public affairs dialogues roundtable
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Today’s Discussion
I. Welcome & Introduction: Craig Hoy, Executive Director, PublicAffairsAsia
II. Today’s ObjectivesIII. Moderator’s Overview: Alan VanderMolen, President,
Asia Pacific, EdelmanIV. Survey Results & DiscussionV. BreakVI. Social Media/PA Case Studies & DiscussionVII. Conclusion: What does this mean for public affairs in China:
Foreign MNCs, SOEs, Government, Civil Society
VIII.Cocktail Reception
Introductions
• VIPS:– Mr. Liu Hang, Acting Director, Ministry of Foreign Affairs
– Ms. Zhang Xin, SCIO
– Mr. Zheng Yannong, Vice President, CIPRA
– Mr. Xue Lan, Dean, School of Public Policy & Management, Tsing Hua University
• Craig Hoy, PublicAffairsAsia
• Alan VanderMolen, Edelman
• Frank Lavin, Edelman
• Steven Cao, Pegasus
Today’s Objective
1. Discuss impact of social media on public affairs in Mainland China
– Review survey results and case studies
2. Discuss the future of public affairs given the new role of social media
– Foreign MNCs, SOEs, Government, Civil Society
Moderator’s Overview:
Social Media Landscape
What is Social Media?
• Internet-linked
• Many-to-many, user generated content
• A keyboard and a point-of-view gets you into the discussion
• Governments, companies and citizens are becoming their own media companies
What Does It Look Like?
OLD:Pyramid Model
Organization
Mass Audience Consumers
Media
NGOs
InvestorsRegulators
Employees
Trade Bodies
Businesses
NEW:Sphere of Cross-influence
conversations start anywhere– and involve influencers of all stripes
• Conversations can start anywhere within a network
• Influence flows from multiple sources – no longer the sole domain of mass media
• Influence can spread in any direction
• Real people can be influencers and/ or amplifiers
• Different pyschographics: Watchers, Sharers, Commenters, Producers, Curators
curators
producers commenters
sharers watchers
China Internet: The Numbers
• 338 million Internet users
• 181 million bloggers, 119 million regularly update
• 155 million people use mobile phone for Internet
• 124 million social network (SNS) users
• 102 million BBS users
• 62.8% of Internet users are aged 10 - 29Data source CNNIC reports June and November 2009
China’s Major Websites All Have Social Media Components
• QQ /Tencent from IM to gaming to blogs
• BBS: from tianya.cn to People’s Daily to Baidu.com to tiexue.net…
• SNS: Kaixin001.com, Renren.com, 51.com
• Blogs and news commentary: Sina.com, Sohu.com
• Video: Youku.com, Tudou.com
• Microblogging: Sina, QQ
• Auction/e-commerce: Taobao.com
Trust in the Internet
• 84.3% of Chinese Internet users believe that the Internet is their most important source of information.
Data source CNNIC June 2009
Trust wanes for most traditional information sources;
Word-of-mouth on par with media
C95-98,103. [TRACKING] Now I’m going to read you a list of places where you might get information about a company. Please tell me how credible you believe each one
of them is as a source of information about the company—is it extremely credible, very credible, somewhat credible, or not credible at all? (Top 2 Box), Informed publics
ages 25-64 in China.
70%
39%
50% 49%53%
47%
22%
34%
44%49%
34%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Television news coverage
Articles in business
magazines
Articles in newspapers
News coverage on the radio
Conversations with your friends
and peers
Conversations with company
employees
2008 2009
13
N/A
The Unwritten Rules
• National pride
• Anti-establishment: Chinese Netizens love challenging authority
• Sensational: Chaozuo 炒作 approach
• Replicable: Zhuanzai 转载 culture
A View From The Government
The characteristics of online public opinion crises …suddenness 突发性destructiveness 破坏性urgency 紧迫性 …
In the Internet age, many of the means of news control that were effective in the past are no longer useful, and many in fact bind our own feet and hands, creating passivity in the handling of crises by the party and the government.
