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Buy BRADY, But Don't Be Like Brady

9/24/2022

by David Hagenbuch - professor of marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Tom Brady is one of few professional athletes who transcend their field. While many football players and fans revere him, even those who pay little attention to sports know his name. In a new video ad, Brady surprisingly suggests that aspiring athletes shouldn’t aim to be like him. That advice sounds self-effacing, but how does it fit with other messaging surrounding Brady’s brand?

Sports analysts love to debate who’s the GOAT—greatest of all time. When talking football, it’s easy to make a case that it’s Tom Brady. No one has come close to his seven Super Bowl wins in what might be the most challenging position in all of sports, NFL quarterback. He’s also the all-time leader in passing yards, completions, and touchdowns. Then there’s his incredible longevity—still going strong at age 45.

It’s not surprising that Brady, like other top-tier athletes, has also been a prolific product endorser. He’s promoted brands that include, but aren’t limited to, Beautyrest, Disney, Snickers, UGG, and Visa. Most Brady ads garner little extra exposure, but his most recent commercial for Under Armour has captured added attention.

The ad includes another legend, actor Morgan Freeman, who reads a letter that Brady has purportedly penned to a hypothetical football prodigy who some are calling “The Next Tom Brady.” Brady says to reject any such associations and instead to “compare yourself to nobody but the kid in the mirror.”

One can imagine at least a couple reasons why the GOAT might give that advice: 1) He genuinely wants young players to chart their own unique course and not be saddled with expectations to be someone they’re not; or, more cynically, 2) He doesn’t want anyone matching or exceeding his accomplishments, thus dimming the light of his star.

Each of these motivations is possible, but given that the celebrity friendship and letter are almost certainly contrived, the most plausible motive is the one that drives virtually every commercial — selling product.

Both Brady and Under Armour want people to buy the brand’s athletic equipment and apparel. It’s been their common cause for more than a decade and a partnership that has rewarded Brady handsomely: in the ballpark of $10 million to $15 million a year.

In fact, one might even say that NFL quarterback is Brady’s side-hustle and product endorser is his day job, at least in terms of income. In 2021-2022, Brady’s compensation from quarterbacking was $31.9 million while his endorsement earnings totaled $52 million.

To his credit, Brady has positioned himself well for life after football, as an endorser and in other ways. His ever-expanding business portfolio includes such ventures are TB12, 199 Productions, and Autograph. There’s also his namesake BRADY brand, which takes us back to the central question of this piece:

Does the living legend really want aspiring athletes to avoid comparisons to him?

BRADY, which calls itself “The Next Generation Apparel Brand,” seems intent on living up to that label. From the website’s photos, the brand appears to be targeting young male athletes.

The brand features a wide variety of athletic apparel from underwear and socks, to t-shirts and sweatshirts, to complete training, golf, and lifestyle collections. The common component on each article is the BRADY trademark, embroidered on the front panel of hats, heat-pressed on the left shoulder of training Ts, and silkscreened in 4” high letters across the chest of sweatshirts and hoodies.

Therein lies the advertising irony. Through Under Armour's commercial and the BRADY brand, Tom Brady passes mixed messages to young athletes, telling them:

“Don’t let anyone compare you to me, but please wear my name across your chest.”

Just as basketball players who sport #23 on their jerseys encourage comparisons to another GOAT, Michael Jordan, any high school or college quarterback who wears BRADY emblazoned on his football training shirts invites comparisons to Tom.

These associations aren’t unique to athletics; they occur most times famous people put their names on products. Virtually every celebrity endorsement benefits from such classical conditioning as the admiration that people have for the celebrity transfers onto the product they’re promoting.

Whether it’s verbalized or not, the celebrity in the ad suggests, “I use this product, so you should buy it and be like me.” The consumers' emulation can extend to other products the celebrity endorses as well as to other attitudes and actions.

