Huawei's brand crisis 'relatively contained' compared to other recent cases in SG

Huawei's SG$54 promotion may have started out with good intentions, but it ended up calling in police to manage crowds, disappointing thousands of consumers, and even copping flak from CASE. In a bid to manage consumer sentiments, a week from the event, the company handed out SG$100 vouchers to some 5,000 affected consumers.

A crisis impact study by Milieu Insight has now revealed that the brand crisis was still considered "relatively contained" compared to other recent cases in Singapore.

According to the findings, some 49% of 2490 respondents said they are less or much less likely to recommend the brand to their loved ones after the incident, while 38% indicated that it lowered their intent to purchase.

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In comparison, the impact on Irvins for the dead lizard find in its products in January was 69% on recommendation and purchase intent. Spize's food poisoning outbreak in December 2018, on the other hand, saw an even higher negative impact of 85% and 84% on recommendation and purchase intent respectively.

However, Huawei's still rank hire than when Breadtalk was called out for illegal waste discharge in June this year, which saw a 50% negative impact on recommendation and 26% on purchase intent. Milieu Insight COO Stephen Tracy said that the poor campaign execution by Huawei is still classified as a "high-profile incident that damaged brand perception". Results show that Huawei's brand perception was 66% negative. Conversations around the brand surround the following topics:

However, Tracy does not think that the incident will impact sales negatively in the long-term. He explained: "Huawei has gained market share in the last 24 months against competitors like Apple by offering high spec phones at more attractive prices. Despite the SG$54 phone incident enraging many consumers in Singapore, the incident is unlikely to have a material impact on Huawei device sales going forward." Only 19% of those surveyed have purchased from Huawei in the past six months.

Milieu Insight's crisis impact studies were all launched within 48 hours of the event.