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Chinese consumer rights show could hammer featured brands, warns brand expert

A consumer rights show on China’s national TV network today – World Consumer Rights Day – could mean double-digit sales declines for the brands singled out on the program, a brand expert has said.

This year, internet companies, particularly in the e-commerce sector in which scams have been common in China, are expected to be the focus of the CCTV show – known as san yao wu or 3.15 – which has drawn massive TV audiences in recent years.

The impact on brands from the broadcast could huge, Paul Galesloot, the Shanghai-located APAC COO of brand agency Cowan has suggested.

“In such a competitive environment as China, it will be very hard for a brand to recover if it takes a hit. A brand could easily suffer double-digit sales declines if it is perceived in a negative light on the programme,” he said.

Allegations made on the broadcast have been known to be questionable, but any claim made against a brand will be damaging regardless of its authenticity, Galesloot said.

“Research suggests that we are no longer in the age of information, we are in the age of attention. People focus on whatever is in front of them without challenging the facts. There is no such thing as objectivity anymore – only shared subjectivity. Which is why a negative perception can be taken as  fact. Anything negative said about a brand will spread like wildfire,” he said.

The consumer response to the show, which is backed by the China Consumers’ Association, will play out in social media. But it will be difficult for brands to get an accurate sense of what is being said about them, because much of the chatter will take place on the popular peer-to-peer platform WeChat, Galesloot said.

He added that 3.15 would prove a boon for brands in China in the long run, by raising confidence among consumers.

“More people are shopping online in China than in the US, but most Chinese shoppers earn under RMB 5,000 (US$813) a month, and are potentially the easiest to scam. 3.15 is about protecting those people and giving them a confidence boost that could drive domestic consumption.”

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