Local brands cut ties with Manner: What other revenue streams can it explore during a crisis?

Local brands such as 24/7 Fitness Hong Kong, THANN and 24 STORAGE have cut ties with 微辣Manner, a Macau-headquartered entertainment company which earned its reputation through producing lifestyle and comedic videos on YouTube, after its ex-agent Jane Lao committed suicide on 25 July.

In a suicide note that was posted on her Instagram, Lao said that she suffered from depression after she underwent an abortion and got cyber bullied by her ex-colleagues at Manner and threatened by the management team of the company.

In response, Manner expressed its deepest sorrow and regret towards Lao’s death. It said the company has nothing to do with the incident and it has postponed its 10th anniversary show. “If the company discovers that anyone has intimidated others in the name of Manner, the company will reserve the right to take legal action," the statement read.

Manner’s response didn’t seem to diffuse the PR crisis, as local brands immediately ended their partnerships with Manner. Local storage company 24 STORAGE said in a statement that it will stop collaborating with Manner’s artist 阿丞 and take down all Manner-related campaigns.

Meanwhile, 24/7 Fitness Hong Kong announced it will stop sponsoring and promoting Manner’s 10th anniversary gala dinner. Manner’s artists Jeffrey Fok (霍哥) and Witness Kou (高維泰) also announced their departure from the company over the past weekend.

The incident has drawn mixed reactions online as media intelligence firm CARMA saw over 70,000 mentions across various channels with 37% negative sentiments over the past week.

The sentiments mostly came from netizens in Hong Kong and Macau who expressed disappointment with Manner, particularly its public statement following Lao's passing, said CARMA’s HK GM Charles Cheung.

Many felt the statement was cold and inconsiderate, and suspected that Manner's motive was to protect its brand image by distancing itself from Lao.

On the other hand, some netizens applauded the decisions of brands such as 24 Storage, 24/7 Fitness, and THANN, which terminated their partnerships with Manner.

Can Manner’s statement weather the PR storm? 

Commenting on the incident, Celine Cheung, account director, RSVP Communications, said Manner’s statement lacks sincerity, and is clearly written from the points of self-defense and self-preservation, which understandably disgusts the public.

As Manner failed to share and express the same feelings and pains as the public, it raised negative sentiments from the public and even brands chose to end their relationships with Manner. “Commercial brands do not wish to get involved in third-party crises; therefore, it is normal for them to terminate collaboration to avoid further scandals,” she added.

In fact, it is common for brands to sever ties with entities embroiled in controversy to protect their own image and reputation. For example, international brands such as Prada and Honma had cut ties with Chinese actor Li Yifeng last September after he was reportedly accused of soliciting prostitutes. 

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Agreeing with Cheung was David Ko, RFI Asia’s managing director, who said disassociation can indeed be an effective way to stop reputational bleed, as it demonstrates that the brand is socially responsible and does not support unethical or questionable actions.

In this case, he said Manner should communicate regularly with the public and its stakeholders about the steps it is taking. It should be transparent about the progress of the investigation and open about its intention to rectify any identified issues. Further, the company should launch an independent investigation into the allegations. He added:

It's important that the investigation is transparent and conducted by a third party to ensure its credibility.

How can controversial brands explore other revenue streams during a crisis? 

Apart from rebuilding trust with audiences and mending the damage to its reputation, Manner should also explore other revenue streams to maintain its internal operations soon after the PR crisis as it has lost a number of potential advertisers and brand partners.

It’s also worth noting that the followers on Manner’s YouTube have decreased drastically from 751,000 to 695,000, as of 31 July, a check by MARKETING-INTERACTIVE saw. Furthermore, 18 videos have been reportedly taken down from its channel, according to HK01. 

On the social media front, Vin Ng, director of Spread-it, said Manner’s success in the YouTube marketplace is often linked to its ability to consistently produce engaging content, particularly in video format, as well as their knowledge of the influencer market.

"To tap into these fields and identify new revenue streams, one possible strategy is to offer production services to clients who aim to create content," he said.

This approach enables the YouTube channel to avoid direct interaction with the public[…]However, it is crucial for the YouTube channels to remain behind the scenes.

Although controversial YouTube channels such as Manner can still earn return from viewerships by the media platforms, those revenues are not stable and cannot be sustained, said Ken Cheung, digital director, KREW Digital. He added:

Moreover, controversial brands / channels must receive a lot of complaints and negative reports by their haters, they take high risk for the channels to be shut down. I think those brands need some time to revamp their brands after some months.

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