We are operating in a climate of consumer activism and empowerment that can unfortunately show up in brand dislike, even hate, both of which make indifference sound like a godsend. Consumers always vote with their pocketbooks. That’s both good and bad news for retailers. And activist consumers have made their voices heard for centuries, with collective movements and boycotts, and on the flip side, as positive grassroots brand builders. Again, good or bad news for retailers depending on where they sit.
No one wakes up in the morning wanting to trash a brand. And no one wants to wake up feeling their once-trusted brand has sold them short by not sharing their values. To be fair to retail leaders, resisting the pressure of investor activists takes enormous tenacity and patience. And responding to the needs and whims of all consumer-activist stakeholders, including customers and employees, takes an equal level of stamina.
Although retail leaders are not necessarily trained as political operatives, it is becoming clear that playing to influencers and policymakers might be a good short-term practice to survive in a highly disruptive marketplace. That doesn’t say much for a brand’s integrity when its ethos swings in the wind. Customers want brands they can rely on and trust. On that note, see the end of this report for TRR’s activism checklist for some proactive strategies.
Active Activists
If you’re paying any attention to the news headlines, you might conclude that the American consumer is reaching an inflection point of frustration. When real income and spending power are diminished, retail is typically the first line of resistance when shoppers pull back. Compound that with principled spending, and you’re on the brink of serious pushback by customers who typically vote with their pocketbooks.
America has a long tradition of consumer activism. The Boston Non‑Importation Agreement and the Montgomery Bus Boycott were coordinated consumer actions that forced large policy changes. On the marketing front, the Bud Lite brand positioning disaster has become a brand legend. Backlashes against Target’s LGBT positioning has also become a textbook retail cautionary tale. Now Target is facing a 40-day backlash which began at the start of Lent (those 40 days of retail fasting) because Target made changes to its DEI programs. Other recent examples include the Tesla backlash in Europe and Poland’s call for a Tesla boycott. The New York Times reports that Tesla sales plunged 76 percent last month in Germany, part of a wider pan-European slump. The Guardian reports that “Data from the European Automobile Manufacturers’ Association showed sales of new Tesla cars almost halved in Europe last month. The figures left analysts scrambling to assess how big a factor was customers turning their backs on the brand because of Elon Musk’s foray into EU far-right politics.”
Brand Hate
The political weaponizing of consumerism is becoming problematic. Our TRR colleague Glyn Atwal reports, “The online community is a global megaphone. Anyone can share their views, opinions, and experiences about almost anything – including brands they love or even hate. Emotional sentiment is amplified through social networks. This can drive brand engagement if the narrative is positive. However, the dynamic shifts when online content attacks brands, directly. Social media has become a go-to outlet for consumers to let off steam. Disappointment, anger and even rage directed towards brands is the new normal of the ‘callout’ culture. Consumers don’t just walk away from brands quietly; they can actively campaign against them and their impact can have a lasting effect in attracting new customers. Likes, product reviews, blogs, TikTok and the spontaneous combustion of social media are consumers’ tools to make or break products and services. And with the proliferation of chatbots and agents, AI is the latest influencer, positive and negative. That said, some people’s hate campaigns are love campaigns for others.”
If you accept that the social media megaphone has become the go-to tool to mobilize consumer activist movements, it’s no surprise that the February 28th 24-hour U.S. “economic blackout” movement prompted online by The People’s Union gained social media traction as its call to arms was posted, reposted and amplified. Was the boycott successful? That’s in the eye of the beholder. According to an interview in Newsweek with John Schwarz, an unknown and with questionable-credibility (with an extensive manifesto of demands) orchestrator of the event, “The success of the blackout will be determined by the level of participation, which he planned to monitor through website registrations, interactions on social media and the overall visibility of the campaign.”
That’s not exactly a data-driven business formula that tracks sales, a measure of sustained rejection of a retail brand or evidence of a change in policies, which seemed to be the intent of the boycott. A one-day blackout against U.S. retail behemoths is, as one retail expert told us, “Like taking a knife to a gunfight.” In this case, the day-long boycott seemed to be more a movement among constellations of friends than a national outcry. On the 28th, anecdotally, it was retail business pretty much as usual.
