Category: Reputation Management

The Curious Case of Colin Kaepernick and Nike

As we explained earlier this year, more businesses are participating in the public discourse surrounding divisive social issues, undeterred by today’s hyper-partisan climate. While their impetus to do so varies, many companies are appealing to the interests of their customers and employees. For a company to do otherwise is to imperil its wellbeing, after all. That is why most businesses, before taking a public stand on an issue, invest in market research to approximate the reactions of key stakeholders.

Even by these emerging standards, however, Nike’s decision to make Colin Kaepernick the face of the 30th anniversary of its “Just Do It” campaign is arrestingly bold. Not only is Kaepernick a polarizing figure for taking a knee during the playing of the national anthem at NFL games to protest racial injustices, the former San Francisco 49er is suing the league—an important Nike partner.

The company’s move provoked an array of responses, ranging from predictable Hatfield/McCoy standoffs on social media to a modest selloff in Nike shares. In a Wednesday Tweet, veteran pollster Frank Lutz railed against the move: “What happens when the world’s most popular sports brand doesn’t do its research? It loses $4 billion. I am continually amazed when big brands that should know better still make colossal errors based on faulty judgment. I’m sure they will sell more stuff… But is it worth it?” Separately, a poll of U.S. consumers was released Thursday indicating that 24 percent of respondents now view the brand unfavorably, up from 7 percent.

It remains to be seen the extent to which Nike’s actions will be accretive to the company’s long-term success. Nevertheless, there is an apparent logic to Nike’s strategy that is instructive to stewards of both consumer and corporate brands.

Mine new markets – The new Just Do It Campaign is evidence that Nike is playing a long game that is aided by the revitalization of its brand. As Oppenheimer’s Brian Nagel observed, “the extensive roster of athletes and their powerful stories are core to the company’s stepped up efforts in reaching a younger demographic”—a market segment that, at least domestically, values social activism. Moreover, the company is targeting 12 priority markets in an online sales offensive, only two of which, New York and Los Angeles, are located in the U.S.

Tap one’s heritage – In ways that are scarcely recognizable to the diversified holding company that it is today, Nike was an upstart brand that represented a fresh alternative to Adidas, Puma and Converse. Just Do It wasn’t simply a departure from industry conventions, it constituted an in-your-face challenge to athletes and consumers alike to dig deep to be their best. The company’s willingness to take chances has occasionally backfired, including the cringe-worthy 2010 television commercial in which Tiger Woods was asked by his deceased father if he had “learned anything” in response to the golfer’s marital infidelities that dominated the headlines. For better or worse, Nike has been steadfastly daring.

Contemporize the brand – In 1995, Michael Jordan, a Nike pillar, reportedly quipped that “Republicans buy sneakers too” when asked why he didn’t weigh in on political and social issues. Even in the pre-social media days of yore, the world’s most famous athlete was criticized for playing it safe, which he acknowledged in a 2016 essay, “I Can No Longer Stay Silent.” And so it is that athletes and other popular culture figures today aren’t simply tolerated for expressing their views, they are expected to demonstrate them. Therefore, Nike casts Kaepernick as an embodiment of what it means to just do something, only now in ways that transcend sports.

Embrace the chaos – It’s not for nothing that Nike elected to launch the new Just Do It campaign with a Tweet by Kaepernick, willfully making a splash in the contentious end of the social media spectrum. The rollout strategy is notable not because the company initiated an important conversation—as if social media routinely enables measured discourse among parties who disagree—but because it substantiates Nike’s narrative that doing something that matters frequently entails pushback and, sometimes, the need to go it alone. It is also a calculated gamble that more online influencers would act as advocates than detractors, an outcome that benefits the campaign in ways that nether paid nor earned media can.

Nike hasn’t been pitch perfect in its efforts thus far. For example, Just Do It’s signature phrase—Believe in Something. Even if it means sacrificing everything.—would have greater impact had Kaepernick not been under contract with the company as an unemployed quarterback. Still, the campaign has the potential to significantly advance Nike’s overarching business strategy. And, no matter the increased emphasis on social issues, that remains the foremost utility of business communications.

