China Bans Luxury Gift Ads in Austerity Drive
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China has banned the broadcast of advertisements for luxury items on its state radio and television stations as part of a campaign against corruption and extravagance. The timing coincides with the Lunar New Year preparations and festivities, where the giving of gifts, often to gain favour with state officials, is a norm.
China has banned the broadcast of advertisements for luxury items on its state radio and television stations as part of a campaign against corruption and extravagance. The timing coincides with the Lunar New Year preparations and festivities, where the giving of gifts, often to gain favour with state officials, is a norm.
According to China’s State Administration of Radio, Film and Television, a state censor and media regulator, some adverts have been promoting the giving of luxury gifts, “transmitting an incorrect system that can encourages a bad social ethos.”
SARFT explained:
[quote] Some television and radio stations have broadcast advertisements with ‘gift-giving’ slogans such as ‘premium gift choice’, a ‘gift for leaders’ and ‘giving honour to your superiors’, and the ads have been for a wide range of products including famous watches, rare stamps and commemorative gold and silver coins. [/quote]
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SARFT, which routinely bans television programmes seen as too racy or politically subversive, also said that national broadcasters were obligated to support Beijing’s efforts to stamp out corruption and ostentatious displays of wealth and privilege.
While it is not clear how strictly the new rules will be enforced, the campaign ties in with incoming president Xi Jinping’s recent pledge to tackle corruption and reinforce the virtue of frugality. The new restrictions also come a day after the government proposed a 35-point plan to tackle the nation’s growing and politically sensitive income gap.
Amid growing public anger over inequality, Xi has repeatedly warned of the existentialist threat posed by corruption.
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However, in China, the lines between corruption and goodwill are often blurred and the giving of gifts is often seen as an integral part of building successful social networks. According to a recent Bain survey, nearly a quarter of all luxury goods purchased in China are for gifting.
Furthermore, corruption and excess have been important drivers of revenue for some luxury and hospitality sectors. Huang Tiemin, president of the Shanghai Hotel Industry Association said:
[quote] Shark fin, abalone, bird’s nest and other very expensive foods can very often be found in banquets funded with public money … Since the new regulations were published, banquet bookings have fallen by at least 30 percent. [/quote]
Huang, however, is confident that more thrift and less extravagance will be good in the long run. “In the short term it will hurt profits, but in the long term hotels will be forced to adjust our business model so we don’t focus on public money,” he told the BBC.
“We will have to cater more to the local private market and attract more international guests, and I’m confident that we will.”
