2019 Volume 22 Issue 3

Strategies for Managing in the Age of Boycotts

Strategies for Managing in the Age of Boycotts

Are Boycotts Prone to Factors That May Make Them Ineffective?

In the days of seasons past, consumers had it easier. If you found a product you liked, you might have searched for the best manufacturer or brand and then found the most competitive price and made your purchase. We are not so lucky today. Today’s consumers are subject to social pressure to support brands that are aligned with their personal values. Research tells us that consumers are more sensitive to negative Corporate Social Responsibility (CSR) information than to positive CSR information.[1] CSR practices represent the extent to which a company strategically manages its brand image to meet societal norms.[2] As a result, when firms do not conform to their customer’s values, they often find themselves the target of boycotts. Managing in the age of boycotts is something firms need to pay attention to and understand how to manage.

Introduction

Boycotts are defined as “a concerted refusal to do business with a particular person or business…in order to obtain concessions or express displeasure.”[3] They have been the subject of recent news headlines. Some of the latest consumer boycott campaigns have been aimed at changing:

  1. The behavior of countries, as in the call to boycott the Sultan of Brunei’s hotel properties in response to human right concerns with implementing Shariah law, which among other things, calls for death by stoning for adultery and homosexuality[4] or the B.D.S. (boycott, divest, and sanction) movement that seeks to pressure Israel into ending its occupation of the West Bank;[5]
  2. Consumer’s preferences for fast-food, as in the boycott of Chick-Fil-A charitable foundation that continued donating to anti-LGBT groups following a 2012 incident in which Chick-Fil-A’s CEO was quoted blaming the country’s woes to an increasing acceptance of gay marriage;[6]
  3. Public policy, as in the shaming of politicians and political leaders to enact climate change legislation by a 16-year-old, Nobel Peace prize nominee, Swedish teen Greta Thunberg;[7] and
  4. Television viewers’ choice of news shows, as when advertisers left in droves after Fox News television hosts Tucker Carlson and Jeanine Pirro reported to have made misogynistic, homophobic, racist, and anti-Muslim comments.[8]

Effectiveness of Boycotts

The aim of these initiatives is to encourage consumers to avoid certain brands (as in not buying products made in Israel or from a specific restaurant such as Chick-Fil-A) or to participate in a specific action (as in not staying in specific hotels or skipping school on Fridays as in the case of Greta Thunberg) as a form of protest against perceived unfair business or social practices and call for change.[9] [10] Since boycotts are used as a tool to garner social change, it is reasonable to question the efficacy of such strategies and what brands that find themselves a target of such activities can do to protect themselves.

How effective a boycott’s strategies are is a function of the stated objectives of it. When the goal of a boycott is to bring awareness, it can be effective when it reflects a movement, as Wharton marketing professor Americus Reed recently explained in an online debate.[11] Consider the Montgomery bus boycotts of the civil rights era or Cesar Chavez’s campaign to compel grape growers to provide better pay and working conditions for migrant farm workers.[12] These boycotts influenced public opinion and over time helped pave the way for social change. However, boycotts rarely succeed in inflicting lasting economic harm to the targeted company.[13] [14] Despite rarely resulting in lasting economic harm, boycotts have been shown to be successful in damaging the targeted firm’s reputation and brand image.[15] The more a boycott is able to call attention to the issue it aims to change, the more of a chance it has to change social norms and galvanize support.

Boycott Shortcomings

Boycotts’ biggest shortcoming is that they are prone to several factors that make them ineffective. First, the consumer zeal for boycotts tend to fade over time. Once the media spotlight is gone, the buzz fades. Second, as with movements rooted in collective action, a free riding problem occurs.[16] Consumers can choose to ignore the boycott and still purchase or participate in the targeted activity. Often the act of boycotting can be costly for the consumer as they are forced to find an alternative or substitute that can take time, effort, and increased inconvenience. They may also speculate on the success of the highly uncertain boycott strategy and conclude that their action or inaction will not make a difference (a perceived lack of efficacy) so they may as well not participate in the boycott.[17] Lastly, the lack of coordination is a common obstacle. In order for a boycott to succeed, enough people need to participate. Those early adopters of the boycott are those with whom either switching costs are low and the boycott affects them minimally or they are zealous about the focused boycott issue. But once the early participants join, the larger majority of potential boycotters remaining may have higher switching costs and may not care as strongly about targeted boycott issues. It becomes harder and harder to overcome the coordination obstacle of getting additional support. It is this challenge in estimating the participation of others that hinders a boycott’s effectiveness. Studies have demonstrated that if consumers judge the likelihood of others participating in the targeted boycott as low, they are less likely to also participate and boycott the targeted brand.[18]

Awareness, Egregiousness, Boycott

Just as the purchasing factors consumers consider have evolved to become more socially conscious, so have the skill sets of successful managers. What follows are some tips and strategies regarding how to implement best management practices once you are a target of a boycott.  It may be helpful to follow an empirically validated framework for boycott management called Awareness, Egregiousness, Boycott (AEB).[19] The first step is to measure the awareness of the boycott. What percentage of your customers actually knows about the boycott? Research demonstrates that for most boycotts, awareness is extremely low.[20] The second step is to measure the perceived level of egregiousness and aim to understand why your customers find your company’s policy or actions so objectionable. Lastly, formulate your boycott response strategy. Some of these strategies are outlined below.

Strategic Impression Management

How can companies best protect themselves from these growing social movements? First, do not give your customers a reason to boycott you.[21] Constantly scanning the marketing environment is an important task of any strategic marketer and understanding the social/cultural environment of your customer is paramount. Do right by your customers and they may not target you for a boycott in the first place. Best practice firms engage in strategic impression management as the foundation of their brand strategy.[22] A common tactic of the impression management arsenal is making prosocial claims (expressions of the organization’s commitment to socially acceptable standards, values, actions).[23] In this context, prosocial claims are a communication strategy and can serve as a barometer of a firm’s commitment to CSR activities. It is important to understand that these strategies are effective when firms have made prosocial claims in the past. If so, they are a great tool for responding to a consumer boycott threat. Prosocial claims can often neutralize the reputational threat at which the consumer boycott is aiming. They do not even have to be related to the boycotted issue, as long as the information is positive, the positive statements provide a halo effect for the firm and leads to lower levels of boycott participation.[24] The claims need to be rooted in past prosocial actions and CSR investments, otherwise, the communicative efforts will be interpreted as inconsistent, hypocritical, and suspect. Best practice firms incorporate good public relations campaigns into their marketing plans to ensure they are not just positioning their brands according to their marketing strategy, but also laying a foundation to ward off or minimize the effect of a future boycott.

Social Media Threats

Today’s social media environment can help exacerbate the boycott phenomenon. Thus, it is helpful to conceptualize boycotts as social movements.[25] Social movements employ “contentious performances” such as boycotts to threaten a targeted firm’s reputation and legitimacy among its constituent audiences, usually through social media channels. Social movement actors use the media to make negative claims about the targeted firm and threaten the firm’s reputation. These create a series of claims-making performances by both parties. The degree to which firms engage in this back and forth is a function of how well the firm believes it has protected itself by building a “buffer” of heavily communicated prosocial claims, rooted in CSR investments.[26] Firms that have a large reservoir or deposit of good will may not be targeted for a boycott as boycotters perceive the cost of overcoming these investments in prosocial communications as too large to conquer[27] and if targeted for boycott, often find the negative effect of the boycott minimized.

Strategies for Addressing Boycotts

If you do find yourself as the target of a boycott, here are some strategies that may help.

Weather the Storm

First, if you can weather the storm short-term, hunker down and ride it out.  This is especially true if the targeted company is adamantly opposed to the changes sought by the consumers waging a boycott.[28] For example, in 2012 Chick-Fil-A was the focus of boycott efforts when a senior member of their leadership made public comments opposing same sex marriage and supporting organizations that critics accuse of being anti-marriage equality. As of 2018, sales have almost doubled.[29] The company, responding to the negative press, announced they would stop donating to all political-based groups. The Chick-Fil-A’s website still reflects its founders’ Christian vision, but do so with a more inclusive message. The company has instructed all of its franchisees not to get involved with anything that blurs the line between their private beliefs and their commitment to providing all customers quality food.[30]

Keep in mind that strong customer relationships facilitate communication that drives mutual understanding between the brand and consumer. If the targeted company makes investments, prior to the boycott initiatives, in positive brand imaging and socially responsible investments, these can often serve as a form of “insurance” to counteract messaging about the perceived egregious actions of the targeted firm.[31] [32] [33] [34] Research has demonstrated communicating the unlikelihood of boycott success, often translates into less consumer participation in boycotts.[35] This messaging needs to be transmitted very carefully and centered on the fact that the firm’s customers’ objections have been fully heard and valid counterarguments are made in the spirit of mutual understanding. This is not about winning an argument. This is about trying to understand the motivations involved. So, it is critical to check all relevant facts. Additionally, check your assumptions and clearly differentiate between what is fact, what is assumption, and what is opinion.  Use data and logic to understand their point of view, even if you disagree. Do not assume the other side has all relevant data.

