When it pays to take a stand.

In our current climate, it has been interesting to observe companies’ reactions to the underlying concerns and fears shared by many Americans via their choice of advertising creative, their business decisions, and press statements.  But of equal importance, its been informative to see the impact on business results.

Granted, while advertisers are headquartered all over America, most of the advertising agencies responsible for influencing and executing their creative are seated in the urban, liberal capitals of the US- New York in particular.  Many messages have become laced with messages of encouragement, perseverance, the preservation of equality and justice, and in some cases, outright protest.  Is this because it’s the right thing to do?  Possibly.  But they’re proving that not only is it a little easier on the conscience – albeit somewhat risky, this can drive advocacy and loyalty.

February is the month of two major advertising opportunities – the Superbowl and the Oscars. The Superbowl has come and gone, but with it came fresh energy about what commercials might make the strongest statements.  The most-hyped (though it ultimately fell flat… and was apparently largely fictionalized…) commercial was about the origins of Budweiser and its immigrant founder.  (Oooh immigration – hot, sexy current topic!) But before its airing, I recollect even my non-beer drinking facebook friends’ enthusiasm as they posted “I’ll buy a Bud!”.

After the Superbowl, people began anticipating a surge in politically charged spots. Yesterday’s Oscars (a most memorable broadcast to say the least) was, indeed, peppered with some thoughtful commercials from some brands I wouldn’t ordinarily classify as politically active… or don’t really think of as having much of a strong ideological perspective.  From Cadillac’s spot encouraging American unity, to Hyatt’s spot promoting the importance of cross-cultural understanding, it’s clear that there’s now a trend for even not-so-controversial brands to take the ‘calculated risks’ of ideologically driven advertising.

But at some point this starts to feel somewhat cookie-cutter, or even disingenuous.  Especially when considering brands that A: aren’t one of the first to make such a stand and/or B: haven’t really built up the equity to make such a statement.

  • Nordstrom has a fairly straight-laced, conservative reputation.  But its first-mover advantage as one of the first retailers to remove the vast majority of Ivanka Trump’s line from its selling floor (for performance reasons) was not done without fanfare from fans and foes alike.  While tweets from the president’s personal account admonished Nordstrom, several celebrities and ‘regular Americans’ proudly tweeted unsolicited support for the retailer.  Despite an initial drop, its stock price jumped 7%. Nordstrom ultimately won by taking a risk, being a leader, and rationalizing its decision in a most-‘Nordstromy’, business-focused way: the line was simply underperforming.
  • Starbucks, an American (well, global) staple, has long been the target of several boycotts (note the prevalence of #boycottstarbucks) for its liberal stance on a variety of issues, from its recent commitment to hire 10,000 immigrants, to its founder’s support of same-sex marriage.  Newsweek recently ran an article tracking the effect of #boycottstarbucks on its stock price – something that happened at least 5x in just as many years.  In nearly every case, (the exception being CEO Howard Schultz’s support of Hillary Clinton) the stock price went up.
  • On the other side of the coin, there are noteworthy conservative examples… before Chick-fil-a opened its long-awaited New York restaurants with their ensuing block-long lines, remember its same-sex marriage controversy regarding its financial support of several anti-LGBT groups?  Despite protests, it experienced a post-controversy net boost in sales.  But Chick-fil-A is known for its conservative values just as much as its nuggets – its restaurants are even closed on Sundays in observation of the Christian sabbath.  Whether or not you agree with their stance, the fact of the matter is they leaned into what their brand stood for – and won.

At the end of the day, while many of us hope that every company will have the gumption to stand up for our ideals, these companies are beholden to their shareholders.  And those with especially strong brands are beholden to their own DNA – which is not unrelated to their business performance.

When they can successfully lean into what they stand for, authentically, it can pay in both brand and shareholder equity.  But it is naive to believe that it’ll work for every brand. Consumers appreciate relevant messaging, but also authenticity; There are risks and rewards associated with being a leader and having a genuinely strong point of view.

What brands do you think have the equity to take a moral stand?

Alliah

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