Pinduoduo’s suicidal PR and H&H’s “brand failure theory”

On the first working day of 2021, Pinduoduo contributed a textbook-level failure case to China's public relations industry.

I will not repeat the details of what happened, the dead are the greatest. If you don't know, I suggest you don't read on. In addition to expressing our anger about this suicidal public relations incident, we should also see something deeper from it. The following are some personal opinions.

1. What exactly is Pinduoduo doing in public relations?

Judging from Pinduoduo's handling actions so far, Pinduoduo has not responded positively to the follow-up treatment of the sudden death of the employee from beginning to end. Instead, the focus of public relations is on Pinduoduo's answer to the question "How do you view the online rumor that a Pinduoduo employee died suddenly after working overtime" on Zhihu. Let's take a look at this amazing answer again:

"Look at the people at the bottom of society. They all use their lives to make money. I never think it's a problem of capital, but a problem of society. This is an era of risking one's life. You can choose a comfortable life, but you have to choose the consequences of comfort. People can control their own efforts. We can all do it."

28 seconds later, the account deleted the comment. It was this comment from the certified official account that touched the sensitive nerves of countless "working people", and in turn triggered a tsunami of public opinion, rushing towards Pinduoduo and other Internet giants where the overtime culture is prevalent.

This answer, firstly, reflects Pinduoduo's distorted corporate values: not working overtime and not risking one's life for money is choosing comfort, and comfort is shameful ; secondly, it puts the blame on this era and this socialist harmonious society: society is like this, if you don't risk your life for money, you will be eliminated.

Let us first review the recent background:

On November 10, 2020, the State Administration for Market Regulation released a draft "Anti-monopoly Guidelines for the Platform Economy" for soliciting opinions, and regulators called for "resolutely preventing capital from manipulating public opinion."

On December 11, 2020, the Political Bureau of the CPC Central Committee clearly proposed to "strengthen anti-monopoly and prevent the disorderly expansion of capital." Later, the People's Daily published a commentary saying, "Don't just focus on the flow of a few bundles of cabbage and a few kilograms of fruit. The vast sea of ​​technological innovation and the infinite possibilities of the future are actually more exciting."

It can be said that Pinduoduo’s answer on Zhihu hit the mark and touched the red line, so the first priority is to distance itself from the issue, which is the focus of public relations.

When so many people have seen the push of the answer, and there are screenshots of different versions on PC, web, and APP, Pinduoduo still resorts to shameless denial and puts the right of verification in the hands of Zhihu. This approach is really confusing. So after being slashed back by Zhihu, Pinduoduo hurriedly issued a second statement, throwing the blame onto Xiao Li, an employee of the external supplier, quickly slapping itself in the face.

The magical process of being like a headless fly, coupled with two announcements written on Hammer notes without even an official seal, makes it hard to believe that this is the level of the public relations department of a listed company worth 20 billion US dollars. It also firmly labels Pinduoduo with the negative label of confusing right and wrong and lying.

As for Zhihu being so tough, is it for justice? Yesterday I saw an interpretation by an old lady on Bilibili, and I totally agree with it:

Pinduoduo should be a major advertising client of Zhihu, and both of them have the same investor, so their relationship should be unusual. In addition to not wanting to be scolded by Pinduoduo netizens, it may also be related to what was said above: "Resolutely guard against capital manipulating public opinion." Now is not the time to help your brother, so just give him a blow.

It can be said that Pinduoduo’s entire public relations process was not intended to take care of the emotions of netizens, nor did it ever think about properly handling the aftermath of employees who died suddenly, but rather to minimize the possibility of being targeted. Although the whole process is very ugly, it basically achieves the purpose.

For Pinduoduo, the king of the sinking market, what built its business barriers was not the 996 "workers" that aroused public outrage in this incident. Pinduoduo's core users may not even know what 996 means.

After falling 6% on January 4, Pinduoduo's stock price soared 12% the next day to a record high, causing people to exclaim that capital is profiting from human blood. Little do people know that this has never been a moral judgment seat, but a place for exchanging interests.

2. Don’t do PR, pay the bill

Putting aside the special factors of this incident, how should ordinary companies and brands learn from this?