Communicate

Second, as you seek mutual understanding, communicate to your customers the negative outcomes to their boycotting, these can serve to lessen boycott participation. The aim here is to communicate—not manipulate. For example, explaining how employees may be negatively affected or other secondary and tertiary stakeholders who are innocent and caught in the crossfire. This occurs when firms have to close down factories and communities are harmed by the reduced tax revenue and further business closings. While consensus of opinion may seem desirable, wanting all parties to agree on the issue at hand, research has shown that non-consensus opinion (where differing opinions co-exist) are more common occurrences in the real-world.[36] This is what occurred in 2014 when members of the Hollywood elite called for boycotts of the Beverly Hills Hotel. The owner of the hotel, the Sultan of Brunei, announced plans to implement severe anti-gay policies in his home country. In response, the Dorchester Collection, the parent company of the hotel, launched a social media campaign focused on the harm the boycott caused its hotel employees. Celebrities and protesters alike were quoted in the press expressing sympathy for the staff and challenging the boycott outright.[37] Although firms often cut advertising during boycotts (the Dorchester suspended all social media postings, except for those focused on employees managing through the crisis) to stay out of the limelight to avoid calling attention to themselves or for fear that their advertising investments would be nullified due to the boycott. Research suggests that this may not be the optimal strategy.[38] Quality advertising that reinforces positive brand associations can increase the cost of boycotting to the consumer and help neutralize the effects of any negative information.

Self-Reflect

Finally, self-reflect. Maybe the boycotters have a point. Perhaps their claims are legitimate and justified. Remember that boycotting is related to customer complaining behavior as customers often do not buy from you again if they are dissatisfied with your firm.[39] [40] [41] Firms need to keep up with changes in the broad marketing environment (demographic, economic, social-cultural, natural, technological, and political-legal). This includes changes in social values and norms. The ability to monitor these changes often serve as the basis for new opportunities or the identification of potential threats to your brand.[42] For example, the state of Indiana found itself the target of a boycott after the state legislature passed the notorious Religious Freedom Restoration Act (RFRA) in 2015. The law, as originally written, allowed state businesses to refuse service to same-sex couples based on religious grounds. After swift and strong negative reactions from the business community, the state government reversed course and modified the law a week later. It is estimated that the RFRA cost the city of Indianapolis more than $60 million.[43] If the ensuing pressure potential for your brand image is high, and boycotters have a legitimate complaint, revise your position quickly, before the boycott picks up steam. If you do plan a policy shift, do so without reference to the boycott as this may encourage further boycotts in the future.[44]

Creating Trust

Boycotts have been used as a tool for change for centuries[45] and they do not seem to be going away anytime soon. In 494 B.C., Roman plebs rejected their brutal treatment by their patrician wards and left the city of Rome in droves.[46] In fact, the term boycott comes from events in 1880. Irish employees refused all forms of cooperation with their English land agent Captain Charles Cunningham Boycott.[47] A recent search of the website of Ethical Consumer (a global non-profit centered on utilizing purchasing pressure to call for more ethical and sustainable business practices) lists more than 40 firms targeted for boycott. These firms include Amazon for tax avoidance strategies in Europe to fast-food restaurant chain Wendy’s for workers’ rights issues.[48] This fits with past calls for firms to be more proactive and prepare a set of business strategies to effectively respond to this increasing consumer practice.[49] These authors argue that there is really nothing new here. Marketing practices of old valued the brand of individual craftsman. Not because they knew certain craftsman made superior products but because they knew the individual craftsman behind the brand.[50] They put their trust not so much in the product stamped with the brand but the person behind the brand to do right by them. As your customers pull the curtain behind your brand, give them reasons to trust you by making more proactive investments in CSR initiatives as they create a bank of good will from which you may have to draw upon in a time of crisis.[51] Staying abreast of consumer social trends, listening to what is important to them and investing in corporate activities that give them a reason to remain a customer are the best strategies for avoiding the toll a consumer boycott can bring.

Conclusion

The pressure for consumers to align purchasing behavior with their values is getting support from high places. The pope has reminded Catholics all over the world to be conscious of their buying habits. Pope Benedict XVI taught that the act of consumption is always a moral act and that Catholics have a specific social responsibility shared with the firm from whom they purchase products.[52] He argued Catholics are called upon to not just consider an economic cost benefit analysis when purchasing products but to consider their role in economic transactions that are truly good for our society.[53] Consumers seem to reflect this sentiment as more are patronizing companies that heed business practices that focus on creating a positive impact on factors beyond profitability. Perhaps the best way for firms to successfully manage boycotts is to do good, by the standards of their customers. The best way to manage out of a crisis is to avoid it to begin with.

