Topic: Do brands that take sides on divisive issues lose market share? (Read 290 times)

It's all very relative. Because if, for example, a small-scale product/company has collaborative ties with parties that cause divisions, then the product or company will definitely be affected as well. Because all consumers will definitely be aware of this, that the product is collaborating with the party that created the chaos issue. Likewise with products that already have a big brand. So it is very likely that this theory is not correct.

Your insight is truly extraordinary, indeed neutral is the safe path for companies that are aware of the impacts that occur. However, it does not rule out the possibility that the company is playing behind the scenes.

this much is true, too much emotional when it comes to some issues, try to side so hard they'd confront the other side without even trying to think from the other perspective, and this happens to almost anything these days, when it comes to some luxury brands, they'd also try to side with the one they favoured and attack the other but I guess thats just how it is, not that previous generation didn't do the same thing but I guess these days it gets worst with the presence of social media and the cancel culture.
personally if i were to own a company i'd try to be as neutral as possible but even then we will be question by both sides because being neutral might mean avoiding problem but also means that we are always questioned on our stand on some issue.
definitely tough thing to decide these days. even more so with the crazy thing happening on social media like twitter like basically its a place where everyone try to force their idea into other.

Yes, it's very helpful when you check them at most times. And I think most investors and traders does this so if there are hot topics and news, the market always reacts because of the same sentiment coming from retail and institutional investors.

They're all good at this and that's why riding what's been on the news always have the impact to market prices. We're not new to this anymore as sometimes there were moments that when there were good and bad news for Bitcoin.

We see the market changes so quick and that's why these are important market sentiments to consider.

It's true to say that he's stubborn, I think it depends on his upbringing in the past.
However, they can also be called consumers who drive sales. However, it depends on how a product is sold and whether it becomes a well-known brand. And I think if the most popular brands were to take sides on "divisive" issues I think they would lose market share slowly but surely.

its always been like that taking side on divisive issue cause the company to lose the customers on the other sides, so many companies out there are trying hard to stand neutral but alas some of the side supporter of divisive issue sometime so aggresive they consider even the neutral side to be against them thats the thing with most of the companies nowadays, since company exists to make profit they naturally just gonna go with the flow not taking either sides, different if in a country in regard of the divisive issue the general opinion of the public of such country leaning towards the other side much more the company will definitely follow the general masses opinion and would also take sides since it would also mean that there'd be no meaningful lose to take the sides and instead might gain favour for them and put them in a spotlight.

Those market insights are very good indicators on what may possibly happen to the stock market.
So if you are into stocks, keeping your eyes open to this kind of news would be very helpful in your portfolio.
This is why most brands are careful in taking sides or expressing their support to any political or social drama.
It can easily have an impact on their market performance and so losses in just a snap.

Yes, they do. The current generation's consumer is driven mostly by emotions and their beliefs on the brands that they choose. If brand A expresses its support to idea B, then consumers will immediately boycott it because they believe in idea C that is a complete opposite of what idea B is all about. It's just nuts, but then again, the consumers drive sales and profit, so they have to ride that wave.

Also, consumers expect companies to take sides in a rather light issue most of the time, but smart companies usually just stay silent on the issue and pretend they aren't hearing or seeing things in order to not get cancelled and still get the market share of both sides of the issue. I think companies that are numb and mindless against current social issues usually do well compared to those who take sides and push forward with it. That's what big companies are doing, and they are still posting great revenues every year.

The current generation is highly opinionated even if their opinions don't mean shit to an issue that is going on. As triggered as I am to these young ones of today, I have to understand that they are also consumers that drive huge sales to a lot of things that are in trend, which actually is a huge reason why I am paid good money by my current employer.

That happens, when these companies have issues, the stock/share holders are acting quickly because they know that the market sentiment changes overtime quickly.

When the company itself does something wrong or one of their endorsers do, it's a domino impact and the sentiment of the entire market is being seen to react whether the incident is good or not.

If you're an investor, actually it's a good indicator and you get to have the idea how it goes. And that is why it's important to check every issue that happens globally.

