Social media platforms offer tools for businesses to reach prospective consumers at rates never before seen. These businesses can micro target their ideal demographics regardless of physical location, even crossing borders, and push advertisement right into their newsfeeds. What’s more, internet giants like Facebook and Google offer complex metrics on individual behaviours that give advertisers crucial insights into the demographics they’re looking to capture.
While social media platforms present incredible opportunities to spread a message and organically reach potential consumers, they also present grave risks for those very same reasons. If businesses aren’t careful in crafting their message and researching the needs and behaviours of their target demographic, their message can spread for the wrong reasons.
Luxury fashion brand Dolce and Gabbana provided a warning for businesses on social media when in November 2018, their video advertisements in preparation for an upcoming show went viral.
The videos featured an Asian women trying to eat several foods with chop sticks while a narator intentionally mispronouncing the process. The videos contained racist stereotypes and resulted in large scale boycotts by Chinese celebrities and consumers.
In addition, hateful and racist Instagram messages surfaced, allegedly sent by Stefano Gabbana saying derogatory things about China.
Major Chinese companies that carried the brand also responded by dropping Dolce and Gabbana from their stock, a major blow to the company trying to jump on the emerging Chinese luxury market.
Impact to Dolce and Gabbana’s Market Share
China represents one of the largest emerging markets for both middle class consumer goods and luxury items. Recent reports show China has delivered over half total growth in luxury spending between 2012 and 2018, and is predicted to account for 65 percent of the world’s additional spending by 2025. Hollywood for example has begun to cater major blockbusters to the Chinese market, adding Chinese actors and characters to more and more high budget items, and portraying China in flattering circumstances. As China reporter for Axios Bethany Allen-Ebrahimian writes:
“China’s burgeoning market of movie-goers is expected to soon surpass the United States as the largest in the world. China’s censors have wielded this power adroitly, mandating that production companies abide by [China’s] bottom lines in order to earn one of the 34 coveted spots allotted to foreign films for distribution in China each year.”
Other sectors of the economy have similarly tried to carve off their piece of the emerging Chinese market as it continues to grow into a consumer powerhouse. By alienating this major market, and potentially other emerging Asian markets who may just have easily been offended by the videos and conduct, Dolce and Gabbana misses out on the opportunity to cement themselves as a cultural icon and social class symbol.
Even if Dolce and Gabbana earns back the trust of Chinese consumers, these consumers may already associate other brands with being the top of haute culture and symbol of wealth. The longer that Dolce and Gabbana suffers public backlash from this event, the more their competitors cement themselves as long term default brands for luxury items.
In addition, western markets are growing more conscious of racial tensions and value companies with positive relationships with marginalized groups. These racist videos may impact the perceptions of those consumers even outside of Asia, who would rather support organizations with a cleaner track record on social justice issues. With the speed in which content can spread and opinions can be shared on social media, Dolce and Gabbana have to worry about global pushback to their actions.
Proposed Solutions and Recommendations
As shown above, China and other Asian markets are quickly becoming major purchasers across demographics and sectors. While that growth means alienating the whole market will result in major profit losses, it also means that the market might be large enough to offer room for multiple products and even move past the blunder as new purchasers enter the market.
The 65 percent of the world’s additional spending by 2025 that China is predicted to achieve will come from new consumers entering the economy, and many of these purchasers potentially would not have the negative associations with Dolce and Gabbana that current consumers do. Though some will inherit the negative associations from others around them, Dolce and Gabbana have the opportunity to reach out to these new consumers with a fresh start.
The #MeToo movement and the Black Lives Matter movement have both had a major online presence, and have unearthed various problematic social media posts and behaviour from individuals and companies, resulting in public backlash on numerous occasions. These movements have certainly brought the importance of racial and gender equality to the centre of social media dialogue, which has resulted in several companies having the opportunity to provide examples of apologies for past behaviour; some apologies have been successful and some not so much. The best apologies have the following characteristics in common:
1) Actually apologize for behaviour and recognize the harm it has done to marginalized communities.
2) Recognize that the behaviour may be systematic and comes from a place of privilege. The behaviour is problematic on it’s own, and also because it represents a broader social issue.
3) A commitment to do better, which can be done through active work on company culture terminating relationships with problematic individuals, and making financial/cultural/ongoing contributions to the issues and communities at hand.
A great example of an organization who apologized for a racially coded scandal is Starbucks. After an incident where a Starbucks manager treated two black patrons in a racist way, Starbucks responded quickly with a sincere apology and tangible steps responding to the incident, most notably a plan to close 8,000 stores for racial bias training.
While Dolce and Gabbana did release an apology video filmed by the two founders of the brand, they failed to convince audiences of their sincerity and work to meet characteristics 2 and 3 as listed above. To begin moving past this incident and working to grab a foothold in the Chinese market, Dolce and Gabbana should communicate an updated message of apology that meets the three qualifications mentioned above.
Every day that Dolce and Gabbana isn’t actively increasing their market share in the highly coveted Chinese market, other luxury brands are taking their place, cementing themselves as irreplaceable cultural icons and signifiers of wealth. Missing out at this crucial juncture can have long term implications for their global market share. Asian markets are only growing, and Dolce and Gabbana can not afford to be completely excluded from the game.
Starbucks responded quickly, sincerely and took decisive action when dealing with a racially coded scandal with their brand. They committed to doing better, and took the financial hit of temporarily closing their businesses so employees could take racial bias training. Dolce and Gabbana has yet to take these steps, and consumers know that they aren’t sincere in their apologies.
Dolce and Gabbana needs to release an updated message as soon as possible with commitment to learn and do better, and recognize the harm their actions have caused. Without this sincere apology, other brands will continue to surpass them in this highly sought after market. For now, they stand as a warning example of the power of social media, not only as a platform for sharing your curated message with the exact target audience you intended, but a highly connected community where a poorly conceived message can spread fast to consumers who will change their purchasing behaviour to support brands with the values they share.
Justin Draper is a Canadian fiction and non-fiction writer who focuses on themes of politics and culture. He is currently completing his Masters degree in Communication and Technology at the University of Alberta.
Follow Justin on Twitter at @JustinDraperYEG