When it Comes to Mea Culpas, Zuckerberg Is No Buffett

One needn’t be prescient to have anticipated the extraordinary spectacle of Facebook CEO Mark Zuckerberg’s testimony before lawmakers on Capitol Hill this week. Not only have leaders of both parties condemned fake news and Russia’s meddling in U.S. elections—manipulations enabled in no small measure by Facebook—the Cambridge Analytica breach reveals that social media is a new frontier that is loosely regulated.

Equally predictable was the steady cadence of tough questions directed at Mr. Zuckerberg by Democrats and Republicans alike. After all, the issues at hand are inexorably serious, as the Facebook CEO himself has repeatedly acknowledged. Given the inevitably disjointed and often cynical nature of Congressional hearings, Mr. Zuckerberg’s single best opportunity to manage Facebook’s reputation, while blunting the threat of legislation that could undermine the company’s business model, was his opening statement.

Mr. Zuckerberg used the opportunity to acknowledge Facebook’s errors, take personal responsibility for the missteps and pledge corrective action by the company. His was a smart, time-honored strategy that he discharged reasonably well. Not leaving well enough alone, however, Mr. Zuckerberg began his opening statement by proclaiming that Facebook is an “idealistic and optimistic company” that has helped give rise to the #MeToo movement and the March For Our Lives; he ended it by reminding lawmakers that his “top priority is our social mission” and to be “a positive force in the world.”

We understand the logic of Mr. Zuckerberg’s claim that Facebook “brings the world closer together,” despite numerous research studies concluding that social media fosters entrenched ideological division: The more a company is perceived as contributing to society’s greater good, the greater its regulatory license to operate. Still, nearly two minutes of the Facebook CEO’s five-minute opening statement—40 percent in all—dwelled on how the company was focused on “all of the good connecting people can do.”

Compare Mr. Zuckerberg’s opening statement with that of Warren Buffet, which was delivered in September 1991 before a House subcommittee investigating the Salomon Brothers’ bond trading scandal. Mr. Buffett had recently become chairman of the firm, which was among Wall Street’s largest at the time, when it nearly became insolvent as a result of various trading abuses. Like Facebook, the stakes were high for Salomon Brothers: The firm’s actions affected the integrity of nation’s financial system, including the sale of treasury bonds, not to mention the livelihoods of more than 8,000 employees.

Mr. Buffet was short, if not sweet, in his opening statement. Speaking for little more than two minutes, he began by acknowledging: “The nation has a right to expect its rules and laws to be obeyed. And at Salomon, certain of these were broken.” It’s not simply that Mr. Buffett was plainspoken, he cut to the chase in addressing the firm’s misdeeds—and what needed to be done about them—ignoring the inevitable temptation to manage perceptions of the firm. As a result, lawmakers and other stakeholders surely saw Mr. Buffett as a straight shooter.

In turn, the Salomon Brothers Chairman spoke in stark terms—and with palpable anger in his voice—about how “…the past actions of Salomon are presently causing our 8,000 employees and their families to bear a stain.” In so doing, he conveyed that the firm’s failure to obey the law had painful social implications for those who worked for Salomon Brothers, including himself. Implicitly, but no less powerfully, Mr. Buffett signaled that the firm was largely comprised of people whose core values routinely impelled them to do the right thing.

Correspondingly, he made a point of inviting federal authorities to wield “the power of subpoena, the ability to immunize witnesses, and the power to prosecute for perjury.” One might argue that Mr. Buffett was demonstrating political guile in his remarks. Perhaps. Yet, when is the last time a chairman or CEO explicitly welcomed a governmental investigation into his or her business—before Congress, no less, and with overflowing media hoard in tow? Not this week.

