Well, recent news about the mother of all group-buying services is that its television commercial during Super Bowl invoked all sorts of negative responses. More than Chicago Sun-Times has reported, now the Chinese web is also blasting Groupon’s take on Tibet matter with every cannon available. For example, take a look at this article which is spreading across every single major Chinese tech portal right this moment. The story, as the opinion of practically all Chinese netizens, was in a furious tone saying that Groupon made an awful lot of mistakes about Tibetan culture, and what Tibet is really like, ending with a demand that “Groupon should stop insulting other cultures in the name of charity, cease all hypocritical actions, apologize with sincerity to every single Chinese whose feelings got hurt by the commercial.”
Wow. I imagine Groupon was thinking about doing China, a market it’s trying to enter right now, a solid. Donating money is a no-brainer, indeed. However, obviously for lack of basic understanding of China, they touched the wrong spot.
The common sense is that every single country on this planet has something that it doesn’t want others to poke into. To China, several things should never be mentioned light-heartedly, unless you are 1000% sure you are doing the right thing, and at least 25 of your friends agree. Some of them are: Tibet, the Dalai Lama, Taiwan, the Diaoyu islands, and sometimes Tian’anmen Square (depends on the context). Groupon could have been much more productive spending those three million dollars on advertising in China, or a fraction of that on hiring a Chinese consultant about dos and don’ts.
And that’s not the only trouble Groupon had in China so far.
Shortly before China’s Lunar New Year vacation, Groupon started building of local marketing team in Beijing. The progress was OK. Everything must start somewhere, and market entry starting with team building makes perfect sense. We have sources which said the company had an ambition of hiring up to 3,000 members in 3 months. A thousand recruitments per month, quite intense it is. And Groupon started by… going postal.
Groupon came into the Chinese employment market like a tornado, recruiting new blood “with surprisingly low qualifications” according to our sources. Meanwhile, the company started, well, acquiring human resources from competing Chinese group-buy websites, or Groupon-clones. It’s said Groupon offered double salaries for anyone who was working for its not-yet-competitors and wish to have a career change. It might be a normal move in western culture, where direct competition has always been encouraged, and dueling was widely accepted since ancient times. However, in China, it’s not that case.
“Face” is a very important factor of Asian cultures, particularly in China. To “gain face” means to be proven better than peers (in terms of wealth, ability, appearance, etc) in front of an audience. To “give somebody face” means to compliment him as much as possible and avoid pointing out his shortcomings in public. The contrary is to “lose somebody face”.
Chinese have always preferred secret plots to public challenges. To challenge somebody in broad daylight insults the guy himself, his friends, and his peers (not necessarily in good relationship with him). And that sometimes could turn everyone, prospected alliance included, all against you. The principle applies to politics and business, also personal affairs. Dueling had never been popular throughout Chinese history. Reasoning, court ruling, and even assassination had been loved better. If you are familiar with The Wheel of Time novels, Daes Dae’mar, or rather the “Game of Houes”, will give you some close idea.
So, Groupon’s brave charge hit a concrete wall. Chinese group-buy sites, although tensely fighting each other a moment ago, suddenly united together and shouted an announcement, making it clear that “those who have served at Groupon, be it only briefly or not, or only part time, will never find a place in our courtyards.”
Soon after that, Mr. Ren Xin, the VP of Groupon China, resigned over undisclosed “personal reasons”. Given the interesting timing, it’s hard to prevent people from generating wild speculations. It doesn’t take a hardcore Chinese to see that losing a VP in a HR blitz is a big loss of face.
The morale of the story? Speed is good, only when you are in the right direction. Doing 150 mph on a highway is exciting, but the same speed down a cliff is not. Always know where you are going. If you don’t, buy a GPS navigator, or stop every now and then to ask for directions.
So it unfolds probably the most eventful China entry in the IT sector. There’s some aftertaste lingering, too. Now we are almost sure that Groupon will be holding hands with Chinese behemoth Tencent. Today there came rumors that Tencent bought a domain name gaopeng.com, almost surely for this JV with Groupon.
In Chinese language there is only one possible character combination for that domain name that makes good sense. 高朋 gāo péng, “most distinguished friend(s)”. The pronunciation is close to “Groupon”, only resemblance of pronunciation isn’t everything in rebranding. Any question about this, please have a look at http://www.jiba.nl, whose Chinese transliteration will be horribly vulgar no matter how you tweak it.
In Groupon’s case, “gaopeng” is a nice name, only off the cue. The only usage scenario of this term in Chinese language is as part of “高朋满座” gāo péng mǎn zuò, “most distinguished friends filling the entire room”, which is used to compliment a networking event to be very successful. It makes a nice “group”, but totally has nothing to do with “on” or “buy”. On a casual look it might be mistaken as a SNS website competing with renren.com, kaixin001.com, and its JV partner Tencent.
If it’s us, we’d say invent another cool naming idea, and sell this domain to Facebook. How about that?
Article by Illuminant Digital Communications team, Beijing