Core Insights - Xibei, once a thriving brand with 6.2 billion in revenue, is now facing an unprecedented crisis due to a public relations incident in September 2024, leading to a sharp decline in stock price and brand reputation [1] - The founder's confrontational approach and emotional public relations strategies failed to resolve the issue, resulting in a significant drop in revenue and daily losses of one million [1][22] Group 1: Crisis Origin and Management - The crisis began with a minor complaint about the price of pre-made dishes, which unexpectedly garnered national attention [3] - Xibei's response deviated from standard public relations practices, as the founder perceived the complaint as an attack and mobilized 18,000 employees for a company-wide meeting, escalating the situation [3][20] - The company's misunderstanding of internet dynamics led to a perception of online observers as adversaries, exacerbating the crisis [5] Group 2: Public Relations Missteps - Emotional appeals and unusual compensation strategies, such as offering vouchers and even houses, failed to mitigate negative sentiment and instead invited ridicule [7] - The core issue was not the public sentiment itself but the company's inadequate response, which lacked substantial reforms and failed to address consumer concerns [7][9] - Xibei's eventual corrective measures, such as offering freshly made children's meals and transparent kitchen practices, were implemented too late, highlighting the need for practical solutions in public relations [9] Group 3: Financial Implications - Following the crisis, Xibei adopted a strategy of widespread price reductions and voucher distribution, which temporarily boosted sales but severely impacted brand value [11] - Sixty percent of new customers utilized vouchers, leading to a significant drop in average transaction value, indicating a loss of brand premium that took years to build [11][13] - The brand's positioning shifted from mid-to-high-end dining to competing with fast-food outlets, a strategic misstep that undermined its market position [11][13] Group 4: Strategic Failures - Xibei's failure to address its core competitive advantages, such as understanding family dining needs, contributed to the decline in brand perception [13] - The company launched nine sub-brands from 2016 to 2023, all of which failed due to misalignment with market demand and poor pricing strategies [15] - The lack of learning from past failures and the absence of a coherent strategy led to resource wastage and intensified the public relations crisis [16] Group 5: Lessons and Future Directions - Post-crisis, the founder expressed intentions to learn from successful brands like Haidilao, but the execution fell short due to mismatched employee treatment and service quality [18] - Xibei's superficial imitation of successful strategies without understanding their underlying logic resulted in limited corrective outcomes [20] - The experience serves as a stark warning for the restaurant industry, emphasizing the importance of long-term strategy, consumer communication, and effective crisis management [26]

Core Insights - The controversies surrounding Xibei's prepared dishes and the "Anemone" fireworks incident have sparked widespread social attention, highlighting the critical role of media in information dissemination and focus [2][3] - Both incidents suffered from initial response failures, leading to rapid spread of negative information without timely media guidance [2][3] Group 1: Xibei Prepared Dishes Controversy - The controversy began on September 10 when issues were exposed by Luo Yonghao on Weibo, leading to a surge in discussions on short video platforms, with related videos on Douyin exceeding 100 million views [2] - The main criticism of Xibei centered on a lack of transparency regarding their 72% prepared dishes, contradicting customer service claims about fresh ingredients, which led to accusations of "playing word games" [3][9] - Following the incident, Xibei's offline store traffic significantly declined, with core stores in first-tier cities experiencing drastic drops, and overall revenue facing substantial pressure [10] Group 2: Anemone Fireworks Incident - The Anemone incident ignited controversy on September 19, with discussions peaking on September 20, where the topic reached 429.71 million views and 4,063 discussions [2][7] - Media highlighted the ecological concerns regarding the brand's claims of soil restoration, questioning the effectiveness of their measures and contrasting them with their long-standing brand philosophy of "respecting nature" [3][5] - Following the incident, the parent company of Anemone, Amer Sports, saw a notable decline in stock price, dropping 5.82% to $35.27, alongside reports of increased customer returns and a shift towards competitors [10] Group 3: Public Relations and Media Response - Both brands faced significant damage to their core trust systems due to a disconnect between public relations responses and media exposure of core issues [3][10] - The lack of effective communication and remedial measures through media led to sustained negative sentiment and actual business losses for both brands [10] - In contrast, the case of Haidilao's 2017 crisis management is cited as a benchmark for effective public relations, demonstrating how proactive media engagement can restore brand trust [14][19]

