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A Brand's Guide to Navigating Online Boycotts

New Knowledge

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Jul 12, 2019

Our online landscape is littered with boycotts everywhere we look, and nowhere is it more apparent than Twitter. As of this writing, #BoycottHomeDepot and #BoycottToyStory4, are just a few of the top trending calls for boycotts on Twitter.

Before our instantaneous social networks could drive activity with lightning speed, boycotts took time to organize. They required immense manpower, picketing, door to door recruiting and time to organize large groups of people in support of a specific goal.

Today, participating in a boycott is as easy as a few clicks of the mouse - but with potentially more devastating effects. For brands navigating the online realm it can be challenging to know when to ignore these social movements and when to snap their crisis communications team into action. New Knowledge, with our reputation management PR technology, is helping our clients to detect boycotts and tackle them before they become widespread controversies. Here’s our insight into what can make a #boycott so damaging.

How Do Boycotts Gain Momentum So Quickly?

Boycotts are usually launched in response to what the public perceives as a social, political, moral, and/or environment injustice, committed by a company or individual. They may not always be based on factual information.

Though they are widely considered to be important instruments of democracy, boycotts are (in some cases) being co-opted by foreign adversaries who amplify their size and reach with the use of automated bots. Boycotting a brand is the most popular disinformation tactic in use today. Like a rogue wave, it is unpredictable and largely uncontrollable.

The 24-hour news cycle and the speed of social media make the organization of any protest exponentially faster. A post about boycotting a business can reach customers in minutes, even while they are in line at the store in question.

Twitter outrage typically has a duration of two to three days, from inception to creation and circulation of the hashtags. The response in social media will then determine how long the movement continues.

If response is strong, the boycott and the news cycle can begin to sustain each other in circular fashion. The boycott endures because it is in the news, and the news keeps covering it because continuing to get supporters in large numbers on social media is newsworthy. Because the variable that determines continued length is based on social media response, it is out of the brand’s control.

When consumers read about controversy that casts a brand in a negative light, the reaction to boycott a brand has become automatic. How a boycott takes shape is almost formulaic: it gets repeated in similar forms with different brands over and over again.

What are the Different Types of Boycotts?

Organic Boycott: Uber (#deleteUber)

Organic boycotts occur when participants use social media to call attention to causes and companies.

#deleteUber was created in response to allegations that the company intended to profit from a protest against President Trump’s ban on immigrants from Muslim-majority countries.

Uber CEO Travis Kalanick, a known Trump supporter, was serving on the President’s Economic Advisory Council. Uber waived its surge pricing from JFK airport, where Muslim refugees had been detained in early 2017. In response, cab drivers in New York City organized a strike in support of Muslim refugees.

Uber claimed its actions were misinterpreted, but that didn’t stop the hashtag or the sentiments that go with it. An estimated 200,000 people deleted the app, leading Kalanick to resign.

Inorganic Boycotts: (#boycottNFL) and Johnson & Johnson

Inorganic boycotts take place when online agents employ automated bots and algorithms to drive visibility to specific causes or companies.

Russian interference in American life is not limited to just presidential elections. In 2017, Twitter accounts attributed to Russian agents tried to sow and inflate discord after the Parkland school shooting in Florida. Agents picked up on divisive issues (like gun control and kneeling during the National Anthem) and used hashtags like #ar15, #NRA, #boycottNFL, and #takeaknee.

Boycotts that get hijacked by trolls often use machine learning and other algorithmic tools to amplify brand crisis. Doing so gives them a much farther reach with a longer life cycle, making it harder for brands to successfully manage their reputations.

A network of inauthentic accounts began targeting pharmaceutical giant Johnson & Johnson in mid-2018, with the root of the behavior coming from an adversarial organization called A Case for Women. This group used targeted ads and cultural narratives to amplify negative brand impact for Johson & Johnson, based on concerns about carcinogens in the company’s talcum powder.

Botnet account New Knowledge detected surrounding Johnson and Johnson boycott

Not only are there Facebook groups dedicated to boycotting Johnson & Johnson, but the company has lost over $50 million in lawsuits brought by women who allege that they contracted mesothelioma from the company’s talcum powder. However, Johnson & Johnson was found NOT liable for the same claim in a lawsuit in South Carolina.

Counter-boycotts happen when organized resistance against a boycott appears to eliminate the blow to brand reputation. But just like the original protest, a counter-boycott is beyond the control of the brand as well.

Counter Boycott: Chick-fil-A (#BoycottChickFilA)

Counter-boycotts happen when organized resistance against a boycott appears to eliminate the blow to brand reputation. But just like the original protest, a counter-boycott is beyond the control of the brand as well.

Chick-fil-A is currently managing widespread criticism regarding its attitude towards the LGBT community. Founders Truett and Jeanette Cathy also founded the WinShape Foundation, an organization that supports anti-gay groups such as The Marriage and Family Legacy Fund. Public perception is that the company supports an anti-gay, non-inclusive agenda. Consumers have demonstrated against the Chick-fil-A in the following ways:

● Students at 10 U.S. universities including Northeastern and New York University organized to prevent Chick-fil-A locations from opening on college campuses.

● The company recently lost a deal to open a location in the San Antonio airport, and is finding similar sentiments in Toronto.

● The cities of Boston and Chicago effectively banned the company.

The Axios Harris Poll, which ranks the reputations of the most visible companies in the country, lists Chick-fil-A among the companies with the fastest falling reputations for 2019. In 2018 it was #4 in the rankings; this year it fell to #22.

However, the Georgia company has the best reputation among fast food restaurants. The company’s supporters have a campaign of their own that serves to counter the initial protest. They heard about the protest and took to social media to encourage people to support the chain.

What’s the Impact of a Brand Boycott?

On the surface, it might seem like the impact of brand boycotts is nothing more than reduced sales for a sustained time period. However, that couldn’t be further from the truth. Brand boycotts have the devastating ability to harm nearly every area of the business. Below are the most commonly-found impacts.

Damaged Brand Loyalty, Trust, and Reputation

A widely-publicized boycott can severely impact customer loyalty to a brand, erode trust built up over many years, and tarnish a brand’s hard-won reputation.

Take corporate leadership figures, for example. They are often brands themselves, and their actions in personal or professional contexts can present problems for the companies they represent.

Mark Zuckerberg’s 2018 testimony before a joint session of the U.S. Senate’s Commerce and Judiciary Committees put Facebook on the hotseat for how the company managed user data. The Federal Trade Commission (FTC) opened an investigation soon after to find out how the company handles user privacy. As a result of the investigation, the social media platform could face billions of dollars in fines.

In 2018, Tesla’s Elon Musk faced continued trouble for tweets about the innovative auto company. The U.S. Securities and Exchange Commission (SEC) asked a judge to hold Musk in contempt for violating a settlement requiring him to get company approval prior to tweeting about company business. The news sent Tesla’s stock down 2.5% and created more negative press, generating the hashtags #BoycottTesla and #BoycottElonMusk.

Financial Losses

From reduced sales to loss of stock value and market share, boycott impacts come in many forms. What do they have in common? The unknown factor.

It is nearly impossible to prevent a boycott, so it’s definitely tough to mitigate its damage without advance preparation.

Reduced Sales

As a result of the #DeleteUber boycott the company lost net $4.5 billion in 2017. Those losses also contributed to competitor gains in the market. In 2016, Uber’s passenger base was 10 times that of rival Lyft. In spring of 2018 it was 2 to 1, suggesting a significant erosion of consumer trust.

Lower Stock Indices

In December of 2017 pizza chain Papa John’s founder John Schnatter stepped down as CEO following potentially racist remarks he had made regarding the NFL’s handling of the national anthem protest. In May of 2018 during a conference call with company leadership, Schnatter deeply offended executives by using violent, racist comments. He later apologized in a statement and resigned from the board.

Both events resulted in widespread activity on social media and dramatic financial losses. The 2017 comments caused company stock to fall 11% in just a few hours. As of March 2019, company stock has fallen 25% since the initial comments.

Brands Must Defend Themselves Against Boycotts.

Because boycotts are voluntary and non-violent, they are not punishable by law. Brands who find themselves at the center of a boycott have no legal recourse to control the situation. However, what brands DO have control over is how they respond to a boycott - quickly, with the right messages in the right places.

Today’s effective brand management relies on artificial intelligence, natural learning analysis, and other algorithmic tools to monitor and mitigate coordinated attacks. Without them, eventually a negative narrative becomes indelible.

Learn more on how to combat these reputation-damaging events in our webinar, Disinformation 2019: Brands in the Crosshairs.

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