Apr 8, 2005

P&G calms plaintiff

Consumer rights is a big issue in China, as major brands are discovering. Will Procter & Gamble be able to weather the latest conflict?

P&G calms plaintiff
De-Wrinkle Active, the latest launch in China from Procter & Gamble's exclusive SK-II skincare line, has attracted a blaze of unwelcome publicity after a Jiangxi woman filed a lawsuit against China's biggest advertiser, as well as the shop that sold her the product, the company that distributed it and even the celebrity who promoted it, on the grounds that she had been deceived by the brand's advertising.

The vertiginous price tag of SK-II has kept its products far out of reach of most people, but the court case concerning the anti-wrinkle cream, which was due to be heard on April 1, has ensured that the ultra premium brand has now become public property in China, with attention turned to how P&G defends itself against the potentially damaging claims.

The company is up against a worthy opponent, the same lawyer who forced Anheuser-Busch to change the labelling on its bottles after successfully arguing in court that the brewer's claim to be the world's number one beer contravened Chinese laws against comparative advertising.

This case has already prompted P&G to recall product information about the cream following claims that they were misleading. There may also be a wider fallout for advertising in China, potentially re-writing the rules of engagement for celebrity endorsements by examining the relationship between SK-II and the star of its ads, actress Carina Lau Ka-ling.

The development of SK-II in China mirrors the country's growing status as one of the world's major markets for luxury goods but its day in court reflects another emerging trend -- consumer activism, which has risen out of nothing five years ago to become a major force in Chinese society today. P&G is not the only company to find itself at the receiving end of this new consumer confidence, as stories pitting ordinary people against huge corporations abound in the media. P&G's coverage has been better than most, with articles appearing applauding its response to the crisis, but the case serves as a salutary reminder that consumer attitudes are changing so fast that it will be the most adaptable, rather than the merely strong brands that survive.
Source:
Campaign Asia
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