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The NBA faces a billion-dollar crisis over one executive’s tweet about Hong Kong. Here’s why China is so hard for Western brands to break into.

The NBA this week became the latest in a slew of foreign brands who have landed in hot water in China.Dozens of Western brands have angered Chinese consumers with their marketing or public statements, and many still appear to be struggling to learn their lesson at high costs.Though the mistakes range from apparently racist ad…

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The NBA faces a billion-dollar crisis over one executive’s tweet about Hong Kong. Here’s why China is so hard for Western brands to break into.
  • The NBA this week became the latest in a slew of foreign brands who have landed in hot water in China.
  • Dozens of Western brands have angered Chinese consumers with their marketing or public statements, and many still appear to be struggling to learn their lesson at high costs.
  • Though the mistakes range from apparently racist ad campaigns to a failure to represent China’s perceived borders, it all boils down to one fundamental misstep, experts told Business Insider — a lack of respect.
  • “People underestimate what the Chinese consumer feels and thinks,” said Fenella Barber, founder of Bao business-relations advisory. “We assume from the West that this authoritarian state is sitting heavy on China […] there’s just more to the debate than that.”
  • Visit Business Insider’s homepage for more stories.

The NBA faces a billion-dollar crisis in China as all of the league’s partners in the country suspended their ties over Houston Rockets General Manager Daryl Morey’s tweet in support of the Hong Kong protesters, and basketball fans threatened to boycott its games.

The league is learning what many Western brands have in recent years — that China is an immensely difficult market to cater for.

In recent months, a slew of companies from Dolce & Gabbana to Marriott International have had to apologize to Chinese consumers — for reasons from displaying maps that exclude Chinese-claimed territories, to showing seemingly racist ads — or risk losing billions of dollars in revenue.

luxury shopping china

Chinese shoppers sit in front of the designer Miu Miu store in Beijing in August 2015.
Kevin Frayer/Getty


Some of those apologies have failed to stick, however. D&G, once a popular brand among China’s middle class, has suffered from weak sales in the country for months after the fashion house depicted a Chinese model struggling to eat Italian food with chopsticks in a November 2018 ad campaign.

Business Insider spoke to two experts to understand why China is such a fragile market, and why so many Western brands still appear to be struggling in the country. Both declined to directly discuss Chinese politics due to the sensitive nature of their work.

‘It’s about respecting your market’

Here are some examples of how brands have landed in hot water in China in the past year alone:

  • D&G’s ad campaign last year appeared to mock Chinese culture. Amid the backlash a woman also published screenshots appearing to show co-founder Stefano Gabbana making racist comments about Asians.
  • Brands including Versace, Swarovski, and Calvin Klein referred to Hong Kong, Macau, and Taiwan as Chinese territories. (Hong Kong and Macau are semi-autonomous Chinese cities. Taiwan is a self-governing island which China claims as its own.)
  • Tiffany & Co published an ad campaign that depicted a Chinese model striking a pose similar to a symbol of the Hong Kong protests. Though the company said the photograph was shot in May — before the protests even began — the campaign was released in October, at the height of the tensions.

All of these cases show one fundamental misstep done by the brands, Chinese consumer experts say: They all appeared to show a lack of respect and knowledge of the country’s culture and politics.

tiffany hong kong deleted ad

A screenshot from a Tiffany & Co ad campaign, which featured a Chinese model striking a pose similar to that used in the Hong Kong protests. The company has since removed the ad campaign.
Tiffany & Co.


The majority of Chinese consumers are patriotic and willing to punish people who mock them — like consumers in any other country would be, said Fenella Barber, the founder of Bao Advisory, a business-relations advisory based in London and Shanghai.

“They’re [Chinese people] proud of where they’ve come to,” Barber told Business Insider, referring to the country’s economic and social development into a superpower. “If they feel put down for whatever reason by a foreign company, they’re quite happy to jump on the bandwagon.”

“But where they [companies] are targeting the money and they do bad advertising, and to be honest, that’s just a lack of respect,” she said, referring to the D&G ad. “They haven’t really understood the market and they’ve done a pastiche of China in some way and expect that to work. That’s just — really?”

