Brands crave public relationships more than their publics do – and that’s a good thing
What do PayPal, Wells Fargo, Deutsche Bank, Goldman Sachs, Bank of America and Hyatt Hotels have in common with Bruce Springsteen? If you follow U.S. news, you may know they all oppose North Carolina’s so-called ‘bathroom bill,’ which limits the rights of transgendered people to use the washrooms of their choice.
While artists and activists have always been at the vanguard of social change, corporations have historically been careful to avoid even commenting on controversial social issues, let alone backing their words with the sort of concrete actions we are seeing in U.S. states that consider or adopt laws permitting discrimination against gay, lesbian, bisexual and transgendered people. In North Carolina, PayPal cancelled plans for an operations centre that would employ 400, while Deutsche Bank suspended plans to create 250 new jobs at its local offices; in Georgia, corporate activists include Disney, AMC and Salesforce.
The list of brands taking stands on social issues grows longer every year: in America, Starbucks was occasionally mocked but mostly praised for its #RaceTogether campaign; in Canada, big banks invest heavily in LGBTQ-positive marketing surrounding Toronto’s massive annual Pride celebration; in Ireland, many of the nation’s biggest companies took public stands in favour of same-sex marriage (against the historically powerful Catholic church) during last year’s referendum on the subject; on the other side of the spectrum, some brands such as Chick Fil-A have strengthened the loyalty of their socially conservative customers by standing against same-sex marriage or gun control.
Why are so many powerful brands suddenly taking stands, and what can others learn from this values-based form of public relations?
1. The affinity of some is better than the indifference of all. In the most information-rich, attention-poor era of human history, being neutral has become a risky place to be. The brand that can forge and demonstrate shared belief with a segment of the market gets noticed, and, even more significant, its stand gets talked about and shared.
2. Affinity breeds advocacy. With trust in corporations, advertising and traditional sources of authority low, consumers are relying more than ever on news and reviews from friends and even strangers. These powerful networks of influence are enabled by our ability to share like never before — be it through a Facebook update, a WhatsApp message or a TripAdvisor or Yelp review. By taking stands, brands can aspire to the holy grail of 21st century marketing: customer-to-customer advocacy.
3. Employees have networks, too. In announcing its decision not to expand in North Carolina, PayPal specifically cited the potential impact on its employees. While the number of employees affected by the ‘bathroom bill’ is likely very small, the deeper message was that the company wanted its people to be proud of its values – with the knowledge that staff would no doubt share news of the company’s stand widely with their own networks. This matters: research consistently suggests that we are more likely to trust the word of someone who works for a company than the company itself.
4. While attention spans are short, our memories are long. While we may not always remember why, our emotional impressions about brands last a long time. While it’s easy for a brand to go from strength to weakness by betraying its values (think of Lululemon after its founder’s judgmental comments on women’s bodies, or Volkswagen after the emissions-fraud scandal), it’s much harder to go from weakness to strength. Since the Internet’s memory is eternal and instantly accessible, who wants to be on the wrong side of history?
5. When a purchasing decision is close, values are the tiebreaker. According to a recent U.S. study, people are 8.1 per cent more likely to buy from companies that “share the same social and political views” as they do, and 8.4 per cent less likely to buy from those that do not share those views (Dodd and Supa, 2015). The “more likely to buy” number rockets to 20 per cent among millennials between 26 and 35.
Some commentators decry corporate social activism, arguing that it’s driven more by economic interests than core values. I believe this is missing the point, for two reasons.
First, when brands take stands, they are really seeking to strengthen their relationships with their consumers and stakeholders. Since brands crave relationships with their publics more than the public craves relationships with brands, this puts the public in charge. PR theorists such as James Grunig have long held that one key test of ‘public relationships’ is whether members of the public believe they can influence the organization – and the idea that they can do so is unambiguously positive.
Second, when the economic power of corporations combines with the communication power and credibility of ordinary citizens, the potential for social change is great. That is why the smartest brands are taking heed, and so are their consumers and stakeholders.
About the Author:
Daniel Tisch is the President and CEO for Argyle Public Relationships. He is one of Canada’s best-known communicators, having worked at senior levels in government before embarking on a 20-year consulting career in which he has advised CEOs, boards, government leaders and marketers for some of the world’s biggest brands.