Tue, Feb 07, 2017 - Page 10 News List

US companies must navigate a minefield


Starbucks Corp has promised to hire 10,000 refugees. US President Donald Trump’s supporters have called for a boycott, while Uber Technologies Inc has allegedly taken advantage of Trump’s anti-immigration decree to drum up business, leading users to unsubscribe from the app en masse.

Trump’s election has laid bare the deep divisions of American society, a discord that has forced many businesses to walk a fine line to avoid alienating consumers.

“Companies that were working very hard to stay neutral no longer can,” brand expert Bruce Turkel said. “The biggest problem is anything they say can be misinterpreted.”

Sportswear manufacturer New Balance, for instance, found itself embroiled in controversy after its chief executive officer Matt LeBretton voiced optimism following the election.

“We feel things are going to move in the right direction,” he said in an interview, prompting outrage on Twitter, where users called for a massive boycott of the sneaker company, forcing the brand into damage control.

“From the people who make our shoes to the people who wear them, we believe in acting with the utmost integrity and we welcome all walks of life,” the company said.

Beverage giant PepsiCo Inc faced similar backlash from the opposite camp. Two days after the election, the company’s chief executive officer Indra Nooyi said her employees “were all in mourning.”

“And the question that they’re asking, especially those who are not white: Are we safe?” she said. The retaliation came instantly: “It’s probably a good time to pass on the Pepsi products,” conservative site The Gateway Pundit wrote.

Calls for boycotts often proliferate on Internet forums such as Reddit and 4Chan, as well as social media platforms like Facebook and Twitter. Others originate from more structured protests.

The Grab Your Wallet site, launched in October last year, lists companies suspected of favoring Trump, either because their leaders contributed to the real-estate billionaire’s campaign or because they do business with the Trump family.

The long “boycott” list includes the department store Macy’s Inc, retail giant Wal-Mart Stores Inc and beer brand Yuengling.

“Brands have always been political, but now consumers can see more of this activity and are making decisions based on this information,” site cofounder Shannon Coulter said.

However, the impact of boycott campaigns is difficult to evaluate, because calls to blacklist specific companies tend to get lost in the frenzy of social media.

“Consumers have an incredibly short memory,” marketing expert Merry Carole Powers said.

Still, some companies fear losing customers by staying silent.

Nordstrom Inc, a chain of department stores, recently announced it would drop the Ivanka Trump clothing line belonging to the president’s eldest daughter.

“There’s no margin in the middle,” said Turkel, who wrote the book All About Them, focused on company branding. “If you stay quiet, you get nothing out of it. You have to figure out who your audience is and what are their values.”

Uber appears to be playing it by ear as it devises its strategy.

The company first distanced itself from Trump’s executive order temporarily barring refugees and travelers from seven Muslim-majority countries, but it then came under fire for allegedly taking advantage of a New York taxi driver protest against the ban, prompting a wave of unsubscriptions. As taxi drivers went on strike refusing to pick up passengers at John F. Kennedy International Airport, New York, Uber not only continued to operate, but also dropped its surge pricing.

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