在网络时代,许多过去行之有效的新闻管理办法有的已经不起作用,有的反而束缚我们自己的手脚,造成党和政府处理事件的被动。
From government document: ‘How public prosecutors can neutralize online opinion crises’ — August 2009 http://media.nfdaily.cn/content/2009-08/13/content_5553979.htm
Edelman/PublicAffairsAsia Social Media Survey: November 17, 2009
Online Survey Results
Methods
• This survey was conducted over the Internet beginning November 6 and ending November 13.
• A total of 132 interviews were submitted by the end of active data collection.
Respondent Profile
• One out of three respondents are communications specialists with MNCs or SOEs. One in five work with consultancies. Approximately one in 10 are employed by government or NGOs.
• Six out of ten claim to be decision makers for government or public affairs strategy in China. The remainder are mostly involved in the implementation of government or public affairs strategies.
• More than six out of ten respondents are residents of China or Hong Kong.
Importance of “Social Media” to Overall Public Affairs Strategy in
China
How important is social media to your broader public affairs strategy in China?
Extremely important 17%
Very important 28%
Somewhat important 29%
Not particularly important 14%
Not at all important 13%
74%
Social Media’s Influence Over Public Policy
To what extent do you believe opinions expressed in online and digital social media channels influencecontemporary public policy in China?
The most influential mediachannel available
10%
Often more influential thanother media channels
57%
No more influential than othermedia
24%
Less influential than other mediachannels
9%
67%
How the “Social Media” are Used by Respondents
Answers
How often do you conduct a systematic search of social media for news and information about your business?
And how often do you communicate news and information about your business via social media?
Many Times a day 11% 5%
At least once a day 27% 16%
Several times during the week
21% 16%
At least once a week 12% 17%
Less than once a week 29% 46%
59%
How Social Media is Used in Organizations
Represented in this SurveyWhich of the following statements best reflects your organization’s use of social media in a public affairs context in China?
We fully utilize social media platforms as part of our public affairs strategy and have evaluated its impact
17%
We have started to use social media platforms as part of our public affairs strategy but have not yet evaluated its impact
43%
We do not utilize social media platforms as part of our public affairs strategy
32%
We avoid social media platforms as part of our public affairs strategy
8%
60%
Department or Function Responsible for
Social Media in China
In your organization, which department (function) is responsible for strategic social media communications in China?
Marketing department 11%
Corporate communication / Corporate affairs
23%
Public relations department 16%
Public affairs department 8%
No particular department assigned 42%
Statements About Social Media
Statements About Social Media
Online Public Affairs Case Studies in China
• The Coca-Cola Company - Huiyuan
• Tengzhong- Hummer
• Hangzhou 70kph
• Mineralized water
The Coca-Cola Companyfailed bid to buy Huiyuan
* With lawyer Qian Weiqing, trade analyst
Mei Yuxin, and consultant Li Su
How Story Broke
Media breaks storySeptember 3, 2008 — Huiyuan reports Coke takeover bid to
Hong Kong market regulators, HK media pick it up
Social media reactsSeptember 5 — Sina.com video interview* that says Coke's
acquisition of Huiyuan would violate anti-trust law
Further reaction from social mediaSeptember 8 — Sina video transcript taken down — netizens call
it 封口门 (hush-gate), alleging that Coke attempted to manipulate public opinion
How Story Played Out
National pride issues September 5 - 12 — Internet discussion focuses on allegations of
quid pro quo for Coke Olympic sponsorship, national pride, sale of national jewel to foreign company, criticism of Huiyuan CEO Zhu Xinli
— Mainstream media follows tone of Internet debate
Slow reaction September 12 —Coca Cola Company denies cover-up charges
Deal is rejectedMarch 18 2009 — Regulators finally turn down the deal; netizens
claim victory
Lessons Learned
• Buyer and seller treated this as “transaction communication” - top down
• Completely ignored grassroots / digital
Tengzhong - Hummer Deal
Image from
http://www.dongying.com.cn/qcpd/xwzx/sdpl/42041.shtml
How Story Broke
Unstructured announcement by GM / TengzhongJune 1, 2009 — GM Chapter 11 announcement says Hummer brand will be
discontinuedJune 2 —GM says MOU signed with Chinese buyer for Hummer; later that day
CNN and NY Times identify it as Tengzhong, Tengzhong then confirms
Social media reactionJune 3 through August — Blog posts criticize the deal, saying Tengzhong will
get only a brand name not any technology, and alleging that the deal is for money laundering or a way to export capital from China. Such online criticism continues throughout June. Bloggers suggest that the government may not approve the deal
Announcement of deal confirmationOctober 9 — Tengzhong and GM announce deal is finalized
How Story Played OutGovernment reaction to new announcement
October 10 — In a Xinhua report, the Ministry of Commerce states that it has not received the required applications from Tengzhong.
