I figured this was the place to ask.

I always thought it was just something that everyone (especially businesspeople) knew -- as a business, you stay out of politics, because no matter what you say, you're going to alienate half your customers.

What has changed in recent years to make so many highly-paid, smart, presumably educated business leaders forget this basic tenet of business?

I think the simple answer is that the notion of go woke go broke isn't true. There are certainly ample examples, especially for a short-term impact, but a consistent and persistent negative impact to businesses would end this trend pretty quick.

Further, DEI (and now DEIA) movement has led to inclusion efforts being very loud in the board ranks and through executive leadership. From this, some executives have flown up the corporate ranks thanks to DEIA. Clearly they and similar peers would personally see the benefit and probably think everyone benefits from these concepts. Get enough of those and eventually some weird decisions are made like this Bud Light campaign.

Also you have about half of people that tend toward favoring community over self responsibility. These are folks, plenty of them among exec ranks, are generally going to be more agreeable to these ideas, even if not their personal belief.

Finally thought from me. The young adult generations are now dwarfing Gen X and older generations in collective economic power within consumer ranks, with real power following in the coming decade(s). Like it or not, their views are what will shape things going forward for a time, and some companies will be early to attach to the shift just like some will be late to adapt.

Millennials have moved into middle and upper management. It will only get worse.

Well is the question really why are politicians dragging corporations into their world? All this DEI etc was not contentious until just 12-18 months ago.

I think this can be a good discussion for this board if it stays in bounds. What's out of bounds? I don't know how to describe it, but you know it when you see it, right?

Just to add to some of the points above, companies have also seen a steady increase of litigation for inclusion-related issues. So I think part of the activism strategy is to help manage their public image. Probably not the main factor, but I think it's a very real part of the issue.

Another answer is that many of these companies have diversified their revneue streams globally and no longer primarily depend on the USA for most of their revenue. They can afford to play politics at home, lose a little revenue, probably weather the temporary storm, and even make up the revenue elsewhere, globally.

SchizoAg said:

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I figured this was the place to ask.

I always thought it was just something that everyone (especially businesspeople) knew -- as a business, you stay out of politics, because no matter what you say, you're going to alienate half your customers.

What has changed in recent years to make so many highly-paid, smart, presumably educated business leaders forget this basic tenet of business?

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It's too much work for a consumer to actually practice boycotts in reality… go woke, go broke is fake news.

ac04 said:

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wrong board. corporations are somewhat held hostage by huge investment firms like blackrock, vanguard, and state street among others to participate in ESG/DEI bull**** or else.

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This is really the biggest part of the answer. It's access to capital. ESG has permeated institutional investors and banks. It's no longer good enough to just not discriminate against any group. You must actively support them.

I posted this here because I was more interested in the opinions of business people than political "zingers". I'm glad I did, thanks for the insightful replies.

If you listen to millennials *****, none of them has any money to invest in the stock market, so surely the shareholder ranks are still dominated by older people. Why do they put up with this stuff? Even if, as YouBet noted, America is a smaller proportion of their business now than in the past, why is it okay for them to do anything that reduces share value?

ATM9000 said:

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SchizoAg said:

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I figured this was the place to ask.

I always thought it was just something that everyone (especially businesspeople) knew -- as a business, you stay out of politics, because no matter what you say, you're going to alienate half your customers.

What has changed in recent years to make so many highly-paid, smart, presumably educated business leaders forget this basic tenet of business?

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It's too much work for a consumer to actually practice boycotts in reality… go woke, go broke is fake news.

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Boycotts usually fizzle out not only due to the amount of effort put forward but also due to economics. A lot of people say 'buy America" and then go to Wal-Mart, Sams, etc.and buy krap made in Vietnam by 10 year olds due to price.

Like with most issues, there are numerous, complex reasons underlying what we see happening.

