Trend report final

Trend Report: How Consumer Public Relations Become More and More Effective in China via Sina Weibo Student Name: Lin Zhu Student Number: 14258244 Tutor: Michael O’Brien/ Pam Williams Word Count: 3299 Submit Date: 02/12/2013

Content: 1.0 Introduction..............................................................................3 2.0 Findings....................................................................................4 2.1 Background.........................................................................4 2.1.1 Consumer PR and Marketing.................................. 4 2.1.2 Chinese Social Media Market...................................5 2.2 Case Study..........................................................................6 2.2.1 Mass Media................................................................7 2.2.2 Social Media..............................................................8 3.0 Conclusion and Future Work................................................11 4.0 Reflective................................................................................14 5.0 Reference................................................................................15

1. Introduction Consumer Public Relations is an important tool to get through with consumer brands as it serves to educate customers on new products and services as well as establishing a level of trust in a brand. Professionals believe that the consumer public relations is rapidly developing as an effective way to win over the customers’ hearts. According to Ries and Ries 2001 (cited by Tench.R and Yeomans. L, 2009), a seismic shift is underway, which will result in a diminished role for advertising in the future as companies look for more sophisticated ways to promote their products and services. Some super brands such as Amazon and Disney has already placed the Consumer PR at the forefront of their marketing strategies.

Meanwhile, social media is extending traditional public relations activities. In the past, Consumer PR using traditional mass media, through newspapers, magazines, television or radio to increase brand exposure and brand awareness. Companies must compete for limited positions of the mass media, even if they usually spend huge amounts of money but hardly to achieve the desired effect they expect, because they have to enhance consumer awareness through these methods.

Nowadays, the Consumer Public Relations and marketing landscape is changing. In China, Consumer PR activities especially through social media are emerging and innovating, which provides valuable experiences for public relations effectiveness. In this report, the current trend and development within this particular PR specialism will be fully discussed. The evidence of the trend will be proved by both academic texts and practitioner sources. Meanwhile, the factors of what impact this might have on PR within Consumer PR sector over the next 2- 5 years will also be discussed in this report.

2. Findings 2.1 Background 2.1.1 Consumer PR and Marketing The relationship between Consumer PR and Marketing has always been a somewhat ambiguous and controversial one. Practitioners and academics of both disciplines have continued to argue over where the dividing line between the two disciplines should be drawn. The trend has centered on the question of whether the role of public relations is to support marketing or whether it serves a broader social and political function.

Philip Kotler, one of the leading marketing academics, has continued to advocate the view that public relations, especially the consumer public relations, while a distinction function, should be managed as part of a company’s marketing function. In a paper first written in 1978 Kotler and Mindak (cited by Black.S, p43) identified five different conceptual models of the relationship between marketing and Consumer PR.

Marketing

Consumer

Separate but equal functions

PR

Marketing

Consumer

PR

Separate but overlapping functions

Marketing Consumer PR

Marketing as the dominant function

Consumer PR

Marketing as the dominant function

Marketing

Marketing = Consumer PR

Marketing and Consumer PR as converging functions

With the development of the media, as the carrier between companies and consumer are changing from traditional media to social media, the relationship between marketing and consumer public relations is the evolution from graph 1 to 5 shown as above.

2.1.2 Chinese Social Media Market According to Kaplan and Haenlein (2010), social media is “a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of user-generated content.” In general, social media provides an interactive platform for users to disseminate information and share creations (Hopkin, 2008). In addition, these forms of social media are containing “social networks, Internet forums, micro blogging, wikis, podcasts, pictures, video, prating and social book marking” (Kaplan and Haenlein, 2010; Weber, 2009; Kania, 2001).

Because of the majority western social media such as Facebook, Twitter and YouTube are blocked in China, Chinese IT companies began to invent Chinese version of social media services. The Chinese versions of social media are not exactly replicating the original; those are the combination of local culture and Internet customs on the basis of the original (Yu, Asur, and Huberman, 2009).

While the tremendous impact of social media is changing the world, Chinese social media is also developing rapidly. In China, online social networks are becoming the major platform for the youth to gather information and to make friends with like-minded individuals (Jin, 2009). According to the “2013 Chinese Internet Users on Social Media Report” conducted by China Internet Network Information Center (CNNIC) in 2012, the number of Chinese social

media users has reached 235 million, accounting for 51.4% of the overall total number of Internet users (Figure 1).