I don't think brands need to get involved in anything political, but I also don't think you will always please everyone in life. Some people will always be divisive and full of hate, trying to oppress people that are different from them or don't follow a specific god. Brands are free to make statements and people are free to boycott them if they so choose. I don't see the biggest brands taking a strong stance on most topics, because they will have marketing and legal departments that will steer them away from offending large groups of people in many circumstances. The biggest multinational companies often have to navigate a minefield of different rules and customs between countries, but do so successfully, like McDonalds for example.

Small brands need the attention to trend and get more attention, so activism is a good way for them to achieve it. Activism for them only has the potential of increasing their audience from the attention they get from either good or bad comments and campaigns. As a brand or business gets bigger and it's customer base mature, care has to be taken on the stance taken on many divisive issues because by then you already have an audience and should want to guard them jealousy and not take actions that will result in loosing them.

Every producer must be very careful when it comes to their marketing strategy in a very competitive market. A brand manager must know how to handle the target market and gain their trust. It is not easy to control damage when a mistake is made in the branding, because others are already waiting for the opportunity, they are likely to spread it through the press that damage control might spread, is difficult to control, and takes a long time to recover. Sentiment around gender, religion, ageism, race, and politics is one of the most dangerous areas for branding

Taking sides may hurt, or may help as well it all depends on how you deal with your customers. If your customers are people who are against trans people, then supporting trans people may feel right for you, and for all matters and purposes trans rights are human rights and I support their existence as well, but that doesn't mean that you should promote it on your ads, just support their existence and choice individually, if you bring in your company then just as well others have a right to not buy your product as well.

However, if a beer company ended up supporting some team, like lets say some NFL team in USA, and sponsored or anything, then they would make a ton more money. Because, that's the customer base. If you want to take a side, take a side on the customer base, what your customers tell you, do not take the opposing side of your customers or you will lose money. It is not really rocket science, you should be able to see and figure this out easily.

The major market of those two brands mentioned in the OP were men so it's only expected that they were hugely disappointed after those ads and endorsements were released. The best example I've seen was some men putting bullets to a budlight with Dylan Mulvaney's face hehe.

I don't patronize their products anymore but what did they do that made people ask for boycott?

i think it depends on what the issue is of course

brands represent something especially big brands wherein they have a wider reach of course it matters what kind of message they are sending to people


if it’s about discrimination well of course the brand would be really in the chopping block

would this happen with small brands? yes and easily but big brands are criticized but most often are not heavily affected that’s because if you are big enough of a brand that you have become a staple to the community whatever you do, people will still consume your product unlike small brands wherein you can easily find an alternative to them

an example is people saying mcdonalds should be boycotted but still a lot of people continue to buy their meals

I don't think you can't really change that though. Ideology by nature will clash with each other. Besides, it is impossible to tell them to "just ignore it" if the promotion is happening in their area. On the other hand, I think shrinking market share is not similar to the harm you're talking about here. Businesses should know that bringing different values (and actively promoting them) to people with different values is not the smartest decision for sales. CMIIW.

Brands that take sides on divisive issues DO lose market share. Remember the Dylan Mulvaney Bud Light saga?
Trans male advertised for huge beer company, the people hated it & their sales nosedived.

https://www.them.us/story/dylan-mulvaney-bud-light-drama-explained

It's a rather subtle question. The problem is that the world has become so "multi-layered", and so used to putting the interests of one layer above another, that it has, to me, turned into a kind of race, "who will create problems with a new hype topic".
And here in the "work" goes everything that can be - gender, skin color, orientation, weight, .... Waiting to add height, foot size, eye color, hair color, ear size
My opinion - no one owes anyone anything - if you don't like the products of brand A - buy from brand B. If you don't have brand B - then be kind enough to create your own brand/business and sell specialized products to those who need them so badly.
If you don't like advertising - don't watch it, but don't forbid others to watch it either!   Freedom should be either general or should not be selective.

I understand protests, if it brings real harm or problems to some group, but to demand attention to oneself or one's own promotion is too much !

I would want to read a legitimate survey on this. It seems this is a hard claim. Is this backed by scientific findings? Since you researched this topic, what would be the reasons for this?

The only way I can make sense of this is that, say, a popular brand has hundreds of millions of consumers globally and it speaks out against LGBTQ+ members. Many of its consumers are members of that group. They will certainly cut their consumption of that specific brand. Compare that to a small and unknown brand that only has, say, a thousand consumers. When it speaks out against that group, a portion of its consumers might go away, but since it has millions of potential consumers, such activism might be a reason why others who otherwise aren't considering its brand or haven't heard of it yet will begin to use it.

