American society is undergoing a profound change as all aspects of life increasingly converge with political views into a single set of overlapping motivations. No longer are people’s political lives separate from their personal or commercial actions, if they ever were. Now political views are shaping how people live, shop and do business. It shows in the increased demand for corporations to advocate for social values and respond to political events. Today, party affiliation is no longer an optional extra to understand a brand’s strengths and weaknesses; it is necessary.
Most Americans want their purchases to support brands that will help them “make a difference in the world.” According to a 2016 Ipsos study, most (85 percent) feel that aligning with a good cause doesn’t have to come at the expense of corporate profitability. But the reality is that people do not all agree on politics. So as organizations face increasing pressures to “take a stand,” how can they navigate the swamp of conflicting beliefs and ideologies?
Companies include many people with differing or competing priorities. The employees of an organization might prioritize different goals than shareholders who, in turn, hold different beliefs than customers. To understand the myriad forces driving business behavior, it is worth spending time evaluating people’s perceptions of corporate values as this convergence of commercial and political action grows.
Political identities affect brand engagement
For most customers, brands do not start off as decidedly “Republican,” or “Democrat.” Normal brand engagement and trust build through the more traditional paths of quality products and reliable service. When customers think of a brand, they base their first connections on personal experiences or interactions. However, as the marketplace becomes increasingly competitive, quality and service individually become less effective at differentiating a brand. As a response, brands increasingly seek to build emotional connections with customers based on marketing towards how those customers see themselves. This identification-based marketing, when successful, builds a strong bond between a brand and customer as the brand becomes an indispensable part of how they see themselves.
However, this identification or emotion-based strategy can create a profound brand risk. In American society, identity is increasingly breaking down along party lines. Partisanship, or party ID, is now shorthand for people’s separation into two tribes: one urban, multicultural, and progressive; and the other rural, white, and conservative. By leaning into emotional connections, brands have accidentally stumbled into the firing line of contemporary American identity politics.
Adding complexity, American society also is rife with political or media entrepreneurs looking for a convenient foil to inflame their base or raise their own profile. An outspoken action or political misstep by a brand often presents just that kind of opportunity.
Tribalism in customer bases
So what is a company to do in this new age of uncertainty?
The first thing they must do is understand with which political tribe their customer base identifies. Numerous Ipsos studies on the political orientation of the customer base for a wide variety of brands show that most brands have customers from all outlooks. However, most brands also have a customer base that more strongly leans to one side of the political aisle versus the other, particularly if a brand pulls disproportionately from one demographic. For instance, brands that appeal to rural residents tend to have more Republican customers regardless of any values the brand may pronounce. This even happens at the brand category level.
Understanding where a brand’s customer base is coming from can prepare brand leaders for how they respond to values-based actions. For instance, Chick-Fil-A restaurants being closed on Sunday for religious reasons and supporting conservative causes makes sense to its customer base in the “Bible Belt” region where it was founded. But as the company expands into urban areas in the Northeast and Midwest, these policies come into increased conflict with the views of their newer customers.
Conversely, the rewards also can be real – Nike’s stock soared after its Colin Kaepernick television spot aired. The ad embracing the outspoken athlete connected to a core customer base in urban areas. The better that brands know what their customers will respond to–in a positive or negative way–the better they can prepare for all outcomes. No one knows when something about a brand or company will go viral.
[EVENT] The State of Reputation in Canada: Today’s Context, Tomorrow’s Expectations
On May 7, please join Ipsos for an exclusive breakfast presentation about the state of reputation in Canada – how companies are performing now, the impact of the current social and economic context on trust, and how your stakeholder’s future hopes and expectations will influence your reputation in the years to come.