a high-quality development evaluation index system of services trade taking five aspects into account: opening-up and security, optimizing and coordinating trade structure, innovation-driven service upgrading, enhancing international competitiveness, and sustainable development. Lei [21] proposes that the connotation of the high-quality development of service trade mainly includes coordination, innovation, openness, being green, and sharing, and in terms of economic development is related to industry level, the degree of human capital, services trade openness, and innovation level. To summarize, the high-quality development of services trade not only pertains to static indicators such as the growth scale and growth performance of services trade but also pertains to dynamic capabilities such as the optimization of trade structure and innovation lead.

2.3. The Mechanism of How Digital Factors Affect Service Trade

At present, the academic circle generally believes that digital elements have a very significant impact on trade mode, trade structure, and transaction scale and these effects are contingent on mechanisms such as transaction cost reduction, the expansion of the trade scope, and the creation of new services and business opportunities.

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Digital Elements Reduce the Transaction Cost of Service Trade

Bakos [22], Rauch [23], and Anderson and Van [24] have pointed out that the popularity of networks reduces the cost of information searching and that exchange in trade leads to the development of international trade. Lendle et al. [25] and Chen [26] pointed out that the Internet and e-commerce can create new markets and new products. Ferencz [27] further points out that the transformation of digital services helps to realize online services provided by service trade, improving the efficiency of the service supply. Ju et al. [28] divide trade costs into both fixed costs and variable costs. Cross-border e-commerce helps to reduce the fixed costs of trade while being more sensitive to the variable costs of trade.

(2)

Digital Elements Expand the Trading Scope of Services Trade

In traditional international trade theory, geographical distance is considered to be a very important factor restricting the development of trade between countries. In the early stage of the services trade, scholars noticed the breakthrough of traditional geographical boundary restrictions made by digital products such as audio-visual products. Coppel [29] points out that digital information technology shortens geographical distance in international trade. A few empirical studies have found that digital information technology can weaken the negative impacts of geographical distance. For example, Gomez et al. [30] extended their research to online consumer survey data based on data from specific e-commerce platforms, pointing out that the distance factor in the EU has been greatly reduced due to the emergence of e-commerce. Tan and Hou [31] found that cross-border e-commerce can indirectly promote trade growth between countries by weakening the trade distance existing with respect to geographical, cultural, and political factors.

(3)

Digital Elements Create New Products and New Business Opportunities in Service Trade

Du [32] proposed that the progress of information and communication technology promotes the upgrading of traditional service industry trade targets in digitalization and creates a new digital industry trade that can be represented by the following innovations: The first is the digitalization upgrading of traditional service industries such as education, medical care, design, consulting, and other professional services. The second is the birth of a new digital industry, new products, new organizations, new industries, the sharing economy, intelligent manufacturing, platform enterprises, and the Internet of Things, all of them emerging and entering the market. Finally, new service business opportunities occur through big data analysis. Liu et al. [33] further pointed out the emergence and application of new technologies such as 5G communication, virtual reality, big data, cloud computing, 3D printing, and artificial intelligence (AI) as well as the emergence of new economic models as having greatly enriched the existing types of service trade.

In general, some consensus has been reached on the mechanism of the influence of data factors on trade at home and abroad along with its achievements. This has mainly focused on the motivation, mode, and strategy of data factors affecting trade, but research on the micro impact of the mechanism on service trade is still rare, as is special and in-depth research [34]. Moreover, most previous research only focused on transaction cost theory and classical trade theory, lacking the achievements made involving information economics, innovation economics, and factor flow theory.

3. Main Advantages of High-Quality Development of Services Trade

In the era of the service economy, services trade in various countries has received increasing attention. Despite uncertainty in the global economy, China continues to show strong resilience and sustained development with the prospect of new opportunities.

