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(originally published by Booz & Company)


The Power of (Online) Public Opinion

With more and more activists coming online in China, companies must prepare themselves for Web traffic with a thoroughness that may not be necessary in other markets. If businesses want to be able to respond rapidly and effectively, it is vital that they track commentary and news about themselves online and put plans in place to deal with negative publicity as soon as it arises. Executives must consider the impact of Internet-driven public opinion when formulating strategies and actions, and they must understand the speed with which views are formed and spread on the Web, as well as the harm that can come from misinformation or negative postings. To protect themselves, companies should take the following three actions.

• Monitor and manage. Unverified news spreads more quickly on the Internet than through other channels. On a day-to-day basis, senior executives and public relations managers must involve themselves as active agents in the monitoring of online commentary and discussion about their company and its products and services.

New companies that deal in online reputation management have sprung up to help executives follow public opinion. For example, Beijing-based Daqi and Shanghai-based CIC (which calls itself the “first Internet Word of Mouth research and consulting firm in China”) charge multinationals monthly fees to monitor activity on the Web, assess the danger, and diffuse the issue or create a positive spin. Some businesses specialize in promoting discussion online, posting and replying on online forums in ways that boost their clients’ products or services, and designing targeted discussion topics to catch users’ attention. However, these companies are unregulated, and that has led to the emergence of businesses known as “Internet innuendo spreaders.” Rather than promoting a company, they aim to harm its competitors. Reports suggest that hundreds of such businesses are operating in Beijing alone.

• Be proactive. Wherever possible, companies should proactively manage online opinion, whether for marketing and promotion or to defuse potential crises. Any company planning an acquisition in China, laying off staff, or taking any other action that could be perceived as anti-Chinese needs to be especially careful. As Coca-Cola Company learned in its failed 2008–09 bid to acquire China’s biggest juice maker, Huiyuan Juice Group, companies considering a major deal in China need to bear in mind the possible online repercussions before making announcements. The Chinese news service conducted an online poll on whether the Coca-Cola deal should be allowed to go forward. The views expressed in blogs and discussion forums were less vitriolic than those expressed during the XCMG debate, but the Sina survey revealed that an overwhelming majority of those polled — some 80 percent — were against the acquisition, which Beijing could not ignore.

Corporations should also be aware of how attempts to manipulate opinion can backfire. A viral campaign by computer maker Lenovo aimed at promoting its laptops flopped when Internet users realized that what appeared to be a Web posting from someone looking for a real person whose photo he had taken (the “red laptop girl,” an attractive young woman usually pictured toting a red Lenovo IdeaPad) was in fact a corporate promotion. The campaign attracted a lot of discussion, but most of it was negative.

• Prepare for crisis. Executives should educate their staff, and themselves, about the proper use of online tools such as blogs. Many professionals and senior executives have personal blogs, but it is crucial to understand that the Internet is not a private space and that what is published on blogs can affect the image of the company one works for. Initially, Vanke’s Wang Shi learned this lesson the hard way, but he was also able to use his popular blog to his advantage in making his public apology.

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