What’s driving brand crises in China?
From GSK, Qualcomm, VW/Audi, Chrysler and Microsoft to McDonald’s, Yum Brands/KFC and most recently Walmart, it has been a long, hot summer for foreign companies in China.
According to CIC/Ogilvy PR’s latest Crisis Management in the Social Era report, nine of the ten most significant crises in China in 2013, as measured by Weibo posts, involved foreign companies.
Hark back to 2012 and the majority of crises in the Middle Kingdom involved domestic entities.
Why the sea-change?
In the wake of multiple food safety issues, Beijing is clamping down heavily on food suppliers and retailers, as well as anti-monopolistic activity.
And, in time-honoured fashion, Beijing is using these clamp-downs as a pretext to target foreign companies.
Also worth mentioning is that the report contains interesting data on the effectiveness of different crisis responses on short-term purchase decision-making. The findings will not be unfamiliar to crisis communications professionals:
- Least damaging: acknowledge the problem and promise to investigate
- Most damaging: outright denial.
Whether the impact of a crisis is best measured by the volume of Weibo posts is open to question; impact on sales or reputation/trust are arguably more useful metrics.
In addition, Weibo is only one of many social media in China, albeit the most influential, at least for now.
Concerns over the methodology notwithstanding, the report is well worth a read.
Here it is in full: