June 9, 2022

Taking a stand: Deciphering corporate social, political stances

From Pride Month campaigns, declared commitments to social justice, and choosing sides in hot-button debates around gun control, reproductive choice, voting rights and more, companies are increasingly delving into social and political issues. Consumers are quick to take notice and are becoming critical in their own assessment of such stances: How can we decipher a genuine stance from pandering?

Alex Davidson, assistant professor of marketing in the Mike Ilitch School of Business, offers his perspective on a brand’s decision to take a stance and how such stances shape a consumer’s experience with the brand:

 

Why are we seeing more and more brands take stances?

This is something that has been growing over the last few years and really begins when social media starts to play a major role in how consumers get their information. For example, in the early days of social media, back in 2009, there was a passenger waiting for his United Airlines flight to take off when he saw the baggage handlers throwing people’s luggage carelessly onto the plane. He later found his guitar broken and when he asked the airline company for compensation, they refused. So, what did he do? He made a song about it — “United Breaks Guitars” — and posted it on YouTube. It went viral and the airline suffered significant backlash. Nowadays, it’s even more common for someone to go on social media and say, ‘this company wronged me’ or ‘this product doesn’t work.’ As a result, companies have to be very careful with everything they say and do.

On top of that, social justice issues are now a top concern for a lot of people. The rise of social media has also equipped anyone with the ability to post about injustices that can attract millions of readers and viewers. Many look at big companies and view them as agents of change due to their resources and ability to influence. And so, there’s an expectation for companies to react to social justice issues. What’s more, they are expected to not only say certain things and uphold a certain image, but also to practice what they preach and engage in the initiatives they endorse.

 

What should a brand consider when deciding to take a stance on an issue?

There are a lot of factors to consider, and it’s not necessarily so simple. If they choose not to take a stance, they might receive a lot of blowback from various consumers and social justice groups. At the same time, if they do engage — let’s say in Pride Month — a lot of consumers might perceive that as pandering and exploitative for the sake of driving profits.

That’s why, if they do decide to engage, they have to actually get involved and find concrete ways to endorse the ideas behind that particular issue. For example, they can introduce hiring practices and management policies that help to tackle the injustice that they are referring to. Specifically, if they are showing support for Pride Month through their branding, they should also establish inclusive practices when it comes to hiring and managing their own employees. If not, their messaging will be inconsistent with how they act, and they can be perceived as hypocritical. Importantly, if they’re a company claiming to support the LGBTQ+ community, they should be doing it all year, not just during Pride Month. Consumers are very savvy and will grow distrustful of organizations pandering through “rainbow capitalism.”

 

How can a consumer tell if a company’s stance is genuine? Can you share an example of a brand that gets it right?

Generally, their policies and actions will line up with their declared stance. Look at the case of Uber. They have a website dedicated to their Pride initiatives that shows how they’re actually playing a role in social activism. They’re not just putting rainbows on their profile picture — they’re actually getting involved. They say they’re committed to using technology and data to help empower LGBTQ+ communities to help make them safer. Through their help center, they offer a discrimination reporting option, which it makes it easier for drivers or passengers to report incidents. They have customer support agents who are specifically trained for bias and discrimination. They have display name settings on their app, so you can display your chosen name and gender identity if that makes you feel more comfortable. They’re partnering with nonprofit organizations and promoting legislation centered around social causes. So, it’s not just an active stance; in Uber’s case, it’s proactive — they are taking a lead and putting their money where their mouth is.

 

Does a company’s size impact its influence?

To some degree, the bigger the company, the higher the expectation for them to take a political stance on important issues. I think a lot of consumers, especially younger consumers, want to see bigger companies be more active in fighting for social causes they deem important. That’s because they consider big companies to have the potential to make a huge impact. With their technological capabilities, market access and capacity to communicate to a wide audience  — they have the power to be influencers of change in a manner that is consistent with many young peoples’ values. And while this expectation might not be as large for smaller companies, they can still play a role as allies. They don’t need to necessarily engage in expensive, far-reaching campaigns seeking to enact change, but they can stand by those who do. They can show support in smaller ways and communicate their stances with their local markets to show support.

 

Do all consumers pay attention to such stances? Do they really influence purchasing decisions?

Not all consumers pay attention. Marketers can use various means to break down consumers into segments to determine which ones are more likely to pay attention to a brand’s political or social stance. For instance, age is a major consideration, as younger consumers are more likely to pay attention. Consumers’ political identity is another important way to segment markets, with more liberal consumers endorsing social issues that coincide with their political beliefs, and more conservative consumers taking stances on the issues that affect them.

Even among those who are apolitical or simply do not pay attention, they may find themselves aligning with specific causes. With the power of social media, consumers are going to see information from their friends or from companies themselves — and that has an influence. You may not necessarily be aware of it, but you consume those messages. So even if a small consumer segment is paying attention to corporate activism, it has the power to touch an entire marketplace through the impact of social media.

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