Public Relations in China

Building and Defending your Brand in the PRC

D. Wolf

• Publisher: Palgrave Macmillan
• Year: 2016
• ISBN:
  9781137483812
• Topic: Business
• Subtopic: International Business
• Index: Business

In this pithy yet compact book, David Wolf, provides business owners and PR practitioners with a roadmap to corporate credibility in China. Laced with thoughtful advice and braced with illustrative cases, Public Relations in China strips out the jargon and offers something rare: a practical handbook for building and defending a brand in China.

chapter 1

The Basics and First Steps

If you spend some time strolling along the high streets of Beijing or Shanghai, you might think that most companies have China cracked: international brands are predominant among the cars on the streets, among the products in grocery stores, and in the advertising that pervades urban life in China. And you won’t walk far before realizing that Starbucks, McDonald’s, KFC, and Pizza Hut are daily staples of Chinese life.

But behind all of that apparent success is a struggle that preoccupies business leaders in China, yet never seems to make the headlines. It is the struggle to make those brands known to hundreds of millions of people while ensuring that decades of sweat and investment do not disappear because of a single misstep or act of hubris. Success in China is precarious, hard to obtain, and harder to sustain. It is a constant tightrope walk, and public relations has become the essential balancing pole.

Success in China is precarious … It is a constant tightrope walk, and public relations has become the essential balancing pole.

Unfortunately, the vast majority of enterprises and adventurers who have sought fortunes in China have returned empty-handed, or worse. For each notable success, there are many more examples of companies that have given up or that have struggled mightily for underwhelming returns. While a range of factors can make the difference between success and failure, far too many companies in China fail – or, in many more cases, find their businesses permanently handicapped – because of fundamental errors in public relations.

At the same time, each company that enjoys lasting success in China has discovered that one of the critical keys is the need to build, nurture, and defend their reputation among the full expanse of important audiences (or “publics”). They learn that sales will move your product, marketing will convey its attributes, advertising will imprint the image of your brand indelibly in the minds of millions, and having lunch with the Minister of Industry and Information Technology will demonstrate that you understand the importance of guanxi¹. But they also realize that none of those things will be sufficient in the long run.

China changes with a speed that makes Silicon Valley seem like Brigadoon, and keeping even core audiences happy there has vexed some of the world’s smartest companies. Tastes change. New competitors (even local companies) pop up with a cheaper version of what you have to offer. A local competitor starts pouring poisonous disinformation about you into the ears of customers. Your advertising becomes a background drone. And your best friends in government are transferred, retire, die, or even get sacked for malfeasance.

The brutal truth in the People’s Republic of China (PRC) is that regardless of how great your company is, how superb its products are, and how long you have been operating there, lasting success hinges on your company staying relevant for, and engaged with, a host of publics. That means winning over a lot of people, and doing so constantly and consistently. In short, success in China means having strategic and effective public relations. And “strategic and effective” is the key.

Every week companies approach me and my team with requests to “do their PR [public relations] in China,” but a surprising number believe that “PR in China” means translating and distributing their press release. For some, that may be all that they really want: they have no intention of doing business in China, but somebody in their organization took a look at a draft release and growled, “Make sure this gets seen in China, too.” For those companies, the best route is to work with a service like PR Newswire (PRN): for a few hundred dollars, they’ll do a reasonably good (though not always perfect) translation of your release, and through their local China joint venture they’ll send it out to dozens or even hundreds of relevant outlets. PRN will make sure that the release goes out and gets run (in most cases, all but verbatim) and afterward PRN will provide the clippings to prove it. But a fortnight later the story, the product, and the company are all forgotten.

Most companies need – and want – much more from their public relations than just a little noise: they want public relations to make a tangible difference in awareness, perception, trust, and, most importantly, revenue. They want public relations that will help build their business and reputation in China; will help defend it against all manner of rumors, slip-ups, and crises; and will turn their reputation into a competitive advantage that will secure their market and hold back the multiplying cohort of local competitors.