Mr. Buffett ended his opening statement with a no-holds-barred ultimatum to employees that invariably resonated well beyond the firm: “After they first obey all rules, I then want employees to ask themselves whether they are willing to have any contemplated act appear the next day on the front page of their local paper, to be read by their spouses, children, and friends, with the reporting done by an informed and critical reporter. If they follow this test, they need not fear my other message to them: Lose money for the firm, and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless.”

Unadorned by the airbrushed language typical of today’s mea culpa, Mr. Buffett was efficient, sobering and, above all, practical. He acknowledged wrongdoing and pledged remedial action, but he also invited increased regulatory scrutiny of the firm’s operations. All told, more than half of his statement was focused on solving a problem of the firm’s creation. Moreover, Mr. Buffett called upon Salomon Brothers’ employees to hold themselves accountable not simply to the laws of the land, but societal norms as well. And for those who failed to do one or both, he left no doubt that they would meet with swift and severe consequences.

The purpose of our analysis isn’t to be critical of Mr. Zuckerberg. (Again, he performed reasonably well in a challenging climate; in fact, while he was testifying on Tuesday, Facebook’s share price finished up 4.5 percent.) Instead, we want to use Mr. Zuckerberg’s appearance before Congress to draw attention to Mr. Buffett’s markedly different approach in an analogous situation. We regard the latter’s opening statement as the standard by which all others should be measured.

At the core of Mr. Buffett’s communications strategy was his evident awareness that there is seldom, if ever, a quick fix in regaining the trust of company’s stakeholders—and the greater the breach of trust, the longer the fix. No less instructively, he understood that the first essential step in regaining the trust of stakeholders is to recognize that positive headlines, while valuable, are no substitute for substantive, positive action by a company and its leaders. 


Want to be a Most Admired Company? Trust your Employees over Fortune

A decade or so ago, we met with the CEO of a Fortune 250 company that was the focus of sharply negative front-page headlines and Congressional hearings. At issue were a series of irregularities that, it was alleged, illegally boosted the company’s earnings.

The criticism leveled against the company belied its perennial recognition by national media outlets as being “most admired” and among the “best places to work.” The juxtaposition wasn’t lost on the CEO, who observed that the allegations were “unrecognizable” to a company so widely feted for the integrity of its culture. Shortly thereafter, the CEO stepped down under mounting pressure.

That’s the thing about company values: Unless they have tangible, longstanding effects on how a business operates, they are, at best, mere window dressing. At worst, they are an indictment of a business’ failure to make good on essential promises—a self-inflicted wound that can be ruinous to a company’s reputation.

Given the erosion of trust in institutions, as well as increased expectations that businesses invest in society’s greater good, many companies are taking a fresh look at their vision, mission and value statements. In so doing, they are asking tough questions about what is most important to their employees, customers and other stakeholders—and how to hold fast to the corresponding values in their daily operations.

Based on our experience, here are several critical success factors for how companies should express, measure and promote their core values to help ensure that they have the desired effects on their businesses:

Strike a balance between substance and inspiration.

While mission, vision and values statements take many forms, far too many are written (and recognized by the news media) largely for their ability to inspire stakeholders. This approach can undermine their primary purpose of guiding employee behaviors. Inspiration can be a powerful element of such statements. However, when overemphasized, it can result in ornate platitudes offering little perspective on how to demonstrate a company’s values in one’s work. Mission, visions and values statements that are not prescriptive are mere statements of hope.

Another reason mission, vision and values statements are often laden with impractical, inspirational language is that many businesses hope it will strengthen their bond with customers. This is a prudent objective, but since such statements amount to a code of conduct for employees, they should be written primarily for them. Moreover, our research reveals that customers give significant credit to companies that are good employers, including cultivating a strong, values-based culture for employees. Given as much, most customers will surely recognize and appreciate employee-centric vision, mission and values statements.

Measure your company’s adherence to its values.

A tenet of Peter Drucker’s management orthodoxy is “you can’t manage what you can’t measure.” Nevertheless, few companies effectively measure the extent to which individual employees adhere to their values—and, no less importantly, employee attitudes regarding the integrity of the organization’s overall conduct.