Dolce & Gabbana Cinese Ad

A Dolce & Gabbana ad campaign in November 2018 showed a model eating traditional Italian food with chopsticks.
Dolce & Gabbana/Instagram


The Chinese government has also weighed in on some of these controversies in the past — the Chinese Consulate in Houston criticized Morey’s tweet, for example — but most of these brands had been rowing back their comments to appease consumers, rather than the Communist Party.

China’s leaders and citizens are particularly sensitive about issues of sovereignty — like Hong Kong, Macau, and Taiwan’s perceived place in the country — and many foreign brands have had to issue apologies highlighting their respect for China’s borders.

“[Sovereignty] is incredibly important to the Chinese people […] so to have someone else be flippant about it” is particularly offensive to them, Barber said.

“Chinese soft power might not work well internationally, but it works very well at home,” she added.

Read more: China is waging war against a cafe because it served coffee to Taiwan’s president

—Norman Hermant (@NormanHermant) October 7, 2019

“You cannot separate politics and culture any more than you can anywhere else,” Domenica di Lieto, CEO of digital marketing agency Emerging Comms, told Business Insider.

“For example, Brexit is a political, legal, business, and social story that incorporates a range of views from other sides, with many based on inherent beliefs. People have to respect that.”

“It’s not really political, it’s about respect,” she added. “It’s about respecting your market and your consumers and understanding them, and understanding the motivation, and being very clear that you understand them.”

Barber added: “I think people underestimate what the Chinese consumer feels and thinks. They’re not all put upon. I think we assume from the West that this authoritarian state is sitting heavy on China — I think there’s just more to the debate than that.”

Di Lieto noted, however, that public criticism of brands who have shown apparent disrespect to consumers isn’t unique to China. Last year, BECCA Cosmetics received widespread criticism on Twitter after people accused it of darkening a white model’s skin tone to demonstrate the deeper shades.

china national day

People hold up their phones to record fireworks during China’s National Day celebrations in Beijing on October 1, 2019. This year also marked the 70th anniversary of the founding of the People’s Republic of China.
Aly Song/Reuters


The Chinese are buying on their own terms now

The Chinese market can bring huge revenues — mainland consumers spent 170 billion yuan ($23 billion) on luxury goods alone in 2018, according to consultancy giant Bain & Company — but it’s also one of the trickiest to capture.

Foreign brands can no longer operate on the belief that just because their campaigns work in the West, they will in China too, both experts said.

“For a long time, people were happy to buy Western products or a Western idea,” Barber said. “That’s not necessarily true anymore. In China’s case, things are changing, and the nuances haven’t necessarily changed within the Western businesses’ mindset.”

“China doesn’t like to be seen as a cash cow,” she added.

“China wants to be welcomed into the world and its people want to be given respect. The other thing that’s often misunderstood is that Chinese don’t necessarily want to buy into the whole American, Westernized dream, and the West is quite slow to catch on to that.”

Di Lieto also said: “For years Chinese consumers have been very patient with Western companies that have benefitted hugely from their income while not always giving appropriate consideration to their culture.”

But now, Barber says, “the Chinese are patriotic, nationalistic, happy to come down strong on a Western company if they upset the national image.”

Read more: The NBA has already felt ‘economic impact’ from Daryl Morey’s pro-Hong Kong tweet — here all the moves that have been made by China

China singles day shopping

The Chinese are huge shoppers: Here, packages await delivery at an unnamed distribution center in the country ahead of Singles’ Day, the country’s version of Black Friday.
VCG/Getty Images


Foreign brands are learning — at huge costs — that the speed and method of rowing back comments are affecting their market.

The NBA risked billions of dollars in advertising and broadcasting rights not after Morey deleted his tweet and distanced the team and league from his views, but after Commissioner Adam Silver defended Morey’s right to freedom of expression.

Di Lieto said: “A lot of crises escalate because of a lack of apology by the right person with the right sentiment, and there’s no point in an apology that sounds like you’re just reading off a script either,” she added.

