How can foreign brands deal with Chinese consumer boycotts? - Shaun Rein

Shaun Rein

Getting into hot water with China's consumers, its government or both happens regularly to foreign brands. Business analyst Shaun Rein uses the latest NBA-upheaval to explain how those boycotts work, and how foreign brands can deal with them, according to the Marketplace.

The Marketplace:

China’s nearly 1.4 billion consumers take issues about the country’s territorial integrity seriously. “They go back to what they consider humiliation during the Qing Dynasty,” said Shaun Rein, author of the book, ‘The War for China’s Wallet.’  

“They feel that the Western powers, led by the British, enslaved the Chinese to opium [and] destroyed the country’s economy.”... 

Chinese firms suspended or canceled sponsorship deals with the National Basketball Association last month after Houston Rockets’ general manager, Daryl Morey, tweeted support for protesters in Hong Kong.  

Ecommerce giants Alibaba, JD.com and Suning voluntarily removed Houston Rockets merchandise from their platforms.  

“They’re showing the government that they will support the motherland,” Rein said.
There are some signs that NBA is on a slow route to recovery in China. While Chinese state broadcaster CCTV has not resumed airing NBA games, internet giant Tencent has — except for the ones involving the Rockets.  

Rein, who is also founder of the China Market Research Group, suggested the best way for foreign brands to combat these boycotts and bans is to issue a sincere apology.  

“What we tell our clients is stand up, apologize [and say] ‘We are sorry. We respect China. We respect China’s sovereignty issues,’” he said. “Then afterwards you can say pretty much anything, as long as you’re showing respect to the Chinese people.”  

Rein said the NBA fell far short of that but, even so, that public anger appeared to have subsided after Chinese state media stopped covering the controversy.
There are times, however, when the central government, via the state press, whips up public anger.
In 2016, China felt threatened when South Korea signed a deal with the U.S. to deploy an American anti-ballistic missile shield called the Terminal High Altitude Area Defense (THAAD).
Rein said the government criticized South Korea in the Chinese state press.  

“They basically said: ‘How dare this little country install something that could be an offensive tool against us,’” he said. Chinese consumers took the cue. They stopped buying Korean cars, cosmetics and snacks.  

South Korean supermarket chain Lotte, because it provided land for the South Korean military to build the THAAD system, was the hardest hit.

More in the Marketplace.

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.

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China is overspending on soccer - Rowan Simons

Rowan Simons

China has been spending too much money on soccer, especially on players and coaches, says soccer expert Rowan Simons to AFP. But there is no end in sight, and it is not helping soccer in China.

 AFP:

China’s big spend comes as the country tries to raise its football game to a level commensurate with its growing economic and military might. China lost all three of its World Cup matches in 2002, its only appearance, letting in nine goals and scoring none. 

“All this craze and investment has come with the appointment of a football-loving president,” Rowan Simons, an author and prominent commentator on Chinese football. 

“But the question is does this have long legs? Will it remain once he steps down, and will it actually promote the sport at home?”... 

Chinese business magnates openly acknowledge that their footballing investments also have political calculations. 

“In general there’s a feeling that the Chinese have been overpaying, especially in some of the player and coach acquisitions,” Simons said. 

But beyond the cash paid for the teams and players, Chinese firms are chasing prestige and visibility for their products.

More at AFP.

Rowan Simons is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in this speakers´request form.

Are you looking for more experts on China-s outbound investments? Check out this list.

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Why Suning went for Inter Milan - Rupert Hoogewerf

Rupert Hoogewerf

Why is retail giant Suning going for one of Europe´s largest soccer clubs, while other Chinese tycoons went for the smaller fish? It is part of the firm´s global strategy, expending into Europe, says Rupert Hoogewerf, founder of the Hurun China rich list in the International Business Times.

The International Business Times:

For Suning President Zhang, who set up his first small shop in 1990 and turned Suning into a retail giant that has ridden the internet wave and had a turnover of some $24 billion last year, it’s another stage in what are reported to be plans to build a “sports eco-system,” as the company, like many Chinese industry giants, seeks to diversify. And he made no secret of his desire to boost his company’s international profile. 

“The acquisition of Inter is a strategic move. Ours is an international business and our brand will soon be big in Europe too," he said. 

“Zhang has a global vision — you can see his ambition” said Rupert Hoogewerf, Chairman and Chief Researcher of Hurun Report, a Shanghai-based consultancy focused on China’s entrepreneurs. 

“He’s built a retail ecosystem,  and he’s already become a big real estate developer. He’s built the tallest building in Nanjing, and now he’s building a hotel near Shanghai’s Bund – if you have ambitions you have to be there,” he said. “And it’s clear that [China’s entrepreneurs] are now going into football because it’s on the national agenda.” 

And Hoogewerf said that Suning’s purchase was on a different level from Wang Jianlin’s investment in Atletico Madrid, or web giant Alibaba’s founder Jack Ma’s purchase of a half-stake in China’s top club Guangzhou Evergrande. 

“Suning buying Milan will up the ante for all the [Chinese] entrepreneurs,” he said. “In the past they’ve bought smaller foreign clubs, or a smaller stake, but Suning are buying one of the big names in European soccer.”

More in the International Business Times.

Rupert Hoogewerf 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 frorm.

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Buying Inter Milan helps egos, not Chinese soccer - Rowan Simons

Rowan Simons

Retail giant Suning has bought a majority share of Italian soccer club Inter Milan. Soccer expert Rowan Simons suggests in Time that those high-profile purchases might help some egos, but is unlikely to boost soccer in China.

Time:

“For a brand like Sunning, there has to be a global branding angle,” says Rowan Simons, an expert on Chinese soccer and author of Bamboo Goalposts. “And there are definitely ego factors at play here, similar to the other billionaires from the Arab states, Russia or the U.S. that have made similar acquisitions.”... 

“There’s a growing feeling that these sorts of acquisitions actually do nothing to help Chinese football at all,” agrees Simons. “The problems are laid out very clearly in [Xi’s] plan and it begins with the grassroots.” 

China remains bereft of independent, amateur soccer clubs that foster young people enjoying the sport — an unfortunate legacy of the Chinese Communist Party’s aversion to any social enterprise outside its purview that may potentially challenge its dominion. “Any amount of investment at the elite level ultimately will not turn into a good China national team unless you have millions of kids out there playing for fun,” says Simons.

More in Time.

Rowan Simons 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.

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