During Trump’s administration there have been a number of boycotts (or at the very least, called for boycotts) on a wide variety of industries, both for supporting Trump and for clashing with him. The boycott of Uber from a weeks ago garnered national attention and eventually warranted response from the company’s CEO, but the most recent boycott surrounding Trump and his family is of Nordstrom after the company’s decision to end its partnership with Ivanka Trump. Nordstrom stopped selling Ivanka’s clothing line, citing poor sales as the driving factor. But that decision may also have been largely influenced by the threat of anti-Trump boycotts following the “Grab Your Wallet” campaign that called for consumers to boycott a list of almost 70 perceivably pro-Trump companies. Despite the company’s official stance that removing Ivanka’s products should not be interpreted as “taking a political position,” Trump supporters have by and large condemned the company for giving in to anti-Trump boycotts and have responded with a similar call to action. Since making the decision, Nordstrom has become a target for a whole new series of boycotts from the opposite side of the political spectrum. Still, the actual impact on Nordstrom’s stock from the pro-Trump boycott has been minimal.
The limited effectiveness of these boycotts could be for a number of reasons. First, the boycotts associated with Trump, his supporters, and his critics have become so numerous that little to no attention is paid to them individually anymore. Overall, the number of stories about boycotts in U.S. newspapers has increased about 30% from only a year ago. Each specific boycott only has a few days of media attention before the public is redirected toward a new cause. Most companies suffer minor and temporary reputational damage as a result of any given boycotting effort. Furthermore, boycotts in general have proven to be an ineffective method of exacting change from companies. Even amongst consumers who agree with the ideology behind a boycott, most would not frequent the company in the first place and the rest are usually too loyal to the product or service to inconvenience themselves by forsaking it.
In today’s highly polarized political atmosphere, it may be difficult for companies to completely avoid taking any kind of political stand. Nordstrom was in a unique situation with Ivanka Trump in which the public perceived even inaction as a decisive political stance. Perhaps as tensions rise around Trump’s administration, it will become more and more difficult for companies to avoid these increasingly common, politically motivated boycotts, especially if even silence and inaction is interpreted as opposition. However, trends have shown that the repercussions of even highly public feuds and boycotts in this political and economic climate are not necessarily detrimental. While the situation between Nordstrom and the Trumps continues to unfold, so far Nordstrom stock has had a slightly positively impact from the media attention.
Sources:
http://fortune.com/2017/02/09/donald-trump-ivanka-trump-nordstrom-twitter-boycotts/
http://www.businessinsider.com/trump-boycott-companies-will-it-work-2017-1
12 Comments
Have boycotts ever worked? I think one reason they may no longer effect companies the way they previously did is modern media-as you said, being exposed to one cause after another via media makes it difficult to focus on one, and lowers the “attention span” of the activists of a certain cause.
The above comment was posted by Sam Childress.
There’s no such thing as bad publicity, and it would seem that Nordstrom is almost riding the benefit of Trump supporters “boycotting” their stores. But we all have to take a step back and realize that a lot of companies have survived what could be described as fickle consumers, so I doubt that Nordstrom is in any real trouble.
Are Trump supporters a big part of Nordstrom’s customer base? It is not a store for the thin of wallet, but I don’t know what the data show about the income profile of our President’s most vocal supporters. If few are part of Nordstrom’s customer base, then the net is a lot of free publicity for the department store chain, and an improvement in sales.
Under Armour is the latest example in this boycott phase as #BoycottUnderArmour was trending on Twitter this past week after the company’s CEO Kevin Plank said “To have such a pro-business president is something that is a real asset for the country,” Even though this was a purely economic statement, people despise Trump so much that it still rubbed them the wrong way and spoiled their image of a quality company like Under Armour. I do believe Under Armour will be fine though and it will be able to rebound from this temporary hit to its image.
I read somewhere that Ivanka’s brand at Nordstrom actually declined in sales (will have to recheck). It is crazy how Trump’s tweets and comments can directly affect big companies. Maybe Trump’s tweets now correlate to a degree what FDR was doing with fireside chats in the 1930s.
Follow up on FDR: did he refer to individual companies, much less ones in which he and his relatives had a financial interest? I don’t know but suspect not. FDR wasn’t involved in construction contracting or owning suppliers to the military. Plus the press at that time would have pilloried him, newspapers made it hard to maintain an alternate universe as they competed for circulation and would follow up on each other’s scoops. Stories that proved wrong would generate front-page mea culpa’s, so readers would be clued in quickly. That’s something that can’t happen in the fake news universe.
Boycotts have been going on forever, one of the bigger ones that comes to mind is chik-fil-a and the opposition they’ve experienced from the LGBTQ community. I just don’t see how a boycott would ever significantly hurt a company. Consider a prominent firm– they probably have someone smart enough leading them to know that if they experienced a boycott that it would really hurt the company. Thus, they would know not to say or do something that could potentially bring on a boycott.
Dropping the Invanka Trump lines appears to be the right move for Nordstrom, as internal statistics reveal an overall drop of 32% in the line’s sales. Thus, it’s a little harsh for Trump supporters to be claiming Nordstrom is simply boycotting the President’s connections. However, I am interested to see how long boycotts of anything related to the president will occur as such a circumstance is quite unprecedented in political history. Are people still just caught up in the shock of his election or will they actually stay committed to boycotting Trump products for the forseable future?
As has been stated above boycotts are an ineffective way of enacting (or at least attempting to enact any sort of change). Even one as “popular” or widespread as the chic-fil-a boycott left no discernible effect. As stated in the article, usually boycotts are done by those who probably didn’t shop at a particular store anyway. Everyone else is likely indifferent or loyal to the brand.
This reminds me of early 2003, when forty percent of Americans called for the boycott of French products, particularly wine, in response to France’s opposition of the Bush administration’s involvement in the Iraq war. While French wine sales dipped temporarily, sales eventually returned to their normal trajectory. Boycotts do not usually hurt the corporation’s long-term bottom line because they are unable to be sustained. As such, while the call for boycotts of Trump brands allows consumers to voice their discontent, it is unlikely to change Trump’s behavior or have any implication in his policy proposals.
There’s a literature on international sanctions (boycotts), eg of South Africa under apartheid, of Iran and on and on. With one or two possible exceptions they were failures, if one believes their goal was to actually change foreign behavior rather than to provide (empty) gestures to domestic political constituencies. See the very thorough (300+ cases) study: Hufbauer, G. C., Schott, J. J., Elliott, K. A., & Oegg, B., eds. 2007. Economic sanctions reconsidered (3rd ed., Expanded ed). Washington, DC: Peterson Institute for International Economics.
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