Karma alert

This is an evolutionary and revolutionary time to be running a company and marketing products and services in China. Brand reputations built over decades can be destabilized in an hour in an Internet firestorm.

Just ask Christian Dior.

One incendiary remark by Sharon Stone, their global celebrity face, caused a management panic and emergency global fire-fighting in a desperate attempt to preserve Chinese consumers' trust and reputation.

Not to mention other customers in other countries. Let's see if Chinese consumers forgive Dior anytime soon.

Note to bloggers: in three months time, ask how their sales were impacted in China from the moment Stone made her remarks. But the issue is much bigger than Stone's misplaced remarks. Carrefour has seen a massive backlash. So has McDonald's.

In fact, so have many companies who are seen to be insensitive or not in tune with the emotions and feelings of Chinese people in 2008.

This is not a political comment. It's just business.

Smart companies need to understand that consumers in any country, especially in China, will embrace them if they believe they are doing the right thing.

The opposite is also true. If consumers believe companies are not making an active contribution, they will punish them.

Let's get empirical. My firm, Edelman, researched 5,500 consumers around the world in late 2007. This included 1,000 people from across China - in Shanghai, Guangzhou, Chengdu, Beijing and Wuhan.

We wanted to know how consumers understood and engaged with social issues, brands and causes. Or put another way, how people like you and me were likely to behave toward companies we felt were trying to do the right thing.

The results were extraordinary. Consumers really care. And Chinese consumers care the most. Consumers in China will alter their purchasing habits much more than the global average depending on how they perceive companies are behaving.

The Edelman "Good Purpose" Survey results (www.goodpurposecommunity.com) show that social purpose as a marketing imperative has a powerful consumer appeal in China, and globally, and can help brands build deep relationships.

A few highlights of the Edelman study:

Chinese consumers are prepared to vote with their wallet more than any other group. Seventy eight percent of Chinese consumers say they would be prepared to pay more for a brand that supports a good cause they believe in. Globally this is still a very high 70 percent.

More than 73 percent of consumers globally would be prepared to pay more for environmentally friendly products. In China this rises to 84 percent. And 90 percent of Chinese consumers say products should use recycled packaging.

Making the world a better place? Eighty five percent of consumers are willing to change brands or consumption habits to make tomorrow better than today. In China, 90 percent of consumers feel this way.

Eighty eight percent of global consumers surveyed feel it is their duty to contribute to a better society and the environment. In China this again rises to 90 percent.

Seventy eight percent of consumers like to buy from brands that make a donation to worthy causes. Chinese consumers are more likely than the global average to feel this way at 88 percent. Finally, 83 percent of consumers globally say they can personally make a difference by supporting good causes. This again rises in China - to 90 percent.

So what does this mean to a company marketing in China today? It means companies and their consumers are in this together. If you want your consumer to care, show them that you do too.

Edelman defines this as MSR - Mutual Social Responsibility. MSR, globally, and especially in China, is the next key step in connecting consumers with brands via a clear social purpose.

A force for good gives a consumer a reason to buy. But the "good" needs to be compelling. The days of a big check photo opportunity once a year are over. Doing good one day a year doesn't help you over the other 364. The era of collective, ongoing responsibility is here and now.

Brands need to create powerful, ownable ideas, embedded with a social purpose platform, to differentiate themselves and rise above the noise.

A powerful, simple idea can move an entire community. It can move a country. And it will certainly drive your sales.

Globally, word of mouth, social marketing and new channels are key to bringing a social purpose concept to life in a world of attention deficit disorder and 24/7 communications.

Many companies see the Internet in China as a worrying development. Hard to manage. Rife with rumor. They are missing the point. Absolutely and fundamentally.

Yes, it can be home to 220 million critics. But if companies heed what global research, especially Edelman's, tells them, it can be home to 220 million advocates.

That's a lot of friends. And all our data shows that friends soon become customers.

Forget ROI - Return on Investment. Return on Involvement is the new metric.

Bottom line: if you are trying to sell something to the people of China, make sure you give people a good reason "why" to choose you over a competitor.

And if you do, consumers will even pay more for your product.

Not a bad deal.

Do good. And make money. Who says CSR and sustainability is intangible? It's proven to be revenue generating. And Edelman has the evidence to prove it. So to those that think that just a glossy ad, a special event or a celebrity face is the answer, think again. Especially in China.

With 220 million people reading and discussing how they feel about companies online and 60-80 million bloggers writing about companies, a simple, powerful fact of life in China emerges.

People will reward a company for doing good. And they'll punish it for doing bad.

It really is that simple.

Happy marketing.

The author is Managing Director, Chinese Mainland of Edelman, the world's largest independent public relations and communications consulting firm. The views expressed are his own.

(China Daily 06/30/2008 page7)