Do brands that take sides on divisive issues lose market share?

[btc78]

i think it depends on what the issue is of course

brands represent something especially big brands wherein they have a wider reach of course it matters what kind of message they are sending to people

A similar situation occurred with Gillette in one of their campaigns that the public viewed as sexist, resulting in a loss of market share.

if it’s about discrimination well of course the brand would be really in the chopping block

would this happen with small brands? yes and easily but big brands are criticized but most often are not heavily affected that’s because if you are big enough of a brand that you have become a staple to the community whatever you do, people will still consume your product unlike small brands wherein you can easily find an alternative to them

an example is people saying mcdonalds should be boycotted but still a lot of people continue to buy their meals

[Yogee]

The major market of those two brands mentioned in the OP were men so it's only expected that they were hugely disappointed after those ads and endorsements were released. The best example I've seen was some men putting bullets to a budlight with Dylan Mulvaney's face hehe.

[....]
an example is people saying mcdonalds should be boycotted but still a lot of people continue to buy their meals

I don't patronize their products anymore but what did they do that made people ask for boycott?

[justdimin]

Brands that take sides on divisive issues DO lose market share. Remember the Dylan Mulvaney Bud Light saga?
Trans male advertised for huge beer company, the people hated it & their sales nosedived.

https://www.them.us/story/dylan-mulvaney-bud-light-drama-explained

Taking sides may hurt, or may help as well it all depends on how you deal with your customers. If your customers are people who are against trans people, then supporting trans people may feel right for you, and for all matters and purposes trans rights are human rights and I support their existence as well, but that doesn't mean that you should promote it on your ads, just support their existence and choice individually, if you bring in your company then just as well others have a right to not buy your product as well.

However, if a beer company ended up supporting some team, like lets say some NFL team in USA, and sponsored or anything, then they would make a ton more money. Because, that's the customer base. If you want to take a side, take a side on the customer base, what your customers tell you, do not take the opposing side of your customers or you will lose money. It is not really rocket science, you should be able to see and figure this out easily.

[royalfestus]

Every producer must be very careful when it comes to their marketing strategy in a very competitive market. A brand manager must know how to handle the target market and gain their trust. It is not easy to control damage when a mistake is made in the branding, because others are already waiting for the opportunity, they are likely to spread it through the press that damage control might spread, is difficult to control, and takes a long time to recover. Sentiment around gender, religion, ageism, race, and politics is one of the most dangerous areas for branding

[Rruchi man]

would this have happened with smaller brands? Read what this article found out.

Small brands need the attention to trend and get more attention, so activism is a good way for them to achieve it. Activism for them only has the potential of increasing their audience from the attention they get from either good or bad comments and campaigns. As a brand or business gets bigger and it's customer base mature, care has to be taken on the stance taken on many divisive issues because by then you already have an audience and should want to guard them jealousy and not take actions that will result in loosing them.

[Fortify]

I researched this topic based on what happened with the Bud Light brand, which was boycotted due to their campaign on a socially divisive issue. They lost market share, and their top executives were forced to address the issue. A similar situation occurred with Gillette in one of their campaigns that the public viewed as sexist, resulting in a loss of market share. However, would this have happened with smaller brands? Read what this article found out.

As long as a brand’s initial market share is sufficiently small, engaging in activism can result in a net increase in customers even if the brand takes a stance that consumers overwhelmingly oppose. In contrast, large brands can lose more than they gain, even when opponents and supporters are in balance.

I don't think brands need to get involved in anything political, but I also don't think you will always please everyone in life. Some people will always be divisive and full of hate, trying to oppress people that are different from them or don't follow a specific god. Brands are free to make statements and people are free to boycott them if they so choose. I don't see the biggest brands taking a strong stance on most topics, because they will have marketing and legal departments that will steer them away from offending large groups of people in many circumstances. The biggest multinational companies often have to navigate a minefield of different rules and customs between countries, but do so successfully, like McDonalds for example.

[livingfree]

That happens, when these companies have issues, the stock/share holders are acting quickly because they know that the market sentiment changes overtime quickly.

When the company itself does something wrong or one of their endorsers do, it's a domino impact and the sentiment of the entire market is being seen to react whether the incident is good or not.

If you're an investor, actually it's a good indicator and you get to have the idea how it goes. And that is why it's important to check every issue that happens globally.

[dothebeats]

Yes, they do. The current generation's consumer is driven mostly by emotions and their beliefs on the brands that they choose. If brand A expresses its support to idea B, then consumers will immediately boycott it because they believe in idea C that is a complete opposite of what idea B is all about. It's just nuts, but then again, the consumers drive sales and profit, so they have to ride that wave.

Also, consumers expect companies to take sides in a rather light issue most of the time, but smart companies usually just stay silent on the issue and pretend they aren't hearing or seeing things in order to not get cancelled and still get the market share of both sides of the issue. I think companies that are numb and mindless against current social issues usually do well compared to those who take sides and push forward with it. That's what big companies are doing, and they are still posting great revenues every year.

The current generation is highly opinionated even if their opinions don't mean shit to an issue that is going on. As triggered as I am to these young ones of today, I have to understand that they are also consumers that drive huge sales to a lot of things that are in trend, which actually is a huge reason why I am paid good money by my current employer.