A company’s values should be a prime focus of performance reviews, potentially in the form of a scorecard used to gauge an employee’s demonstration of these values. The eventual score should carry significant weight when determining adjustments in his or her responsibilities and compensation. In addition, employees should be polled no less than annually for their confidential opinions on the extent to which the organization as a whole, and its leaders specifically, adhere to the company’s vision, mission and values.

The annual performance review and employee polling data should be tracked longitudinally so that any relevant trends can be identified. The company’s board of directors should be informed of the key findings and any resultant actions taken by senior management, especially those aimed at strengthening the operating culture.

Be transparent about what you measure—and what it means to the business.

Companies making a significant, ongoing priority of their values should initiate a CEO-led discussion each year with employees about the state of their culture, ideally at town hall meetings. In addition to unpacking the aggregate findings of the employee polling—warts and all—the CEO should reinforce how businesses with strong, value-based cultures often enjoy competitive advantages. He or she should explain how the company’s values are integral to the successful implementation of the business strategy.

Given the fundamental link between a company’s culture and its overall performance—and the fact that payroll is the largest expense for most businesses—companies should take the extraordinary step of providing an annual accounting of the culture to investors. Not only should leaders provide key metrics derived from the employee polling, they should detail their performance goals for the next year and the investments they will make to achieve them.

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We frequently encounter RFPs from large, well-known companies with the expressed goal of securing a choice spot one of the media-generated “most admired”, “most innovative” and “best places to work” lists. We understand the value of headlines, including their ability to attract and retain industry-leading talent, but how much insight does any media outlet have into the inner workings of a company?

Fortune, which has no shortage of proprietary lists, anointed Enron in January 2001 as “the best company to work for”—a designation that included a cover photo of then Chairman Ken Lay smiling ear-to-ear. (Evidently, the magazine’s editors weren’t yet in on the joke.) Also, an extensive financial analysis revealed that the stocks of Fortune’s least admired companies outperformed those of its most admired companies between April 1983 and December 2007.

In contrast, imagine the universal appeal of a company whose commitment to its core values includes specific performance metrics—as gauged by its employees, no less—and the same hit-or-miss disclosure as its year-end financial results. For companies making a significant, ongoing priority of their values, this approach constitutes a powerful message to employees, customers, shareholders and other stakeholders: Culture counts here. The balance of companies can either play catch up by implementing similar measures—or hope to find itself on one of the many “best” or “most” lists. 

How to Take a Stand on Public Policy Without Grandstanding

Last month, Patagonia weighed in publically on President Donald Trump’s recent executive orders to dramatically shrink Bears Ears and Grand Staircase-Escalante National Monuments, boldly proclaiming “The President Stole Your Land” in social media posts and an email to customers.

Tempting as it may be to regard the outdoor apparel company’s salvo as a sign of our hyper-partisan times—or a shout out to a customer base that likely includes few supporters of the current Administration—our reading of events finds that Patagonia’s actions were practical, measured and, above all, authentic. We believe that the company’s actions constitute an instructive case study on when and how businesses should speak out on public policy:

Patagonia has long had a dog in this fight – While businesses often assert that a given social issue is core to their values or mission, Patagonia has advocated for the preservation of public lands for almost 30 years. For a company incorporated a mere 45 years ago, this represents two-thirds of its existence. Among the company’s achievements to date is helping to establish several national monuments, including Bears Ears National Monument, as well as Basin and Range and Gold Butte National Monuments.

Values are important, but are often generic and malleable. Consequently, values alone provide even the most well-intentioned business with little currency when tackling a social issue. However, a business with a history of demonstrating its values, particularly with a track record of accomplishment, has inexorable license to speak and to act. It is this measure of authenticity that is most valued by key stakeholders, in addition to being a prime resource in achieving a business’ desired social outcomes.

Also, Patagonia’s essential utility is to enable people to enjoy the outdoors, not least on public lands—a resource reduced by roughly two million acres as a result of the executive orders. Had the company not lent its voice to the resultant public discourse, while endeavoring to reverse the course of action, one could reasonably argue that it failed to make good on a core responsibility.

