If you’re in China buying a tub of skincare online, a tray of New Zealand kiwifruit at the local fruit store, an expensive bottle of wine dining out, or even a well-known condom brand at a convenience store, there’s a fair chance you’ll end up with a fake. Unlike Western consumers who take things at face value, Chinese consumers are inherently untrusting of things for sale which contributes to them taking quite a different customer journey for products and services than consumers elsewhere.
Up until five years ago, the prevalence of fakes saw many consumers just accept it as a likely consequence of shopping in China. In 2013, China’s massive retail market saw just one million consumer complaints to relevant government departments. At the time, Americans numbered less than a quarter compared to China’s population but made more than twice as many complaints overall. The sudden rise of social media encouraged some aggrieved Chinese consumers to take complaining into their own hands. In 2011, a wealthy businessman in Qingdao disappointed with his Lamborghini’s service hired nine men to destroy his sports car with sledge hammers, and circulated the video on social media, which was followed by a run of copycats. But overall, most consumers seemed to just grin and bear it.
That is no longer. Last year consumer complaints grew 44% to 2.4 million – edging closer to America’s 2.7 million complaints. As China’s consumers have grown more sophisticated and assertive, so have their channels of recourse. Consumers are more aware and confident about the options available to them meaning brands are much less likely to get away with the things they used to. This is further exacerbated by the rise of ‘professional complainers’ who troll supermarkets for products with incorrect labelling and claims, unlawful additives and multiple production dates, earning ten times the purchase price in compensation.
As consumers have become more proactive in dealing with issues, CCTV’s annual 315 consumer watchdog broadcast has become less relevant. Once one of the most potent beacons of consumer protection, the show was notorious for bankrupting businesses it singled out. Even überbrands such as Nike and Apple took material hits after being shamed on the show in 2012 and 2013 respectively.
Last Thursday’s 315 show confirmed how much less of an impact it makes these days. Just a fraction of the media and online buzz now accompanies 315 relative to the golden days five years ago. Nike was singled out again last year, but it appeared to do little to break the label’s stride in China. Brands are also much better prepared these days with comprehensive crisis plans, illustrated by VW who apologised within minutes on Weibo after being singled out on 315 this year, again. The show has been unable to find its mojo since CCTV joined a string of other state media for corruption involving shows such as 315.
Yet with the fall of 315, the rise of complaints has been augmented with enthusiastic complaining – and praising – on digital channels such as social media and online reviews on ecommerce and travel platforms. In short, it is becoming more difficult to fix actions that annoy Chinese consumers. Much like anywhere, brands should be particularly vigilant to do what they can to keep consumers happy, within reason. Go to Page 2 to see this week’s China news and highlights.