 

References

[1] Bhattacharya, C.B., & Sen, S. (2004, April). Doing Better at Doing Good: When, Why, and How Consumers Respond to Corporate Social Initiatives. California Management Review, 47, 1, 8-24.

[2] Harjoto, M. A., & Salas, J. (2017). Strategic and institutional sustainability: corporate social responsibility, brand value, and Interbrand listing. Journal of Product and Brand Management 26, 44, 545-558.

[3] Garrett, D. E. (1987). The Effectiveness of Marketing Policy Boycotts: Environmental Opposition to Marketing. Journal of Marketing, 51, 46-57.

[4] Holson, L. M., & Rueb, E. S. (2019, April 3). Brunei Hotel Boycott Gathers Steam as Anti-Gay Law Goes Into Effect.” The New York Times. Accessed at https://www.nytimes.com/2019/04/03/world/asia/brunei-hotel-boycotts.html

[5] Edmondson, C. (2019, January 28). Senate Advances Pro-Israel Bill as G.O.P. Searches for Democratic Divisions. The New York Times. Accessed at https://www.nytimes.com/2019/01/28/us/politics/senate-israel-boycott-democrats.html?rref=collection%2Ftimestopic%2FBoycotts&action=click&contentCollection=timestopics&region=stream&module=stream_unit&version=latest&contentPlacement=13&pgtype=collection

[6] Del Valle, G. (2019, March 22). Chick-fil-A’s charitable foundation kept donating to anit-LGBTQ groups. Vox. Accessed at https://www.vox.com/the-goods/2019/3/21/18275850/chick-fil-a-anti-lgbtq-donations

[7] Sengupta, S. (2019, February 18). Becoming Greta: ‘Invisible Girl’ to Global Climate Activist, With Bumps Along the Way. The New York Times. Accessed at https://www.nytimes.com/2019/02/18/climate/greta-thunburg.html

[8] Epstein, K. (2019, March 13). “Advertisers ditch Carlson and Pirro’s Fox News shows; protesters urge other companies to join them.” The Washington Post. Accessed at https://www.washingtonpost.com/arts-entertainment/2019/03/13/advertisers-ditch-tucker-carlson-jeanine-pirros-fox-news-shows-protesters-urge-companies-join-them/?utm_term=.b78e9ba49fbf

[9] Friedman, M. (1991). Consumer boycotts: A conceptual framework and research agenda. Journal of Social Issues, 47, no. 1: 149-168.

[10] Garrett, 1987.

[11] Reed, A. (2019, February 7). Social Media Boycotts Succeed When They Reflect a Movement. The New York Times. Accessed at https://www.nytimes.com/roomfordebate/2017/02/07/when-do-consumer-boycotts-work

[12] Livingston, M. (2018, March 1). “Here’s when boycotts have worked-and when they haven’t”. Los Angeles Times. Accessed at https://www.latimes.com/nation/la-na-boycotts-history-20180228-htmlstory.html

[13] Delacote, P. (2009). On the Sources of Consumer boycotts Ineffectiveness. Journal of Environment & Development, 18, 3, 306-322.

[14] Reed, 2019.

[15] Bhattacharya, 2004.

[16] Livingston, 2018.

[17] Klein, J. G., Smith, N. C., & John, A. (2004, July). Why We Boycott: Consumer Motivations for Boycott Participation. Journal of Marketing, 68, 92-109.

[18] Ibid.

[19] Ibid.

[20] Freidman, M. (1999). Consumer Boycotts. New York: Routledge.

[21] Klein, 2004.

[22] McDonnell, M. H., & King, B. (2013). Keeping up Appearances: Reputational Threat and Impression Management after Social Movement Boycotts. Administrative Science Quarterly, 58, (3) 387-419.

[23] Ibid.

[24] Yuksel, U., & Mryteza, V. (2009). An Evaluation of Strategic Responses to Consumer boycotts. Journal of Business Research, 62 (2), 248-259.

[25] McDonnell, 2013.

[26] Yuksel, 2009.

[27] McDonnell, 2013.

[28] Bhattacharya, 2004.

[29] Yilek, C. (2019, September 20). Chick-fil-A has more than doubled sales since critics called for boycott. Washington Examiner. Accessed at https://www.washingtonexaminer.com/news/chick-fil-a-more-than-doubled-sales-since-critics-called-for-boycott

[30] Peterson, H. (2017, August 6). ‘Chick-fil-A is about food’: How national ambitions led the chain to shed its polarizing image. Business Insider. Accessed at https://www.businessinsider.com/chick-fil-a-reinvents-itself-liberal-conservative-2017-5

[31] Klein, 2004.

