How Will Corporate America’s New Political Boldness Affect Its Brands?

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Wharton's Americus Reed and Sigal Barsade discuss political advertising at the Super Bowl

In today’s politically charged environment, corporate America is making its voice heard on issues like immigration, diversity and globalization. While corporate public interest campaigns are not new, the latest reaction from the private sector is nearly unprecedented in intensity and scope. This year’s Super Bowl is a prime example, with companies ranging from Budweiser to Airbnb pointedly airing commercials celebrating immigrants and the importance of embracing the nation’s diversity.

They disagree with President Donald Trump’s recently issued travel ban, which temporarily halted immigration from seven predominantly Muslim nations as well as all refugees (with Syria under indefinite suspension) until better vetting procedures are established. That executive order is now under judicial review. This week, nearly 130 companies reportedly filed court papers saying that the ban is unlawful and unconstitutional. They include Apple, Facebook, Google and Microsoft.

In Super Bowl LI, several major advertisers chose to air political commercials in an event that drew nearly 114 million viewers, according to a ratings report. In doing so, they are “communicating to their consumers and employees the values they stand for,” said Wharton marketing professor Americus Reed on the Knowledge@Wharton show on Wharton Business Radio on SiriusXM channel 111. (Listen to the podcast at the top of this page.) However, it is important for companies to make sure the external values they are showcasing align with internal values, or else it will result in cynical employees, added Wharton management professor Sigal Barsade.

To be sure, taking a strong political stand carries risks to companies’ brands, especially after a particularly contentious presidential election that saw the nation split between Trump and Hillary Clinton. “It’s going to make half the country very happy and the other half not so happy,” Reed said. “You understand that when you do this, from a target-marketing perspective, you are essentially aligning yourself with a set of values that is going to resonate with a group that you are aware of, and that’s not going to resonate with [another] group.… If you think that is an important enough stance to take politically and as a business in terms of what you do, then you’ll make that trade-off.”

“You also have to be careful that you are not perceived as being inauthentic in jumping on this marketing train.” –Americus Reed

For a company like Coca-Cola, which is an international brand, openly supporting diversity makes sense, Reed said. “It makes a lot of sense to project those more progressive, global, international sorts of values.” However, this message could get lost in the crowd if many companies are doing the same thing. After all, a major component of marketing is differentiation.

Revisiting Implicit Biases

Moreover, these ads about a company’s values go beyond marketing but could influence a society’s culture especially as they create or reinforce subconscious beliefs — or implicit bias. “Implicit bias is when we don’t realize that we are biased,” Barsade said. “Implicit bias comes from the culture. So much of our culture comes from the media, including commercials.”

Barsade believes these ads influence implicit bias in the formative years of children, such as a recent commercial by cracker brand Honey Maid that explores issues around diversity. As children watch such ads, they may conclude that “that’s who we are … and that’s how you start to shift the national culture,” she said. Based on her research on implicit bias, Barsade said such commercials could profoundly “change the way that the country looks at things because the media is so incredibly powerful.”

Barsade said she expected the full impact of such advertising to manifest over the next 10 years to 15 years. “The effects of this are the strongest on the children who are growing up seeing these ads — it just becomes part of their consciousness,” she said. “Implicit bias starts at a very young age.” As for society’s conscious bias, she said the ads will have an immediate impact.

A Widening Consciousness

The Super Bowl event has often seen advertising around patriotic themes, but this time around, the ads focused on what America stands for on issues like immigration, diversity and inclusion. Barsade and Reed cited the following commercials for their more overtly political bent:

Coca-Cola re-ran an ad from 2014 that features people from eight different nationalities singing “America the Beautiful,” the famously patriotic song written more than a century ago by Katharine Lee Bates and composed by Samuel A. Ward. “We believe it’s a powerful ad that promotes optimism, inclusion and celebrates humanity — values that are core to Coca-Cola,” the company stated on its website.“The Coca Cola ad feels good regardless of which side of the aisle you are on, from a purely emotional perspective,” said Barsade. “The message is not meant to isolate half of the country.” She noted that Coca-Cola would benefit “to the degree that its internal values are about inclusion and diversity” and if it matches external values as well.

A 90-second commercial from 84 Lumber was especially controversial. The ad that ran during the Super Bowl was a sanitized version of the original ad that was deemed as too political. It showed the journey of a Mexican mother and daughter crossing the border to the U.S. for a better life.The broadcast network that aired the Super Bowl, Fox, “is walking a line here trying to find a sweet spot where it can allow advertisers to make their messages without getting so far over the top that it changes the tone or introduces controversies,” said Reed. “That is a smart move by Fox.”

Anheuser-Busch’s Budweiser beer commercial traces the journey of its founder, Adolphus Busch, to America in 1857, clearly stressing the benefits of welcoming immigrants to the U.S. “I’d be surprised if anybody was offended at a visceral level by the concept of immigration,” said Barsade. “In some ways they are trying to bring everybody together, but the meta-message and the timing of it is saying, ‘We are implicitly taking a stand against [anti-immigrant laws].’” She also noted that the company used “a very effective emotional tone that could draw a lot of people in.”

Limits of the Message

But there are limits to the impact a company can have when it adopts lofty ideas like diversity and inclusion, especially if everyone else jumps on the bandwagon. “It will work to a point,” Reed said. “As more and more companies do this, it becomes less unique. You also have to be careful that you are not perceived as being inauthentic in jumping on this marketing train.”

Barsade, who advises organizations about strategies revolving around their culture, noted that many firms list diversity and inclusion among their values. However, these issues don’t always make it to the top three. But as these themes pick up steam in the public consciousness, “the highlighting of this from company to company may indeed make it more salient,” she said.

These ads could “change the way that the country looks at things because the media is so incredibly powerful.” –Sigal Barsade

If this political stance by Corporate America somehow becomes a national movement, it’s yet unclear how their brands will be affected. “We are in this cultural moment right now where these topics are salient,” Reed said. “It makes a lot of sense that if the brand is authentically connected to these values, to jump into this.” But as more companies take that route, “it can easily be perceived as a marketing gimmick” and perhaps backfire.

At least, these ads could improve an employee’s view of their company, said Barsade. She cited “a powerful ad” from Amazon that shows a Christian pastor and a Muslim imam finding a remedy for their aching knees by ordering knee pads for each on its e-commerce site. Barsade postulated that the ad could offset some of the negative press Amazon received for its tough HR practices, as outlined in a New York Times report in 2015.

“The question is, ‘What does it do for their consumers who may care about the negative press, but also for their employees?’” Barsade asked, referring to the Amazon ad. The employees could react by being more accepting of Amazon’s high-performance requirements, or they could question any gaps they see in what the company does for them and its public posturing, she said.

These ads also serve a recruiting purpose in that they could attract workers who agree with the values they project. Reed said it is about getting the “ability to attract employees you can connect with and create a sense of synchronicity [between] what you believe are your company’s values and their values.” In the end, he felt that both employee and company would benefit from a public showing of corporate values. But Barsade saw a potential downside. “If the employees don’t agree with you, you run the danger of losing them or [workers] becoming less committed.”

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