Companies Should Leave Politics to the Politicians

For companies looking to appeal to younger, more socially conscious consumers, the temptation can be strong to take a stance on politically charged issues, but that might not be the best policy, as we point out in an article in this month’s Insight section (“Consumers Want Businesses to Stay Out of Politics”).

The article highlights a study by Bentley University and Gallup, which found that fewer than four in 10 U.S. adults (38 percent) believe businesses should take public stances, a decline of 10 percentage points in just the past two years. The research also found that businesses that publicly endorse a political candidate risk harming their bottom lines among consumers who do not share that candidate preference. More than six in 10 consumers say they would be less likely to purchase from a company that endorsed the candidate that they did not support.

This year especially, the upcoming elections are hyper-polarizing, the political rhetoric is hyperbolic, and the divisions are more evident than ever, so companies that come out on one side greatly risk not just alienating consumers who stand on the other side but also risk long-term damage to their brand reputation and sales. For proof, one needs to look no further than Bud Light, which in the spring of 2023 began working with transgender influencer Dylan Mulvaney on a social media promotional post. The backlash was almost immediate, and Bud Light’s sales are still suffering today, a year and a half later.

Bud Light is certainly not the first company to face criticism for its stance on political hot-button issues. Coke, Delta, Disney, Nike, Goya, Adidas, the North Face, and Target are just some of the more recent ones that have caught the public eye in the past few years.

Bud Light is different, though. Amid quick news cycles, most company controversies fall quickly out of the public eye, and most boycotts are short-lived.

Bud Light has not bounced back from a drop in sales that could be as high as 30 percent, though, for a number of reasons: Because there are a lot of other light beer options available, boycotting Bud Light did not cause serious disruptions to consumers’ lives. And Bud Light did not respond well to the controversy, causing more news coverage and many people on both sides of the issue to dig in deeper.

As the controversy continues to this day, a new term has entered the marketing lexicon: “Bud Lighting,” used to describe the boycotting of companies that cater to various causes considered to be “woke.” In its aftermath, many companies and their marketing departments have become very aware of the potential pitfalls of taking stances, or of being perceived to take stances, on controversial social issues.

Though not specifically addressed in the Bentley University/Gallup study, I also have to question the efficacy of companies taking political stances. Do such positions by companies do anything to sway public opinion? Or alter political outcomes? Did Coke and Delta publicly coming out against Georgia’s voting law changes in 2021 do anything to amend the legislation or lead to its repeal, or did it just erode some of their market share, if even for only a few months?

Now, as companies and their brand marketers re-evaluate their roles in the political arena, it is important for them to get to know their customer bases better, assess their competitive landscape, and avoid taking positions and acting in a way that will only create or prolong negative media attention.

Although I don’t like boycotts, I hope this new era of Bud Lighting will encourage companies to step away from politics and return their attention to their core missions—creating value for their shareholders, putting forth the best products and services possible, and meeting the needs of their customers.

Leonard Klie is the editor of CRM magazine. He can be reached at lkile@infotoday.com.

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