3.1. Services Trade Continues to Develop Rapidly and the Trade Deficit Continues to Decline

China’s services trade has developed rapidly, and the overall scale continues to grow yearly. In 2021, the total volume of trade in services reached CNY 5298.27 billion, up 16.1% year-over-year. Of this amount, the export of services was CNY 2543.5 billion, up 31.4%, and imports were CNY 2754.77 billion, up 4.8%. The growth rate of service exports was 26.6 percentage points greater than that of service imports, which was down CNY 481.65 billion year-over-year, dropping to the lowest level since 2011 (see

Table 1. Statistics on the import and export of China’s service trade in 2021. Amount unit: RMB 100 million Yuan.

Service Type	Import and Export		Export	Import	Balance of Trade
	Amount	Growth Rate (%)	Amount	Amount
Total Sum	52,982.7	16.1	25,435.0	27,547.8	−2112.8
Processing Services	1343.9	11.1	1298.0	45.9	1252.1
Maintenance and Repair Services	753.7	−0.9	507.5	246.3	261.2
Transport	16,821.6	61.2	8205.5	8616.0	−410.5
Travel	7897.6	−22.5	733.6	7164.0	−6430.4
Building	2598.2	13.2	1966.4	631.8	1334.6
Insurance and Pension Services	1369.9	12.1	335.2	1034.6	−699.4
Financial Services	665.7	31.1	320.8	344.9	−24.0
Intellectual Property Royalties	3784.8	18.5	759.7	3025.1	−2265.4
Telecommunications, Computer, and Information Services	7714.8	19.3	5126.9	2587.9	2539.0
Other Business Services	9390.1	8.6	5958.8	3431.3	2527.5
Personal, Cultural, and Entertainment Services	333.6	11.9	122.5	211.1	−88.6
Government Services not Mentioned Elsewhere	308.8	−26.2	100.0	208.8	−108.7

Data source: Ministry of Commerce, PRC.

for details). The trade in knowledge-intensive services continues its steady growth, with exports increasing by 18%, up 14.4% year-over-year. Among them, audio-visual services, medical care, education, online retail, and online consumption increased significantly, with exports of personal culture and entertainment services; telecommunication computers; and intellectual property royalties and information services increasing by 35%, 26.9%, and 22.3%, respectively. In addition, with the rapid growth of transportation services and goods trade, the import and export of transportation services reached CNY 1,682.15 billion, an increase of 61.2% over the last year, becoming the fastest-growing field of services trade. The growth of knowledge-intensive and transport services has contributed to the rapid rise in service exports; since the outbreak of COVID-19, China’s travel services trade deficit has dropped sharply from CNY 1494.16 billion in 2019 to CNY 643.04 billion in 2021, which is one of the main reasons for the sharp decline in the services trade deficit.

3.2. Emerging Business Forms Are Booming with Continued Optimization in Trade Structure

Big data, artificial intelligence, and cloud computing have spawned a large number of new models and business platforms. In terms of trade innovation, these platforms have expanded cross-border delivery services mainly by encouraging technology trade, communication service, and computer information service development. New ways of creating overseas consumption services trade are expected to emerge through e-commerce efforts. In terms of business innovation, cross-border industrial integration should be accelerated and new business forms such as “manufacturing + service” and “culture + tourism” should be developed with a focus on technology trade, cloud services, digital trade, supply chain management, and other fields.

Over the past few years, emerging services such as technology and knowledge-intensive industries (finance, telecommunications, intellectual property, etc.) and import and export services trade have seen rapid and steady growth. In 2021, imports and exports relevant to knowledge-intensive services consisting of insurance services; telecommunication computers; financial services and information services; intellectual property royalties; personal cultural and entertainment services; and other commercial services reached CNY 2325.89 billion, accounting for 43.90% of the total number of services and up by 15.1% compared with 2016 numbers. Traditional services, consisting of travel, transportation, construction, and processing services saw a decrease from 69.5% in 2016 to 54.10% in 2021, as shown in Figure 1. The growth rate of imports and exports of knowledge-intensive services was 6.3% in 2016 and 14.4% in 2021, which is more than a twofold increase. In 2021, exports and imports relevant to knowledge-intensive services increased by 17.96% and 10.44%, respectively.