The company took a stand without grand standing – There is no shortage of businesses that have taken aim at President Trump for his executive orders ranging from the travel ban or the transgender military ban—with some CEOs reprimanding the commander-in-chief for his lack of values.

In contrast, Patagonia’s public overture amounted to a straightforward recitation of key facts and a call-to-action. Whereas many CEOs would seize upon the moment as a thought leadership opportunity, Rose Marcario, to her credit, recognized that the effort to thwart the executive orders wouldn’t benefit from her imprimatur—especially given President Trump’s penchant for taking to Twitter to criticize high-profile individuals.

Although the claim that the nation’s public lands have been “stolen” is based on a particular reading of the law, the company thereafter limited its messaging to the enumeration of data pertaining to the economic impact of the outdoor industry, the percentage of public lands currently open to oil and gas leasing and development and the widespread public support for protecting federal public lands.

It is noteworthy that Patagonia didn’t make a value judgment about the oil and natural gas industry—a popular bogeyman of environmentalists—opting instead to provide a dispassionate, statistical overview of leasing and development on public lands. In lieu of ideological rhetoric, Patagonia invoked the words of Theodore Roosevelt—a Republican president responsible for establishing the United States Forest Service and five National Parks.

Patagonia is part of a diversified coalition seeking a common solution – There is strength in numbers, not to mention diversity, when given the formidable challenge of overturning two sweeping executive orders. Patagonia belongs to a group it characterizes as “350 businesses, conservation groups and Native American tribes that have come together on this issue to protect public lands.”

Due to the breadth of its members, the coalition is capable of mounting a full court press to prevent the reduction of public lands at Bears Ears and Grand Staircase-Escalante National Monuments. To that end, Patagonia leveraged the strength of its customer base to call popular attention to the effects of the executive orders, while other members of the coalition attested to their environmental and economic impacts. Still other members have presumably reached out to allies in state and federal government to urge the Administration to reconsider its actions.

Also, Patagonia has pledge to file a lawsuit against the Administration that will be joined by numerous non-profit organizations. Another suit is to be brought by the Inter Tribal Coalition.

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Businesses have a fiduciary responsibility to speak out on issues that are critical to their self-interests—no matter the prevailing political climate or White House occupant. However, when a business’ priority is also a societal priority, both the opportunities and risks of taking a public stand are compounded, especially given the rise of identity politics and groupthink in the social media age.

Patagonia’s response to the Administration’s actions was well conceived and well executed. Given the company’s business model and historic role in preserving public lands, along with its reasonable temperament, Patagonia belongs in the thick of any integral effort to rollback the executive orders. 

Reputation Management in the Digital Age: New Critical Success Factors

Editor’s note: This is the second of a two-part SoundInsights installment examining the best practices for managing corporate and non-profit brands based on the new realities of the digital age.

The decline of traditional communications channels, coupled with the rise of social media, have upended many of the longstanding tenets of reputation management for corporate and non-profit brands alike. Today, organizations engage in two-way communications that are often initiated from the bottom-up—from one or more stakeholder groups—as opposed from the top-down—from the organization itself.

Below are several critical success factors that are the basis of a new playbook for the digital age.

Develop a value proposition that balances business rigor with social relevance—and vice versa.

Traditionally, a corporate or non-profit brand was rooted in benefits that were largely exclusive to the end users of their products or services. When knitted together, these benefits were commonly articulated as a value proposition or mission statement designed to resonate with customers, beneficiaries, investors and donors.

That has all changed: Corporations are now expected to be more mission-driven in their business pursuits, whereas non-profits are expected to be more business-like in making good on their missions.

Corporations are increasingly expected to contribute to society’s greater good, not simply their bottom lines, as we know. B2C and B2B companies ranging from Unilever and Walmart to GE and IBM long ago committed to addressing key societal challenges, often selling more products and services at better margins in the process.

