How to deal with a consumer PR crisis – Ashley Dudarenok

 

Ashley Dudarenok

China’s sportswear giant Li-Ning got into hot water when netizens got upset about a possible new fashion line, looking very similar to Japanese military style. Marketing guru Ashley Dudarenok gives in Campaign Asia some advice on how to deal with such a PR crisis. Li-Ning has not yet responded

Campaign Asia:

When Campaign reached out to China marketing expert, founder of Alarice and ChoZan, Ashley Dudarenok, on how the brand should manage this PR crisis, she believed that “silence is not a particularly wise choice at this time, but rather a response should be made as soon as possible”.

She added: “In particular, if Li-Ning as a local national brand continues to delay a response, the negative sentiment among Chinese consumers may fester even more dramatically. Li-Ning’s failure to respond to the market will continue to raise questions as to whether the brand’s design crisis is deliberate”.

Dudarenok offered more advice for Li-Ning on how to resolve the issue. Firstly, she said the brand should monitor public opinion by identifying the exact problems and to what extent they have developed. Then, the brand should react quickly and show a serious attitude about this issue. This is to “calm the immediate negative sentiment in time to avoid further development and festering”. Finally, Li-Ning should take practical action to control public opinion and avoid further furore. “

[The brand should] provide a sincere explanation of the problems in the design of the garment and apologise for the negative impact,” said Dudarenok. “To avoid another PR crisis, it is important to respond rather than just trying to cover up the incident.”

More in Campaign Asia.

Ashley Dudarenok is a speaker at the China Speakers Bureau. Do you need her at your (online) meeting or conference? Do get in touch or fill in our speakers’ request form.

Are you looking for more consumer experts at the China Speakers Bureau? Do check out this list.

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China's Anta takes on Nike and Adidas - Ben Cavender

Ben Cavender

China's Anta bought in 2009 the Italian sports shoe brand Fila for China and plans to take on Nike and Adidas during the 2022 Olympic Winter Games in Beijing. Branding expert Ben Cavender sees Li-Ning and other domestic brands as the first hurdle to take before Anta can really compete globally, he says in the Fair Observer. 

The Fair Observer:

“To some extent, it [FILA] is still seen as a cheaper alternative to Adidas and Nike, but Anta has been working hard to create more of an image of a first-choice brand and has been fairly aggressive with its marketing,” says Ben Cavender, principal at China Market Research Group. “It has also used brands like FILA to try and move up-market and into streetwear.” Financially, the latter strategy seems to be successful...
But the first obstacle to Anta’s global ambitions may not be Adidas and Nike but other Chinese brands, particularly Li-Ning, named after the athlete who became a gymnast star at the 1984 summer Olympics in Los Angeles...
“Li-Ning is an interesting case because going back five years, Li-Ning overexpanded its retail footprint in China and tried too hard to copy Nike,” says Cavender. “The Li-Ning of 2019 is in a much stronger place. It has embraced being a Chinese brand with unique Chinese design characteristics and has been setting the internet on fire with its streetwear.”
He notes how Li-Ning had to scale back and reevaluate before achieving a resurgence. Thanks to those efforts, the company is now booming, with profits in the first half of 2019 nearly tripling. Its rise has been reflected in Li-Ning’s share price, which has risen around 170% since June 2018, compared to just over 50% for Anta...
 Although Anta seems to have positioned itself well, there are still many hurdles ahead to achieve global success. The company is likely to benefit in the run-up to the next Winter Olympics, but it needs to be careful not to repeat the mistakes of Li-Ning and make sure it masters the mainland China market first. “Companies like Nike are effectively marketing organizations that happen to sell shoes, so it is very difficult for an outsider to break into that top position in the market,” says Cavender, noting that it may take some time for Anta to be in a position to compete globally.

More in the Fair Observer.

Ben Cavender is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more branding experts at the China Speakers Bureau? Do check out this list. Are you looking for speakers at your online event? Do check out our options.

China brands tap into nationalism after NBA-conflict - Tom Doctoroff

Tom Doctoroff

Li-Ning and Anta, two Chinese shoe sport manufacturers, took a nationalistic twist in their marketing after the US National Basketball Association (NBA) and the Houston Rockets triggered off criticism from China's government. Marketing expert Tom Doctoroff comments on the slippery slope of nationalism in China marketing for Al Jazeera.

Al Jazeera:

These companies have also made efforts to tap into rising nationalism among China's youth. 

In the case of Li-Ning, the company rebranded itself and began running advertisements rooted in national pride in an effort to capitalise on political tensions with other countries, Tom Doctoroff, senior global advisor at Prophet, a global brand and marketing consultancy, told Al Jazeera. 

The controversy surrounding the US National Basketball Association (NBA) and the Houston Rockets earlier this year also provided Li-Ning's domestic competitor, Anta, with an opening to burnish its credentials as a patriotic Chinese company, says Doctoroff. 

Anta severed its relationship with the NBA after the general manager of the Rockets, Daryl Morey, tweeted a message in October supporting pro-democracy protesters in Hong Kong. The tweet provoked a fierce response in mainland China, where state television stopped broadcasts of the league, multiple companies suspended or terminated cooperation and social media was flooded with criticism. 

Both Anta and Li-Ning are trying to "make inroads driven by nationalist sentiments", said Doctoroff. The Houston Rockets incident was a "shot across the bows" of the sneaker industry, the sports teams connected to it, and business in general, he said. 

"If a brand makes a hint at supporting dissolution of what China considers to be its legitimate territory, then the brand will suffer," Doctoroff noted. 

Every brand will have to grapple with balancing "freedom of expression and commitment to maintaining China sales," he said. "Most will be cautious … These are delicate times."

More at Al Jazeera.

Tom Doctoroff is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more branding experts at the China Speakers Bureau? Do check out this list.  

China's consumption is booming - Shaun Rein

Shaun Rein

Business analyst Shaun Rein appeared on the "On China" show of CNN's Kristie Lu Stout, discussing China's growing consumption, Barbie and how even in a downturn China's wealthy will become wealthier. 

CNN:

One area where Western brands have some headway against their domestic Chinese competitors is product safety, in the wake of scandals over tainted baby formula, fake eggs and exploding watermelons. 

Shaun Rein said his company, China Market Research Group, interviewed 5,000 Chinese consumers in 15 cities last year. "Their biggest concern in life, ahead of being able to pay education for their kids, or for medical care cost for their families, was food and product safety," Rein said. " 

They're absolutely petrified of biting something and dying, or getting toxic shock syndrome from a toy. So what we've found is in these 5,000 consumers they trust foreign brands far more than they trust local domestic Chinese brands," Rein said. 

A dichotomy is growing in Chinese consumer trends between shopping for status and shopping for value. 

"What that means is, people don't buy mid-level brands, which is why you see (brands?) like Marks & Spencer, or Li-Ning, or Gap kind of struggle, because these are branded for middle-class consumers," Rein said. "What we see is people either shop for the most expensive things they can get, like a Louis Vuitton or Hermes bag, or they go for the cheapest."

More on CNN.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.


 This week, on November 22, the China Weekly Hangout is about the future of nuclear power in China. You can register at our event page here. (Two weeks earlier we missed the change in daylight saving time in the US and had to cancel.) First part will focus on the resumption of building nuclear power stations, the second part of the chances NIMBY protests can derail this ambitious program. Planned participants: Richard Brubaker and Chris Brown.

You can access all editions here.

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