3.3. Trade Trials Expand Innovation and Facilitate Opening-Up

China’s pilot policies represent an important development goal formed after the country’s reform and opening-up. China opened up the services industry through various channels, built pilot cities for innovative service industry development, and promoted its services trade to a higher level of opening. Since 2009, the State Council has identified 37 service outsourcing demonstration cities, including Beijing, Tianjin, Shanghai, Chongqing, and Guangzhou, and has established policy support based on the credit and insurance industries, personnel training, public service platform construction, and tax incentives in service outsourcing demonstration cities. Starting in 2017, China adjusted its negative lists for foreign investment market access each year, gradually lifting or relaxing restrictions on the service domain. The current restrictions in the Special Administrative Measures for Foreign Investment Access (Negative List) (2020 edition) and the Special Administrative Measures for Foreign Investment Access in Pilot Free Trade Areas (Negative List) (2020 edition) have been reduced to 23 items. In 2020, the Ministry of Commerce proposed a comprehensive expansion of services trade innovation development in Beijing, Tianjin, Shanghai, and 28 other provinces and cities (regional) with the goal being to “prior to carry and try” in the form of reforming the management system; expanding opening to the outside world; improving the policy system, promotion mechanism, and innovation and development mode; and optimizing the regulatory system in an effort to identify the optimal path to national services trade innovation development. In 2020, 12 industrial parks, including Zhongguancun Software Park, were identified as the first batch of national digital service export bases, providing a carrier for digital trade development and the institutional opening of the digital field. In 2021, the 37 nationwide service outsourcing demonstration cities spent a total of CNY 959.1 billion in offshore service outsourcing contracts with an implementation figure of CNY 733.6 billion, accounting for 84.9% and 85.3% of the national total figure and national implementation figure, respectively. In general, since the establishment of the China (Shanghai) Pilot Free Trade Zone in 2013, there have been 21 pilot free trade zones; additionally, Hainan free trade ports have been set up in China, forming a new east−west, north–south, and land–sea corridor, further promoting the comprehensive opening-up of China.

3.4. Online and Offline Platforms Are Improved, and the Market Structure Is More Reasonable

To further expand the high-level opening of the services sector to the outside world, China has comprehensively established an exchange platform with international influence and has held exhibitions related to services trade. In 2012, the Ministry of Commerce and the Beijing Municipal Government co-hosted the China (Beijing) International Trade in Services Fair (the Beijing Fair), later renaming the event the China International Fair for Trade in Services (CIFTIS) in 2019. To date, the CIFTIS has been held for eight sessions and has become the world’s largest exhibition in services trade. As such, it is one of the three exhibition platforms for China’s opening (the other two exhibition platforms being the China International Import Expo and the China Import and Export Fair.) The services trade fair not only provides an important channel and bridge for introducing advanced services to China from across the globe but also provides a platform for introducing China’s services to the world. In 2021, CIFITS was themed “Toward Digital Future and Service-Driven Development” wherein digital trade, the industrial Internet of Things, 5G communication, and block chain innovation were highlighted, attracting more than 12,000 enterprises from 153 countries and regions participating online and offline. Most of the world’s top 500 industry-leading enterprises set up booths onsite at the 2021 event, with more than 1672 contracts.

The more trading partners in services trade, the fairer the market structure. A total of 14 bilateral services trade agreements were signed between China and Brazil, Japan, Uruguay, Russia, Argentina, Panama, and Portugal during the 13th Five-Year Plan period. Simultaneously, the BRICS Trade in Services Cooperation Roadmap and the CEEC Cooperation Agreement on Trade in Service was implemented. As of 2020, almost 238 countries and regions have built trade relationships with China with an increase of 40 countries and regions compared with 2015. Additionally, combined with its Belt and Road Initiative, China has enhanced trade in services with participating countries; a total of 205 cooperation agreements have been signed between China and 171 countries and international organizations. According to the China Services Trade Development Report 2020, from 2015 to 2019, the level of services trade between China and Belt and Road countries increased from USD 79.65 billion to USD 117.88 billion. In 2020, China’s import and export of services with countries along the Belt and Road routes reached USD 84.64 billion wherein exports were USD 37.80 billion and imports were USD 46.84 billion. China also undertook offshore service outsourcing from countries along the Belt and Road totaling USD 19.77 billion, up 6.9% year-over-year. In January 2022, the Regional Comprehensive Economic Partnership officially came into force. Thus, China’s trade in services with countries in the region is expected to improve greatly as it continues to promote digital trade and a digital economy.

