Wednesday, January 13, 2021

Mixing Business and Politics Requires a Strategy

Business leaders today are trying to navigate a hyper-politicized environment that can ambush them at any moment.  Everything a business does and says is being scrutinized to reveal political positions to either support or oppose.  Whether intended or not, or true or not, claims made by pundits, politicians and loud social media influencers can instantly lead to market segmentation, swarming or cancel culture that can unexpectedly derail your business and sales targets.

Prudent business leaders will think through these issues and have a plan.  They will discuss the most likely sources of trouble and identify the most likely scenarios and their potential business impacts.  The goal of these exercises is to create a playbook on how best to respond not if, but when it happens.  When it does happen the speed at which it materializes can be shockingly fast.

Some businesses are content with selling to a subset of the market that closely identifies with a well understood political persona or political position, while others wish to maximize their market size and potential by maintaining an apolitical position.  In either case, it is better to have a plan and then stay out in front of issues.

In the past political preferences were often kept confidential and any marketing or position statement from a company could be tightly managed and controlled.  Today, however, in a world of “cancel culture” and swarming where just about everything can be considered a litmus test, it’s wise to prepare.  Leaders, employees and former employees all have a pulpit today and businesses cannot stop what is said. No longer can businesses reasonably believe they can fully control their own messages.

Let's now take a look at a few of the objects and brands that were politicized in 2020.  
The ubiquitous nature of social media and social media influencers has resulted in an environment where businesses are always just a tweet away from chaos.  Businesses must truly understand this reality.  As an example, this week widely read NYT's columnist Nicholas Kristof wrote an article where he stated, "I’d like to see pressure on advertisers to withdraw from Fox News."  Similar pressures were also applied to Cumulus Media this week forcing their leadership to order program hosts to stop spreading falsehoods.

Let's now look at some examples of businesses that have found themselves in the middle of politics this last week: 
  • Twitter and Facebook have barred [politician] from their platforms.
  • Shopify, which provides online store software, closed two [politician]-associated stores. 
  • Forbes warned that any of its contributors hiring [politician's] press officials will be viewed as a “potential funnel of disinformation.”
  • Zendesk and Okta, which provide popular back-end business services, both said they’d stopped working with Parler on Sunday. 
  • Reddit banned a major group on its site for [politician] supporters.
  • SnapChat banned [politician] from their platform this week. 
  • TikTok, the Chinese-owned social media app banned some videos of [politician] speaking. 
  • YouTube suspended [politician's] channel
  • Deutsche Bank (DB) has decided to refrain from future business with the [politician].
  • Signature Bank said it had started closing [politicians] personal accounts.  The US bank also said it "will not do business in the future with any members of Congress who voted to disregard the Electoral College." Source: CNN
  • Amazon said on Monday that it was removing products promoting [Q].
  • Amazon also decided to boot Parler from its web servers and cloud services.
  • MyPillow was offering a discount code to its customers: “FightFor[politician].” Online shoppers who type in the phrase can receive lower prices on the company’s “premium” pillow, “classic” pillow and other products.
  • Stripe will stop processing payments for [politicians] campaign website.
  • The PGA has canceled plans to play its 2022 championship at [politician's] golf course.
  • Walmart's CEO Doug McMillon, as a leader in the business lobby, Business Roundtable, signed a letter critical of [politician] and his actions.
  • Blackstone CEO Stephen Schwarzman made public statements critical of [politician].
  • Apple and Google have all booted the Parler app from their app stores, a social media platform friendly to [politician] supporters.
  • Instagram, which is owned by Facebook blocked [politician] from its platform.
  • YouTube, owned by Google, announced it will penalize accounts spreading misinformation from [politician].
  • Snapchat blocked [politician's account] indefinitely.
  • Airbnb cancels all reservations in the Washington DC area.
  • Marriott announced it would be halting donations to the GOP lawmakers objecting to certifying the presidential election.
  • Cumulus Media ordered their radio program hosts to stop spreading false information and accept the election, in order not to lose sponsors' business.
  • Hallmark asked for their money back.  "The recent actions of [politician] and [politician] do not reflect our company’s values,” and “requested [politicians] to return all HALLPAC campaign contributions.”
  • City of New York announced they had canceled agreements with the [politicians] organization.
  • Blue Cross Blue Shield Association, the health care insurance group announced a pause on giving from its PAC to Republicans who had voted against certification.
  • The U.S. Chamber of Commerce condemned [politician's] conduct and said on Tuesday that lawmakers who backed his efforts to discredit the election would no longer receive the organization’s financial backing.
  • Dow Chemical announced it was “immediately suspending all corporate and employee political action committee (PAC) contributions to any member of Congress who voted to object to the certification of the presidential election.” ~ yahoo!Finance
  • Morgan Stanley announced they would stop giving money to members of Congress who objected to certifying the election.
  • The list continues and includes Walmart, American Express, AT&T, Best Buy, Cisco Systems, Commerce Bank, Comcast, General Electric, Intel and MasterCard.
All of these businesses and organizations are likely to be impacted by these public statements and announced policies.  The internet has ears and remembers.  Some may be negatively impacted, but others may see a positive impact from their statements and policies.  Some of these organizations reversed policies, some announced new policies, while others simply reiterated existing policies.

Even though many business leaders want to avoid politics, they also recognize that the rule of law is necessary to operate a business and support investments.  When rules, laws, regulations, practices and norms are disrupted there is a risk to businesses.  This risk may force them to act.  Ronnie Chatterji, a business professor at Duke University, was quoted by the Washington Post this week, as saying “The rule of law that ensures peaceful transitions of power - also makes business possible."   https://www.washingtonpost.com/business/2021/01/08/trump-policies-corporate-america/
    Sometimes no matter how hard a business tries to avoid politics, their hand is forced as voting technology company, Dominion found out. "Dominion said its reputation and resale value have been deeply damaged by a “viral disinformation campaign."  Dominion sues [politician] lawyer Sidney Powell, seeking more than $1.3 billion.
    Are you willing to take political positions with your business?  Will supporting or opposing a particular politicized issue help or hinder your business?  Is your target market aligned with a political position?  Does it align with your organization’s?  How does your leadership team and employees feel about it?  Are they both in agreement?  Is it possible to remain apolitical on an issue?

    Social media and social networks are now permanent fixtures in our society, as such, it appears this challenge will be here for the foreseeable future.  Choosing how to position your business in a politicized environment has now become both a reality and a priority.

    Read more on the Future of Information, Truth and Influence here:
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    Kevin Benedict
    Partner | Futurist | Leadership Strategies at TCS
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    ***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.