“Chinese consumers will see straight through that. The same applies in all countries.”

“If the market is important to a company, and where the money is really big it should be … [that] you just need to tread a bit more carefully and not to treat it so lightly, to give the time and attention to do things properly,” Barber added.

daryl morey

Houston Rockets GM Daryl Morey.
Bob Levey/Getty Images


Some brands have foregone the Chinese markets to make a political stand, though.

After Beijing banned “South Park” from the country’s internet over an episode that addressed government censorship, the comedy show’s writers show issued a mock apology and wrote a new episode in which character Randy Marsh says: “F— the Chinese government.

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Tyson Fury’s promoter says an Anthony Joshua fight should be in the UK or USA, not Saudi Arabia

Tyson Fury fights Deontay Wilder at the MGM Grand Garden Arena in Las Vegas on Saturday, February 22.Should he win, and overcome Wilder in an anticipated trilogy bout later in the year, then there would be pressure to fight the WBA, WBO, and IBF heavyweight champion Anthony Joshua in a battle of Britain mega-bout.Joshua’s promoter,…

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Tyson Fury’s promoter says an Anthony Joshua fight should be in the UK or USA, not Saudi Arabia
  • Tyson Fury fights Deontay Wilder at the MGM Grand Garden Arena in Las Vegas on Saturday, February 22.
  • Should he win, and overcome Wilder in an anticipated trilogy bout later in the year, then there would be pressure to fight the WBA, WBO, and IBF heavyweight champion Anthony Joshua in a battle of Britain mega-bout.
  • Joshua’s promoter, Eddie Hearn, previously told iFL TV that the money to host such a fight in Saudi Arabia is difficult to turn down. Business Insider previously reported Joshua made $85 million when he beat Andy Ruiz Jr. in his anticipated rematch in Diriyah, last December.
  • But Fury’s promoter, Bob Arum, told Business Insider this week that regular fights in Saudi Arabia “kills the sport” and that promoters owe it to fans in established boxing markets like the USA or UK to put the fight there, instead.
  • Visit Business Insider’s homepage for more stories.

LAS VEGAS — A battle of Britain mega-fight between Tyson Fury and Anthony Joshua should take place in the UK or USA rather than Saudi Arabia, Fury’s promoter Bob Arum told Business Insider this week.

Putting regular fights in Saudi Arabia “kills the sport,” Arum said.

Fury, meanwhile, puts his unbeaten record on the line when he challenges for Deontay Wilder’s WBC championship belt on Saturday at the MGM Grand Garden Arena.

He could receive a $40 million payday for the bout. If he wins, he would command 60% of the purse in a contractually-agreed trilogy bout later in the year, Arum previously told Business Insider.

But that is not all.

Should Fury come out on top in his three-fight rivalry with Wilder, having drawn with the heavy-hitting American in 2018, then there would be pressure to meet his British rival Joshua so all four of the heavyweight championships would be on the line in a winner-take-all super showdown.

It is a bout Joshua’s promoter Eddie Hearn recently said could take place in Saudi Arabia, according to iFL TV. Hearn said he was planning to put “three or four” shows in Saudi Arabia in 2020, and a Joshua vs. Fury fight could command $200 million paydays for the fighters.

But speaking to Business Insider, Arum said the fight should not happen in Saudi Arabia because it would do a disservice to boxing fans in established markets. Putting the political situation to one side — a political situation which Business Insider previously reported as “sportswashing” — the bout should take place in a UK or USA city, Arum said.

“If we care about this sport and want to see it grow then the fight should take place either in the United States or in the UK,” Arum said. “We owe it to our fans to do that.”

Hearn held the rematch between Andy Ruiz Jr. and Joshua in Diriyah, December 2019. The bout was the second fight of the year between the two athletes, after Joshua was humiliatingly beaten by Ruiz Jr. in New York City earlier in the summer — one of the greatest upsets heavyweight boxing had ever seen. But his victory in Diriyah saw him collect a career-high check of $85 million, according to a previous Business Insider report.

