China’s state press agency Xinhua has shut down the website of the respected business newspaper 21st Century Business Herald, and terminated a ¥3.5 million ($590,000) contract between the agency and the Bank of Communications, after it was exposed for receiving payouts for publishing good news and concealing bad press. It follows other high profile state media corruption cases this year, such as the senior CCTV employees involved in bribery and corruption.
Extortion by staff at the state-run news monopolies continues to erode Chinese consumers’ faith in traditional media channels. IPSOS research found that Chinese shoppers trust online sources more than the state media. For example, 49% of consumers increase their purchase intent through websites, versus less than 32% for the state-run newspapers, television and radio.
Research by Cohn and Wolfe found the watching television is the 6th most common method Chinese consumers use to find info about a brand, newspapers are 9th and radio is 10th. Digital channels such as web sites, social media and online reviews are the main methods for research, and they influence other popular channels such as asking friends and family. Although most Chinese consumers know not to trust everything they read online, it is much more transparent and objective than state media, and has become the standard research channel for middle and affluent class Chinese.
Whilst online channels are important, offline marketing can still create many synergies that reinforce and raise awareness of online campaigns. Traditional media channels are powerful tools that can make or break a brand – as Nike or Apple will tell you – and should be an important component for brands with large marketing budgets in China.
Between October 1-7, China Skinny’s Shanghai office will be closed for the Golden Week holiday. We hope our China-based readers have a great break and don’t eat too many instant noodles. See you on the other side!
Go to Page 2 to see this week’s China news and highlights.