[TimeTeller]

That happens, when these companies have issues, the stock/share holders are acting quickly because they know that the market sentiment changes overtime quickly.

When the company itself does something wrong or one of their endorsers do, it's a domino impact and the sentiment of the entire market is being seen to react whether the incident is good or not.

If you're an investor, actually it's a good indicator and you get to have the idea how it goes. And that is why it's important to check every issue that happens globally.

Those market insights are very good indicators on what may possibly happen to the stock market.
So if you are into stocks, keeping your eyes open to this kind of news would be very helpful in your portfolio.
This is why most brands are careful in taking sides or expressing their support to any political or social drama.
It can easily have an impact on their market performance and so losses in just a snap.

[poodle63]

its always been like that taking side on divisive issue cause the company to lose the customers on the other sides, so many companies out there are trying hard to stand neutral but alas some of the side supporter of divisive issue sometime so aggresive they consider even the neutral side to be against them thats the thing with most of the companies nowadays, since company exists to make profit they naturally just gonna go with the flow not taking either sides, different if in a country in regard of the divisive issue the general opinion of the public of such country leaning towards the other side much more the company will definitely follow the general masses opinion and would also take sides since it would also mean that there'd be no meaningful lose to take the sides and instead might gain favour for them and put them in a spotlight.

[CK485]

The current generation is highly opinionated even if their opinions don't mean shit to an issue that is going on. As triggered as I am to these young ones of today, I have to understand that they are also consumers that drive huge sales to a lot of things that are in trend, which actually is a huge reason why I am paid good money by my current employer.

It's true to say that he's stubborn, I think it depends on his upbringing in the past.
However, they can also be called consumers who drive sales. However, it depends on how a product is sold and whether it becomes a well-known brand. And I think if the most popular brands were to take sides on "divisive" issues I think they would lose market share slowly but surely.

[livingfree]

That happens, when these companies have issues, the stock/share holders are acting quickly because they know that the market sentiment changes overtime quickly.

When the company itself does something wrong or one of their endorsers do, it's a domino impact and the sentiment of the entire market is being seen to react whether the incident is good or not.

If you're an investor, actually it's a good indicator and you get to have the idea how it goes. And that is why it's important to check every issue that happens globally.

Those market insights are very good indicators on what may possibly happen to the stock market.
So if you are into stocks, keeping your eyes open to this kind of news would be very helpful in your portfolio.
This is why most brands are careful in taking sides or expressing their support to any political or social drama.
It can easily have an impact on their market performance and so losses in just a snap.

Yes, it's very helpful when you check them at most times. And I think most investors and traders does this so if there are hot topics and news, the market always reacts because of the same sentiment coming from retail and institutional investors.

They're all good at this and that's why riding what's been on the news always have the impact to market prices. We're not new to this anymore as sometimes there were moments that when there were good and bad news for Bitcoin.

We see the market changes so quick and that's why these are important market sentiments to consider.

[shinratensei_]

The current generation is highly opinionated even if their opinions don't mean shit to an issue that is going on. As triggered as I am to these young ones of today, I have to understand that they are also consumers that drive huge sales to a lot of things that are in trend, which actually is a huge reason why I am paid good money by my current employer.

this much is true, too much emotional when it comes to some issues, try to side so hard they'd confront the other side without even trying to think from the other perspective, and this happens to almost anything these days, when it comes to some luxury brands, they'd also try to side with the one they favoured and attack the other but I guess thats just how it is, not that previous generation didn't do the same thing but I guess these days it gets worst with the presence of social media and the cancel culture.
personally if i were to own a company i'd try to be as neutral as possible but even then we will be question by both sides because being neutral might mean avoiding problem but also means that we are always questioned on our stand on some issue.
definitely tough thing to decide these days. even more so with the crazy thing happening on social media like twitter like basically its a place where everyone try to force their idea into other.

[itorai]

its always been like that taking side on divisive issue cause the company to lose the customers on the other sides, so many companies out there are trying hard to stand neutral but alas some of the side supporter of divisive issue sometime so aggresive they consider even the neutral side to be against them thats the thing with most of the companies nowadays, since company exists to make profit they naturally just gonna go with the flow not taking either sides, different if in a country in regard of the divisive issue the general opinion of the public of such country leaning towards the other side much more the company will definitely follow the general masses opinion and would also take sides since it would also mean that there'd be no meaningful lose to take the sides and instead might gain favour for them and put them in a spotlight.

Your insight is truly extraordinary, indeed neutral is the safe path for companies that are aware of the impacts that occur. However, it does not rule out the possibility that the company is playing behind the scenes.

[Qiubell5]

As long as a brand’s initial market share is sufficiently small, engaging in activism can result in a net increase in customers even if the brand takes a stance that consumers overwhelmingly oppose. In contrast, large brands can lose more than they gain, even when opponents and supporters are in balance.

It's all very relative. Because if, for example, a small-scale product/company has collaborative ties with parties that cause divisions, then the product or company will definitely be affected as well. Because all consumers will definitely be aware of this, that the product is collaborating with the party that created the chaos issue. Likewise with products that already have a big brand. So it is very likely that this theory is not correct.