China Dell Hell (aka Processor Gate)
Dell Credibility Crisis
I got a quote in a Business Week article, "Mad as Hell in China's Blogosphere." The article touches on increasingly vocal and active consumers on Chinese BBS and blogs taking on companies. I previously touched on this online consumer activism, what I call "Crisis 2.0," here.
The BW article cites a recent Dell incident as a case study where a consumer complaint on a BBS about a processor eventually led to a class action suit.
Here is the timeline for Dell's "processor gate."
June 23: First consumer complaint on IT168 BBS notebook forum
June 24: IT168 forum administrator invites others to complain about Dell
June 24: IT168 sets up special "Dell Hell" section to track issue
June 28: Dell responds to the incident, says "sorry"
June 29: Lawyer Ma Jianrong invites forum participants to join a class action lawsuit
June 30: Story moves to mainstream media, dubbed "Processor Gate"
July 4: CCTV reports the class action suit
July 5: Dell offers refund; consumers not mollified
Troubles in social media are unfortunately not new for Dell. See related articles on "Dell Hell" in US last year:
Buzzmachine: Dear Mr. Dell (original Dell Hell post)
BusinessWeek: Dell in the Blog House (analysis of Dell Hell in US)
Onalytica: Measuring Blog Influence on Brands (Dell as case study for CGM influence on Brands)
Dell recently set up a blog in the US to deal with its "credibility" crisis.
More recently, Dell is having problems with notebook batteries catching fire and being caught on consumer digital cameras here, here and here. These stores are also getting picked up in the Chinese blogosphere. Dell Hell is now a global phenomenon.
See also Pacific Epoch: Customers To Sue Over Dell Chip Controversy
posted by Sam Flemming @ 11:11 PM
10 Comments
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10 Comments:
"Crisis 2.0", you did coin a great term. Companies will know this term better, and it tastes bitter.
And in a further extension of their woes with Jeff Jarvis of Buzz Machine, an intern at Dell's PR company, CGI, left a scorchingly unprofessional comment on Jarvis' blog, thus further dragging Dell's name through the mud.
This lead to a critical post from Uber PR Man Richard Edelman and a subsequent apology from CGI.
Whoops. On the bright side, Dell did "join the conversation". Although they might be wishing they hadn't.
Sam-
The article makes reference to business related blog complaints, where would I be able to find these blogs?
Interesting how this progressed exactly how one would have anticipated it would have progressed had Dell done the same thing in the U.S. But, I suspect Dell would NOT have handled this the same way in the U.S. I think in the U.S. their legal and PR people would have counseled them from the get-go and I do not get the sense that happened here.
D.A.,
We are finding most "consumer discussions" about companies, products, and services happening on BBS sites. My blog mentions IT168 for notebooks. Also, you can find www.younet.com for mobile phones and www.xcar.com.cn for automobiles. You can find BBS sites/forums for almost any category of consumer product, esp. the more expensive, complicated ones which require research. Does this answer your question?
Imagethief wrote a nice piece further analyzing the Dell situation here: http://tinyurl.com/nd3g6
Great article, Sam. You show well the dangers that multi-nationals can run into in China if they do not take into account the blogosphere. Dell is a good case in point that you have highlighted.
Our own research has found similar examples in China, like Haagen-Daaz and Colgate.
Shaun Rein
Managing Director
China Market Research Group (CMR)
www.researchcmr.com
Ouch - does this pain never end? What's interesting is the way the Chinese seem to have learned very quickly about the effectveness of this medium. Rock on.
Sam, great to meet you at the office yesterday afternoon. Do keep in touch.
By the wayi always thought of Dell as a company strong at customer service. I think they found the wrong country to sleep on.
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