“I don’t mind and I don’t fault Eddie for going to Saudi Arabia with the Joshua v Ruiz fight,” Arum said. “[He] made a good buck, that was okay, but you can’t keep doing it or you’re going to kill the sport.

“And it’s not political,” Arum added. “We’re putting politics aside. We’re just talking as a promoter who wants to appeal to the most boxing fans.”

Read more:

Deontay Wilder’s trainer says meeting the boxer ‘has been the greatest thing that ever happened’ to him

The winner of the Deontay Wilder and Tyson Fury fight could earn $138 million in 12 months on prize money alone

Tyson Fury says his fight with Deontay Wilder ‘is not a racial war’

Here is what would happen if America’s hardest-hitting heavyweight Deontay Wilder punched you in the face

Tyson Fury is preparing one of the boldest and riskiest fight strategies of his career to beat Deontay Wilder

3 tactics the Tyson Fury team can use if they’re worried his horrific cut will reopen and lose him the Deontay Wilder fight

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Politics

Super Tuesday made it crystal clear: Joe Biden is the Democrats’ best option to beat Trump

Joe Biden surged back on Super Tuesday and dominated in a slew of states.The electorate that turned out to vote for Biden is the coalition Democrats need to win over to capture the general election.So it is now clear that Biden is the best bet to beat President Trump.Michael Gordon is a longtime Democratic strategist,…

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Super Tuesday made it crystal clear: Joe Biden is the Democrats’ best option to beat Trump
  • Joe Biden surged back on Super Tuesday and dominated in a slew of states.
  • The electorate that turned out to vote for Biden is the coalition Democrats need to win over to capture the general election.
  • So it is now clear that Biden is the best bet to beat President Trump.
  • Michael Gordon is a longtime Democratic strategist, a former spokesperson for the Justice Department, and the principal for the strategic-communications firm Group Gordon.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit Business Insider’s homepage for more stories.

After a huge Super Tuesday, it is becoming apparent that former Vice President Joe Biden will be the Democratic nominee. Sen. Bernie Sanders will continue to earn votes and gain delegates, but the voters have spoken with perceptible vibration: Biden is the one who can defeat Trump, and he will.

Sanders bid to bring in a swath of new voters to the primary has fallen flat, while Biden has been able to build a diverse coalition of Democrats that can carry him to the nomination and beyond.

The pattern held for Biden in stirring fashion on Super Tuesday. Case in point: Biden got a huge boost in suburban areas of states like Virginia, North Carolina, and Minnesota that helped secure his big night. Not coincidentally it was also the suburbs that delivered the historic 2018 midterm win for Democrats.

The winning coalition

There are moderate Republicans, independents, and conservative Democrats who are anxious for a change in the White House, but they would rather skip the Presidential ballot line than vote for Bernie Sanders. They are not interested in the finer points of Fidel Castro’s reign, and Sanders’ doubling down on Castro is confusing but also stubborn. Many of these voters live in suburbs. They swing from election to election and these days just need a slight nudge to go blue.

In addition, African Americans are coming out in force for Biden. Had Hillary Clinton motivated Black voters to come out enthusiastically in 2016, she would be our President. Biden has their support in the primaries, and it will translate to the general, despite Trump’s best efforts.

Biden has the core of the coalition that elected Bill Clinton and Barack Obama and moved the Congress in 2006 and 2018. To make sure he beats Trump, he has to get the young, college-educated, and white liberal supporters of Sanders. Biden has the baseline no one else has but needs to embrace the Sanders wing as much as possible to deliver the knockout blow.

An uncontested convention

Biden needs to speak to the issues that motivate Sanders supporters and be careful not to critique them or their candidate. But the good news is that Donald Trump has done something that no one in the Democratic Party could do: put everyone’s eyes on the ultimate prize.

That’s why former rivals Pete Buttigieg and Amy Klobuchar endorsed before Super Tuesday, not after. That’s why Michael Bloomberg got out the moment he wasn’t viable. And that’s why we should not have a contested convention. As the primary season progresses and Biden continues to consolidate, Bernie Sanders should see the writing on the wall.