No doubt the ESG push is a big one, perhaps the biggest. But you can't discount the immense pressure that executives feel to approve these choices. Who wants to be the one white guy who stands up and says "no thanks" to some idea or campaign that focuses on DEI? It's a lot easier to just get on board and hope for the best.

Look what happened to Stan Richards -- one of advertising's greatest minds. His own people leaked audio of his issues with a new Motel 6 ad campaign and he was forced to resign from the firm he founded and built into a powerhouse.

I also believe that the trend toward credentialism has increased the chasm between marketers/ad agencies/brand managers and their customers. The Bud Light marketing VP has a very high class background; she likely has never crossed paths with a real Bud Light customer.

woodiewood1 said:

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ATM9000 said:

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SchizoAg said:

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I figured this was the place to ask.

I always thought it was just something that everyone (especially businesspeople) knew -- as a business, you stay out of politics, because no matter what you say, you're going to alienate half your customers.

What has changed in recent years to make so many highly-paid, smart, presumably educated business leaders forget this basic tenet of business?

---

It's too much work for a consumer to actually practice boycotts in reality… go woke, go broke is fake news.

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Boycotts usually fizzle out not only due to the amount of effort put forward but also due to economics. A lot of people say 'buy America" and then go to Wal-Mart, Sams, etc.and buy krap made in Vietnam by 10 year olds due to price.

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One difference here is that switching costs are non-existent. There are multiple competing products at the same price point, that taste almost exactly the same, and that exist in abundance.

Some will go back but many won't because there is no stickiness to that product. All else being equal I'm going to be loyal to the option that isn't pushing extremely controversial politics like AB.

woodiewood1 said:

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ATM9000 said:

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SchizoAg said:

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I figured this was the place to ask.

I always thought it was just something that everyone (especially businesspeople) knew -- as a business, you stay out of politics, because no matter what you say, you're going to alienate half your customers.

What has changed in recent years to make so many highly-paid, smart, presumably educated business leaders forget this basic tenet of business?

---

It's too much work for a consumer to actually practice boycotts in reality… go woke, go broke is fake news.

---

Boycotts usually fizzle out not only due to the amount of effort put forward but also due to economics. A lot of people say 'buy America" and then go to Wal-Mart, Sams, etc.and buy krap made in Vietnam by 10 year olds due to price.

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Also because there are no viable alternatives.

I also think people like the Bud Light VP, truly are insulated and believe 80% of the population agrees with their political/advertising stance. They've been "educated" by liberal professors and been in groups that really don't offer counter thought.
I bet that girl is truly shocked that the divide is 50/50 or even 60/40 against her.

Access to capital and fear for their own jobs.

It's no longer enough to just nod along. If you're not actively supporting every facet of DEI agenda, you're seen as against it.

The sad part is there are some actual good parts in content I've seen (golden rule type stuff, etc), but hard to focus on that when a session starts out with "truths" such as the entire country is racist, systemic bias is everywhere, etc.

Quote:

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Look what happened to Stan Richards -- one of advertising's greatest minds. His own people leaked audio of his issues with a new Motel 6 ad campaign and he was forced to resign from the firm he founded and built into a powerhouse.

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That was crazy but probably the #1 reason people in Advertising & their clients just go along. Who would have thought that Stan could not voice questions or opinions about a campaign in development in discussion? One employee took him down. One. Employee. Wonder if they are still there.

Corporations have always been involved in politics and they do so in their own interests. You are just surprised because there are some more and more obvious places where corporate interests (e.g. making money) doesn't align with your personal political interests.

Related to this, corporations are continuing to act in their own interests. America is not a majority white, male, Republican country. That is a minority. To continue to hire and sell into a diverse economy they need to show they care about those other interests. Blackrock and others are pushing ESG because they are looking long-term and realizing that without it, your company won't exist long-term even if that means some odd missteps like the AB commercial people are seeing.

ac04 said:

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wrong board. corporations are somewhat held hostage by huge investment firms like blackrock, vanguard, and state street among others to participate in ESG/DEI bull**** or else.