This, of course, could differ depending on the specific case, but if we do the math, it might be true.

It depends on what side they're going to be on because if they're on the controversial side and the side where a majority of the population disagrees then they would see a negative impact to their sales and stocks but if they're siding with what the majority thinks is the right one, they're probably going to see an increase in their sales and stocks but there are outliers out there that are an exception to the rule, some companies might take the non-majority stance but still gain respect from the majority and no effects that significant can be seen in their sales or stocks, another case would be companies that take the majority stance but the majority feels like they're just faking it so they don't see any significant increase or decrease in their sales or stocks.

I think it is influential when their market is bigger in the area of boycotts due to campaigns on socially divisive issues because this is done on a massive scale. Boycotts have a big impact on product travel and maybe you understand what I mean and you can search on the internet about boycotting several products at this time. Smaller brands are actually more dangerous because they cannot survive when a boycott occurs and the company certainly cannot afford the losses because the product is still not big.

Current conditions may be focused on an idea that is starting to be rumored to boycott several products and not just one as you mentioned. The effect of a boycott is large and the product could sink in the market and not be able to rise again, not only large products and even small products will experience problems when this happens.

I might be blind, where does this quote come from? I checked your links and it doesn't seem like any of them contain that. I can only say that we need to know how the research is being conducted because a small market share is quite ambiguous and the form of activity it not rigidly defined. A good example is shared above. I doubt a small company that sells religious attire would net a positive market share if they got themselves heavily involved with values that directly oppose their customer's values.

Brands do not lose market share if they take a side on any issue, only if they are able to choose that side wisely. Let me give you a small example of ongoing war between Israel and Palestine.

If a western brand takes side of Israel in this situation, it will reward them nicely if the majority of their revenue comes from the western countries.

But if a brand from Saudi Arabia takes side of Israel, they might have to lose their entire market share.

So it really depends on your target market. Brands do not take impulsive decisions rather they take decisions on the data.

I'm not sure if a lot of people boycott brands based on said brands' public stance on political/hot-button issues (though the more vocal people might create youtube videos and such demonstrating their new hatred of their formerly beloved product), but I'm pretty sure if there's a big difference in opinion, people aren't going to "appreciate" a corporation's position. 

And if people are using their brains, they'd realize that crap like the Bud Light thing and the Gilette razor commercials are just performative in nature, designed to increase their ESG scores so that the parent company doesn't lose its financing from whatever banks they rely on.  When I learned about ESG financing, it blew my frigging mind and just made me want to stay at home with the doors locked even more than usual.

What a world.

It's 2023 and soon it'll be 2024. What do you expect from people who are getting offended for small shits? Karen rising everywhere. Women are pretending to be men, men are pretending to be women, and some are pretending to be helicopters, dildos, trees whatever fuck they see. What more can you expect from them? All they can do is complain about everything. They can't understand how stupid they look doing those shit.

But coming to the main fact, negative marketing is a thing and it does work on small brands. But it harms bigger brands. People just want to drag down what's on the top. 

not all are aligned with what they believe. i think the majority are just forced to follow what was instructed from above. https://www.youtube.com/watch?v=ReBc_kGV6IQ
take for example Dana White's friend was instructed by a CEO to take down his post about Kenedy. this company-sponsored UFC gym and the CEO doesn't like what Dana posted.

if Danas friend is just as weasle as Budlight or Disney, he would have said Yes taking it down immediately. but they stand their ground.

Because their initial market share is restricted, smaller businesses may see a net rise in consumers even if the position is unpopular. Larger brands, on the other hand, may incur huge losses regardless of a fair mix of fans and opponents. The instances of Bud Light and Gillette show how vulnerable huge brands are to popular sentiment. This highlights the significance of understanding the dynamics of brand size, activism, and customer reaction for developing effective marketing tactics.

As per my understanding be it a business or brands they should be very selective and have multiple review and it's impact on business before making any such statements or partnerships or advertisement which will be sensitive with emotions of people within their business zone or globally. Because it impacts a business terribly though we can capitalise the market after certain period of time but the dage done for the brand is irreparable and i have see  many brand unable to regain the market value which it once held. I am a part of one of the largest E-commerce company and I could relate to this.

