Does Gushcloud Have A Case Against Xiaxue?

It seems like Gushcloud is not going to sue Xiaxue, after Vincent Ha (CEO & Co-Founder of Gushcloud) posted the official response. If it’s not the Christmas season, when a statement like “Live and let live” would seem like a really pathetic meek response to what is a fierce and targeted attack on Gushcloud, what would Vincent and Co-Founder Althea do?

After all, Gushcloud’s initial response is that they were seeking legal advice after reading Xiaxue’s Gushcloud exposé. Has Xiaxue dealt such a fatal blow to the company that all Vincent can do is to wish us a Merry Christmas and that we should be “remembering what this season is about”? Seriously?

Vincent has noted in his official response blogpost that the point Xiaxue made about the “Alleged irregular financial reports” is “damaging”, has Gushcloud “run the risk of losing our influencers and partners”, and “create a loss of confidence in the company”.

So, Vincent thinks his blogpost will be able to undo all the damage done? If he thinks that’s the case, I suspect he is very much mistaken.

Also, he had no comments on @linlovesall’s ad-masking. Is this a silent admission of guilt on the company’s part?

But first… more thoughts on ad-masking…


{ Ad-Masking: Will You Do It? }

Now, S$300 seems like a very small sum of money when one’s integrity is concerned and one reader even left a comment on my blogpost to say that Yilin has been a “sellout”.

So I’m just wondering…

Yilin has about 4000+ followers on Instagram while Xiaxue has over 500,000. To be offered S$300 for an ad when you have only 4000+ followers is a lot of money. I have heard from an advertiser 2 months ago that LadyIronChef charges S$300 per Instagram post/ad and like Xiaxue, Brad (LadyIronChef) has over 500,000 followers.

So, assuming the tables are turned, and we set up a shell company and offer Xiaxue (or any other top blogger) 125 times what Yilin supposedly charged via Gushcloud (because Xiaxue has approximately 125 times more followers), that would be an Instagram ad fee of S$37,500.

Would Xiaxue/Brad/AnyOtherTopBlogger be willing to mask an ad and essentially do what Yilin did? Not for S$300, but for S$37,500?

I don’t know what their answer would be. I can only hazard a guess. What do you think?

By giving Yilin a disproportionately higher fee than what someone with 4000+ Instagram followers would be able to charge, I think Gushcloud might have inflated her fees, and there might also be a case against Xiaxue for entrapment.

Note: (1) There is no legal benchmark or guidelines regarding what a blogger can charge for any form of advertising, whether on a blog or on a social media platform. So inflating the fees of a blogger in your stable is not illegal. (2) Any discerning advertiser would compare ad rates between bloggers and find that paying S$300 for 4000+ followers (the post will probably get 200-300 eyeballs only) is too expensive. Setting up a shell company and offering above-market-rate fees for an Instagram ad while stressing certain not-too-ethical guidelines might seem like entrapment, no?

You decide.


{ What Should Advertisers & Influencers Do? }

As an advertiser with a limited budget, you should approach bloggers directly. Why? You are more likely to get what you pay for.

For instance, if you pay a company S$1000 for a blogger to put out an ad, but the company takes a huge cut so as to have a healthy balance sheet, accrue profits, pay for office renovations, etc, the blogger might end up with maybe, S$400?

So the blogger puts out an ad based on what he/she received, not what you think you should get for S$1000.

And like Xiaxue has proven in her blogpost, bloggers are willing to accept payment that is much lower than what these agencies care to charge. Eric Lim charged her S$100 while Gushcloud had wanted S$300. Asyiha charged her S$80 while Gushcloud had wanted S$500. As an advertiser, you save a lot of money if you approach bloggers directly. What does the agency really do? Send out an email to the blogger with YOUR guidelines. Can’t you send out that email yourself? Assuming it’ll save you S$420 or more?

As an influencer, protect yourself by always asking for payment upfront, whether from your agency or from an advertiser. A company that is here today can easily fold overnight. And who will then pay you for the advertorials you spent hours to craft? An advertiser can also start nitpicking about the post and refuse to pay you. So, always collect payment upfront.

Also, you’ll have to learn to say no to money at some point in your blogging journey. You’ll just have to get used to it.

On Christmas Eve, I received an email from someone asking if I help “personal trainers write articles as a form of marketing”. I almost jumped out of my skin when I saw that email. God help me if it’s another one of Xiaxue’s shell companies! LOL! But like what I usually do, I explain that I already have a sponsorship deal (I work out with Quantum Fitness trainers – I really do! And they are some of my best pals ever) so I have to pass this deal on to a fellow blogger I trust. And I did. *And no, said blogger pal will not give me any money. In fact, I can’t even remember him treating me to a meal ever.


Back to the issue of whether Gushcloud has a legal case against Xiaxue.

IF Vincent and Althea’s blogposts contain the truth, e.g. that they did not pay for YouTube views on Yan Kay Kay’s BOAT channel, YES, they definitely should go ahead with legal action.

In Singapore, it is almost EXPECTED that Gushcloud would take action against Xiaxue. Sure, there are people with their popcorn tubs waiting to watch a good showdown, but there are many more wondering if this company conducts its business in a legal, ethical and moral fashion.

In order to restore #faithingushcloud, the company’s CEO has to put his money where his mouth is, and publicly strive to restore its reputation after Singapore’s Blogging Queen tore it to shreds.

Even Xiaxue stated at the end of her blogpost that it might get her a letter from Gushcloud’s laywers. And if, surprise surprise, she doesn’t, the company might as well fold tomorrow.

If Gushcloud is innocent, it should definitely pursue legal action and send out a strong message that it will not tolerate disparaging remarks made against the company, its founders and any of its influencers, partners, affiliates, clients, etc.

But if its financial books will not stand up to close scrutiny, then better not lah.

*Update: My thoughts after reading the Gushcloud Group Whatsapp Chat Log HERE.