Figure 1: Size of Chinese Internet users and Internet penetration rate (CNNIC, 2013) China is a country of social media connections (Crampton, 2012). Chinese Internet citizens are willing to trust so-called experts (Fenn, 2012). With the time goes on, social media in China is becoming a reliable source, sometimes have even more audiences than mass media. Precisely, this development of Chinese social media is a direct result of Consumer PR's growing effectiveness.

2.2 Case Study In the middle 2000s, many international brands such as Starbucks, IKEA began to try to take advantage of China's social media to talk about their brand, the world of Chinese social media began to develop gradually (Fenn, 2012).

Until now, social media is becoming one of the core platform for Consumer PR to spread messages and get in touch with their audience and to build their trust (Fenn, 2012). Sina Weibo, launched on August 14, 2009, a sub-creation by SINA Corporation, is such a product conform to the development of the media era. According to CNNIC, Sina Weibo was the most popular Weibo platform in China during 2012 (Figure 2&3). Now, Sina Weibo has already owned more than 500 million active registers, representing a substantial increase of 74%, claimed by SINA’s CEO Charles Cao.

Figure 2: Number of Users and Utilization Ratio of Social Networking Website from 2011 to 2012 (CNNIC, 2013)

Figure 3: Number of Users and Utilization Ratio of Microblog from 2011 to 2012 (CNNIC, 2013) In order to analyze how consumer PR becoming more and more effective via social media platform, there are some examples are show from both mass media and social media.

2.2.1 Mass Media VANCL was launched in 2007, which is one of the leading Chinese clothing retailers without any tangible store. VANCL is stressing their brand philosophy of “fast fashion” and “cheap-chic duds”, therefore, they offers products that are less fashion-forward but with an affordable price for the young group from a low-to-middle socioeconomic status (VANCL.com.cn). Compared with its competitors such as H&M and Zara, VANCL virtue of its price drives a big draw

for the following of young urbanites in China.

However, because of the limited social media channel at that time, VANCL put their focus of publicity more on the mass media.

In July of 2010, VANLC officially started its advertisement putting in CCTV, covering many channels including CCTV-1, CCTV-3, CCTV-5 and CCTV-6.

The advertisement was repeatedly played for dozens of times every day. The putting of TV advertisement aimed at attracting more consumer groups other than internet consumer group to meet VANCL's demand of expanding in size.

Exposure to the highly competitive apparel industry, VANCL takes full advantage of the mass media for their Consumer PR. VANCL using its depth grasp of the mass media, continue to have written news reports, presentations and other dissemination of information by reporters, to let the customers to believe this brand is benign leading the fashion industry, as well as its reasonable price to brings the consumer substantial returns. Meanwhile, the CEO of VANCL Nian Chen engaged in propaganda by himself. Chen frequently attend various conferences such as Fortune Global Forum, the industry summit, business conversations, talk about various topics related to VANCL constantly made news points to the mass media and the public.

However, after a short resplendence, VANCL fell into the predicament. As the winner of CCTV 2008 advertising bidding, the costly result is short and weak consumer recognition. When they put the sales growth rate and promoting at the first place, the quality of their products is no longer believable. And it makes sense for them to lose their customers even if they had the largest share of the market. All in all, through mass media is not only tremendous invest, but also because some crisis led to the collapse of brand recognition.

2.2.2 Social Media 2008 is China’s television celebrates its 50th anniversary. There is a survey said that in China, there are 294 TV stations, 1283 channels, four million TV sets and 1.2 billion viewers. TV is still the most influential media in China at that time (CCTV Annual Report, 2008). However, the development of the Internet industry in China has been impressive during these years. As the global economization, the cooperation between enterprises is also increasingly strengthened. Whereas, the developing social media just to meet the evolving needs of social business.

After the Sina Weibo launched, VANCL retarget their audiences and focus more on the social media. The retarget customers are the 1980s generation born under the one-child policy. This group of young people is showing more preference to individualism and creativity than former generations. Meanwhile, this group is served as the main creator of contemporary popular culture (CNNGo, 2010). VANCL spent a large amount of money in social media.

VANCL opened 7 Weibo accounts in Sina Weibo and try to track their consumers’ purposes. The most popular engaged account is the VANCL Fans Group (translated from Chinese “VANCL 粉丝团”), with 1,102,940 active

followers. Nevertheless, this is not the official account. VANCL use this account to provide after-sales questions, the latest product information, announce some events and awards, and even the most popular entertainment and fashion trend information, in order to maintain best interactive with their followers.

