The risk and rewards of brands taking on Trump

As both Starbucks and Uber receive very different reactions after taking a stand in Trump matters, marketing experts weigh up whether brands should get involved.

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A lot can happen in 12 days. But few would have expected President Donald Trump to make so many radical changes in such a short space of time following his inauguration.

In particular, Trump’s executive order to suspend the US refugee admissions system for 120 days and to ban all entry of citizens from seven Muslim-majority countries has been met with widespread anger. In fact, hundreds of thousands continue to take to the streets globally to protest against the controversial changes.

And it isn’t just the public, brands are getting involved too. Starbucks, for example, has announced plans to hire 10,000 refugees over the next five years across the 75 countries it operates in. Airbnb, meanwhile, has offered free accommodation to those impacted by the travel ban, while Jeff Bezos, CEO of Amazon, says the ecommerce giant’s legal and lobbying teams will also help fight the ban.

Although the stance of Starbucks has resulted in some Trump supporters threatening to boycott the coffee chain, there’s been widespread praise on social media. And it appears to have had an impact on its brand health score too. According to YouGov’s BrandIndex, Starbucks’ reputation score has increased by 5.9 points to a score of -3.1 over the last week. This is the second biggest weekly rise on a list of 38 of the biggest fast food and drink brands.

The pros and cons

The Starbucks’ move was of relatively low risk, according to Brand Finance’s Robert Haigh. “Starbucks customers are part of the ‘liberal metropolitan elite’, it does not have a large presence in Trump’s heartland and is well known for a relatively liberal political stance so this is unlikely to antagonise its existing customer base,” he explains.

However, Cranfield University professor of political marketing Paul Baines claims the move might not be as risk-free as Haigh claims.

READ MORE: Marketing in the age of Trump

He ponders: “Even those who agree with the Starbucks’ policy on hiring immigrants may feel that it is not the place of a company like Starbucks to get involved in such issues and so they may perceive a ‘jumping on the bandwagon effect’. They might therefore perceive ‘manipulative intent’ on the behalf of Starbucks – that this policy pronouncement is a marketing ploy.”

So should brands really be getting involved when it comes to matters pertaining to Trump? Baines says history has plenty of examples of brands taking a political stance on controversial issues. “Remember the ‘bloody soldiers’ Benetton ads of the 1990s? This Starbuck’s pronouncement is a similar stance to that but perhaps on an even more divisive issue,” he adds.

But brands that capitalise on political matters aren’t always successful either. Baines cites furniture brand Habitat, which was strongly criticised over social media for trying to promote its products on sale using hashtags linked to the 2009 Iran protests.

Marketers becoming ‘too political’

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President Trump might not like the way Starbucks has critcised his new immigration orders

According to marketing leadership expert Thomas Barta, a lot of senior marketers have lost sight of reality by getting too involved. “Marketing’s role is to serve customers sustainably better that competitors do—that excludes politics,” he firmly suggests. “But shouldn’t marketers do good? Absolutely! But brand marketing and politics are simply two different things.”

One brand that has suffered from the Trump buzz is Uber. There has been a suggestion it could profit from the ban of Muslims into the US, with its CEO Travis Kalanick one of a number of executives chosen as advisors to Trump on economic issues.

As a result, the hashtag #BoycottUber has been widely shared on social media and its buzz score – a balance of consumers’ impression of a brand’s quality, reputation, value and satisfaction – has fallen 3.8 points to a score of -10 over the last week, according to YouGov’s BrandIndex. This is the steepest fall on a list of 29 transport brands.

Starbucks getting involved in this issue could be perceived as it jumping on the bandwagon

Professor Paul Baines, Cranfield University

In the wake of this, Brand Finance’s Haigh advises: “Most brands, including Uber, will have a broad customer base across all political persuasions, so perhaps an apolitical stance is advisable.”

Yet, he also acknowledges many won’t have any choice bar fighting Trump publically. “Brands in some sectors such as tech will be damaged by Trump’s actions in a very direct, practical way, even beyond brand concerns such as limited availability of labour. So for some they will feel it essential to vocally oppose him.”

The consensus for marketers seems to be rule with your head, not your heart. Should Trump’s foreign or domestic policies directly impact your business, then it could be a good idea to galvanise your brand advocates against the newly-appointed US president. But if you’re just looking to take a slice of what’s trending on Twitter, you run the risk of making your brand look like a predatory opportunist.

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Comments
  • Alison Andrew 1 Feb 2017 at 8:25 pm

    Starbucks is not jumping on a bandwagon – it is solidifying its positioning as a brand with a social conscience. This stance adds to what it already does with veterans, healthcare, further education opportunities, homeless programs etc and completely resonates with the vast majority of its customers. It knows it customer base better than most.
    Uber’s stupidity is failing to see that in anyway siding with Trump would not resonate with its affluent customers in metropolitan (blue) areas and that a perfectly good alternative in Lyft exists for people to change to with the download of an app.
    Two companies – one knows their customers through great research, segmentation, targeting and positioning. The other – dumb as a rock belief in mass marketing without strategy.

  • Adam Hays 3 Feb 2017 at 12:06 am

    As a United States citizen and someone who resides currently in the United States it is refreshing to see the rest of the world paying as much attention to the Trump presidency and its effect on all aspects life as those in the US are. I personally do not feel that business should get highly involved in politics however I do feel that every business has a set of morals and ethics it should abide by. If those companies’ core values are infringed upon it is that businesses responsibility to react accordingly. Citizens interact with many businesses a day and their advertisements and branding are very influential to the public. I find it telling how Starbucks’ stand on the immigration order had such a positive reaction while Uber’s relationship with the ban had such a negative reaction. As a marketing student, I feel that it is the responsibility of the marketer to brand the product tastefully and creatively. A marketer should have the business’s interest in mind, the interest targeted clients, and the interest of society as a whole. Businesses have a responsibility to not just serve and make money but to set example for employees and customers, they are certainly entitled to tastefully market within political boundaries.

  • Dalin Ard 5 Feb 2017 at 5:53 am

    I agree with Alison’s comment above, I do not see Starbucks stance as either “jumping on the bandwagon” nor a “marketing ploy”. If I recall correctly, Starbucks is one of the first companies to take a stance on this controversial issue. Additionally, I do not believe that Starbucks made this stance exclusively to make money based on people’s support, rather, I believe that they are trying to assist the refugees in any way they are able to. However, I do agree with the author’s statement that not every company has the ability to take such a bold political stance. Starbucks’ key demographic are young liberals who, in general, are strongly against President Trump’s Muslim ban. So in this case, I believe that this is a brilliant move for them, from both a business perspective and from an ethical one. Personally, I am excited to hear that this has had such a positive impact on them. From what I have seen on both Facebook and Twitter, the movement to boycott Starbucks severely backfired and ended up helping Starbucks even more. Companies that have a broader consumer base should stay completely out of political issues as it could negatively affect their company’s image. I am excited to see if other companies do end up following suit, and to which degree they will do so, especially with the Super Bowl tomorrow. I understand Thomas Barta’s worry about marketers becoming too involved in politics and losing sight of their company’s brand image. In conclusion, companies should put very careful consideration into their decision to either get involved politically or to stay out of it completely.

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