Most brands now need to choose a side

THE troubling events taking place in Hong Kong over the past three months have revealed not only social and economic implications, but also peeled away the veneer of conventional wisdom that brands should stay neutral.

In the wake of Cathay Pacific's "surrender" to China, other brands operating in and outside of Hong Kong have either chosen to support one side or the other, or (presumably like Cathay) have been forced to. Sports drink brand Pocari Sweat and insurance company Cigna Hong Kong pulled their ads from a local broadcaster - TVB - because it was perceived to be pro-Beijing, while "celebrity" brands like Mulan's Liu Yifei (a Chinese-American actress) and Kim Eui Sung (a popular South Korean actor) have taken opposite sides of the political spectrum, the former publicly supporting Beijing while the latter, the protesters. Not surprisingly every one of these brands has been met with immediate and vigorous support or scathing criticism.

The question (again) arises: should brands stay silent? In a recent piece "Brands must remain silent about Hong Kong: PR chief"" in Campaign, David Wolf, managing director of Allison Advisory, argued against businesses speaking up, saying, "at the end of the day, our clients are businesspeople". In so doing, he consciously delegitimises branding's time immemorial prime directive - the primacy of the consumer. In an earlier piece "Brands mostly silent as Hong Kong raises its voice" in the same publication, managing editor Mathew Miller maintains that not only does "everyone understand why brands aren't speaking out", he also suggests that the reason is legitimate and "understandable given the country's power and the size of its current and future market". Nonetheless he does voice disappointment "that virtually no brands have found a way to at least show a bit of empathy". The problem is that he starts that sentence with a disarming observation: "It doesn't matter much, really..."

Actually the evidence suggests that it does.

Choosing to remain silent involves considerations that are a bit more nuanced than stark warnings not to poke a tiger or suggestions that realpolitik amounts to sensible pragmatism - even if probably shared by a significant segment of the marketing community, particularly those based and doing business in "sensitive" markets like China. In fact the alternative choice - that is, to "speak out" - invites consideration that invokes the hotly debated brand purpose construct. A core marker of brand purpose is "to stand for something". Critics of the construct accuse practitioners of being delusional and naïve, levelling the common refrain "that brands can't and shouldn't try to save the world". That excessive claim is, in fact, a misrepresentation of the construct. That some brands attempt to take on such ambitious missions - to 'save the world' in some manner and measure - does not make the efforts necessarily either recommended or desirable. Brands like Ben & Jerrys that have strayed into controversial political and cultural debates (think of presidential candidates' support, or support for immigration and LGBTQ rights, among others) are more the exception than the rule.

Other brands that don't enjoy the unique teflon qualities and heritage this brand has are more likely to experience consumer confusion, polarisation of segments and ultimately decay of market presence - precisely what the critics of brand purpose relentlessly argue. As Marketing Week contributor Professor Mark Ritson bluntly explained: "The whole concept of brand purpose is moronic. I do not want Starbucks telling me about race relations and world peace." Indeed, he has a point.

But the broader and more salient point that he and his supporters don't address is this: too many brands either misunderstand or misuse brand purpose, which makes them easy targets for that kind of criticism. And this shouldn't be surprising. Brand purpose is a relatively new construct that does not enjoy a formal theoretical framework and is still dynamically evolving in real time. It is inevitable that many companies will get it wrong - from definition to operationalisation. But that does not necessarily invalidate the construct. With regards to brand neutrality, brand purpose only works well when the cause or concern it addresses lies within the universe of the brand's scope. Unilever's Lifebuoy is a good example. Its "purpose" of arresting child mortality under the age of five in India and parts of Africa links the product function to the goal. Lifebuoy has the legitimate right (if not the imperative) to choose a side.

Admittedly very few people might push back on that choice as it is universally resonant. But consider P&G's Ariel detergent powder in India where gender inequality has persisted for generations. There Ariel uses a metaphor - "Share the load" - to compel men to share not only the washing load but also contribute more fairly to all other dimensions of daily life. The brand chose a side that was not just societally just but contextually relevant to the product, the brand and consumers. Was it a risk? Yes. But the overwhelming response from ordinary men, celebrities and political leaders that transformed into a great social movement made the effort not only right but sensible from a business perspective.

More surprising perhaps was the decision by one of the United States' biggest gun retailers - Dick's Sporting Goods - to announce in 2018 that it was considering stopping all gun sales in the wake of repeated mass shootings across the country. There is probably no issue more flammable in the US than the gun rights debate with intractable positions on both sides. Nonetheless the brand chose to pick a side with its announcement and initial efforts to draw down on its gun inventory. While this move may not amount to the brand's purpose, it does reflect a conscious decision by the brand to not stay silent. The result? As CNN reported, the move won praise from gun control opponents and anger from gun enthusiasts. The backlash probably hurt the sale of rifles that the company continued to sell. As a test, Dick's last fall stopped selling all hunting gear, including guns, in 10 stores. It replaced the guns with other goods, such as apparel of a local sports team and other popular items. The experiment was a success. "Those stores outperformed the balance of the chain pretty meaningfully," CNN noted.

The world today is, by virtue of globalisation and transparency, very different from that of just 20 years ago. Ordinary people exposed to virtually everything at every moment of the day have themselves become protagonists and antagonists. They are taking sides on everything, willingly or not. Who's virtuous or villainous becomes entirely subjective. Brands not only exist in that world but they also contribute to it.

It is inevitable that in this environment, brands will be called on by some stakeholders to choose a side - a reality that contrasts sharply with Mathew Miller's assertion that people "aren't all that concerned with the opinion brands might have about what's going on". There is, in fact, abundant evidence that people across all demographics not only care about the opinion of brands but expect them to act.

This is the business reality of today - something that is supported by a multitude of research studies, many longitudinal. In fact, the evidence is so compelling that even the most conservative corporate establishments are recognising this. In what was a landmark decision, the Business Roundtable, one of America's most powerful business groups representing some of the biggest and most powerful firms in the country, recently announced the scrapping of "shareholder-first ideology" in favour of a "focus on social responsibilities as well as profits". This is timely and fitting where power (and therefore responsibility) has transitioned away from governments to corporations.

In 2000, out of the world's 100 largest economic entities, 51 were corporations while 49 were sovereign countries. By 2015 that number had grown to 63 and, only one year later, jumped again to 69. On that list many were founded only after the turn of the new century. The role - and purpose - of business in society is fundamentally shifting.

Yes, in some cases where the brand has little to no legitimacy to participate in a debate, it should probably stay neutral. But where the issue lies squarely within that brand's universe, it may well be faced with an obligation, not just a choice.

Brands need to continue to be models of everything that is progressive, not the opposite. Allison Advisory's Mr Wolf laments the difficult position companies often find themselves in. He asks rhetorically: "These gigantic operations in China are now having to say 'Gosh what do we do? What do we have to change?'. " One possibility that brands should not dismiss out of hand is that of stepping up and saying something. Consumers, not "clients", are likely to reward them.