Core Viewpoint - Xibei has initiated a significant price reduction across its nationwide stores, with discounts ranging from 20% to 40%, but customer response has been lukewarm, indicating a potential disconnect between the company's actions and consumer perception [1][3]. Pricing Strategy - The price reductions observed in Xibei's "Luo Yonghao" set menu in Beijing show a total price drop from 663 yuan to 598 yuan, equating to a 9.8% decrease [2]. - Specific dishes like the "Sesame Oil Fried Eggs" saw a price drop from 43 yuan to 33 yuan, a reduction of 23.26%, while the "Five Tomato Sour Soup Noodle Fish" decreased from 29 yuan to 23 yuan, a 20.69% drop [2]. Customer Sentiment - Despite the price cuts, consumer sentiment remains negative, with a significant majority of users on social media expressing they will not return to Xibei, highlighting a lack of trust in the brand [5]. - The competitive landscape in the restaurant industry is noted, with consumers having numerous alternatives, which diminishes the effectiveness of Xibei's price reduction strategy [5]. Operational Challenges - Xibei's price reduction is seen as a desperate measure to counteract a significant drop in customer traffic, with reports indicating many empty tables during peak hours [3]. - Previous attempts at customer retention, such as offering 100 yuan dining vouchers, have not proven effective in attracting and retaining customers [5]. Public Relations and Brand Image - Xibei's handling of the public relations crisis is criticized, with comparisons drawn to successful crisis management by other brands like Haidilao [10]. - The company's leadership, particularly CEO Jia Guolong, is portrayed as out of touch with consumer sentiment, which has contributed to the brand's declining reputation [7][10].

Core Viewpoint - Xibei is facing public backlash due to a controversial self-promotional article that was perceived as overly sentimental and out of touch with consumer sentiment amid ongoing criticism regarding food quality and pricing [6][7]. Group 1: Article Content - The article titled "7-year-old Maomao: I thought I would never eat Xibei again" was published on Xibei's official WeChat account, depicting a child's emotional attachment to the restaurant amidst negative online discussions [1][2]. - The narrative describes how Maomao's mother suggested avoiding Xibei due to recent controversies, but Maomao insisted on going, highlighting a long-standing relationship with the brand since he was two years old [5][6]. Group 2: Public Relations Response - The article's emotional appeal was criticized as outdated and likely to provoke consumer backlash, especially given the current scrutiny of Xibei's food quality and value [6][7]. - It was noted that the article may not have been intended for public consumption, as it was meant for internal morale-boosting among employees, but its visibility led to misinterpretations [6][7]. Group 3: Recommendations for Improvement - The company should focus on understanding consumer perceptions of "pre-made dishes" and engage in more transparent communication rather than relying on emotional narratives [7]. - Emphasizing product quality and service improvements is essential for regaining consumer trust, rather than attempting to counter criticism with sentimental stories [7].

Core Viewpoint - The article discusses the backlash faced by the company 百果园 (Bai Guo Yuan) and its chairman 余惠勇 (Yu Huiyong) after a public relations attempt to address consumer complaints about high prices, which instead led to a significant consumer revolt and a drop in stock price [2][10][25]. Group 1: Consumer Reaction - Starting in May, consumers began to voice complaints on social media about the high prices of 百果园's products, particularly highlighting the price of 阳光玫瑰青提 (Sunshine Rose Green Grapes) at 70.9 yuan per pound compared to much lower prices on delivery platforms and competitors [8]. - By early July, the complaints peaked with phrases like "月薪两万吃不起百果园" (earning 20,000 yuan a month but unable to afford Bai Guo Yuan) and reports of an average of three store closures per day [10]. - Following the release of a video by Yu Huiyong on August 8, which aimed to "educate" consumers, a backlash ensued, leading to a campaign where consumers stated, "we do not cater to Bai Guo Yuan, we educate Bai Guo Yuan" [21][22]. Group 2: Company Response - On July 18, during the company's 23rd anniversary, Yu Huiyong decided to personally address the pricing controversy through a video [12]. - The video was produced with a scripted format, where employees posed questions about the high prices, but this approach was perceived as condescending by consumers [13][15]. - Following the video's release, the company's stock price dropped over 8%, resulting in a market value loss of approximately 2 billion Hong Kong dollars [25]. Group 3: Misjudgments by the Company - The company misjudged its audience by attempting to "train" consumers in a manner typically reserved for internal staff, which backfired publicly [33]. - There was a significant emotional miscalculation, as other brands tend to "pamper" consumers, while 百果园's approach was perceived as arrogant and dismissive [34]. - The company also misjudged the market dynamics, as consumers expect transparency in pricing and quality, which was not met by 百果园's offerings [35].