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It's this.

You had Vanguard, Blackrock, and State Street going to big companies in the months following Biden being voted in and told that ESG would be a priority for those institutional organizations going forward.

And business leaders were staring at inflation and a recession, and the big money threatening to sell off the companies shares they owned if they don't play ball.

We had a rep for Larry Fink (Blackrock) tell our leadership they would dump all of our shares if we didn't play ball. That would have absolutely tanked our stock. So our leaders have started implementing some of the ESG stuff to our detriment - nothing publicly stupid like A-B just did, but things that get us 'ESG points' in the investment community.

And it's all pointless stuff that does nothing positive to our bottom line, or is really having any effect on our company culture, but checking a bunch of boxes and keeping us in the good graces of the big 3.

SchizoAg said:

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I figured this was the place to ask.

I always thought it was just something that everyone (especially businesspeople) knew -- as a business, you stay out of politics, because no matter what you say, you're going to alienate half your customers.

What has changed in recent years to make so many highly-paid, smart, presumably educated business leaders forget this basic tenet of business?

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because people are dumb including executives and will do anything to enhance their stock price.

$ANH is down 39.34% in five years and desperate executives do even dumber things.

crazy thing is they could have just created a commercial or advertising with someone in their early 20's to attempt to reach the younger crowd and change their image from a old man with a beer gut.

something "refreshing" and light.

Instead they opted to use a man pretending to be a woman as their poster child.

pocketrockets06 said:

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Blackrock and others are pushing ESG because they are looking long-term and realizing that without it, your company won't exist long-term even if that means some odd missteps like the AB commercial people are seeing.

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You sure about that?

You think the tens of millions of people that have crossed the boarder are thinking about this stuff? They just want to work hard and raise a family, which is not aligned with ESG whatsoever.

Don't think it's all DEI reasons. I think executives also want to sell more of their product to people that don't currently buy their product. They want to increase sales and increase market share. Used to be that marketing to women was how you increase sales. Prime example was Lego starting to make a line of toys targeting girls specifically. They were aiming to capture a portion of the market that had previously alluded them, and they sold more toys to girls as a result. It's risky because you can alienate your existing customers if you don't handle it correctly or get yourself caught up in heated political debates like Barnum and Bailey did. Since this was only a obscure endorsement that may not have been seen much outside of twitter, I think Bud will be fine long term and will go back to trying to bring in new customers to their brand. They'll just probably stick to less controversial endorsements in the future.

If there is no significant, long-term backlash... then why is it stupid?

You open yourself up to new markets consuming your product, and the people who were already consuming your product have shown that they aren't going to stop.

I guess we shall see with earnings report. But I feel like much of the "Blackrock!" crowd is similar to the "Soros!" crowd... It's guys who live on politics and assume any and everything is politics related.

Decent chance this is simply just a company taking a shot at marketing to a new base (that, whether you like it or not, is growing). Maybe it will work, maybe it won't... But I just very much doubt there's this nefarious puppet master forcing them to cater to the trans population "or else!".

Proposition Joe said:

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If there is no significant, long-term backlash... then why is it stupid?

You open yourself up to new markets consuming your product, and the people who were already consuming your product have shown that they aren't going to stop.

I guess we shall see with earnings report. But I feel like much of the "Blackrock!" crowd is similar to the "Soros!" crowd... It's guys who live on politics and assume any and everything is politics related.

Decent chance this is simply just a company taking a shot at marketing to a new base (that, whether you like it or not, is growing). Maybe it will work, maybe it won't... But I just very much doubt there's this nefarious puppet master forcing them to cater to the trans population "or else!".

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There will be significant long term backlash. There are plenty of options when it comes to beer.

One thing that has always fascinated me with corporations and the nature of the stock market / investing is the increasing need to always grow. No corporation will ever be satisfied with how they're performing, even if it's really good. And it seems to be the downfall of quite a few of them....