In 1993 Rupert Murdoch commented, "advances in the technology of telecommunications have proved an unambiguous threat to totalitarian regimes everywhere.”  China took notice and quickly scuttled Murdoch's plans for expanding satellite media in China.  Jump 20 years later to 2013, and it looks like the Communist Part of China is using this threat to its advantage to save itself.  

Today, millions of China's netizens are using microblogging services to raise awareness and bring transparency to 2 issues which threaten the Communist Party's legitimacy:

• Corruption by government officials
• Government officials fast-tracking their children into highly sought after government positions

And the central government is letting it happen.

The joining of internet users and officials is a new approach in graft-busting in China with officials taking clues from the public in social media before  launching investigations into implicated officials

The Central Commission for Discipline Inspection (CCDI) said Liu Tienan, vice-director of the National Development and Reform Commission (NDRC), was being investigated by the agency for serious violations of discipline - a common euphemism for corruption.  The official report follows accusations against Liu first made in December by Luo Changping, a deputy editor with Beijing-based Caijing magazine, who posted the allegations on his microblog account, which has tens of thousands of followers.  Previously, several high-profile corruption allegations by internet users led only to the downfall of low- to mid-level corrupt officials.

"The joining of hands between internet users and disciplinary officials is a seemingly new approach in graft-busting," Wang said, adding that the latter took note of clues provided by the public before launching investigations into allegedly implicated officials.

Unlike the 1980s, ordinary people are now more willing to stand up and point fingers at suspected corrupt officials.  The current leadership has shown its determination to crack down on corruption at all levels.  With the help of internet users, central government leaders will keep targeting corrupt officials, as this helps drive support from the general public.

China's netizens are exposing a culture of nepotism in the promotion of young officials which is causing overwhelming public disgust in China

Recent cases:

• 30-year-old Yuan Huizhong, the daughter of a former secretary of the Communist Party political and legal affairs commission in Yangzhou , whose appointment as deputy secretary of Yangzhou's Communist Youth League in February was exposed by a microblogger.  The media quoted an expert as saying it usually took at least nine years for a township cadre to be promoted to her level.
  
• Chang Junsheng, 22-year-old deputy secretary of China Communist Youth League's Wangjiang county committee in Anhui province, was sacked just over a week ago after the qualifications he presented in an open selection of officials were found to have been falsified. His father is the official in charge of promotions in the county.
• Xu Tao, nominated as deputy secretary of Xiangtan county in Hunan in December at the age of 27, was removed from the post on May 7 after microbloggers raised questions about his five years of work experience. His father had been chairman of the local people's congress and his mother was deputy director of the district's procuratorate.
  
  

With support of the top leadership, the internet and social media netizens are nullifying the old Chinese saying "the sky is high and the emperor is far away", which is used to describe how central officials make policy, then local officials do whatever they want.

Sources:

• "Nepotism puts system for promotions in spotlight", South China Morning Post, May 26, 2010
  http://www.scmp.com/comment/insight-opinion/article/1246072/nepotism-puts-system-promotions-spotlight
• "Social media seen as new weapon in graft-busting in China", South China Morning Post, May 14, 2013
  http://www.scmp.com/news/china/article/1237116/joint-effort-between-social-media-and-officials-hailed-probe-official
• "The Son also Rises: nepotism doesn't disappear in China, it just gets a promotion", South China Morning Post, May 13, 2013
  http://www.scmp.com/news/china/article/1236343/son-also-rises-nepotism-doesnt-disappear-china-it-just-gets-promotion
  
• "How Murdoch Got Lost in China", New York Times, May 4, 2008
  http://www.nytimes.com/2008/05/04/business/media/04shelf.html?_r=0

CKB Solutions is all about real solutions for the real world.  To learn how we can help your business, contact Greg Kovacic in Hong Kong.

Before the ubiquity of smartphones, retailers had the advantage over consumers.  It was nearly impossible for consumers to compare prices in real time between offline and online retail channels.  The smartphone leveled the playing field for consumers.  Not surprisingly, prices are being leveled in the process.  All else being equal, consumers want to pay less than more.   Duh! Consumers, with the new found power in the palm of their hands, understandably took to showrooming to make sure they were getting the best price/deal. 

Showrooming is when a consumer checks out a product in a physical store then goes online to make the purchase.  Showrooming impacts some retailers more than others.  E.g. Customers showroom electronics more than any other product category.

Where digital is integrated in the real world, there is only going to be one price (adjusted for shipping and handling, warranty, etc) for both offline and online retail channels.  Retailers would be wise to use their pricing strategy to encourage consumers to visit their physical store, their online store, or both, and purchase via whichever makes them most comfortable.  With pricing leveled, retail success will be driven by service and selection.

Best Buy recently launched a new initiative "to price match the current pre-tax price for new, identical, immediately available products from local retail competitors and select designated major online retailers at the time of purchase only. (No subsequent price matching of competitors is allowed).  If Best Buy lowers a price on a product (online or in-store) we will allow price-matching up to 15 days following the original purchase."

With pricing leveled, Best Buy will have to compete on service and selection.  

Must Haves for Customer Service Differentiation:

• Seamless integration between offline and online
  
• Knowledgeable and supportive retail experience whether offline or online with no forced upselling
• Ability to purchase online in-store if out of stock in-store
  
• Do the homework for consumers and make it easy for consumers to self-educate themselves on why your price is  the best value for the product including delivery and warranty

Must Haves For Product Selection Differentiation:

• Exclusivity, even if only for a lead period
• If a mass market retailer, wide selection across styles and price points
• If a niche market retailer, unique selection at price points relevant to target consumers
• Latest models

Source: "Best Buy Says It Has Killed 'Showrooming' For Good", Business Insider, February 18, 2013
http://www.businessinsider.com/best-buy-new-price-matching-policy-2013-2

CKB Solutions is all about real solutions for the real world.  To learn how we can help your business, contact Greg Kovacic in Hong Kong.