When I was growing up, some young basketball players wore white and red Converse sneakers, #6 jerseys, and patterned their game after Dr. J, while others wore similar shoes with green trim, #33, and imitated Larry Bird. Aspiring athletes have likely been doing the same for more than a century. So, it’s no stretch to suggest that many young football players who wear the BRADY brand emulate #12 and welcome comparisons to him.

It's fine for Tom Brady and other famous athletes to serve as spokespeople for products they genuinely believe in and that benefit those who follow in their footsteps. However, telling young athletes to buy their branded merchandise but not be like them is disingenuous and a trick play that should be flagged for “Single-Minded Marketing.”

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Should Employees' Looks Matter?

9/10/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Despite her aging appearance, Queen Elizabeth II kept her job for an unprecedented 70 years! A Canadian news anchor who let her locks go grey wasn’t as fortunate. Her seemingly heartless dismissal has aroused widespread empathy, including from some of the world’s leading companies, sounding an alarm against ageism. However, in an era when brand-building is of utmost importance, shouldn’t companies have a say in the looks of those they pay to be the faces of their firms?

Before she was “blindsided” by her abrupt termination, fifty-eight-year-old Lisa LaFlamme was “the face of the most-watched nightly news show on Canadian television.” Her 34-years of industry experience combined with a keen intellect and engaging communication style made her the Canadian equivalent of Katie Couric or Barbara Walters.

However, those talents and experience didn’t stop Bell Media from firing LaFlamme from CTV News. Mirko Bibic, the president and CEO of BCE and Bell Canada, denied that hair color had anything to do with LaFlamme’s release, but LaFlamme’s stunned reaction along with CTV News head Michael Melling’s question of who approved the decision to “let Lisa’s hair go grey,” suggest that hair color was at least part of the reason.

Known for speaking out on body image-related issues, Dove, subsidiary of the Dutch conglomerate Unilever, shared its opinion of the incident: Just a week after LaFlamme’s release, Dove Canada unfurled a #KeepTheGrey social media campaign that included the greying of its iconic logo across social channels “to show support for older women and women with grey hair who may face undue workplace discrimination.”

Fast food chain Wendy’s also took up the mantle, temporarily turning grey the red pigtails of its namesake logo.

It’s nice that brands like Dove and Wendy’s care enough to stand against apparent ageism—an often-overlooked issue, especially in societies that tend to glorify youth. But, what about the companies paying, in some cases very significant sums, to people to represent them and, in some cases, to be the faces of their franchises? Shouldn’t these organizations have a say in how their employees look?

When thinking of organizations that dictate their agents’ appearances, one of the first that comes to mind is Disney. At its theme parks, the company carefully curates a wholesome, family-friendly image that stems in large part from the looks and actions of its staff. Personal branding that’s edgy and provocative may have its place in other firms but not at Disney.

Is it legal for Disney to be so prescriptive with its employees’ looks? Yes, since “no federal law bans employment decisions based on appearance in general.” However, employers must ensure that their looks-related rules don’t intentionally or unintentionally discriminate against people because of their race, religion, sex, national origin, age, disability, or genetic information.

Even then, though, there are legally acceptable exceptions if a case can be made that a specific personal trait is a bona fide occupational qualification (BFOQ). For instance, a film studio can exclude adults from auditioning for children’s roles, and a synagogue can stipulate that rabbi candidates must be Jewish.

As in these examples, for a BFOQ argument to be successful, the required personal characteristic must be essential to job performance. If it is, the discrimination is likely legal.

Of course, just because something is legal doesn’t mean it’s moral, but legislation related to employee looks does do a pretty good job of supporting values of decency, fairness, honesty, respect, and responsibility. For instance, if a certain personal characteristic is critical to job performance, it wouldn’t be fair to those hired or to those who rely on their work (coworkers, customers, shareholders) to disregard the criterion.

To determine what’s fair, honest, etc., organizations should consider three questions:

1. Are the firm’s performance assumptions accurate? A company hiring for a web development position might assume that only those 30 years old or younger have the skills and understanding needed to do the work effectively. It could be, though, that the best candidate is a 60-year-old who has many years of industry experience and has kept themself on the cutting edge of their field.

