Question

In this assignment you will assume the role of a manager in charge of business development and write a brief report to your CEO outlining the situation you have evaluated based on the information you have received. Explain how the information you received will impact your firm.

2. Your report should be between 500-600 words.
3. You cannot and should not use outside resources.

START OF CASE

You just signed a contract with Dolce & Gabbana.
You are now in charge of the company’s operations in China.
Unfortunately, your predecessor caused a major crisis for your company (and was fired). Here below, you will see a brief memo written by your assistant.
Now, it is up to you to fix the problem. How would you manage the crisis in your company?

Dolce & Gabbana (D&G) is facing a major crisis in China where top e-commerce sites are dumping its products over accusations of racism. Thousands of D&G goods have disappeared from platforms run by companies like Alibaba and JD.com. The backlash against the Italian luxury fashion brand began earlier this week after it launched video ads featuring a Chinese woman struggling to eat pizza and other Italian food with chopsticks. The situation was then made worse by offensive comments that were allegedly sent from co-founder Stefano Gabbana's personal Instagram account. The videos and comments spread rapidly on Chinese social media, drawing accusations of racism and calls for boycotts from celebrities. The furor forced D&G to cancel a high-profile fashion show in Shanghai hours before it was due to start on Wednesday. The scandal could deliver a heavy blow to the company, as Chinese consumers account for more than a third of global spending on luxury products. The fashion house is now trying desperately

to limit the fallout. On Friday, Gabbana and co-founder Domenico Dolce appeared in a video message posted on social media to apologize to "all Chinese people around the world. Our families taught us to respect all cultures of the world," Dolce said. "We hope to receive your forgiveness for our cultural misunderstandings." The company has apologized previously and also said the offensive messages sent from Gabbana's Instagram account were the result of hackers. But that hasn't stopped the backlash so far.

Retailers yank D&G products

E-commerce company Yangmatou said in a social media post Wednesday that it had removed 58,000 D&G products, declaring that "the motherland is more important than anything else." Lane Crawford, a Hong Kong-based fashion retailer with several outlets in mainland China, said Friday that it is halting the sale of the Italian brand's goods in stores and online after customers started returning them. "We believe that brands need to be aware of the cultural implications of their actions and understand the potential backlash when customers feel their values have been disrespected," Lane Crawford said in a statement. Pages for D&G products on shopping sites operated by Alibaba and JD.com have been taken down, and the brand's products weren't showing up in searches on the sites. Alibaba and JD.com did not respond to requests for comment. D&G products were also unavailable on other online retail sites in China, including those of Yoox Net-A-Porter. A spokesman for Yoox Net-A-Porter acknowledged Friday that the brand's products were unavailable on the company's China sites.

Analysts Evaluations

Analysts warned that D&G's apologies may not be enough to prevent a sharp drop in sales in the world's second largest economy. "The damage to the brand in the eyes of Chinese consumers has already been done," said Ben Cavender, a senior analyst at China Market Research in Shanghai. On social media, people posted videos of themselves burning the brand's clothes or cutting them into pieces and using them to wash their toilets. Cavender suggested another risk is that shopping malls in China choose to start shutting down D&G stores. Hung Huang, a prominent Chinese fashion commentator and magazine publisher, said the Italian brand's use of celebrities to help market its products is likely to encounter difficulties. "I don't think anyone will touch them," she told CNN. Chinese celebrities are already "under pressure" to demonstrate their patriotism following movie star Fan Bingbing's recent temporary disappearance and allegations against her of tax evasion, according to Hung. "China is on a very patriotic bent right now so it's going to very difficult to get support," she said. But Hu Xijin, the editor-in-chief of nationalistic Chinese tabloid Global Times, wrote in a social media post that D&G shouldn't be too heavily penalized because of the incident. He argued that China needs to be more tolerant in order to show the world it's an open market.

END of CASE

Answer 1

Recently D&G launched video advertisement in which featuring a Chinese woman struggling to eat pizza and other Italian food with chopsticks. So our china D&G is facing a major crisis in China that E-commerce sites are not agree to sale products over accusations of racism. The videos and comments spread rapidly on Chinese social media, drawing accusations of racism and calls for boycotts from celebrities. On Friday, When Domenico Dolce appeared in a video message posted on social media to apologize to "all Chinese people around the world.

E-commerce company Yangmatou said in a social media post Wednesday that it had removed 58,000 D&G products, declaring that "the motherland is more important than anything else." Lane Crawford, a Hong Kong-based fashion retailer with several outlets in mainland China that it is halting the sale of the D&G goods in stores and online after customers started returning them. D&G products were also unavailable on other online retail sites in China, including those of Yoox Net-A-Porter.

Analysts warned that D&G's apologies may not be enough to prevent a sharp drop in sales in the world's second largest economy. Ben Cavender, a senior analyst at China Market Research in Shanghai told that The damage to the brand in the eyes of Chinese consumers has already been done.

China is on a very patriotic bent right now so it's going to very difficult to get support, I don't think anyone will touch them for the promotion. Chinese celebrities are already "under pressure" to demonstrate their patriotism