That said, a cascade of new grassroots boycotts is planned by many organizers, and critical mass could reach a groundswell in the future. This is not trivial; retailers need to pay attention and take the consumer’s collective voice seriously.
Are Retailers Flying Blind?
The fact remains that American consumers are just as confused as the retail industry in how to move forward to stave off inflation and inevitable tariff-based price hikes. As our colleague Mark Cohen says, with tariffs used as geopolitical bargaining chips, consumers are left to deal with any fallout by paying higher prices or simply being unable to purchase at all. Leaders of retail operations of all sizes are put into untenable positions to manage their businesses fairly, burdened by external pressures.
We are looking at a potential perfect storm fusing trade policies with activism and consumer frustration. In terms of immediate priorities, the potential collateral damage of tariffs is becoming increasingly clear. One dismal outcome could be a rising tide of consumer resistance and rejection transforming geopolitical circumstances into retail brand hate. According to Atwal, “Brand hate is an increasing threat to a brand’s identity and reputation. In an era dominated by hashtag activism, the temptation for brand marketers to hope that negative associations will dissipate is no longer a viable strategy.”
Activism Checklist
With an increasingly vocal consumer and a growing undercurrent of consumer activism, what should the retail industry do? By no means comprehensive, this checklist has topline activism deterrents and guidance for anticipating the future, not catching up to it.
- Before activating an initiative, challenge your assumptions. If your team is in alignment on how your audience will respond, beware. You must consider a wide range of possible and plausible responses, then ask what-if questions before launching publicly.
- Risk Management. Savvy retailers have agile, dynamic crisis management plans and systems in place. Digital tools track real‑time consumer behavior while social listening tools monitor attitudinal change. Pay attention to the shifts and develop contingency plans that will minimize the impact of short‑term disruptions.
- Scenario Planning. State the intended or ideal effect of any initiative or change, conversely, look at what could go wrong, and then consider the most likely outcome. Develop a plan of action for each plausibility. Finally, weigh the value of the ideal outcome against the alternatives and calculate the risks and benefits. By deeply challenging the effort and calculating a response, you reduce the risk of being blindsided by any result.
- Early Warning Systems. Continuously assess the scale, scope and intensity of negative sentiment. Putting an early warning system in place to detect instances of brand hate online will help brand owners regain control before irreparable damage occurs.
- Transparent, authentic communication for all stakeholders, including the workforce builds trust. Proactive customer outreach, even a mea culpa, and engaging sincerely with consumer concerns are more likely to weather consumer activism.
- Listening to your customers and engaging in online conversations is critical market intelligence. If a customer sees that the brand is part of the solution, they may forgive that brand much more easily.
- Culture. Watchwords to operate by: North Star, empathy, shared purpose, courage.
- Above all, avoid the temptation to use policies and protocols as marketing billboards. Do the right thing for the right reason.
Designing a Future
Ultimately, successful retail is not a transaction, it’s a relationship built on trust and respect. You could call it good hospitality, offering the services and products that customers need and desire. No one wakes up in the morning wanting to trash a brand. And no one wants to wake up feeling their once-trusted brand has sold them short by not sharing their values. To be fair to retail leaders, resisting the pressure of investor activists takes enormous tenacity and patience. And responding to the needs and whims of all consumer-activist stakeholders, including customers and employees, takes an equal level of stamina.
Consumer activism gains traction when people feel they have been disintermediated and ignored. There’s no silver bullet for retailers in serving all their audiences, however being honest, open and empathetic engenders mutual trust and respect. As does operating aligned with stakeholders. We have to hand it to Costco as a leader in truth to power. It has a North Star of shared purpose and a moral imperative to stand up for what is right for all their stakeholders. That ethos makes customers into loyal advocates and is an impressive model for building trust in times of uncertainty. And considering the level of uncertainty in today’s whiplash marketplace, let’s hope they maintain their trust position in how they handle any cost increases from the tariff wars. As we said, customers vote with their pocketbooks, and there is a lot at stake in our disruptive marketplace.