Similarly, corporations fail when they misinterpret what consumers really want. First, it’s important to emphasize that companies are under no legal or moral mandate to cater to customers’ discriminatory and irrational tastes, like only wanting a Caucasian waiter.

Firms sometimes wrongly assume how customers expect employees to look. Disney recently walked back its longstanding policy of no visible tattoos and now permits employees to display “appropriate” ones — an implied admission that it had fallen out of touch with what its customers viewed as family-friendly physical appearance.

2. Are their double standards? Even as America aspires for equality, there are sometimes conflicting norms for different people-groups, e.g., women vs. men, young vs. old, rich vs. poor, Black people vs. white people.

LaFlamme’s termination is a case-in-point. If she were a man, would it have mattered that her hair was gray? Men may face some stigma for coloring their hair, but when they go grey, they’re often described as looking mature, sophisticated, and wise.

Women with the same hair color enjoy few such positive associations; rather, like LaFlamme, they’re more likely to be the victims of age discrimination: “Because of ‘lookism,’ women face ageism earlier than their male counterparts.”

3. Can the firm help precipitate social change? Given that cultural values and norms are much bigger than any one organization, it’s understandable that companies often believe there’s little they can do to have a social impact, particularly with an issue as far-reaching as people’s appearances.

However, even small businesses can help move the needle on such perceptions with their affirming employment practices (e.g., hiring and retaining older workers), as well as by voicing their disapproval if/when their customers discriminate. Global brands like Dove and Wendy’s can have an even greater impact by virtue of their scale and scope.

In the end, the workplace should be a two-way street:

Employees should appreciate that they’re agents of the organizations for which they work and as such, need to respect reasonable appearance-related requirements, for their own benefit, as well as those of their coworkers and the organization on whole.
Organizations should treat their employees with respect and try to truly understand what appearance characteristics are critical to job performance and which are not, while also refusing to cater to customers whose tastes are discriminatory.

There could be a case in which a certain hair color is a BFOQ that a company could legally and morally require. However, that likely wasn’t true in LaFlamme’s situation. She could have reported the news just as effectively with grey hair, and although certain viewers may not have liked her look, many others probably appreciated her authentic appearance and would have welcomed the network’s support of her and other older women.

“Queen of England” shouldn’t be the only occupation accepting of grey hair. Looks matter to individuals and organizations, but requiring employees to change theirs for less-than-compelling reasons appears to be “Single-Minded Marketing.”

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Should Anyone Advertise Alcohol?

8/27/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Drive slower, pay taxes, vote — While we expect governments to tell us to do those things, we wouldn’t imagine they’d urge more alcohol intake, yet that’s exactly what one of the world’s leading nations is doing. Why a country would encourage sipping more sake is an interesting question, but it begs a much bigger one: Is it possible to promote alcohol responsibly?

The nation imploring intoxication probably isn’t one you’d expect — Japan. The world’s third largest economy and a leader in culture and industry has uncorked a contest called “Sake Viva” that asks citizens in their 20s and 30s for new ways to make and market alcoholic beverages. The term sake refers to both a Japanese rice wine and to alcohol in general.

Most of us are familiar with the risks of excessive alcohol consumption, which can lead to everything from disease (heart, liver), to poor mental health (depression, dementia), to social problems (broken relationships, unemployment), to DUI accidents (serious injury, death), all of which enact high financial and other costs on a country. So, why would Japan intentionally invite these expenses?

Ironically, the answer is money. As many governments have experienced, Japan is dealing with decreased tax revenue, partly because of an aging population and shrinking tax base but also because consumption of one of its most highly taxed products, alcohol, has been declining.

In the mid-1990s, alcohol consumption in Japan averaged over 26 gallons per person — a number that by 2020 dropped by about a third. What’s more, as younger Japanese are drinking less than their elders, the sobering trend seems likely to continue.