In summary, China’s services trade has seen steady growth, the trade deficit continues to decline, emerging businesses represented by the digital economy are booming, pilot digital trade is undergoing its launch online and offline, foreign exchange platforms are constantly improving with more diversified international market development, and the market structure is more reasonable and entering a period of high-quality development. Thus, these data elements continue to play a key role in China’s services trade development.

4. Analysis of the Paths by Which Data Elements Impact Service Trade within High-Quality Development

Data elements are pivotal factors in newer technological revolutions and the industrial revolution because of their feature of immediacy, non-exclusivity, and economy of scale, renewability, and strong permeability. Depending on the channels of technology application, platform application, and scenario application, data elements serve service trade by using data- and date-driven impacts on trade targets and forms, creating “Service + Digital” new industry exemplified through innovations such as digitized organization processes, platformized business models, and ecologized industrial systems. Implementing Jiao’s (2022) enterprises’ digital upgrading theory [35], this paper constructs the main paths by which service trade enterprises integrate digital elements, as shown in Figure 2.

First, the digital empowerment of organization processes is driven by digital technology. The office, financial, human resource management, customer relationship management, and sales business management systems of the service enterprise implement information management, and the service enterprise additionally builds customer procurement information and related after-sales service information into a database. Information management can simultaneously realize the information flow of organization processes and provide customers with fast and accurate service. The digitalization of these businesses can help service trade enterprises realize information interconnection, sharing, and collaboration; improve the management efficiency of internal resources; and further, improve the accuracy of services.

Second, the business model obtains a digital upgrade based on digital platform empowerment. Big data-driven business models are used to embody innovation centered on service scenarios; break traditional physical space restrictions; connect enterprises, customers, partners, governments, and other multilateral groups; build online platforms to provide digital matching, digital negotiation, and other core services; and realize real-time demand docking. At the same time, the platform discovers new market opportunities or promotes new transactions by analyzing users’ multi-party transaction data and realizes the innovation of value creation methods [36].

Third, the digital integration of the industrial system takes place based on ecological symbiosis. Service enterprises with digital advantages break the division of labor in traditional industries; integrate key enterprises in the industrial chain through acquisition, cooperation, new construction, and by other methods; reconstruct industrial resources to generate synergistic effects; and constitute a digital ecological symbiosis system [37]. This digital ecological symbiosis system realizes value creation and mutual benefit and sharing in ecology in a diversified and innovative way, obtains competitive advantages in the industrial market, and continues to promote the efficient digital transition of the whole industry so that the evolution of the digital ecosystem is always based on a benign upward state.

5. Meorient: Digital Innovation Service

5.1. Basic Information on Enterprise

Zhejiang Meorient Business Exhibition Co., Ltd. was established in 2010 and was listed on the Growth Enterprise Market of Shenzhen Stock Exchange on 22 October 2019.

Table 2. Developmental events of Zhejiang Meorient.

Serial Number	Time	Events of Zhejiang Meorient
1	1994	Shanghai International Advertising and Exhibition Co., Ltd. was established
2	2005	Shanghai Meorient Exhibition Co., Ltd. was established
3	2006	Hangzhou Meorient Exhibition Co., Ltd. was established
4	2007	Beijing Meorient International Exhibition Co., Ltd. was established
5	2007	Jiaxing Meorient Exhibition Co., Ltd. was established
6	2010	Zhejiang Meorient Business Exhibition Co., Ltd. was established
7	2014	New Third Board listing
8	2015	The self-developed exhibitor business platform went online
9	2016	Self-held exhibition throughout nine countries, has become the preferred platform for the “Belt and Road” market development
10	2017	Mobile app research and development went online
11	2018	Set up research and development team in Binjiang, Hangzhou
12	2018	Website trade product trial operation success
13	2019	Shenzhen Stock Exchange listing
14	2020	Innovation business core technology website trade MAX2.0 version release
15	2020	Global debut of China–Latin America (Mexico) International Trade Digital Exhibition
16	2020	The O2O global double-line exhibition is fully opened

