Caixin
Caixin Global – Latest China News & Headlines

Home >

ABOUT US

CX Tech is Caixin Global's real-time tech news portal, featuring 24-hour news, short-form analysis, and roundups from business and tech media in China.

LATEST
SMIC Profits Soar to $138m in Second Quarter
Foldable Phone-Maker Plans Shenzhen IPO, Dispelling Rumors of U.S. Listing
Astra Inks Oxford Vaccine Production Deal with China’s Kangtai
Trending Story: Are Any New Graduates Really Worth 2 Million Yuan a Year? Netizens Discuss!
Trending in China: Popcorn or Cheaper Tickets - What Would Make You Return to the Cinema?
Tesla Challenger Xpeng Raises $400 Million Before Planned U.S. IPO
CATL Announces it Will Supply Batteries for Mercedes-Benz New Electric Sedan
TikTok Sees No Slowdown in Global Popularity Despite Indian Ban and U.S. Threats
Baidu Search, Sina Weibo on ‘Secret List’ of Chinese Apps Banned in India’s Latest Purge
Trending in China: Choosing a College Major - For Love or Money?
Evergrande Health Forges Ahead With Six New Electric Vehicles
Trending in China: How Cute Rabbit Ears Are On the Frontline in Fight Between Delivery Firms
Chinese Company Files Lawsuit Against Apple’s Siri for Patent Infringement Worth Billions
China Home to Six of the World’s Top 10 Unicorns, Hurun Report Says
Trending in China: Can Music Streamers Help Users’ Depression?
Core Parts of China’s Beidou Satellite System ‘100% Made in China’
Trending in China: Xiaomi CEO’s Shows How Best To Harness China’s Social Media Humor for Serious Business
Apple Takes Down Over 30,000 Apps from China Store Amid Government Crackdown
Chinese Chipmaker SMIC to Establish Joint Venture for Wafer Production
Microsoft Said Plan to Acquire TikTok Will Continue
Trending in China: How an ‘Old Godmother’ Took on China’s Internet Giant and Won

By Yilin Chen / Jul 01, 2020 04:22 PM / Trending Stories

What’s trending?

A legal dispute between internet giant Tencent and China’s beloved chili sauce brand Lao Gan Ma (literally “Old Godmother”) has left netizens scratching their heads. Lao Gan Ma was sued for unpaid advertisement fees and ordered to freeze 16.24 million yuan’s ($2.3 million) worth of assets. However, subsequent plot twists might leave a blemish on Tencent’s formidable legal department’s record, that of 29 undefeated lawsuits since 2013.

What’s the story?

According to a statement that Tencent sent to the Global Times, Lao Gan Ma consistently failed to pay advertising fees to Tencent for promoting their chili sauce. Tencent said that the two companies signed a contract in March 2019 which was worth up to tens of millions of yuan. The media believes that Tencent is referring to its video game QQ Speed, which has incorporated customized visual elements of Lao Gan Ma into its interface.

In response, Lao Gan Ma quickly issued a statement saying that they have not personally or by proxy signed such a contract, nor have they engaged in any commercial cooperation with Tencent. After receiving the order to freeze their assets, Lao Gan Ma asked the police to step in.

A notice published today by the police in Guiyang, where Lao Gan Ma is headquartered, revealed more details of the case. Three people pretending to be marketing managers had forged the company’s seals and signed the contract with Tencent. Their goal was to obtain the gaming activation codes that Tencent distributed alongside the advertisements and resell them for profit.

As one of the most successful condiment brands in China, Lao Gan Ma reported a record revenue of 5.02 billion yuan ($710 million) in 2019, a 14% yearly increase. The brand has also been embraced by loyal customers in overseas markets.

What are people saying online?

Netizens are amused by the series of plot twists over the past two days. “This is great news for Lao Gan Ma,” one user wrote. “They are getting everyone’s attention and free promotion from Tencent.”

Other people are surprised by Tencent’s apparent carelessness in signing the contract. “It’s so rare to see Tencent mess up,” one person said. They also wondered why it seemed perfectly normal to Tencent that a chili sauce brand would wish to advertise in a video game.

Contact editor Marcus Ryder (marcusryder@caixin.com)


Share this article
Open WeChat and scan the QR code