In only one year, from 2019 to 2020, tax revenue from liquor sales fell by $813 million, which was “the largest decline in three decades — and a cause for alarm for a government facing broad fiscal challenges.”

Given that in many countries, alcohol advertising is commonplace – on television, in magazines, and on billboards – why have many taken issue with Sake Viva on social media? The backlash seems to be based not so much on the message but who’s delivering it.

Ryo Tanabe, a Japanese man in his 30s, expressed this sentiment in an interview with NPR: “The fact that the National Tax Agency is doing this makes it a different story. I feel something is wrong with it. I understand they need the tax revenue, but I don't think they have to go this far.”

Tanabe’s reticence about his government advocating more alcohol consumption is easy to appreciate, especially given the increased individual and collective costs excess liquor can levy and the fact that we expect our governments to protect us, not put us in harm’s way.

But, if promoting alcohol is bad, should anybody be doing it? Claiming it’s okay for some to advertise alcohol but not others, seems a little like saying certain people can lie or cheat, but others shouldn’t. If something is wrong for one, shouldn’t it be wrong for all?

I have to admit that alcohol advertising is a difficult issue for me to approach objectively. My personal choice is not to drink, and I work for a university that maintains a dry campus. Over the years, I’ve also written several pieces about potential alcohol abuse by marketers, including:

Still, I have friends and family members who drink, and I respect their choices. I also remind myself and other Christians that Jesus’s first miracle was turning water into wine. There were likely then and there are now many people who subscribe to different worldviews and drink responsibly, in moderation, posing little or no risk to themselves or others.

There’s also scientific evidence that small amounts of certain alcohol, e.g., a glass of wine, hold some health benefits.

So, it’s possible to argue that it’s moral to consume alcohol in moderation, which suggests that it’s also acceptable to produce it for others to consume. But does this moral leeway also mean that alcohol producers can advertise their products?

As I’ve considered advertising, which is paid-for mass communication by an identified sponsor, I’ve often thought that if society allows production of an item, it should also permit its promotion, within reason; otherwise, a moral contraction handcuffs the producer — it’s very difficult for most products to succeed without advertising.

That doesn’t mean, though, that any advertising goes. A product like alcohol, in particular, shouldn’t be promoted to the wrong people (e.g., children), in the wrong places (e.g., near schools), or in the wrong ways (e.g., associated with athletic performance).

Another wrong way to promote alcohol or any product is to suggest its excessive use. Whether it’s food, or clothes, or entertainment, too much of even a good thing can cause people harm.

As suggested above, alcohol poses greater risk when consumed in excess than do most products, which brings us back to Japan’s Sake Viva campaign: Encouraging people to drink more, is tantamount to promoting drinking in excess, given that for most people the middle ground between current consumption and intoxication is likely very narrow at best.

On the other hand, alcohol producers can advertise their individual brands without necessarily encouraging consumers to drink more. The reason lies in the difference between primary and secondary demand, or demand for a product category versus demand for a particular brand.

In this comparative ad for Miller Lite, for instance, the beer claims to have “more taste and only one more calorie than Michelob Ultra.” Miller Lite isn’t encouraging people to drink more alcohol, rather it’s asking them to switch their beer purchases from its competitor.

Given my personal consumption preference, I wouldn’t choose to promote alcohol, but I can understand how others might in order to support demand for specific brands. I can’t comprehend, however, how a country, tasked with protecting its citizens’ well-being, can promote more drinking. Encouraging excessive consumption of any kind equals “Mindless Marketing.”

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Are There Rules When Everyone's an Endorser?

8/13/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

There was a time when only celebrities and aspiring actors were spokespeople. Now the friend you’re having lunch with tomorrow may, unbeknownst to you, have an endorsement deal. It’s nice that company sponsorship has been democratized, but with so many people pushing products, how can consumers survive the promotional onslaught?

The great expansion of spokespeople hit home for me a few months ago during a discussion about personal branding in our university's capstone marketing course. As we considered the notion that those present might be future endorsers, a student in the front row spoke up, “Do you know Rachel Delate? She’s already endorsing products.” A classmate quickly added, “Yeah, she has a deal with Body Armor.”