Unlike Hillary Clinton in 2008  and Sanders himself in 2016, I believe Sanders will get out as soon as Biden becomes inevitable and will support Biden enthusiastically, as will his supporters – because no one wants to live through Nixon on steroids for another four years.

Biden’s coalition that began to form in South Carolina expanded dramatically on Super Tuesday.  And it will carry him to the White House a little less than eight months from today.

Michael Gordon has a long history in Democratic politics and communications strategy. He worked in the Clinton White House and as a spokesperson for the Clinton Justice Department. He also has served on multiple national, state, and local campaigns.

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Chuck Schumer blasting conservative Supreme Court justices is more proof that Democrats are trying, and failing, to copy Trump’s bluster

When Chuck Schumer said Supreme Court justices Neil Gorsuch and Brett Kavanaugh “won’t know what hit” them this week, he was channeling Trump’s schoolyard-bully persona.In play-acting like Trump, Schumer launched yet another partisan “civility” conversation but buried his real message in noise.”If you can’t beat Trump, act like Trump” has become a political maxim of…

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Chuck Schumer blasting conservative Supreme Court justices is more proof that Democrats are trying, and failing, to copy Trump’s bluster
  • When Chuck Schumer said Supreme Court justices Neil Gorsuch and Brett Kavanaugh “won’t know what hit” them this week, he was channeling Trump’s schoolyard-bully persona.
  • In play-acting like Trump, Schumer launched yet another partisan “civility” conversation but buried his real message in noise.
  • “If you can’t beat Trump, act like Trump” has become a political maxim of our time. But only Trump is Trump, and his critics undermine themselves when they try to ape his “tough guy” act.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit Business Insider’s homepage for more stories.

Whenever the Donald J. Trump Presidential Library opens, it ought to have at least an exhibit immortalizing his sickest burns. Call him a schoolyard bully if you want. It won’t matter. He knows who he is, and he’ll hit you first and dirty.

But it’s not easy to pretend to be a bully. You either have the instinct or you don’t. Trump’s the real deal. And perhaps his greatest trick since entering political life has been to coax his political enemies into acting as juvenile and boorish as he is.

Senate Minority Leader Chuck Schumer provided the latest example this week when speaking at a Center for Reproductive Rights rally, where he addressed two Supreme Court justices by name with what can only be reasonably interpreted as a threat.

“I want to tell you, Gorsuch. I want to tell you, Kavanaugh. You have released the whirlwind, and you will pay the price! You won’t know what hit you if you go forward with these awful decisions.”

Does anyone truly believe that Schumer “has brought great danger to the steps of the United States Supreme Court,” as Trump put it in a tweet? Unlikely.

But it was a wildly inappropriate and bizarre display of tough-guy posturing, and Chief Justice John Roberts was completely correct to issue a rare public rebuke of the minority leader, saying: “Justices know that criticism comes with the territory, but threatening statements of this sort from the highest levels of government are not only inappropriate, they are dangerous.”

Schumer didn’t do himself any favors with the mealymouthed statement put out by his office, which accused Roberts of following “the right wing’s deliberate misinterpretation of what Sen. Schumer said.”

OK, then: So what was the correct interpretation?

According to Schumer’s office, he was referencing “the political price Senate Republicans will pay for putting these justices on the court, and a warning that the justices will unleash a major grassroots movement on the issue of reproductive rights against the decision.”

That’s patently ridiculous. Schumer didn’t say Senate Republicans “won’t know what hit them.” The grammar makes it clear the “you” was in reference to Gorsuch and Kavanaugh.

But the whole sadly comical episode is indicative of how Trump has influenced so many political figures into acting like him through pro-wrestling-style insults, childish tweets, and theatrical attempts at viral moments.

‘If you can’t beat Trump, act like Trump’ has become a political maxim

Trump’s been known for his brash, plain-spoken style since he became a national figure following the publication of his bestselling ghostwritten book, “The Art of the Deal.”