Source: Website of Zhejiang Meorient Business Exhibition Co., Ltd.

shows its detailed development history. The company mainly engages in overseas exhibition planning, organization, promotion, and operation services for “Made in China” enterprises to help them expand into the global market. In particular, this business provides digital marketing solutions for the “Belt and Road” market and is an internet company with “independent property rights, an independent brand, and independent operation”.

Meorient Exhibition, an exhibition service enterprise, hosts the largest number of independent exhibitions of the largest scale and with the most complete system held abroad in China. The company conducts the fair annually in Turkey, Poland, Egypt, South Africa, Nigeria, Kenya, Jordan, Mexico, Brazil, Kazakhstan, India, the United Arab Emirates, Indonesia, and 13 other countries, covering 80% of the “Belt and Road” market and major node countries. Every year, more than 5000 companies participate in the exhibition and nearly 300,000 buyers visit the exhibition, accounting for more than USD 1 billion exchanged. As the first A-share exhibition service in China, Meorient holds the leading position worldwide in online digital exhibition markets. Taking its structure from traditional exhibitions, this business is driven by big data through the combination of global customs data and exhibition buyer data. By integrating online and offline promotions and operations, Meorient has successfully created a powerful digital exhibition model that has served tens of thousands of enterprises since the outbreak of the corona virus disease 2019 (COVID-19) pandemic.

5.2. Main Practices

Meorient recognized the need for reengineering its approach based on the digital technology required to satisfy its customer base as well as the need to upgrade and digitize its business practices. Meorient thus built a digital platform supported by big data and cloud computing with the intention of reconstructing the traditional value chain and shaping new value creation and transmission methods, resulting in the digital upgrade of their online business model. Ultimately, three affiliated companies, Meorient Exhibition, Meorient Technology, and Meorient Investment formed a digital ecological symbiotic partnership to retain leadership in the exhibition industry through digital upgrade optimization.

(1)

Digital Upgrade of Business Processes Based on Digital Technology

Since the beginning of 2008, Meorient Exhibition has taken the lead in constructing the information system in the domestic exhibition industry and has successively launched office automation; call centers; Customer Relationship Management; exhibition business management systems; and, subsequently, other information management projects. Implementing a project management system that differs from those of other exhibition companies, Meorient Exhibition prefers the operation management of all international exhibitions wherein the planning and design, venue determination, exhibition attractions, site management, interaction, evaluation, and customer tracking are all allocated into modular business processes managed by related departments. The management of these modular businesses relies on digital data exchange and information management to realize the information-driven optimization of the exhibition process. The informatization of the company’s operation and business management has greatly improved enterprise efficiency and customer service.

(2)

Digital Upgrade of the Business Model Based on Digital Platform Enabling

Meorient’s business model based on the online trade show platform has gone through three developmental stages which may be described as follows:

First was Meorient’s platform design and construction. In 2014, Meorient set up an online trade platform for “online exhibition and trade”. The platform provided accurate information on foreign buyers for Chinese merchants participating in overseas exhibitions and set up an accurate docking service of the buyers’ information by country, language, and merchant.

