Even More at Stake for Brands in the Hashtag Era

SMITH BRAIN TRUST – Companies called out by hashtag movements like #BoycottStarbucks face not just a potential loss of revenue, but also a rising likelihood that customers will go out of their way to lie, cheat and steal from them, according to new research.

Amna Kirmani, marketing professor at the University of Maryland’s Robert H. Smith School of Business, finds that consumers who disagree with a corporation – whether because of its actions, its corporate social responsibility campaigns or its political statements – will seek to punish it.

Some customers will treat low-level store clerks or customer service personnel poorly as a way of punishing the company, or will take excessive advantage of store freebies and perks, such as WiFi or free samples, Kirmani says.

Some will “wardrobe” clothes – in other words, buying them, wearing them to an event and then returning them to the store for a refund as if never worn. Others will lie – about a child’s age at an amusement park, for example – to get a discount they don’t actually qualify for.

Consumers – particularly those belonging to the increasingly influential millennial generation – decide whether brands understand who they are by whether the companies support the causes they care about. They increasingly want companies to stand for something. And they want to know what it is. They’re making spending decisions accordingly.

“It’s not just a matter of liking a company or disliking a company, and it’s not about agreeing with a policy or not agreeing,” Kirmani says. “Consumers are deciding whether brands understand who they are and support the things they care about.”

And that’s one way the marketplace has changed.

With consumers today sharply divided on all sorts of issues – from refugees, to the environment, to guns – the task of managing a corporate social responsibility portfolio becomes highly complicated.

“These days, everything has a pro and con,” she says. Highly charged issues are everywhere — from the NRA, to the NFL, to the climate crisis, to the rights of people who identify themselves as lesbian, gay, bisexual, transgender or queer.

“Target in 2016 announced a plan to install gender-neutral bathrooms in all of its stores. Big backlash,” says Kirmani, who studies corporate social responsibility and how it influences consumers.

In 2012, consumers organized a boycott of Chick-fil-A, after the fast-food chain’s president voiced opposition to legalizing same-sex marriage. There was a counter backlash as well, as other consumers organized a “Chick-fil-A Appreciation Day” in support of his views.

In 2016, a widely publicized boycott campaign took aim at several retailers that carried Donald Trump and Ivanka Trump clothing lines, amid outrage over the content of an “Access Hollywood” video in which Donald Trump was recorded speaking about women in vulgar terms. The boycott kept some consumers away from those stores, even as it might have drawn some others in.

But embracing controversy isn’t a good business plan for most companies, Kirmani says. Few companies can afford to alienate wide swaths of the consumer audience.

Given the stark divisions that exist, how can companies choose what issues to support with their corporate social responsibility efforts?

For a company like Patagonia, whose corporate social responsibility efforts have long been rooted in a single cause and which appeals largely to a single type of consumer, the choice — environmentalism — is an uncomplicated one. “So if you identify with that cause, you shop at Patagonia and if you don’t, you don’t. For them, it’s very clear,” Kirmani says.

For generalized businesses — the airlines, the coffee chains, food retailers, department stores — “that’s where the choices become less and less clear,” she says.

In her research, now in the early review stages, Kirmani conducted experiments with student volunteers in a lab and with other volunteers online, using real issues and fake companies. Kirmani has spent much of her academic career studying consumer psychology, the way we identify closely with some brands and not others, and the “when” and “why” of consumer loyalty. These days her research focuses on where consumer behavior intersects with deceptive behavior.