Further social media reaction
October 12 — Bloggers say Tengzhong may have set up a offshore company to circumvent regulations; CCTV news anchor and blogger Rui Chenggang criticizes the takeover on his blog as "against the Chinese government's commitment to low-carbon economy development and environmental laws“.
Widespread negative speculation and further online criticism of the deal continue. Still in play…
Lessons Learned
• No communication co-ordination between buyer and seller
• As with Coke / Huiyuan: this treated as “transaction communication” - top down, ignoring grass roots / digital
• Buy-side and sell-side vulnerable to nationalistic commentary
• National pride issues can attract celebrity bloggers who have clout of mainstream media with strong digital / grass roots following
Hangzhou 70kph
How Story Broke
Media report fatal car accidentMay 7, 2009— Hu Bin (20) driving souped-up car, hit and killed Tan Zhuo, a
"working class" man (25) while crossing a street. Witnesses said that Hu's speed was enough to send Tan flying, but media
reported police gave him a minor citation for driving at 70 kph.
Social media reaction — “human flesh search engine” 人肉搜索May 7 - 14 — Netizens outraged at apparent deference to Hu's wealthy
background, and his nonchalance — photo of he and friends smoking and laughing near scene of fatal accident
”Human flesh search engine" uncovers Hu's driving record and other personal information and attempts to find out his family connections. "70 kph" becomes online catch-phrase.
How Story Played Out
Police reaction to controversy
May 15 — Hangzhou police released update estimating Hu's speed between 84 and 101 kph.
Resolution
July 20 — Hu Bin appeared in court and is sentenced to three years in prison.
Netizens compare photos released to the press against photos taken at the scene of crime and suggest that Hu paid someone to take his place in jail.
A week later Hu expressed regret and offered proof of his identity.
Lessons Learned
• Authorities are subject to same online forces as companies
• Chinese netizens are sensitive about cases of apparent abuses by the rich and well-connected
• Slow police reaction to online criticism enhanced netizen suspicions
• Once “human flesh search engine” behavior starts, even baseless rumors are credible to netizens
Mineralized Water
How the Story Broke
Story broke on BBS website
Late July 2008 — BBS post “Master Kong, where is your water source?” appears, accusing Master Kong (康师傅) of quality problems, foremost that their mineral water is merely tap water.
Huge response from netizens, who accuse the company of false advertising.
Traditional media picks up story
August 6, 2008 — National Business Daily picks up the story, noting that bottling plant is located in an area without natural springs.
Reporter speaks to Master Kong representative, who says: "Everyone does it. A one or two kuai bottle of water can't be natural spring water."
How Story Played OutRegulators react
Mid August — government regulators get involved, review bottled water standards.
Corporate response
September 2 — Master Kong apologizes for creating the "gap in understanding" by not adequately explaining its "superior source”. Water is now labelled as “distilled”, “mineral” or mineralized”.
Reputational fallout
September 9 — Results of an online poll conducted by China Youth Dailyreveal: 57.3% of respondents will no longer buy Master Kong water; 72.9% believe that supervision of the water industry needs to be strengthened
Lessons Learned
• Social media is the world’s biggest fact-checker and
can rapidly expose false advertising
• Traditional media now feeds off social media
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