A good case study is Starbucks. The company has become a prime target for boycotts over the past several years, and it is facing yet another consumer backlash after pledging to hire thousands of refugees. The pledge was a direct rebuke to the Donald Trump administration’s Muslim travel ban.
Considering that Starbucks survived all of the previous boycotts levied against it, the question is whether or not this latest effort will break the string of failures.
The Muslim ban and Starbucks
On Jan. 27, President Trump signed an executive order that abruptly halted travel to the U.S. for citizens from seven Muslim-majority countries, even those with valid visas and green cards.
The response from Starbucks was swift and unequivocal.
In an open letter to employees dated Jan. 29, CEO Howard Schultz detailed concrete actions the company will take to support its team and oppose the Trump administration.
That includes a new pledge to hire refugees, beginning in the U.S. with a focus on refugees who have supported American troops overseas in the capacity of interpreters and other services. The pledge will eventually encompass scores of countries with the goal of hiring 10,000 refugees in five years.
Schultz also said the company will step up its support for the Deferred Action for Childhood Arrivals (DACA) program, continue building on its strong relationship with Mexico, and provide health coverage for eligible employees if the Affordable Care Act is repealed.
In addition, Schultz encouraged Starbucks employees to become politically active:
“Your voice and your vote matter more than ever. We are all obligated to ensure our elected officials hear from us individually and collectively. Starbucks is doing its part; we need you to use the collective power of your voices to do the same.”
And, Schultz closes with a resounding affirmation of the company’s values:
“We are in business to inspire and nurture the human spirit, one person, one cup and one neighborhood at a time – whether that neighborhood is in a Red State or a Blue State; a Christian country or a Muslim country; a divided nation or a united nation. That will not change. You have my word on that.”
The boycott begins . . .
The backlash from conservative Trump supporters was just as swift. On Jan. 30, Fortune magazine reported that #BoycottStarbucks was trending on Twitter. Here’s s representative tweet:
While President Trump is working to get Americans jobs, Starbucks CEO wants to hire 10,000 refugees.
What about us?#BoycottStarbucks
— Scott Presler VA (@ScottPresler) January 30, 2017
On Jan. 31, Breitbart — a news organization associated with the rise of white nationalism in the U.S. — promoted the boycott under the headline, “Starbucks Pledge to Hire 10,000 Refugees Sparks #BoycottStarbucks Movement on Social Media.”
. . . but it probably won’t work
It’s too early to tell if the new boycott will have an impact on Starbucks. Judging by past performance, though, success is highly unlikely.
Shortly after news of the boycott broke, Newsweek posted an item on that topic from the online question-and-answer community Quora.
Quora contributor Archie D’Cruz looked into seven boycotts against Starbucks that have trended on Twitter since 2012. In each case, he found that the company’s stock actually rose in tandem with publicity surrounding the boycotts.
Do read the full article for details. For those of you on the go, D’Cruz summarizes that 5 of the 7 boycotts were undertaken in opposition to progressive policies articulated by Starbucks.
That category includes legalizing same sex marriage (2012 and 2013), the 2015 “Christmas Cup” controversy promoted by Breitbart as well as Trump, and Schultz’s endorsement of Hillary Clinton for president (2016).
The fifth action in that category is the 2016 campaign urging supporters to give Trump’s name instead of their own when ordering specialty coffees at Starbucks. Though not a direct boycott (in fact, quite the opposite), the intention was to draw negative publicity to Starbucks.
The other two boycotts did not come from conservatives, at least not obviously so. Those related to a tax avoidance issue in the U.K. (2012) and a new dress code for baristas (2014).
D’Cruz sums it all up with this observation:
“The next time you see #BoycottStarbucks trending on Twitter, you might just want to place a call to your stock broker.”
So, how does Starbucks do it?
There are a number of reasons why companies like Starbucks are not impacted by boycotts while others stumble.
Research indicates that a company already on the decline is more vulnerable to experiencing a significant impact, as demonstrated by the recent troubles of the Ivanka Trump brand.
Starbucks certainly does not fall into that category.
The Schultz letter illustrates one area of particular strength for Starbucks. The company has a clarity of purpose that drives it to take progressive positions. That makes it a magnet for boycotts from the conservative side, but it also cements loyalty among its target customers.
At the same time, Starbucks reaches out to conservative-leaning customers by emphasizing diversity of opinion at the point of sale.
TriplePundit reached out to Starbucks by email for comment on the latest boycott, and a spokesperson for the company underscored that point:
“We make decisions based on our mission, values and heritage, and we recognize that sometimes there are some who may disagree with us. We respect the diverse points of views held by our partners and customers and will continue to listen,” the spokesperson told 3p.
“Everyone is welcome at Starbucks. We’ve been committed to diversity and inclusion since our earliest days and creating a culture of belonging is a core company value.”
The Houston Chronicle’s small business section featured a piece on Starbucks’s customers and picks out several points of support for progressive issues:
“Starbucks’ primary target market is men and women aged 25 to 40 … Starbucks’ appeal to this consumer age group through hip, contemporary design that is consistent in its advertising and decor, and working to keep its products current as status symbols. Customers tend to be urbanites with relatively high income, professional careers and a focus on social welfare.”
Significantly, the Chronicle reports that demographic has been growing by 3 percent annually.
Young adults aged 18 to 24 is another important — and growing — market segment for Starbucks that tends to favor Democratic candidates over Republicans. Last November Bloomberg noted that “Republicans fared poorly with youth voters overall” on Election Day 2016.
A Trump supporter commenting on D’Cruz’s piece measured the likelihood of a successful boycott and concluded that the company’s appeal to Democratic voters would help it weather the storm:
“Starbucks’ customers have a high degree of brand loyalty, and for every deplorable customer they lost, they probably gained a student lefty to replace him.”
A Starbucks fan in the same comment thread made the point that publicity over boycotts does not necessarily reach a saturation point that would drive conservative-leaning customers away from Starbucks:
“Like millions of other iPad-toting customers I pony up my five bucks to buy a seat in a quiet, mocha-smelling room with free wifi. Most adults and conservatives in particular don’t care about #BoycottUnimportantIssue.”
Of course, like any major company, Starbucks has made its share of unforced errors over the years. Its recent “Race Together” campaign fell flat, and its supply chain exposes the company to criticism from environmental organizations related to paper products and palm oil.
Starbucks has also taken hits for lackluster performance in the areas of food waste management and recycling initiatives.
In other words, anyone who would like to mount a more successful boycott against Starbucks has plenty of ammunition at hand.
That’s a long shot, though. Starbucks carefully laid the groundwork for customer loyalty through its willingness to take proactive stands on marriage equality and immigration, among other social issues.
In effect, Starbucks’s social positions created a cushion of trust that continue to provide it with publicity attractive to its progressive customer base, regardless of any negative news about its environmental track record.
The company is also starting to pay more (much more) attention to environmental concerns, so the door on that route of attack is also closing.
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