The steps in this chapter will take you a long way toward creating a highly effective public relations program. Follow the steps in this order, and you are literally halfway to doing so:

• Start by knowing why PR is different in China than it is elsewhere. Chances are that you have had experience with public relations elsewhere, or you are reporting to someone at HQ whose experience is entirely abroad. Much of that knowledge will help you in China, but only if you understand how you need to alter your approaches to adjust to some of the core differences in the market.
• Understand why and how PR is misunderstood in China by your colleagues, customers, competitors and regulators, and comprehend why you need to address that upfront.
• Know all of your publics in China, and be able to prioritize them so you know where to focus your time and resources.
• Place PR in the correct place in a China organization to ensure maximum effectiveness.
• Build a PR team in China, whether it is just one person, a small team and an agency, or a large department.
• Create a China public relations plan that will drive the business forward.
• Avoid the ethical traps that ensnare public relations efforts in China.
• Recruit your most important spokespeople: your China executives.

Addressing misconceptions about PR

A key challenge you will face are the deep misconceptions about public relations that can hamper anyone trying to run a campaign in the PRC. For the reasons noted above, public relations in China has necessarily evolved in response to the unique circumstances of the market, the changes that market is undergoing, and the needs that companies have as a result. The speed of change and the things that make China a singular challenge have created a lot of confusion about what PR is and what it can do.

Not just media relations: The most common misconception is that PR in China is synonymous with media relations or press agentry. While media are traditionally the most influential intermediary and a sizable number of PR agencies in China offer almost nothing other than media relations, PR must encompass a far greater range of audiences and channels. Indeed, a campaign waged to convince Chinese journalists of the greatness of a company and the value of its product will not necessarily burnish a company’s brand or improve its business prospects. For that reason, PR must address more than just media, a point we take up below when talking about publics and audiences.

The “PR girls” problem: In the early days of China’s industrialization, factory managers would often bring attractive young women to business meetings. The idea (in its most innocent form) was that the mere presence of these comely young ladies would smooth business dealings between two work units. These young women were called gong guan xiaojie, or “public relations girls.” As a result, many older Chinese executives have had a hard time taking public relations seriously, an attitude they have often passed on to younger colleagues.

PR as propaganda: Language adds to the confusion over PR’s proper role. Common usage in mainland China has turned “publicity” and “propaganda” into synonyms: they are both translations of the word xianchuan, which is how PR is commonly described. The problem is that simply using the term makes PR sound like a single-sided, top-down, manipulative, and evil-tinged process. Good PR is none of those things, and this adds to cynicism about the value of public relations.

PR as a part of marketing: Another common misconception stems from the common decision to place PR under marketing or to limit its duties to supporting the “go-to-market” function in a company. PR certainly has a role to play in marketing, earning attention, awareness, and trust to complement attention that is paid for (via advertising, point-of-sale, etc.). But because it addresses audiences and issues beyond the customers and the channel, PR cannot be effective if it is limited to marketing function.

PR as “communications”: To get away from some of these misconceptions, many managers and public relations professionals in China have taken to calling the craft “communications.” This is both too narrow and too broad. It is too broad because corporate functions outside of the scope of PR – such as sales and advertising – are also forms of communications. It is too narrow because a company’s PR includes not only what it says, but what it does. Nearly every action and behavior that a company undertakes has a public relations dimension: concept cars are as much about PR as they are about design; the decision to set up a factory in China – and then in what city to set up that factory – is as much a PR effort as it is an operational decision; the legion of companies that made donations to earthquake relief in Sichuan in 2008 did so as a matter of public relations; and when a Chinese company lists its shares on the NYSE or NASDAQ, it is as often about gaining stature as it is about financial need.

Even the most prosaic of company actions serve as unintentional PR assets – or liabilities. Microsoft’s decision to offer a different type of warranty on its Surface Pro tablets in China than it does overseas was a tiny decision that turned into a major crisis. Motorola’s decision in 2009 to close its local service centers and hand over its warranty work to a contractor was a far larger public relations challenge than it was an operational issue. And Goldman-Sachs’s employment of the child of a former Chinese leader in a relatively unimportant role helped frame the way Chinese think about the investment bank and its operations in China. Actions and behaviors have PR value, often beyond mere communications. As long as that is the case, those actions and behaviors must be seen as part of a company’s overall public relations effort.

To eliminate misconceptions, it helps to give a clear definition of public relations that is relevant in the China context:

Public relations in China is the sum of actions, behaviors, and communications conducted by an organization with the intent of informing and influencing the groups that have a role in the organization’s success.