Indeed, the enunciation of a profit imperative often enhances the success of a company’s CSR efforts. When then-GE Chairman Jeff Immelt proclaimed “green is green” during the 2005 launch of ecomagination, he did so because the company—renowned for its Six Sigma discipline—would not have been viewed as authentic if it had positioned the initiative as giving back to society. Instead, Immelt explained that the environment represented a business priority for the company, while reinforcing GE’s Edisonian heritage of innovating solutions to pressing societal needs.

For non-profit organizations, whose social relevance is often explicitly captured in their mission statements, there is an inverse opportunity: Clearly articulate a business-like management of your operations. Some key findings of Edelman’s 2017 Trust Barometer, along with research we’ve conducted on behalf of various non-profits, reveal that trust in NGOs has declined in recent years largely because they are not widely viewed as problem solvers. While admittedly oversimplified, the prevailing attitude is that non-profits would be more trusted if they did a better job of measuring the returns on their investments, either socially or financially.

Of course, NGOs have long been evaluated by the percentage of donations that are directed to those they serve, but stakeholders expect a disciplined, interdependent approach to strategic and financial planning. How long will it take an environmental group to return local rivers and streams to health, for example, and what resources are required to achieve this outcome?

Stakeholders further expect non-profit organizations to produce tangible, even quantifiable, results. When pivoting away from its longstanding operating model as a fundraising organization, The United Way of America in 2008 announced Goals for the Common Good—performance metrics gauging the extent to which Americans are healthier, better educated and more financially secure. Progress against each of these metrics is not sufficient; the organization is holding itself accountable to fixed quantitative goals.

Know which social issues to commit to—and which to avoid—and how to speak to them.

Corporations are expected to substantively address social issues, but doing so in the age of social media—and in a society that is often sharply divided—is frequently challenging.

When Apple and J.P. Morgan Chase made contributions to the Southern Poverty Law Center following violent protests in Charlottesville, Virginia earlier this year, they were disparaged for supporting what some characterized as a partisan, unsound charity. Even Starbucks, whose commitments to the greater good are nothing less than groundbreaking, was universally lambasted for its Race Together conversation starter on race relations.

Fair or not, the criticism leveled against these and other companies reveals the fundamental need for a company to first understand the expectations of key stakeholders before shaping, let along communicating, its CSR efforts: Where and how can it make the most valuable contributions to society? And how might those contributions be reasonably viewed from an opposing perspective? Efforts to address even the most deserving of causes, if widely perceived as inauthentic or ill conceived, can undermine a company’s communications and business objectives.

While market research is the only precise means of answering such questions, our experience tells us that stakeholders commonly emphasize the extent to which there is an intuitive relationship between their perceptions of a company and a given social issue. If a company is viewed as being capable of making particular headway with a social issue—largely as a result of its distinctive competencies, less so because of its financial largess—stakeholders will give it high marks.

Equally important is whether a social issue is a common priority with a company’s various stakeholders. Also, how might a company’s support of a social issue imply a public policy position? Tabulating research findings by party affiliation, or the lack thereof, has long been a best practice in market research, but it is an outright imperative in today’s hyper-partisan climate.

Recognize your employees not simply as brand advocates, but also as sources of media.

Storytelling is essential to the vitality of today’s corporate and non-profit brands—and an organization’s employees are unassailably its best storytellers. Their organic, bottom-up perspective on an organization is inherently more authentic, after all. While some organizations struggle with providing employees with the latitude to speak publicly on their behalf, it is the uniqueness and incongruence of their perspectives that them universally compelling.

Compounding the value of employees as storytellers is their connectivity with other stakeholders through social media, along with the unequaled credibility of peer-to-peer communications. Putting real faces on a company is not a new communications strategy, but the practice was often a choreographed marketing effort. Of late, increasing numbers of companies, including some of the world’s largest, are creating employee advocacy programs that emphasize social media, without imposing strict rules. AT&T’s Social Circle, for example, allows employees to speak in their own voices—and now boasts more than several thousand members. 

