Strategies for Managing in the Age of Boycotts 🖐️

Chinese netizens voiced 📢 their support for domestic brands after H&M and Nike came under fire 🔥 in China for refusal 🙅‍♀️ to use Xinjiang cotton. As of press time, 11 topics related to Xinjiang cotton have been hovering on the trending list of China's Twitter-like social media platform Sina Weibo, with each topic attracting tens of millions of views and discussions.

So far, most of China's major e-commerce platforms and online sharing platform have cleared all products and search 🔍 results related to H&M in response to its refusal to use Xinjiang cotton. Chinese brand ambassadors for H&M and Nike have also pulled out of their deals.

Every five 🖐️ seconds, a new boycott is born. Or at least, that is definitely how it feels these days - check your social media feed and there is another call 📞 to boycott a company’s unethical practices.

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. CSR practices represent the extent to which a company strategically manages its brand image to meet societal norms. 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.

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. 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 so they may as well not participate in the boycott.

👉 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.

How can companies best protect themselves from these growing social movements? What follows are some tips and strategies regarding how to implement best management practices once you are a target of a boycott 👇

Strategic Impression Management

First, do not give your customers a reason to boycott you. Constantly scanning the marketing environment is an important task of any strategic marketer and understanding the social/ cultural environment of your customer is paramount. 

Best practice firms engage in strategic impression management as the foundation of their brand strategy. A common tactic of the impression management arsenal is making prosocial claims (expressions of the organisation’s commitment to socially acceptable standards, values, actions). 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.

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.

Social Media Threats

Today’s social media environment can help exacerbate the boycott phenomenon. Thus, it is helpful to conceptualise boycotts as social movements. 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.

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 and if targeted for boycott, often find the negative effect of the boycott minimised.

Communicate 🗣️

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.

While consensus of opinion may seem desirable, wanting all parties to agree on the issue at hand 🙌, research has shown that non-consensus opinion are more common occurrences in the real-world 🌍. Firms often cut ✂️ advertising during boycotts 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. Quality advertising that reinforces positive brand associations can increase the cost of boycotting to the consumer and help neutralise the effects of any negative information.

Creating Trust

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 goodwill from which you may have to draw upon in a time 🕒 of crisis. 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.

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. Firms need to keep up with changes in the broad marketing environment. This includes changes in social values and norms.

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.

Perhaps the best way for firms to successfully manage boycotts is to do good, by the standards of the customers. The best way to manage out of a crisis is to avoid it to begin with.

References:
Global Times, Mar 25, 2021, Chinese public voices support for Xinjiang cotton, turns to domestic brands over H&M, Nike

Jim Salas, Doreen E. Shanahan, and Gabriel Gonzalez, 2019 Volume 22 Issue 3, Strategies for Managing in the Age of Boycotts