As it is mentioned before, after VANCL retarget their customers, they invited the most famous blogger Han Han, and Wang Luodan, Chinese popular actress, as their spoke persons. Both of those two celebrities were born in 1980s, with a very typical personality as the Chinese “post-80s” generation: striving to success and being real. These characteristics coincided with VANCL’s values. Therefore, VANCL created two videos acted by them with concise and representative texts in 2010. These two videos are frantically retweeting in Sina Weibo, because the young generation thought those are too typical for them to represent themselves.

On the other hand, Chen Nian, the founder/CEO of VANCL’s, has also opened his personal accounts on Sina Weibo. Additionally, employees were also encouraged to use Sina Weibo. Until now, more than 100 employees have registered on Sina Weibo aiming to interact and engage with their customers better.

Display the statistics from Sina Weibo at November 27, 2013; VANCL Fans Group now has 1,102,940 active followers. During the two-weeks time, VANCL Fans Group has updated 153 posts. Among these 153 latest updates, 69 updates (45.1%) are about entertainment information, such as pictures and videos. 38 (24.7%) updates of those are interactions between followers, celebrities, and VANCL leaderships. For instance, the Q&A with followers, and some Weibo relevant with VANCL (@VANCL). 20 updates (13.1%) provide the product promotion and new release product introduction. 18 updates (10.5%) are philosophical quotes, 5 updates (3.3%) are about some new launched activities or discount codes and only 3 updates (2.0%) are opinions or comments about the current affairs news.

Social media platforms such as Sina Weibo, is very convenient for the user.

For example, some brands can better manage through this platform to measure success of their communication. They can measure which series of cloths their followers liked the most by number of likes, get feedback through comments and measure engagement through their video campaign (Sina Weibo, 2012). Companies can also measure success through the other statistics shown on Weibo that how generates activity to their sites on other types of social media as well (Walter, 2012).

Figure 4: Top 2o Retweeted Users in At Least 10 Trending Topics (Yu.L, Asur.S, Huberman.B, 2012) In this way, Figure 4 (Yu.L, Asur.S, Huberman.B, 2012) shown above illustrates the top 20 most retweeted authors appearing in at least 10 trending topics each. Obviously, VANCL is in the second place. Meanwhile, as collected and analyzed the feedback from each post, most posts had fewer comments and reposts than 100. Twelve posts have been reposted more than 500 times. Among these comments, most of the users showed their favor and passion toward the VANCL’s products. This is well proved the influence of Consumer PR is becoming more and more effective in the role of social media.

Another successful example of the Consumer PR takes good advantage of social media is Nike.

Nike Training Club (NTC) is the community for women providing the motivation and inspiration you need to look and feel your best. And now it is launched by Nike.Ltc as the app aiming to give the customers a personal trainer, anytime, anywhere. Get lean, toned and strong with more than 85 custom-built workouts. Unlock exclusive extra workouts from celebrities like Lea Michele, professional athletes like Shawn Johnson, and Rihanna’s personal trainer, Ary Nuñez.

Detailed instructions and audio support are on hand to help the user perfect each of Nike Training Club’s 130 dynamic drills. Choose a workout that fits your goal. Set it to your music, share your progress, and earn the rewards. And then just see the results (Nike, 2013).

The users can also share their workout and reward status on Sina Weibo to inspire both themselves and the others to work out together.

In 20 October 2013, Nike initiates an activity named “21 days long & lean program” in order to inspire more woman to “Just Do it”. They create a hashtage #21 days long & lean program#, #Just Do it# and #NTC# to draw people’s attention to join the activity. They also invited some celebrities such as Super Model Chun Xiao, and Pop Singer Fan Weiqi to be the tutor of the

reality training class. Ended by 27 November 2013, 30,190 people like the activity, and there are 546,158 people joining the topic in total, 630 people talking about it per week, 84 people talking about it per hour. From most of the comments, everyone gets the value of Nike: Just Do it.

To sum up, this strategy has turned out to be very beneficial for Nike, based on the advantages of social media; as its low cost, high audience participation and get the feedback from audiences easy and quickly.