[32] McDonnell, 2013.

[33] Yuksel, 2009.

[34] Sen, S., Gurhan-Canli, Z., & Morwitz, V. (2001, December 28). Withholding Consumption: A Social Dilemma Perspective on Consumer Boycotts. Journal of Consumer Research, 399-417.

[35] Klein, 2004.

[36] Shao, J., Havlin, S., & Stanley, H. E. (2009). Dynamic opinion model and invasion percolation. Physical review letters, 103(1), 018701.

[37] Ross, L. A. (2014, May 30). Beverly Hills Hotel Boycott Shifts Focus to Employees. The Wrap. Accessed at https://www.thewrap.com/beverly-hills-hotel-boycott-shifts-focus-employees/

[38] Delacote, 2009.

[39] Klein, 2004.

[40] Tax, S. S., Brown, S. W., & Chandrashekaran, M. (1998, April). Customer Evaluations of Service Complaint Experiences: Implications for Relationships Marketing. Journal of Marketing, 62, 60-76.

[41] Dawar, N., & Pillutla, M. M. (2000, May). Impact of Product-Harm Crises on Brand Equity: The Moderating Role of Consumer Expectations. Journal of Marketing Research, 37, 215-226.

[42] Kotler, P., & Keller, K. L. (2016). Marketing Management, 15th edition. Boston: Pearson.

[43] Bender, A. (2016, January 31). Indiana’s Religious Freedom Act Cost Indianapolis $60 Million In Lost Revenue. Forbes.com. Accessed https://www.forbes.com/sites/andrewbender/2016/01/31/indianas-religious-freedom-act-cost-indianapolis-60-million-in-lost-revenue/#7ad987582e2a

[44] Bhattacharya, 2004.

[45] Ibid.

[46] King, B. (2009, April 1). Why Boycotts Succeed -and Fail. Kellogg Insight. Accessed at https://insight.kellogg.northwestern.edu/article/why_boycotts_succeed_and_fail

[47] Marlow, J. (1973). Captain Boycott and the Irish. History Book Club.

[48] Boycotts List’ (n.d.) Ethical Consumer. Accessed at https://www.ethicalconsumer.org/ethicalcampaigns/boycotts

[49] Gelb, B. D. (1995). More Boycotts Ahead? Some Implications. Business Horizons, March-April, 70-76.

[50] Vargo, S. L., & Lusch, R. F. (2004, January). Evolving to a New Dominant Logic for Marketing. Journal of Marketing, vol. 68, no. 1, 1–17.

[51] Yuksel, 2009.

[52] Benedict XVI. (2009, June 29). Caritas In Veritate, encyclical letter, Vatican website, p. 43. Accessed at http://w2.vatican.va/content/benedict-xvi/en/encyclicals/documents/hf_ben-xvi_enc_20090629_caritas-in-veritate.pdf

[53] Gates, D. (2015, December 7). Four Reasons Why We Need Boycotts. Crises Magazine. Accessed at https://www.crisismagazine.com/2015/four-reasons-we-needs-boycotts

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Authors of the article
Jim Salas, PhD
Jim Salas, PhD
Dr. Jim Salas is an Assistant Professor of Marketing at Pepperdine Graziadio Business School. At Pepperdine Dr. Salas teaches graduate and doctoral-level courses across a range of marketing topics. His main research is focused on the marketing function at the edge of the organization. Specifically, how do business-to-business firms manage the marketing/sales function to drive innovation and growth. His research has been published by Journal of Product and Brand Management, the Journal of Marketing Theory and Practice, Journal of Marketing Education, and Sage Publication’s Business Expert Press. He received his PhD in marketing at Arizona State University’s W.P. Carey School of Business.
Doreen E. Shanahan, MBA, PhD Candidate
Doreen E. Shanahan, MBA, PhD Candidate
Doreen E. Shanahan is a PhD candidate at Pepperdine University. Her research interests involve innovation and consumer behavior, with a specific focus on technology acceptance. She is a Practitioner Faculty of Marketing at Pepperdine Graziadio Business School and serves as the director for the school’s Education to Business program.
Gabriel Gonzalez, PhD
Gabriel Gonzalez, PhD
Gabriel Gonzalez, PhD is an Assistant Professor of Marketing at the Fowler College of Business at San Diego State University. He is an award winning scholar who’s work has appeared in the Journal of Marketing, Journal of the Academy of Marketing Science, Industrial Marketing Management, Journal of Personal Selling & Sales Management, Journal of Services Marketing, Journal of Marketing Education and other leading academic journals.
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Strategies for Managing in the Age of Boycotts

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