Case 1: China’s tainted baby milk powder
Q1. Given strong profit growth, has there been any damage to Baidu.com’s reputation? Yes, as we can see it from a whole picture obviously there has been damage to Baidu.com’s reputation. Ever since the incident happened, Baidu.com has been affected by rumors saying that it accepted the screen-out payments to protect a certain number of milk manufacturing company from online searches about the tainted milk scandal. This has made the company’s information appear unreliable. Even though the case of Baidu.com has not been made clear with lack of evidence, it is easy to realize that the company being paid off for not disclosing information and by advertisement placements, in a way that paid advertisements are listed pages before unpaid advertisements. If this is really how things work, any company could have paid for advertisement placements.
Q2. What would future reputational damage affect, and how could it be measured? It might not sound serious at the early stage whereby the rumor has not gone too far, but if we talk about future winded, the reputational damage that Baidu.com would have to bear aren’t simple as mentioned above. The company might have to face bankruptcy if the public’s trust is completely lost. The company view however can be measured in a way that the public continue to believe that the information is reliable or not. If it does, the hits to the sight would increase, or fall if it is the opposite way. Since what the rumors say is about the omission of information and advertisement placement, anyone in the public could question on the reliability of the information posted on site. Therefore, if there is any chance that the public’s trust is totally lost, it would be rather impossible for Baidu.com’s reputation to recover.
Q3. What steps could Baidu.com take to restore its reputation, and what challenges will it have to overcome? There is only one and also the biggest challenge that Baidu.com will...
Please join StudyMode to read the full document