Yes, they will lose some of their customer, but it highly depends on those companies product if their product has many competition it will be very easy to just move on to the same products from other brand. I really don't have any problem with company that take side on some political or social issue, because those company has it's own values and principles, the owner and boards also have their own values and principles, they will take a side. As long as it doesn't turn into discrimination or something worse like hate-speech/threat , taking side on political or social issues is not a problem.

I think they do too. Small or big brands, customer usually support companies that are align with their morals or principles. Tho the impact of controversial campaigns on smaller brands can vary. While they may not face the same level of scrutiny as large corporations, smaller brands can still experience backlash if their campaigns are perceived negatively. The extent of the impact often depends on the size of the audience and how much noise they can make. It is either a good or bad outcome for companies when there are issues that divide people’s opinions.

Companies are supposed to be politically and socially neutral, to focus on high quality at a reasonable price for the consumer, and to try not to pass on any increase resulting from increased inputs and inflation directly to the final consumer. Rather, the company must sacrifice profits as much as possible without trying to increase the price of the final product, in this way. The company will grow in the face of all economic, political and social crises.

In regards to the bolded, well a President for example who represents a Country will likely lose votes from certain parts of the country he/she does not appeal to their interest , while someone who governs a small part of thesame country would gain more votes from them if he's more concerned about their interest than the larger country. That probably explains the large and small brands phenomenon
The large brands typically spread across the country/world and would likely offend customers where they are located if they decide to take side against them.

Anyway, this is why it's important never to be partial especially as head or servant of diverse people. If both sides are bad, condemn their evil together. If one is right while the other is wrong make sure you still judge them fairly without any bit of bias in you.

Many customers might boycott a brand because of its stance on some societal issues but more customers that appreciate the firm's decision will support the firm. There will always be two groups which are those who support and another who oppose the view or ideology. Anti-Semitism is gradually rising globally because of the war in Palestine and some brands might also take advantage of this to gain more market share. I am sure businesses in the Middle East, South Africa, Russia, etc will benefit from supporting antisemitism. Elon Musk might have peddled down on his views because almost all his business is located in the US and the government is the main supporter of Israel.

Your points are valid @EarnOnVictor that business owners should separate personal beliefs from their business if they want the business to keep flourishing. They should ensure that their comments align with the popular beliefs of their customer base or they risk losing a large chunk of customers.

Ye might have lost some support in the West but it seems he is building connections in the Middle East where his views are welcomed.  Who knows, his antisemitism might be a business strategy to penetrate the Arabian market. Just guessing.

I would like you to know that the world is highly sentimental and biased, they will always align with what they believe, and if the belief of the social majority is against what you preach, then you might be in trouble. This applies to both big and small establishments. If anyone has a different opinion to what is peaceful, just and of the popular opinion and the person is a strong man in an establishment, the best thing is to be neutral, don't say anything. This is what is saving many politicians, especially when it comes to different factions within the same political party. You do not spit ugliness too much, or else, it might backfire on you, particularly in earning businesses/services that its success has to do with the masses.

You can see what happened to Ye when he made anti-Semitic remarks. And recently in the Israel-Hamas escalation, Elon Musk as usual, initially was trying to side with Palestinians, but this didn't go down with many advertisers on his platform (X), they started pulling out one after the other. This made him switch his words and start supporting Israel, to the point that he even visited Israel in November to declare his support.

Due to this, establishments should be very guarded in their utterance, they might be right or wrong, but they should know that if they vex their potential customers and partners, they could ruin the business. And of course, it's even easier to ruin small businesses, while some has been burnt down by extremist in the past. Caution is always needed unless your view aligns with that of the majority.

I researched this topic based on what happened with the Bud Light brand, which was boycotted due to their campaign on a socially divisive issue. They lost market share, and their top executives were forced to address the issue. A similar situation occurred with Gillette in one of their campaigns that the public viewed as sexist, resulting in a loss of market share. However, would this have happened with smaller brands? Read what this article found out.


Reference
+ https://www.nytimes.com/article/bud-light-boycott.html
+ https://www.google.com/amp/s/www.bbc.com/news/newsbeat-46874617.amp