I thought of the "Brand Failure Theory" in Hua & Hua's methodology——

By building brands, companies create repeated games and give consumers the opportunity to punish themselves. Brand is a risk mechanism to protect the interests of consumers. When a brand makes a mistake, if consumers punish it, the brand is effective; if the brand evades punishment, the risk mechanism becomes ineffective and the brand fails.

When a brand encounters trouble, they avoid talking about their own mistakes and instead offer money to delete posts in an attempt to suppress public opinion, which has the opposite effect. Moreover, in today's decentralized media world, it is becoming increasingly difficult to use this trick. So, don’t do PR, pay the bill.

Edward Bernays, author of Public Relations, defines the term "PR" as follows:

Public relations is a management function: developing policies and procedures to gain public understanding and acceptance.

Therefore, public relations should be a job of taking care of public sentiment. When it comes to taking care of public sentiment, we have to mention a word that is repeatedly used in marketing: " user perspective" - ​​giving the public what they want to see and know. When something goes wrong with a brand, the public doesn’t just sit there and watch. They want to see the company take responsibility, admit mistakes, and come up with solutions and commitments.

Here we have to talk about a public relations template-level case - the Haidilao kitchen rat incident in 2017. I won’t go into the details of the process, let’s just review how Haidilao “paid the bill”.

1. Quick and formal

Three hours after the incident, Haidilao issued its first statement. Two and a half hours later, a second statement was issued. Moreover, both statements were printed and stamped. This level of formality is something that Internet companies that are proficient in using Hammer Notes should learn from.

2. No excuses

The first statement was mainly intended for consumers and the media. It immediately acknowledged the problem was real, without any evasion or blaming the "temporary worker". Instead, it simply admitted the mistake and apologized, and stated that the issue would be properly handled.

The second statement, which was directed internally, gave seven specific handling measures, including temporarily closing the two stores involved, proactively reporting the progress of the incident to the relevant government departments, welcoming consumers to visit stores for inspection and supervision, and quickly working with a third-party pest control company to study rectification measures. What’s even more amazing is that Haidilao has specifically assigned specific persons to be responsible for each rectification measure, and has reassured employees at the stores involved that they don’t have to worry, as the responsibility lies with senior management and the company, and they won’t blame anyone.

The whole process is rational and full of warmth. It is a perfect template for the 5S principles of public relations (shouldering the matter, sincerity, speed, system, and standard) .

From the customer's perspective, don't make excuses. If it's wrong, it's wrong. I know I'm wrong and I'll correct it immediately. From the employee's perspective, don't pass the buck. There's no common practice of firing the employees involved. Instead, the company's board of directors bears all responsibility.

Oh my god, what a fantastic corporate culture! After reading the announcement, I really want to become a member of Haidilao’s family.

Compared with Haidilao, Pinduoduo is just like a primary school kid.

Brands should not be afraid of accidents. No one is perfect, and the same goes for brands. When something goes wrong, it is actually the best time to win the trust of consumers. For example, the Westin Castle Hotel in Nagoya, Japan, had a statistic:

The return rate of customers who did not have any problems during their stay at the hotel is 84%;

The return rate of guests who had problems during their stay but whose problems were not resolved was 46%;

The return rate for guests who had issues resolved during their stay at the hotel is 92%.

In other words, the number of repeat customers who complain and have their problems resolved is the highest.

KFC has Sudan Red and hormone-containing chicken, but can't you eat there with peace of mind?

Johnson & Johnson frequently recalls its products globally, but this does not affect its brand value, which ranks among the top 20 in the world.

Therefore, when a brand makes a mistake, it is time to test its brand mechanism.

When a brand makes a mistake, it's just lifting a stone, and you have the opportunity to throw it away. To shirk responsibility and allow your brand to fail is to shoot yourself in the foot.

In my opinion, public relations is really simple. The best public relations is to not do public relations, take responsibility, and pay for everything. At the same time, public relations is really difficult, because when a company’s values ​​are problematic, even the most powerful public relations team can only take the blame.

As of today, several days have passed since the incident, and except for some public accounts occasionally posting articles to discuss it, everything seems to have returned to calm. There is no impact on Pinduoduo's fundamentals, and public sentiment has gradually dissipated. I wonder if everyone feels a little melancholy when thinking about this incident?

Author: Nicole

Source: Nicole