For the country’s communications specialists, the explosion in online tech was something of a high water mark, but it is now time for them to reinvent themselves.
Photo from CFP
By XIAO Fang
PR probably is not the first thing that comes to mind at the mention of China’s internet economy but it is undoubtedly one of many industries that rose and fell with it. Since last year, Alibaba has reportedly laid off a decent proportion of its PR team, while Meituan announced significant changes in its PR function to “put more focus on technology progress and social values.”
Though it is an age-old profession, China’s PR industry as we know it today was born out of the internet economy. Back in 2003, Taobao, having just launched, couldn’t advertise because almost all major websites at that time dealt exclusively with eBay.
But soon the hype merchants were doing their thing, and a deluge of idolatry press followed, with breathless headlines such as “Why Taobao is the Future of e-Commerce” and “Alibaba Giving eBay an Ultimatum.”
They were not all tagged as sponsored, of course, but many cited bullish research reports straight from the belly of the Taobao beast.
PR professionals, who had previously spent their time shuffling between press conferences and photo-ops, suddenly realized that PR could be subtle, insidious and very powerful.
Another notable moment was the 360 vs. Tencent case in 2010. How it shaped China’s internet landscape is a question for another day, but unarguably the shouting matches filled with half-truths, stoked by curious netizens, elevated 360 from a relatively obscure software company to a household name. It went public in New York the following year.
The marriage between tech and PR was sealed in the 2010s, the golden age of the internet economy. Whether the hype or the PR comes first is largely a chicken-and-egg problem. But most founders agree that some persuasion is necessary to create demand before generous discounts are handed out to grab market share.
It’s hard to imagine living without ride-hailing, online groceries or dog walking apps today. But there was a time in the not-too-distant past when taxis were hailed off the street, vegetables bought in person, and dogs were walked by the neighbors’ kids. There is much debate as to whether these were better or more miserable times.
A 13-year PR veteran said in the early years of the internet economy, his industry played a pivotal role in educating the public and investors alike. Good PR attracts more users and a higher valuation, which in turn generates even better PR.
The best thing that could have happened to a startup back in the golden heyday was to get baked by a star VC investor that was a PR master. There was a time when Didi and Ofo (bike sharing) only had to whisper to hesitant investors that Allen Zhu, a Forbes-listed ‘top tech investor,’ had put money into their ventures to create a buzz. Never mind that Didi stocks are now in the toilet, and Ofo is long defunct.
The game started to change in the mid-2010s. With tech companies expanding fast and getting into one another’s lanes, stories gradually shifted from “how awesome my product is” to “how great my company is” and finally to “why my company is better than yours.”
It was not uncommon for even a mid-sized tech firm to have an army of in-house silver-tongued spin specialists dedicated to undermining its competitors and promoting its own values. Users asking about Alibaba’s history on Zhihu are likely directed to photos of beautiful young people having a ton of fun at the company’s 20th-anniversary celebration, followed by breathless employee accounts of how they were deeply touched by how Alibaba transformed the world.
Industry practitioners can rarely pinpoint precisely when things started to change but generally agree that the money hasn’t been flowing as quickly since 2019. The public is tired of entrepreneur worshipping, and there are more regulations on media companies. The fundamental reason, however, is that the tech scene is cooling.
No app born in the last two years has reached more than 10 million daily users, and some VC funds stopped following TMT (technology, media, and telecom) altogether. After a decade of explosive growth, finding another inch of virgin land has become excruciatingly hard. If someone already has two food delivery apps that are as claimed as excellent, why would they get a third?
PR professionals who work at big tech companies today often describe their jobs as unexciting, business-as-usual, or even work for the sake of working. The big tech that just a couple of years ago vied to be daring or even provocative – no publicity is bad publicity, remember – is only posting safe, faceless and bland corporate talk. “Happy Dragon Boat Festival” is about as exciting as it gets these days.
This is partially a natural side effect of the corporate lifecycle. Earlier in the tech boom, when companies were smaller and flatter, whoever was in charge of PR was much closer to the top dogs and their high-flying visions. In a fifty-thousand-person organization, in contrast, even the most brilliant idea can easily be killed in corporate infighting or simply lost in a long chain of command.
Many industry insiders observe that the best PR talent joined big tech during the boom years because of higher pay, but big tech squandered the opportunity to cultivate them. A mediocre talent pool will not save the industry from itself. And many see it as nothing more than a toxic bog of self-promoting bloggers, ethically fluid journalists, and experts eager to get into bed with capital.
Those tired of or fired by big tech PR are already on the lookout for the next boom, but the billion-dollar question is which one. The DTC (direct-to-consumer) sector has made a lot of noise, but it is essentially the internet economy but more mercurial and prone to bubbles.
Electric vehicles are arguably at the center of the greener and smarter economy of the future – in fact, car companies have always been a prominent patron of China’s PR industry – but EV makers are, in general, more ROI obsessed and thus tight-handed. Hardcore tech companies may need to occasionally court investors and assure regulators but do not need an army of PR specialists to help them do it.
The moral of the story is that the consumer economy, the internet or brick-and-mortar, is a numbers game. No number, even 1.4 billion, is too big to exhaust, and when it is exhausted, everyone that fed on it has to adapt and move on. The PR industry might have been complacent in the past, but it can’t afford to be so anymore.