Second, Meorient seized the opportunity to upgrade the platform. The COVID-19 outbreak in early 2020 caused a major blow to the exhibition industry. Meorient increased its investment in research and development involving digital technology to remove the bottlenecks that existed in the information exchange of the international trade chain. The “Network Trade” platform was upgraded to “Network Trade MAX”, which provided merchants with demonstrations; supply and demand information matching services; trade and information dissemination; merchant credit verification; and all types of online trade services driven by the connection, communication, and sharing of data. The “Online Exhibition and Trade MAX” platform contributed to signed contracts for exhibitors within the 35% ratio in 2021 compared with a 10% ratio in 2020. In 2021, Meorient launched digital exhibitions in the United Arab Emirates, India, Turkey, Poland, South Africa, Brazil, the United States, Thailand, Japan, and 14 other trade countries covering textiles and clothing; machinery; household goods; building materials; auto parts; hardware; 3C (computer, communication, and consumer electronics); and the food industry. The exhibitions served nearly 3000 exhibitors from 24 provinces; autonomous regions and municipalities; and docked industry buyers from Dubai, Mexico, Poland, and other online digital exhibition hosts of 127 countries to realize an annual trade purchase of more than CNY 30 billion. As of November 2021, the MAX platform has generated a total intended purchase amount of CNY 48.83 billion, with the on-site purchase amount of the platform reaching CNY 740 million. In the past 2 years, the trade transaction rate of overseas live stream broadcasting via the platform has reached 30.75%, which is 3 times that during the initial stage of the epidemic. Meorient Exhibition has become the industry-leading enterprise in the domain of online “China Trade Digital Exhibition” services.

The third consideration is platform innovation. Combined with the accelerated transformation of the offline exhibition to a digital model, the “Online Exhibition Trade MAX” proposes an innovative double-line exhibition operation platform—“Online Exhibition Trade META”. This new mode can be interpreted as an “overseas offline commodity exhibition, domestic online talk”. This platform may build exhibition halls overseas; exhibitors would be allowed to invite potential clients online 13 days before an exhibition. During the exhibition period, both parties with products or services would partake in involved communications with sample demonstrations and ordering on site. Fifteen days after an exhibition, exhibitors would continue to mine data and apply the results from their data analysis to identify potential customers. Both online and offline digital exhibitions would change in the operational mode of the traditional exhibition with respect to activities from pre-exhibition matching to confirming the order of the exhibition period, which would help exhibitors to build a new exhibition service mode referred to here as “products abroad, exhibitors online, buyers present, instant negotiation” that would increase the possibility of a deal. Thus, the “Trade META” platform solves the problem of inconvenient travel and obstacles in overseas market development; notably, using this platform, Meorient has scheduled 18 exhibitions in 13 regional markets worldwide for 2022.

(3)

Digital Upgrade of Industries Based on Digital Ecological Symbiosis

The current foreign trade digital exchange extends from information interaction and trade services to foreign trade marketing and supply chain services. To create a series of foreign trade service data solutions, Meorient founded Meorient (Zhejiang) Network Technology Co., Ltd. (hereafter referred to as Meorient Technology) located in Hangzhou in 2021 to establish a research and development center for data technology. The goal of Meorient Technology was to speed up the iteration and optimization of digital exhibition services, providing digital marketing solutions for foreign trade enterprises. In the same year, Meorient also established Meorient (Zhejiang) Equity Investment Co., Ltd. (hereafter referred to as Meorient Investment) specifically to carry out the capital integration of exhibition and foreign trade digital services. In the exhibition direction, Meorient Investment invested in Shenzhen Huafu with a focus on the domestic education equipment exhibition market for distribution to major global markets. Meorient Investment also invested in textile advertising to fill the gap in the Japanese market and for global brand exhibitions in the Japanese market. Foreign trade digital services were considered with the support of Meorient Investment in Hangzhou Shukun Technology Co., Ltd. to enhance the service capability of big data marketing in foreign trade services to Meorient. Hangzhou Mio Information Technology Co., Ltd. is also supported by Meorient Investment to strengthen cross-border e-commerce management and software-as-a-service (SAAS) service capability and to manage advertising among platforms such as Google and Facebook. Meorient Technology and Meorient Investment also endorse Meorient Exhibition, thus constituting a digital ecological symbiotic connection, which is shown in Figure 3.

5.3. Main Experience

Utilizing more than 20 years of exhibition experience and 3 years of online digital exhibition experience, Meorient makes full use of the digital technology fusion of online exhibitions and investments in digital ecological symbiosis to launch the global access of Chinese manufacturing enterprises by providing a full range of digital marketing solutions. Their primary digital experience is described below.

