“The black lives matter movement is a testament to the fact that courage is contagious”

- Opal Tometi, Co-Founder, Black Lives Matter Movement

THE SCOOP:

Social Movements have always attempted to create change, resist change, or provide a voice to those that are otherwise disenfranchised. They have influenced major societal shifts in the past few years.

The recent wave of protests under the “Black Lives Matter” or “All Lives Matter” movement erupted around the world after the killing of George Floyd in Minneapolis on May 25th, 2020.

Part of the Black Lives Matter movement includes pushing brands and organizations to do better by fixing their internal structures to support People of Colour in their workforce and donate to causes to help the fight. Since then, brands have been in a race called ‘Brand Activism’ and ‘Ethical Consumerism.’

From changing their ad campaigns by being more inclusive to making huge donations to charities and organizations supporting this issue, brands are playing all the tricks in the book to maintain their consumer base.

DIVING DEEP:

The Black Lives Matter global movement was founded in 2013 following the death of African-American teenager Trayvon Martin. He was fatally shot by a self-appointed neighborhood watchman while walking to a family friend's house after leaving a convenience store. Since then, it has steadily been gaining momentum for years.

Gen Z and Gen Y are seen as the most socially conscious portion of the current population. Such consumers have shown a trend towards personification of brands, and have slowly but surely been treading towards a tectonic shift in how they view their purchases. They have reaffirmed their inclination to shell out a premium in order to buy into the values that the brands support.

Brands have always been a powerful platform in putting forward the voice of people when faced with atrocities. The popularity, wide-spread audience, and visual communication help in making it a major ally in putting across powerful messages.

What are the companies striving to achieve?

‘Brand Activism’ which can be explained as taking a stand on social, environmental, or political issues, has been gaining popularity amongst brands. Body positivity from Dove or Racial Equality from Nike or Corporate Social Responsibility is fast becoming the new norm, on account of the massive success that brands receive while addressing such issues.

‘Ethical Consumerism’ is another global character trait that is gaining popularity amongst the younger consumer base, especially millennials. Consumers are becoming more and more aware of issues that are taking place around the globe and a lot of their buying decisions are influenced by these issues.

Research shows that millennials form about 40-50% of the consumer base of most brands and 8 out of 10 millennials would switch to or prefer brands that support a cause that they believe in.

Consumers being more conscious or “woke” as they would say, are now turning towards spending their money on companies with progressive values. Research also shows that 87% of millennials would purchase a product that advocated an issue they care about, and 88% would boycott a company they thought was being socially irresponsible.

DEVELOPMENTS:

In the light of recent events a huge number of fashion and beauty brands, especially the big players, have come out in support of brands by financially supporting black-owned businesses. Here’s a list of a few of them and how it has affected them:

1. NIKE: Nike has always been known for taking well-calculated and controversial risks

What it did:

i) 1st - 6th September 2018 - Nike releases a powerful ad campaign with influential sports giants such as Colin Kaepernick, Serena Williams, LeBron James, and Odell Beckham Jr.

ii) 29th May 2020 - 60-second social media campaign using video titles “For Once, Don't Do It” highlighting racism and police brutality.

iii) 6th June 2020 - Michael Jordan and the Jordan Brand which forms a huge part of Nike pledged to donate $100 Million to organizations ensuring racial justice and encouraging education.

Impact:

i) 2nd - 6th September 2018 - Sales grew up to 31%. Stocks surged 33% that year and reached an 8-month high of $83.49 on September 3rd, 2018.

ii) 31st May - 4th June 2018 - Online orders saw a rise of 35%.

iii) 8th June 2020 - Share prices see a sudden surge including a 2-month high of $104.55.

2. H&M: The Swedish multinational clothing retailer has never been very vocal when it comes to highlighting social issues. However recent times have seen a change in this behavior.

What it did:

i) March - June 2020 - Violent protests and the coronavirus lockdown forces the company to shut down 3778 of its 5065 stores across major cities in the world.

ii) June 1st 2020 - Announced a $500,000 donation to the NAACP Legal Defense and Educational Fund, Color of Change, and the American Civil Rights Union.

Impact:

i) Sales see a decline of up to 46% in the month of March and April and 25% in June 2020.

ii) June 1st - June 8th, 2020 - The week following the donations saw a steady increase in share prices reaching a 17-week high of $168 on June 5th and a 27% increase in online orders.

3. ADIDAS

What it did:

i) June 10th, 2020 - Announced that it would be donating $20 million to support black communities. This was not taken positively, with employees calling out the company for not being diverse enough and calling the amount meager in comparison to what it was capable of donating.

ii) June 12th, 2020 - Decides to increase its donation to $120 Million to be distributed over the next 5 years which includes 50 university scholarships for Black students at partner schools. The company is also planning on filling 30% of its new employee positions and 12% of leadership roles in the U.S with Black and Latino employees.

iii) July 1st, 2020- The Head of Human Resources, Karen Parkin resigns over racism allegations by several employees.

Impact:

i) The share price saw a drop from $141 on June 10th to $130 on June 11th, almost a 10% drop.

ii) The week following the second announcement saw a steady balance of stock prices with sales seeing a 14% rise. But the company is still struggling to maintain its public image.

ANALYSIS:

The financial gains and losses incurred by brands underline the highly volatile and effervescent nature of a movement. Social movements emerge out of a dysfunction between systems and/or authorities. As it gains traction, it must evolve their goals and objectives in order to avoid dissolution.

Similarly, it must also introspect the motivation of its members to strive for change, and ensure that they align with that of the movements. Finally, they should execute the movement without any physical disruption that may shift focus from the essence of the movement.

Giving back has always had a two-fold effect on a brand. Increasing your sales figures and supporting causes that consumers find meaningful. Consumers, employees, and majority stakeholders have been seen prioritizing Corporate Social Responsibility while choosing a brand or company.

Studies have always shown that companies that integrate Corporate Social Responsibility into their operations show an almost immediate rise in sales and share prices, with consumers ready to pay more for products as well as a significant reduction in employee turnover.

While CSR is highly essential, communication practitioners have a profoundly important job of publicizing and spreading all information about it in the right manner.

There has been a rise in what we call “cancel culture”. If a company does not look towards environment-friendly issues such as waste reduction, sustainable clothing, etc or human rights issues such as racial issues, gender equality, labor rights they could be missing out on a huge chunk of the market group of consumers who prefer to buy from socially responsible companies that align with their values.

Even if a company does decide to take a stance on any of these issues, they need to make sure that the message which is being delivered hits the right note. If not, it could lead to boycotting and protests all of which translates to a huge loss in revenue.

VERDICT:

Not only is it powerful for brands to communicate how they are ethical and socially responsible, but it also promotes a positive brand image. Brands that refuse to embrace this new wave of being socially responsible, face potential diminution in value or, even worse, the slow and painful death known as irrelevance.

However, brands need to realize that consumers do not just view their efforts and campaigns from a dichotomous cultural perception, but align themselves on a spectrum from ‘Exploitative’ to ‘Empowering.’ This is the key ratio that they have to optimize upon and keep in mind whilst announcing aid or exclaiming support in order to not sound disingenuous.

The bottom line could be seen in the fact that ‘the more socially responsible a company becomes, the more it cultivates positive brand recognition, increases customer loyalty, and attracts top-tier employees.’ These can be seen as the keys to achieving increased profitability and long-term financial success that is both inclusive and sustainable.