3. Conclusions and Future Work In the early 2000, Chinese marketing might not be suitable to talk about Public Relations. At that time, rules were unclear, the control from governmental was tight, and many international websites like Facebook, Twitter and YouTube had been blocked. And at that time, Chinese netizens are more addicted to computer games rather than pay more attention to the brand information (Fenn, 2012).

Nowadays, Chinese social media communities and Public Relations industry are developing and innovating. As it is shown in Figure 5, Chinese Internet industry is keep developing. Social media is becoming more and more important when interacting with consumers and raise brand awareness among the younger generation.

Figure 5: Size of Chinese Internet Users and Penetration Rate (CNNIC, 2013) In the past, Consumer PR use mass media as a propaganda tool indeed received significant achievements, however, great shortcomings also exist.

The shortcoming of mass media is cost too much with unclear target audience; the participation of audience is very low, and the audience's perception of the brand is very weak. Meanwhile, the enterprise also does not have a fast and effective way to communicate with the audience, once the crises happen to the enterprise, the result will be the consumers abandon the brand (Chen. N, 2012). On the other hand, Consumer PR own its enlarge influence through social media due to low cost, fast and bidirectional impact and the effective engagement with audience.

To sum up, Consumer PR is expanding rapidly, the public relations involves a large scope of work are becoming more widely. At the same time, the target group is getting stronger; information market is becoming more and more mobility. Meanwhile, Consumer PR works with other departments have also become more and more important. The function of traditional mass media will definitely slack up, however, it won’t be disappear in a short period just like newspapers vs. online news.

Nevertheless, there are still some challenges for Consumer PR using social media as its tool. The biggest danger facing any Consumer PR is being difference (Tench.R, Yeomans.L, p419). PR practitioners need to work on their abilities to create different values to illustrate their clients via social media and make sure they are unique enough among the competitors. Moreover, it is difficult to reach a broad effectiveness by only using Sina Weibo, because there are still some old generations of Chinese citizens are still exposed to traditional media like TV, radio or billboards. Therefore, adopting multiple media channels can be more effective is very important to PR practitioners. In addition, censorship of China’s media system should also be taken into consideration for PR practitioners. Report indicate that the Chinese government is trying to control the use Sina Weibo by using the real-name system, that is to say, all users must be registered the Weibo account with the true identity information (Wall Street Journal, 2012). Hence, companies, especially for those multinational corporations, need to be prepared for the unpredictable future, and also need to develop some impeccable consumer PR plans for the future.

4. Reflective: This trend report is mainly about how Consumer PR becoming more and more effective in China via Sina Weibo. I started two weeks before the deadline in order to make sure I have enough time to develop the finding. I was first deciding to write about the changing relationship between Consumer PR and Marketing. However, I found it is not easy to do the academic research and the topic is too general to write a 3000 words report. So I got a slightly change of my topic, because Sina Weibo become more and more authority among China’s social media industry and effective a lot in people’s daily life during these years. Consumer PR is just one of the beneficiaries.

After I set the topic, and did some research, I realized it is very hard to research on authoritative blogs and websites because many of the articles that was relevant for my topic were more about the marketing things rather than PR. In China, it is indeed always confuse PR with marketing together while I need to try my best to distinguish those two in different functions in my report. And then, I realized that I should focus more on the word change/development rather than describe these media methods as a tool to PR. I used both books form library and Google research when I doing my trend analysis. On the other hand, because of there are so limited amount of the authoritative industry analysis I could use as references, I have to rely on the article I found written by someone in a strong position in PR industry both home and abroad. In that situation, some Chinese industry report really helped me a lot to evaluate the trend critically.

The case study about VANCL and NIKE are really good examples to evident my opinion of the developing trend of the media industry in China and again, the effectiveness of Consumer PR is becoming more and more powerful because of this changing.

After I finished the outline of the report, I exchanged my ideas with some of the classmates and gained some great helpful suggestions from them.

Beside, there are still some shortages of my trend report. For instance, the majority of the statistic references are coming from blogs, which sometimes cannot be rely on strictly. I should spent more time to search more relevant information coming form journal articles and find out more evidence on how the trend is affecting the China’s PR industry.

For my perspective, I learnt a lot during the process of writing the trend report.

I can summarize and comprehend an article more quickly than I used to. And I learnt more about the differences between Consumer PR and Marketing. And different from the former, I had more knowledge about the shortages among the industry and what it might be in the future but not only know how effective it is currently.

In the future such as my dissertation, I think I need spend more time on the truly reliable sources researching in order to support my opinion of view better.

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