Reputation Management: PR vs. Search vs. China’s Water Army

Facebook has been in the spotlight recently as news of the social network hiring PR firm Burson-Marsteller in an alleged smear campaign on Google’s privacy issues went awry.

Hiring agencies to smear a competitor isn’t new. In the search world, this is done in more subtle ways through buying competitors keywords or taking advantage of a competitor’s PR crisis to run SEM campaigns in your favor.

But what unfolded was a PR firm using conventional media relations to influence bloggers and mainstream publications that backfired after the email exchange made its way into the public domain.

If Facebook were to try something similar in China (no, I’m not advocating smear campaigns but…), it would have been a different story.

As a brand marketer targeting China, it’s easy to get local PR firms that hire the water army – better known in Chinese as “Shui Jun” – to post positive comments about your company or negative comments about a competitor on the Internet under the guise of e-PR.

This “army” could number from a few hundred to thousands of anonymous Internet users that will delete or post comments to influence public opinion dictated by the PR firms.

Mengniu, a dairy giant in China, was exposed last October for paying $42,000 to a PR agency, which hired an online water army to smear its competitors’ on the country’s up and coming microblog that consumption of their products will lead to premature puberty. Police had to detain its brand manager and staff as a result.

China’s Internet PR business alone is worth $143 million, based on data from the country’s International Public Relations Association in Beijing. While there’s no official figure what proportion goes into hiring water armies, it seems this practice will continue to flourish.

For companies that can afford to pay and protect their brands, it is likely there would be more demand for online reputation management services. This is one area where specialist firms in search or social media monitoring would go head to head with PR firms to compete for a slice of the market.

Early this month, Omnicom Group’s PR firm Fleishman-Hillard unveiled its specialist unit, BlueCurrent in Hong Kong that offers search and social media strategies, including crisis management, reputation monitoring and influencer marketing.

In Asia, BlueCurrent have presence in Japan since five years ago, mainly in influencer marketing with Procter & Gamble among its list of clients. The newly minted Hong Kong office serves as a regional hub to service clients in Greater China as well as Southeast Asia like Singapore and Indonesia, said James Hacking, vice president for BlueCurrent Hong Kong.

Hacking pointed out one of the misconceptions people have about a PR crisis is that negative coverage isn’t limited to being found on search engines only. Internet users tend to get their information from a wide range of sources and this could range from searching on YouTube for video clips, or the China equivalents like Youku or Tudou, to discussion forums or microblog sites that are thriving in the region. Although the crisis may break out in one country, news of it goes global rapidly.

Max Sim, vice president of BlueCurrent Hong Kong added that in China, the water army could be quite sophisticated in making their comments hard to search and monitor.

For instance, when the Sanlu milk powder brand in the country was suspected of being tainted with melamine, many photoshopped pictures were posted online parodying the incident as reported by a local blog on China Internet trends. Because the words are embedded in the images, it makes it difficult for companies to track the negative comments using keywords only.

Barely three weeks into their new roles, Hacking and Sim have received many queries from brand marketers. With the competitive nature in travel and tourism, it’s no surprise many in the industry are interested in reputation management but just about any consumer-facing sector is keen to protect their brands too. The interest isn’t limited to corporations and varies from government departments to the individual level of the CEO as well.

And if rumors of Facebook entering China are true, the Palo Alto-based social network better get up to speed on how the world of e-PR works in the country, or risk becoming a “victim” in the wild, wild East.