Opinion

Lessons from the NBA controversy – in the case of China, political sensitivity is key

Multinational brands have learned the hard way that they need to be socially and culturally sensitive but recent events in China involving backlash against the NBA prove the need for political sensitivity too, says Sign Salad project director Clare Kane

Tensions in Hong Kong over the territory’s relationship with mainland China are well past breaking point. The unrest that initially focused on a controversial extradition bill might have felt at first geographically distant and commercially unimportant to Western brands. 

But a high-profile spat with the NBA in the US has brought to the world’s attention just how far-reaching the implications of this political turmoil could be. 

The NBA found itself in hot water when Houston Rockets’ manager Daryl Morey tweeted support for protesters in Hong Kong earlier this month. 

In response, Chinese firms suspended sponsorship and telecast deals. It’s the latest in a number of cases where global brands – including several luxury fashion houses – have underestimated or misunderstood the issue of Chinese sovereignty and the lengths to which the Chinese government will go to reinforce its importance both inside and outside of China. 

These events should give brands operating in China a pause for thought. China’s size puts it in a position of significant power, and most companies simply cannot afford to damage their relationships with the country. The NBA has already suffered a significant financial setback since Morey’s tweet – unsurprising given the size of its fanbase – in what constitutes a $4 billion market for the league. 

There has never been a good time for brands to embroil themselves in questions of Chinese sovereignty, but this is a particularly sensitive moment. The People’s Republic of China has just celebrated its 70th anniversary against a backdrop of violent protest in Hong Kong and trade tensions with the US. 

Foreign brands perceived to make missteps are easily replaced by home-grown competitors. Overseas brands were once coveted by the Chinese consumers. But with more and more Chinese rivals emerging that offer culturally relevant propositions, foreign players across numerous categories could be under threat if they don’t toe the political line.

On the flipside, the internet means everything is international now – so brands have the additional concern of how their actions and decisions will be received by people outside of China too. Foreign observers sympathetic to protesters in Hong Kong may feel let down by brands which quickly apologise for political gaffes that rile mainland China. Trying to avoid backlash on all sides means many multinationals are engaged in an almost impossible balancing act.  

So, what can brands do to remedy the situation? Well, they can start by doing their cultural homework. That means engaging in regular cultural pitstops, where they work with experts to investigate how the social and political landscape in the regions they’re targeting is evolving. And in turn, the impact this is having on the residents’ cultural subconscious. 

Understanding China means having boots on the ground, and engaging with emergent social, political and cultural narratives through media, advertising, retail and the internet. It also means learning from local brands and accepting that a global brand strategy needs to be flexible enough to respond to real-time cultural change in the largest consumer market on earth.   

Moving forward, brands should be careful when it comes to how they communicate around China. That means looking beyond just the obvious touchpoints and ensuring consistency of communication across all of them. The recent fallout with Dior, for instance, was around a campus presentation that left Taiwan off a map of China boutiques, suggesting that no faux pas will go unnoticed, no matter how small the audience.

Most brands today eye global expansion. But ensuring that your brand relates to the consumers in all these different markets on a cultural level is much easier said than done. In the case of China, political sensitivity is key, but recent events also illuminate a more general need to understand China and its 1.3 billion consumers, who have been taken for granted for too long. 

Luxury fashion brand Dolce & Gabbana is still counting the cost of a controversial ad campaign last year that provoked widespread outrage. 

Brands should try to remain true to themselves and the values that make them unique and relevant, while also operating in a culturally and politically sensitive way across the globe. We can be sure this won’t be the last fallout of its kind.

But taking time to reflect on shifting social realities across different markets will help brands to navigate an increasingly challenging international consumer landscape, with fewer bumps along the way.

Clare Kane is project director at London-based cultural insights agency Sign Salad and has previously studied and worked in Shanghai

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