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How does "Guanxi" culture influence LinkedIn China's relationship management strategies

August 31, 2016

As has been mentioned in my former blogs, many internet companies fail in China because of not establishing relationship cultivation strategies based on a clear understanding of the Chinese market, and essential cultural phenomena. Of those cultural dimensions, Guanxi is one of the most important, for it is predicated upon “network, connection, and personal relationships.” Any individual with a deep understanding of traditional Chinese culture understands that since ancient times, and when most Chinese lived in small towns, Guanxi, as shall be further explained in the following section, has related to inter-community networking, trusting interpersonal relationships, general reciprocity. In other words, one who is versed in Chinese tradition, will seldom hesitate to guess that at the heart of Chinese business, professional, and social matters, lay considerations about Guanxi. Furthermore, within the Chinese culture setting, Chitu’s fundamental objective is to connect people from various social strata, and further to inculcate solid and trusting interpersonal relationships. Based on these points, it may be assumed that Guanxi plays an indispensable role in encouraging Chitu, in its effort to be successful in China, to pursue a deep understanding of Chinese culture and its business environment, as well as, to pursue and maintain relationships with its key stakeholders.

 
"Guanxi" as a typical Chinese culture
 

Guanxi is a cultural phenomenon, based on Confucius teaching, and it is defined as personal relationships that are reciprocal, intangible, and transferable (Luo, 1997). Guanxi really means “connections” and is built on an informal structure that facilitates implicit exchanges of immediate or future favors. These informal structural ties are interwoven within the entire society via families, friends, and acquaintances in China.

 

Spend any time in China, you will quickly learn the power of "Guanxi." Guanxi drives business deals and government contracts. It is the invisible glue that binds people together. It is the sense of connection and mutual obligation that Chinese society prizes in personal relationships (“Why big American,” 2013).

 

Within the business-to-customer context in social media, Guanxi is used in the form of “seeking assistance from family” or “maintaining friendships by providing help to friends” (Taormina & Gao, 2010) as a means to formulate strategies for building B2C relationships. For a more intimate approach, firms that offer niche products with a smaller customer base can use the analogy of “seeking assistance from family.” For a mass market product, firms can use the analogy to persuade customers to use word-of-mouth by “maintaining friendships by providing help to friends.”

 

To What Extent Are LinkedIn China’s Relationship Cultivation Strategies Influenced by Guanxi
 

I created this section by applying a combination of three approaches: interviews, observation of and user experience on the Chitu app, as well as participation in Chitu’s featured activities. Regarding how Guanxi influences Chitu’s relationship cultivation strategy, there are several important discoveries that are worth noticing: 

 

Making Use of Reciprocity in Guanxi Culture. Sending presents is a traditional way of keeping Guanxi in China. From the beginning, Chitu’s marketing personnel have been teaming up with its public relations teams to communicate Chitu’s image and values (Interviewee 1, personal communication, February 24, 2016; interviewee 3, personal communication, March 25, 2016). One of the regular approaches is sending presents, such as toys, to users who invite friends to register in Chitu. These presents may or may not relate to Chitu as an internet product. As one of Chitu’s users, the researcher herself has participated once, and found that Chitu sends out presents with the purpose of attracting users to participate in campaigns to endorse Chitu and to invite more friends to register on Chitu. The researcher observed there once was an activity called “spring outing at sunny days.” Users, who successfully invited three friends to register on Chitu, had chances to win the spring presents (spring outing goods such as sports shoes and cups). Such activities, which take advantage of consumers’ physiological characteristics in Chinese Guanxi context, are quite common on Chitu. Sending out presents suggests a kind of Guanxi and a way to spread Chitu’s messages. Guanxi activities are usually followed by presents, in which many meanings are implied and can be explored. In China, sending out presents is one of the most impressive and attractive ways of expressing care, admiration, moral concern, and emotional attachment. When a present is sent and then received and accepted, a reciprocal Guanxi has come into existence between the sender and the receiver, especially to the one receiving the present. Obviously Chitu employs this latent rule or “worldly wisdom” well in the Chinese culture context, which results in more user affection. 

