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    How Online Marketers Fuel China’s Fake News Problem

    Incomplete internet laws allow both marketers and rumormongers to profit from viral content.

    I stopped socializing with many of my WeChat friends last September after growing bored of the seemingly endless online marketing campaigns that took place on China’s ubiquitous messaging app. Day after day, people would share the story of some budding architect or promising realtor whom I neither knew nor particularly cared about, but who apparently needed my vote to ensure they won some kind of industry prize. Some acquaintances routinely bombarded chat groups with requests to vote for some supposedly exceptional friend of theirs, sometimes even sending me WeChat red envelopes containing a few yuan in bribe money.

    Recently, my sister shared a link on behalf of her daughter, who was competing against her classmates in art school to see who could create the most attractive set of emojis. My elder brother sprang into action. Like a self-appointed campaign manager, he shared the link in all his WeChat groups several times a day, relentlessly haranguing group members with texted pleas, phone calls, and red envelopes until enough people caved in and voted for my niece to win.

    Like most Chinese social media users, my brother cared little about what the votes were for or which organization collected them. The vote was, after all, a simple marketing gimmick for the competition’s sponsors. Yet there is often a sinister intent behind these contests. To be eligible to vote, participants usually have to download an app, register for an account, or sign up using their WeChat username, all of which require you to share personal information. You can then vote for the candidate of your choice, while the marketers make off with your data — perfectly legally, mind you.

    Social media marketing initiatives are so popular in China because they are quick and easy ways to penetrate the market. WeChat boasts more than 10 million commercial accounts, all of which are on the hunt for public attention and advertising money. To do so, their marketing departments either engage followers through interactive activities like the abovementioned votes, or they pay a third-party data harvesting company to get the information they need to target new followers.

    The viral potential of online content is a boon for marketers, but their techniques cut both ways. In a popular video shared more than 50 million times last February, a man in eastern China’s Fujian province claimed that a popular brand of seaweed was in fact made entirely from plastic. The rumormonger was later proven to have fabricated the story in order to blackmail the seaweed company into sending him 100,000 yuan ($15,000); when the company refused, he published the video online, where it quickly gained traction. In doing so, he damaged the reputation of China’s seaweed industry as a whole, not to mention the prospects of hundreds of thousands of farmers and traders who rely on the industry for their livelihoods.

    Online rumors like this may appear absurd, but the majority of the Chinese public tend not to verify such information before they share it online. Aside from the food and beverage industry, rumormongers often target the education, elderly care, and charity sectors — all of which lack comprehensive market oversight. In many cases, companies knowingly distribute fake news about rival businesses while falsifying their own market shares. Data mining and consultancy firm iiMedia Research published a report last September claiming that nine out of 10 social marketing accounts on WeChat boasted to have greater market shares than they actually did.

    In corporate communications, too, rumormongering is frequently used to undercut the competition. Companies publish false information on a number of in-house accounts, and can pay third-party organizations and influential individuals to republish the company’s lies on their own accounts.

    China still lacks legal provisions that give ample compensation to companies that have their reputations damaged by online defamation. In the seaweed case, the culprit was sentenced to jail for 22 months and fined 30,000 yuan. However, the scandal caused more than 100 million yuan in damages in Fujian province alone as customers canceled orders and seaweed supplies rotted in warehouses.

    It is clear that any policy aiming to stamp out rumormongering must also strictly regulate similar activities, such as viral marketing campaigns. Reassuringly, China’s draft e-commerce law and an upcoming amendment to the unfair competition law both contain passages that aim to better regulate commercial defamation and clarify how much compensation a company is entitled to when it is the victim of a smear.

    Rumormongering is the dark side to China’s wildly successful social marketing industry, an inconvenient truth that reflects the partial nature of our legal system. Commercial platforms on social media must be regulated as rigorously as traditional advertising agencies. Purveyors of defamatory content must face penalties that stop them from further profiting from crassly smearing honest businesses. And as individuals, we should do our part to stop rumormongers by resisting the urge to take part in gimmicky online contests.

    Editor: Matthew Walsh.

    (Header image: People use smartphones while standing in line in Maoming, Guangdong province, May 5, 2014. Huang Xintao/VCG)