Corporate boycotts are now a fact of life for many companies. In a highly charged and politically divided environment, taking a perceived stand on an issue—large or small—could be enough to make you a target.
This is despite the fact that most studies seem to indicate that companies that have experienced boycotts do not appear to have their bottom lines affected; in fact, recent boycotts were often paired with “buycotts” in response that either blunted or negated any financial impacts. The public almost always moves on, sometimes rather quickly.
Although it is somewhat heartening to know that harsh financial impacts are rare, boycotts can also carry reputational risks. The long-term impacts of a damaged reputation may be less clear-cut but are no less important than financial ones.
Identifying issues before they become problems
While not every situation that could lead to a boycott is avoidable or manageable, some are, and for that reason alone media monitoring is a worthwhile effort.
Monitoring social media, in particular, can help a brand to spot potential reputational issues early. This allows for time to think through a response or action plan. Sometimes the best response is to wait out the problem, as making a statement might add more fuel to the fire. In other cases, an early statement could take the wind out of a boycott effort, lessening its impact.
In some situations, you may fairly accurately predict what corporate actions might initiate a boycott action. If your organization takes a controversial policy stance or hires an employee, spokesperson, or influencer known to have provocative opinions, it is prudent to assume there may be some pushback. Have a plan in place to monitor for reactions and have a holding statement ready before the announcement is public.
On the other hand, an unpredictable issue can become a crisis, and that could in turn lead to calls for a boycott. In these situations, using a combination of volume and automated sentiment analysis can provide your communications team with information such as how the issue is evolving, which audiences are most active in advocating for a boycott, and where those audiences are located.
Managing volume during a boycott
Being in the midst of a boycott can feel overwhelming, as the social media outrage machine churns out content at a rapid pace. Trying to review everything coming in usually isn’t possible, so use your tools or reports to look for trends.
This might be the right time to turn your attention to traditional media coverage, to see how the issue is being reported by professional news outlets. Pay special attention to any publications that are priority outlets for your industry or brand—those pieces will carry the most weight with your core audience.
When conducting analysis both during a boycott and after, remember to factor sentiment into any share of voice (SOV) charts, because a boycott effort will almost always cause an uptick in SOV—which may or may not be considered a net positive. Layering sentiment on top of SOV will help to demonstrate what portion of coverage was pushing for a boycott, versus the amount of discussion defending a brand and speaking out against a boycott.
Reputational Impacts
The longevity and impact of boycotts vary dramatically from one to the next, for many reasons. Consumer boycotts can evaporate quickly, particularly if the required behavior change isn’t an easy one. On the other hand, if the switch to another product is easy the effect can be longer-lasting.
A BBC article about boycotts provides an interesting example of just how engrained consumer behaviors can be. After the Deepwater Horizon oil spill, thousands of people signed online petitions saying they would boycott BP gas stations. However, the threat of action didn’t seem to stick. The professor of management interviewed for the story points to behavior patterns as a likely reason. Despite there being many options to purchase gas, we generally do so as part of our weekly routines. This means that a decision to boycott a certain brand of gas would involve revamping an established routine. Anyone who has resolved to exercise more or to eat better can attest that changing a routine is hard.
Boycotts that are more likely to stick around involve much smaller behavioral changes. If you’re already at the grocery store, choosing one brand of pasta over another or one beer over another is easy. Barilla reportedly spent around $5 million a year on reputational repair efforts from 2013 to 2019—but as this Vox article notes, the boycott effort didn’t seem to affect Barilla’s revenue during that time period.
If a boycott doesn’t negatively affect revenue, should a brand even worry or care if a boycott threat surfaces? The answer to this question will need to be addressed at the C-Suite level. When a company makes a decision that could ignite controversy and potentially spark a boycott, those risks need to be weighed alongside whatever benefits the decision brings with it. Not every boycott will be revenue-neutral, and not every boycott will have a countering “buycott” associated with it.
Conclusion
Measurement, monitoring, and analysis can help to inform these decisions before they are made, to better predict the impact. And, by studying boycott efforts that have affected similar companies and industries, businesses can take steps to either lessen their chances of becoming a boycott target, or develop statements that make clear why they chose to implement a decision or policy regardless of a boycott threat.
Disclaimer: The views expressed in this blog post are solely those of the author(s) and do not necessarily reflect the views of CARMA.
