As the most recent batch of Oscar and Super Bowl commercials made clear, brands are increasingly unafraid to address complex sociopolitical issues. Perhaps no brand has epitomized this more than Starbucks, which over the past decade has repeatedly waded into politically charged conversations.
Most recently, in response to the Trump administration’s refugee ban on January 27, Starbucks CEO Howard Schultz announced plans to hire 10,000 refugees over the next five years in an open letter to his staff released two days later. The social sphere exploded.
We analyzed the online conversation generated by this act of brand bravery and its impact offline. We found that Starbucks-related conversation increased twelvefold the day after the announcement, and the resulting backlash increased negative sentiment by 11 percent, from 18 percent to 29 percent of all Starbucks-related conversation. The hashtag #BoycottStarbucks dominated 30 percent of the conversation at its peak and surfaced common themes, mainly objections to the hiring of refugees instead of Americans and complaints about the Starbucks CEO pushing his own political agenda.
Our analysis revealed politically engaged conservatives were the most vocal about the announcement, and they are not necessarily representative of Starbucks’ mainstream customers. People contributing to the noise were 14 times more likely to have affinity for conservative politics and 18 times more likely to watch Fox News compared to those who mentioned Starbucks before the announcement was made. In effect, the backlash was limited to a conservative, politically passionate segment but did not extend to a more mainstream audience.
Given the makeup of those driving the backlash conversation, we weren’t surprised to discover that consideration for Starbucks remained largely unaffected. While there was a slight dip on the day of the announcement, consideration bounced right back the next day, even amid peak negative buzz.
The same dynamic was also observed during similar incidents, such as when CEO Howard Schultz published an open letter in September 2013 with a request for gun owners to refrain from bringing their weapons into Starbucks stores. In March 2015, Starbucks invited customers to #RaceTogether and participate in a discourse on race with local baristas, which many felt was at best an awkward but well-intended gesture and at worst trivialized the challenges of race relations. In both cases, consideration was not severely impacted over time, nor was Starbucks’ bottom line. Following #RaceTogether, Starbucks’ second-quarter earnings soared with both revenue and operating income, increasing by 18 percent and 21 percent respectively.
Starbucks won’t report its next quarterly figures until April 2017, so we’ll have to wait to determine the impact of the refugee-hiring announcement. History suggests, however, that business performance will remain largely unscathed despite negative social conversation.
While not all brands will have individuals in leadership roles so willing to engage in political conversations, here are some lessons to be learned from Starbucks that can apply to all brands:
Acknowledge the reality: Starbucks is not blinded by altruism; the company’s actions are ultimately driven by underlying business needs, even if they are associated with a political message. While political polarization is not new, it has reached an unmatched level of frenzy. At the same time, the brand has also found itself at the center of unintended sociopolitical conversations before. In the past decade, social media has definitely played a significant role in amplifying and spreading provocation. Brands need to be mindful when they are subjecting themselves to increased scrutiny, especially from consumers who on one end of the spectrum want a separation of brand and politics, and on the other end look to brands to stand up to a larger cultural enemy.
Figure out where the brand fits: Starbucks has always put human connection and community building at the forefront of all its efforts, and the compassion it has demonstrated through hiring refugees credibly reflects its brand beliefs. It’s important for brands to support issues that align with brand values and purpose. If completely irrelevant, your brand will merely appear opportunistic and be more vulnerable to backlash, especially without a history of participation in cause-related efforts.
Be prepared: While Starbucks responded on social media through community-management efforts, more could have been done to negate some of the fury. Starbucks CEO Howard Schultz could have highlighted the success of some of Starbucks’ past initiatives such as Hiring Heroes (a commitment to hire 10,000 veterans), or made it more clear that the refugee-hiring program was a global effort across 75 countries and was not restricted to the United States. Brands should have certain preemptive-response measures in place to react to worst-case scenarios, which (as we have seen) can blow up unexpectedly from a single tweet. You’re better off safe than sorry.
Know which opinions matter: Starbucks knows that its core, everyday customers may not be its loudest critics on social media. It’s often easy for brand managers to backtrack or shrink away in the face of negative backlash, but it’s easier to stand strong when you have a sense of who is criticizing your brand.
Balance short-term with long-term goals: Past incidents have shown Starbucks that what resembles a "crisis" or "failure" on the surface may not ultimately hurt the business in the long run. Brands stand to lose out when making myopic decisions in response to a definitive moment in time. Don’t be ruled by fear.
Bravery is the state of having the moral strength to face danger, fear or difficulty. In these polarizing times, we need truly brave brands to have the courage to step up and challenge mandates that stand in the way of progress, regardless of traditional "my/your side of the fence" divisions. And we should salute the brands that do so.
—Cai Yu Lam is digital strategist, Halsey Stowe is senior strategist and Dana Zuber is associate director of analytics at Butler, Shine, Stern & Partners.