When Consumer Power Turns Nasty

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In a recent post, I noted that Dell was having a hard time online due to the work of Chinese netizens calling for fair (and respectful) treatment. It was a sign that Chinese consumers, empowered by the web, could make a big noise and have an impact.

Another case that has grabbed headlines recently is that of the “China Bounder”, author of the infamous (now closed) “Sex in Shanghai” blog (see background on the EastSouthWestNorth blog). An online campaign to find the disrespectful foreign writer, and bring him to some sort of (poetic?) justice, fast became a rather worrying manhunt.

Now P&G is at the receiving end of an online lashing. In this case it is in relation to a product recall of its SK-II cosmetics, which have been subject to investigations over traces of potentially harmful chemicals. Reuters reports:

    “Windows have been smashed at the company’s Shanghai office and one of its Web sites have been hacked at the weekend after the firm went back on an undertaking to give customers their money back pending further word from the watchdog, said a P&G spokesman, Charles Zhang…In Wuhan and Harbin, there were incidents where there was some physical contact between our beauty consultants and consumers,” Zhang said, adding no one had been hurt.”

There are indications that P&G mis-read the situation, and did not react fast enough to head off problems. Instead it reportedly offered refunds, then reversed the offer and set up a helpline. China Herald reports that customers were also being asked to sign waivers in order to get a refund, and that this had made people even more angry. It also notes a report from CRS-Asia which provides more background, and notes that the search engine Baidu listed over 1,200 stories on the scandal by the end of last week.

In a similar case last year, when KFC was caught up in the Sudan-1 contamination scandal, the company quickly issued apologies, and withdrew products. As a result they were able to contain the situation.

Companies increasingly need to factor in the power of the online community when addressing marketing and risk issues in China. It seems that some also need to re-focus on customer service, and to get to grips with the fact that connected groups of Chinese consumers are demanding respect – especially from foreign companies that fail to live up to their premium-brand pricing.

See news sources:

    China consumers turn cautious on P&G skin-care row
    Reuters Canada – Toronto,Ontario,Canada
    SHANGHAI (Reuters) – Public anger in China over a popular skin-care line has become a public relations headache for Procter & Gamble (PG.N: Quote), underlining …

7 Responses to “When Consumer Power Turns Nasty”

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