 

Making Use of Trust in Guanxi Culture. Chitu obtains users’ trust by providing them with a trustworthy platform to interact and network with strangers (Interviewee 2, personal communication, March 24, 2016; interviewee 3, personal communication, March 25, 2016; interviewee 4, personal communication, March 25, 2016). Trust is an important aspect of Guanxi. There is an old Chinese saying, “A man can`t survive without credit.” Having good credit or being trustworthy is the guiding principle of human interactions. It has been a long-standing tradition that Chinese people can easily build trust with family and friends but take strong precautions and distrust towards outsiders, since in the Chinese traditional Guanxi system, social interactions of acquaintances are not favorable towards strangers. Because Chitu is an app targeted at social interactions among strangers, in order to win users’ trust and keep them on Chitu, it is crucial to solve the tendency to distrust strangers (Interviewee 3, personal communication, March 25, 2016). With the keen observation and understanding of Chinese societal reality, Chitu has included two features of credit recognition alongside the real-name registration system, which are “Professional Identity Certification” and “Sesame Credit Rating Certification” (Interviewee 2, personal communication, March 24, 2016; interviewee 3, personal communication, March 25, 2016). “Professional identity” is provided to those who have their real names registered and who are currently holding a job. Those users can submit or upload their company business cards, pictures of employment authorization document, and certificate of identification to the Chitu secretary for approval. It will take one to three days for approval, and those approved can have their professional identity certification. The other feature “Sesame Credit Rating Certification” is a credit rating system developed by Alibaba, and is applied based on the cooperation between LinkedIn and Alibaba. Chitu adopts this approach on account of its deep understanding of the importance of credit rating system in promotion of economy, especially in the process of consumer transitions in China. Users can display their credit ratings on Chitu to strengthen their credibility with the strangers they interact with (Interviewee 1, personal communication, February 24, 2016; interviewee 2, personal communication, March 24, 2016). This strategic measure allows Chitu to make full use of the increasingly reliable credit system in China, and it proves that Chitu combines learning the various niches of the Chinese marketing environment, as well as, incorporating traditional concepts of Guanxi, enables it to devise a plan of action towards building trustworthy relationships with users.

 

Creating a New Model of Guanxi. When the researcher approached one of the executives at LinkedIn China for an interview, the executive invited her to participate in a Chitu offline activity that he had organized. This offline activity was advocated by a Chitu online group named “The Earth’s Sales Elites 2” founded by him as well. Within that online group, there are hundreds of members with a sales background, but from different cities and different industries. They exchange ideas, and learn from others in the group. The online interaction methods that Chitu’s executives create are worth studying. Just to name but a few examples: a series of activities are designed to encourage group members, especially the introverted and bashful professionals, to post “three good deeds done and one habit to be modified” daily reflection to the group message board, and to take part in “daily topics” and share their own stories; “daily star” is an activity in which a group member shares daily his or her working experience and life reflections, which is a chance for the invited group members to show themselves and make friends with others; “Have you taken your weekends photos?” is an activity to relax and entertain users by encouraging them to share their weekend lifestyles through posting photos of their off time adventures. 

 

Offline activities are an extension to the online groups’ engagement. From time to time, online groups hold offline activities in the forms of card games (some are puzzle games that most of the Chinese are good at), karaoke singing, and dinner parties. They meet face-to-face with others and fulfill certain tasks together. 

 

On Chitu, there are numerous online and offline group activities as mentioned, where young Chinese professionals form increasing engagement and interaction every day (Interviewee 1, personal communication, February 24, 2016; interviewee 3, personal communication, March 25, 2016; interviewee 6, personal communication, March 26, 2016). Guanxi, traditionally speaking, is hard to form among stranger groups. The featured activities that Chitu creates demonstrate that, besides building trust, Chitu’s relationship cultivation requires various forms of effort, such as providing users with face-to-face interaction and allowing them to fulfill tasks together. Last but not least, according to the researcher’s observation, Chitu’s activities are based on the strategies of combining western professionalism (openness, equality, and sharing) in networking culture with positive Guanxi essences (harmony, reciprocity, hope and pragmatic spirit), thus, establishing a new Guanxi model—“positive energy”—for Chitu’s users.

 

In summary,three influential patterns of Guanxi culture were discovered in relation with Chitu’s relationship cultivation strategies: reciprocity, trust, as well as “positive energy”.

 

The content above is derived from Chapter 4 of my master's thesis - A Case Study of LinkedIn China and Its Sub-Brand Chitu - with a focus on Public relations and social media strategies. Excerpts and links may be used, provided that full and clear credit is given to Li Yingying and www.liyingying.us with appropriate and specific direction to the original content.

 

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