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Groupon's Super Bowl ad could backfire in China
An image from Groupon's controversial Tibet commercial.
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TEXT OF STORY
STEVE CHIOTAKIS: The Super Bowl always features some high-profile commercials. But this one from Groupon is getting a lot of international attention.
GROUPON COMMERCIAL: The people of Tibet are in trouble. They're very culture is in jeopardy. But they still whip up an amazing fish curry. And since 200 of us bought at Groupon.com we're each getting $30 worth of Tibetan food for just $15 at Himilaian Restaurant in Chicago.
There's backlash against Groupon from human rights groups and possible repercussions all the way to China.
Marketplace China Bureau Chief Rob Schmitz is with us from Shanghai to talk about it. Hi Rob.
ROB SCHMITZ: Hey, Steve.
CHIOTAKIS: So, if Groupon has been wanting to expand to China, how is this working out for them?
SCHMITZ: Not so well. One of the first rules you learn when you do business in China is to steer clear from the three most sensitive issues among the Chinese -- they're known as "the three T's:" Taiwan, Tiananmen, and Tibet. With one 30 second ad, Groupon has managed to offend everyone involved with the Tibet issue, regardless of what side they're on. And they've certainly angered the Chinese side. The Chinese blogosphere lit up after word spread about this ad.
CHIOTAKIS: So what does this mean,Rob, for the company's future there in China?
SCHMITZ: Well, even without this enormous faux pas, reaching Chinese consumers wasn't going to be the cake-walk that it was for Groupon in the U.S. Group purchasing and group coupons aren't new to China. There are already more than a thousand Chinese companies that offer the same service as Groupon. But one thing those companies don't have is a partnership with Tencent. Tencent is the most profitable Internet company in China. More than a half a billion people use its instant messaging service. According to China's state-run press, Groupon is partnering with Tencent for Groupon's China launch. The big question is whether this Tibet ad will jeopardize that partnership. If it doesn't, Groupon still has a chance here, they just gotta mind their p's and q's -- and t's.
CHIOTAKIS: All right Marketplace's China Bureau Chief Rob Schmitz, joining us from Shanghai. Thanks, Rob.
SCHMITZ: Thanks Steve.
Walking through the subway stations in Beijing, I was slightly taken aback by the Groupon ads that were hung on the walls as I had no idea they were a global company. As a Groupon user myself, I have spent some time reflecting on what I think about the concept of Groupon and if it is something the Chinese market would respond positively to. I was interested when I read in the post that this group coupon concept is highly popular in China, but clearly from the issue of the ad, Groupon may not be one of the top contenders for the Chinese. As a college student entering a globalized marketplace, I have learned how important it is to spend time investigating cross-cultural faux-pas, and clearly Tibet is an important one to avoid in China. In the book 'Chinese Lessons' by John Pomfret, he shares how difficult it was for anyone to travel into Tibet in the 80's, especially for the Chinese. He discusses how Hu Yaobang went to Tibet to apologize for their destruction of their cities, but public apologies don't always fix all hard feelings, especially when conflict continues. Regardless of what side of the issue you're on, you shouldn't bring it up in the first place. This also reminds me of the Benetton ads in the 90's-what are you selling? Are you trying to promote your product or are you just trying to get a rise out of people and go with the theory of any press is good press? I will be curious to see if Groupon can become successful in China and if they can learn from their mistakes and not offend another country in the future.
Why does everybody have to do business in China? There are 173 other countries where then can expand to, if they really want to and have the ability to do so. Contrary to what your article suggests, we can argue that this will make Groupon more popular in the US, owing to the testy relationship with China. Also people who are sympathetic to Tibet are likely to remember Groupon first; On the other hand, I cant think of many people who will empathize with China other than CEOs and Wall street fat cats.
