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]