Reputation Management in the Digital Age: The New Realities

Editor’s Note: This is the first of a two-part SoundInsights installment examining the new realities of the digital age—universal truths that stewards of corporate and non-profit brands should weigh when developing their integrated communications strategies. The second part will examine the best practices for capitalizing on the transformed communications landscape. 

The decline of traditional communications channels, coupled with the rise of social media, have upended many of the longstanding tenets of reputation management. A company could once address issues affecting its reputation through one-way communications, often narrowcasting messaging to reflect the particular interests of individual stakeholder groups. Today, it can engage in two-way communications in a surround sound ecosystem in which various stakeholder groups hear largely the same thing.

The command and control playbook for reputation management is gone—and it’s never coming back.

For companies and non-profit organizations proactively attentive to enhancing and protecting their reputations, the digital age represents a potent opportunity. After all, never have they had a greater diversity of tools—many of them far more cost-effective than advertising—not simply to communicate to stakeholders groups, but to engage with them. Conversely, for those content with simply maintaining their reputations, the transformed communications landscape is not without its threats.

Of the realities to emerge in recent years, the following have the greatest potential influence on the relative strength or weakness of corporate and non-profit brands:

Most Americans see the world through the lens of social media.

Whereas both digital and print circulations of U.S. newspapers have declined for 28 consecutive years, social media is now a primary source of news for two-thirds of Americans. According to Pew Research Center (PRC), 68 percent of U.S. adults are on Facebook—roughly three-quarters of which visit the platform at least once a day. Moreover, the greatest users of the platform include milllennials, college graduates and those occupying the highest income bracket ($75,000+) tracked by PRC.

But that lens often provides a binary view of the world.

While many had initially hoped that social media would enable the democratic exchange of differing opinions, it more frequently resembles a standoff of opposing views. This is the result of several variables, not least the algorithms employed by Facebook to shepherd users towards content reflecting their ideological preferences.

In a recent big think article explaining how social media creates echo chambers, Orion Jones observed:
“…sociologists have concluded that social media often entrench people’s ideological positions and even make those positions more extreme. Witness the age of a bitterly divided America.”

People look to people who look like them.

From LinkedIn to Instagram, social media’s essential appeal is, well, that it is social. Whether they are sharing a Harvard Business Review case study or a restaurant recommendation, people do so with the expectation of reciprocity and validation from the members of their professional network or community of followers. The exchange is transactional, but not commercial, which is integral to the popularity of peer-to-peer communications.

This is no less true in a business context. Edelman’s 2017 Trust Barometer finds that an organization has no more credible spokesperson that “a person that looks like yourself” when formulating an opinion about a company—trumping the CEO, members of the board of directors and financial analysts, each of whom presumably has a profit motive for people to like a company.

People who didn’t used to matter now can matter.

Several factors—the expectation that businesses contribute society’s greater good, the rise of online activism and the global trend of people using social media to profess their personal values—have created an environment in which people that otherwise have no relationship with a given company can nevertheless assert themselves for the purpose of either helping or hindering that company.

Monsanto, a business-to-business company that sells seeds to farmers, was targeted by Greenpeace and other activist groups, as well as individual consumers opposed to GMOs. As a result, the company’s ability to gain regulatory approval of products in the U.S. and abroad was significantly undermined. Companies in the energy, pharmaceutical, financial services and retail industries have been similarly confronted.

In contrast, REI—a Seattle-based retailer of sporting goods and camping gear—closed its stores nationwide on Black Friday in 2016, the traditional start of the holiday shopping blitz, advocating that people instead spend time outdoors. #OptOutside became a bona fide movement not simply among outdoor enthusiasts, but also casual enthusiasts and even those who have grown disenchanted with the commercialization of the holidays. Government officials followed suit by allowing free admission in state parks throughout U.S.—and more than 150 business, like REI, paid employees to spend the day outdoors. The company’s brand was further strengthened and sales revenue increased.