(1)

Digital Internal and External Dual-wheel Drive Enterprise Development

Meorient’s digital-driven power derives from the internal management of the company and external business. The internal information management of the exhibition business implements internal operations and business management to create an efficient organization, while the external big data platform, connecting the exhibitor data, service information, and audience information, facilitates information sharing between buyers and sellers. This two-way exchange quickly matches potential buyers and sellers and resolves issues related to exhibition information asymmetry and exhibition service supply.

(2)

Digital Platform Enables a New Business Model for Exhibitions

From the online trade database to the online digital exhibition (MAX), following the double-line product (META), Meorient continues to innovate its exhibition digital products; upgrade the digital exhibition mode; meet the demand for online services from foreign trade enterprises; and facilitate the matching of potential buyers and suppliers at a lower cost and faster speed by relying on big data, the internet, 5G technology, and overseas independent operation ability. This, in turn, creates more market value for foreign trade enterprises and raises the service value of Meorient.

(3)

Science and Technology Investment to Build a Digital Ecological Symbiotic Group

Through strategic layout, Meorient Exhibition focuses on national and international professional exhibitions to help Chinese manufacturing industries engage with the global market. Meorient Technology focuses on digital technology to provide digital marketing solutions for foreign trade enterprises. Through capital integration, Meorient Investment helps both Meorient Exhibition and Meorient Technology to expand the global market by providing digital support for offline and online exhibition services, efficient management, and operation informatization. All three Meorient services focus on the demand for the manufacturing of foreign trade enterprises to expand the international market, realize the information sharing of buyers and sellers, and create value for the customer base regarding digital solutions with the ultimate goal of building a digital ecological symbiotic group based on the exhibition industry. As technology and industry continue to progress, Meorient continues with the active pursuit of upgrading its services. The digital ecological symbiosis group of Meorient Exhibition, Meorient Technology, and Meorient Investment realizes value creation and the mutual benefits of sharing in diversified and innovative ways that promote the efficient digital transition of the entire exhibition industry.

6. Conclusions, Limitations of This Study, and Future Research

6.1. Conclusions

Digital trends in services trade are becoming increasingly significant. Data elements continue to play a key role in services trade development. The development of China’s services trade and the case of Meorient further verifies this proposition. The main paths by which service trade enterprises can obtain a digital upgrade include three strategies: the digital empowerment of business processes driven by digital technology, digital upgrading of the business model based on the digital platform, and digital integration of industrial systems based on digital ecological symbiosis. The digitalization of business processes is the micro foundation of the digitalization of service enterprises. The digital platform business model of digital technology application represents the means for exhibition enterprises to realize the digital path. The integration of industrial systems with digital ecological symbiosis is a support guarantee for the digital upgrading of enterprises.

As such, China should give full play to its advantages regarding information technology, strengthen its digital infrastructure, and consolidate its industrial foundation of services trade to facilitate continuous improvements in the tradability of service products [38]. The traditional services trade sector in China has been forced to adopt more digital means, and further developments in emerging services trade should continue to embrace this approach. Pilot cities in China used for the innovative development of services trade; those used for opening up the service industry to the outside world; and those used as service outsourcing demonstration cities should all be brought into this effort. In addition, it will be important to explore the highly digital regulatory mechanisms that match services trade so as to form experiences that can be replicated and promoted [39,40,41]. Finally, it is essential to continue improving the domestic digital governance system and capacity for building a superior digital environment for the digital promotion process of services trade.

6.2. Limitations of This Study and Future Research

Since research on the role of digital factors in the paths of service trade enterprises is a relatively novel and subdivided topic with very little existing literature that can be used for reference, this research may not be systematic in its attempt to build a framework to analyze the path of service trade enterprises played by digital factors. In addition, the present research took only Meorient, an exhibition service trade enterprise, as an example, which does not guarantee wide representation or fully reflect the characteristics of the digitalization processes of all services trade enterprises. Thus, future research must take note of the digitalization processes of more representative service trade enterprises and further improve relevant theories. In addition, in the process of global development strategic layout, information on the digital path and the internationalization of service enterprises should be combined.