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Discrimination Against Chinese Consumers. Or Not?
Just read an interesting post over at the China Business Services Blog, entitled, Consumer (& Brand) Discrimination (& Crisis). The post focuses on the following incidents of alleged discrimination against Chinese consumers (I am using the word alleged simply because I do not know whether the facts are correct or not):
- “…CCTV accused Apple of discriminating against Chinese customers by offering lower levels of service and charging fees for replacing back covers of faulty iPhones, which is done for free in other countries”.
- “…Following a post on Sina Weibo…The claim made was that the hotel [in the Maldives] removed hot water kettles from the rooms of Chinese guests while leaving them in the rooms of European guests, ostensibly because Chinese were cooking in their rooms…The complaint received wide exposure on Chinese social media and calls for boycotting Maldives by Chinese tourists….”
All of this got me to thinking of how I have heard of two law firms that treat Chinese potential clients differently from how they treat potential clients from other countries. One of these law firms (based in Australia), charges $500 for its initial meetings with Chinese interested in hiring the firm for immigration work, but does not charge anyone else for this initial consultation. I heard about this years ago, so not sure if this firm still does this, but its reasoning was two-fold. First, the law firm had concluded that most of the Chinese that came to the initial consultation (when it was free) were doing so not out of an interest in hiring the law firm for their immigration work, but to “milk” the firm for as much information as possible and then go off and do the immigration work themselves or with a considerably less expensive law firm. Second, this law firm was not really interested in getting Chinese clients because “they were always so difficult and time consuming anyway.”
The second law firm (and again this was years ago) simply does not return phone calls from Chinese companies and individuals interested in doing business in the United States. It made that decision after spending “huge amounts of time dealing with people that were simply never going to pay our rates.”
What is going on here? Are the above actions right? Could not these companies/firms have handled these situations/consumers/potential clients differently? Are you aware of other instances similar to the above? Should these companies/firms be making cultural adjustments/accommodations? Take the hotel example, would it have been better for the hotel to have pulled the kettles from all of its rooms? Would it be fair to claim that the problems of these companies/firms actually lie with their own failures to better understand Chinese culture? The “China experts” are always stressing the need for companies to adapt to the Chinese consumer, but where does adjusting end and discrimination begin? Is there a difference between a hotel and the law firms treating Chinese customers differently from other customers within their own, foreign country, and Apple treating the consumers differently in one country as opposed to other countries?
I have a lawyer friend who works harder than anyone I know to get Chinese companies as clients. He was telling me how my law firm should be doing the same thing. His strategy is to excessivly wine and dine potential Chinese clients at least once a month for a year before really making a play for their business. Then, he says that he under-bills the Chinese companies for the first six or so months of the relationship to further solidify his standing with them. My response to that was that was all way too difficult, especially since we are doing just fine with our existing client base. That’s just our doing a normal cost benefit analysis and ignoring the high hanging fruit, right?
What do you-all think?
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We will be discussing the practical aspects of Chinese law and how it impacts business there. We will be telling you what works and what does not and what you as a businessperson can do to use the law to your advantage. Our aim is to assist businesses already in China or planning to go into China, not to break new ground in legal theory or policy.
2013-03-24 09:49:43
Source: http://www.chinalawblog.com/2013/03/is-discrimination-against-chinese-consumers-rampant.html
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