Know your publics

Armed with an understanding of PR’s importance in China and the broader issues that frame a PR effort, we can start building an effective program. That effort necessarily begins with enumerating those groups, or “publics,” that can influence the company’s prospects in China and how they relate to one another. This might be straightforward elsewhere, but because of China’s size, its culture, its politics, and its stage of economic development, a company’s publics evolve over time, and frequently shift in role and importance.

Many of your company’s publics in China and their relative importance will depend on its industry, its business model, and the state of development of its sector, as well as how government policy affects that sector. Generally speaking, though, a company’s publics that must be addressed by PR extend far beyond the media. Typical publics in China include:

Generally speaking, a company’s publics that must be addressed by PR extend far beyond the media.

Academics: China is one of those places in the world where academic achievement and an academic life is still a matter of prestige, and for that reason experts attached to research and learning institutions are respected voices among audiences in the PRC. Without going too deeply into why (academic achievement was the primary means of social mobility in imperial China), this is likely to remain the case for some time. By academics, we mean not just university professors, but also researchers attached to institutions like the Chinese Academy of Social Sciences (CASS,) the Chinese Academy of Science (CAS,) the National Development and Reform Commission (NDRC,) the People’s Bank of China, or the Ministry of Agriculture. Researchers and lecturers are liberally speckled throughout the Chinese government, professional and business associations, quasi-governmental organizations, China’s growing raft of non-governmental organizations (NGOs), and even (to a degree) the media.

Activists: One does not usually think about activists as influencers in China because of the way the party responds to political voices outside of government. Nonetheless, China does have a small but important legion of “legal” activists, most of whom are deeply patriotic and often quite shrill about their patriotism. From the masses of online posters that are part of China’s 50-Cent Army to the CCTV host who made it a personal campaign to get Starbucks kicked out of the precincts around the Forbidden City, this group operates outside of government control yet serves the government’s ends. Its members are the first to see an anti-Chinese conspiracy at the heart of every act by a foreign company. They look and sound like gadflies; but, as Starbucks discovered, they can often be far more threatening and need to be taken seriously.

Celebrities: The simultaneous growth of China’s media and economy has created a celebrity culture that vaults singers, athletes, screen stars, and successful entrepreneurs into a limelight once reserved for party leaders. The attention and admiration these people receive are natural magnets for companies seeking to build a brand or promote a product, and many of China’s celebrities make far more money from sponsorship and endorsement deals than from their primary professions. But celebrities can be expensive, high-maintenance, and fickle, and China’s increasingly cynical consumers understand that few endorsements are much more that quid pro quo deals. Earn the genuine patronage of a group of celebrities, however, (or even just keep them away from the competition) and you have marketing gold.

Consumers: This is fairly self-explanatory. If you sell products or services for which consumers are the end user, they are your market, and everything public relations does in communicating to consumers is in some way a sales-support function. Yet even if they are not your direct customers, their behaviors and attitudes influence your actual customers and your regulators. As such, every company should consider the role that consumers play in their PR.

Customers: Although some companies confuse “customers” and “consumers,” they are usually not the same. Most businesses – even those producing consumer goods – do not sell directly to consumers, but to intermediaries like distributors and retailers. Those buying directly from a company are customers, while “consumers” are the final, end users of a product or service. Each group needs to be addressed appropriately, but customers remain the top public in China: the most important work that PR can do is to provide direct support to sales. An essential goal of PR should be to reduce the salesperson’s role to taking orders and taking the customer to lunch.

Customers remain the top public in China: the most important work that PR can do is to provide direct support to sales.

Distributors and retailers: Regardless of who the customer and the ultimate consumer may be, a core public for most companies is the sales channel, the total chain of intermediaries that form a link between the company and the ultimate consumer of its product. In industries with long sales channels, a key part of PR is not only supporting a company’s team in selling product, but also helping customers sell the product onward down the channel to their customers, even when that product changes form in the process or becomes a component of another, larger product. Companies that will rarely sell a product to a consumer – think Boeing, Airb...

Table of contents

• Cover
• Title
• Copyright
• Contents
• Acknowledgments
• Introduction
• 1 The Basics and First Steps
• 2 Public Relations and the Chinese Government
• 3 Working with the Media in China
• 4 Public Relations and Corporate Change in China
• 5 Crisis Management in China
• 6 Social Media and Public Relations in China
• 7 Conducting Effective PR in China
• 8 360-Degree PR in China
• 9 Public Relations Agencies in China
• Notes
• Index