Later, as his business fortunes crumbled, he was forced to rebrand as a somewhat self-deprecating TV commercial pitchman to maintain relevance. Then, Mark Burnett cast him in the fictitious reality-TV role of a competent businessman in “The Apprentice,” where Trump really started to lean into the role of indomitable heel.

But it wasn’t until Trump joined Twitter in May 2009 that he unleashed his true id.

With a completely unfiltered bullhorn of global reach, he was free to spread fake conspiracy theories about President Barack Obama’s birthplace, level gross insults on female celebrities’ appearances, and make easily debunkable boasts about his own accomplishments.

Almost a decade to the day later, a lot of lawmakers have calibrated a “be like Trump” approach to fighting Trump.

During a desperate last-gasp attempt at survival in the 2016 Republican primary, Sen. Marco Rubio of Florida fought back against Trump’s “Little Marco” insults by saying Trump has small hands, adding, “And you know what they say about men with small hands? You can’t trust them.”

Rubio may have thought he landed a direct hit, but Trump’s got no shame, and was quite happy to play in the gutter. At a debate days after Rubio’s insult, Trump addressed the audience: “He referred to my hands — ‘if they’re small, something else must be small.’ I guarantee you there’s no problem. I guarantee.”

House Speaker Nancy Pelosi, widely considered one of the most patient and effective political tacticians in congressional history, has never quite sunk into Trump-level vulgarity or made intimation toward violence, but that doesn’t mean she’s above fighting Trump with a petty stunt.

The speaker grabbed headlines in February when she tore up a copy of Trump’s State of the Union address moments after the speech concluded. This came after Trump pointedly snubbed her attempt at a handshake before the address. Pelosi said afterward that “it was the courteous thing to do considering the alternatives.”

And, more recent, the vanquished 2020 candidate, billionaire, and former New York City Mayor Mike Bloomberg, responded in February to Trump’s “Mini Mike” insult with a tweet reading simply: “Impeached president says what?”

Bloomberg’s social-media team also used the @Mike2020 account to “satirically” go after Bernie Sanders following his comments in support of deceased Cuban dictator Fidel Castro, though they were forced to delete the thread after at least one of them was widely reviled as homophobic.

donald trump chuck schumer

President Donald Trump arguing about border security with Schumer in the Oval Office.

Mark Wilson/Getty Images


Trump didn’t make politics uncivil, but he’s helped make it even less dignified

US politics has never been civil.

Take the presidential campaign of 1800, when Thomas Jefferson reportedly hired a journalist to describe his opponent, John Adams, as “a hideous hermaphroditical character which has neither the force and firmness of a man, not the gentleness and sensibility of a woman.”

Trump would never apply such literacy to his barbs, which has worked well for him.

Rubio’s double entendre about Trump’s hands didn’t work because it was a one-off and rang false. He’s still young enough to be part of the GOP’s future, and if he ever gets comfortable enough in his own skin not to come off like a robot, maybe an authentic version of himself could be compelling to the national electorate.

Pelosi’s not a naturally theatrical showboater; she’s the ultimate poker player. Ripping up the State of the Union speech isn’t much of a bluff. It’s going on tilt. In the past three years, she’s shown an ability to ingratiate herself to Trump and score some political victories off him, but she did it by playing cool.

Bloomberg ran for president on his reputation as a technocratic CEO who ran New York with the same kind of humorless efficiency that made him his fortune. Yet he couldn’t hire people to effectively cut Trump to pieces on Twitter, and became the source of online ridicule himself.

That’s the whole point: Trump is Trump. His enemies are not.

Chuck Schumer’s threat — and it was a threat, however empty — to Gorsuch and Kavanaugh has ginned up the predictable partisan outrage, but it was an inauthentic attempt to out-Trump Trump.

As a communicator, Trump can be a shameless and vulgar thug. But unlike his opponents trying to ape his style, it’s rightfully perceived as authentic.

Schumer’s clearly passionate about reproductive rights and wants to make an upcoming Supreme Court decision into an issue that resonates with voters. But in play-acting like Trump, he launched yet another partisan “civility” conversation, and buried his real message in noise.

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