A year earlier, Rachel was in my intro to marketing class where she distinguished herself as a strong student. She’s also a very good lacrosse player, e.g., first team All-Conference, first team All-Region, third team All-American. After the NCAA’s recent relaxation of rules involving name, image, and likeness (NIL), that talent put her in a position to accept endorsement deals.

Besides Body Armor, Rachel also has enjoyed sponsorship experiences with TreadBands, Barstool Sports, and LiquidIV, which have provided her with a variety of branded gear. She says the experiences have been very worthwhile, as she summarizes in a sentence, “I’ve had the opportunity to connect with awesome brands and people and receive cool stuff!”

Knowing Rachel, I’m confident she’s a responsible influencer, but what about many others who have suddenly become spokespeople and might be looking to make quick money, not caring much about what they’re selling or to whom. How should they see their roles? But first, how did we get to this point of influencer inundation?

The rapid rise in number of endorsers has been the result of a perfect storm of at least three interwoven social trends and economic incentives.

First, over the last several years, new ecommerce platforms and tools have made it relatively easy and inexpensive to operate online shops, which has encouraged many people to start, run, and promote their own businesses.

Second, there’s been a steady increase in influencer marketing due mainly to the seismic shift from traditional media to social media. Advertisers have always needed to be where consumers are, which has recently meant firms moving money from the likes of NBC and the New York Times to an up-and-coming influencers’ TikTok and YouTube channels.

Third, crypto currencies and NFTs, two new categories of virtual products that were virtually unknown a few years ago, have offered an array of endorsement opportunities not only because they’re new but because many people still don’t know exactly what they are and, therefore, lean on endorsers to guide them.

It’s this third trend that recently grabbed product endorsement-related headlines, but not for good reasons:

Bloomberg described “the disastrous record of celebrity crypto endorsements,” such as that of actor Matt Damon who plugged cryptocurrency exchange Crypto.com, only to see Bitcoin’s price plummet by 60%.
BuzzFeed News reported that the watchdog group Truth in Advertising warned Jimmy Fallon, Gwyneth Paltrow, and fifteen other celebrities that they violated Federal Trade Commission guidelines by failing to disclose on social media their money-making connections to certain NFTs.

The proliferation of new and experienced influencers playing fast and loose with their referral power, makes me wonder: Have we entered the Wild West of product pitching where laws are lacking and consumers must take their protection into their own hands?

Hopefully, most influencers will have the conviction to self-regulate. For those who are so morally and professionally inclined, here are four best practices for product endorsement:

1. Know the product: An endorsement is basically a recommendation. People want recommendations because there’s something they don’t know well, and they’d like someone who’s more knowledgeable to guide them.

For that reason, every endorser should be very familiar with the product and/or company they’re recommending; otherwise, they’ll fail to offer value or worse, they might mislead the people who are trusting them for help.

2. Believe in the product: Although information is very important, head knowledge is only half the product-endorsement equation. Spokespeople should also believe in the merits of what they advocate.

Several years ago, a reporter asked basketball great LeBron James how he had improved his game and physique over the off-season. James unwittingly replied that he stopped eating at McDonalds, which was one of his main sponsors at the time. James’ slip underscores the fact that knowing about a product is not the same as believing in it. Endorsers shouldn’t recommend to others products they wouldn’t want for themselves.

3. Ensure the product is a good fit for the target market: Notwithstanding the previous point, there are instances in which endorsers don’t use the products they’re recommending because they’re not in the target market. In those cases, it is especially important that influencers understand the needs of those who do use the product.

For example, doctors often prescribe pharmaceuticals they’ve never tried. They can recommend them with confidence, however, because they’ve read the drug studies and believe in the companies that provide them; then, knowing their patients’ medical histories and symptoms, they can project with some certainty that their patients will benefit from them.

4. Disclose your relationship with the organization: From native advertising to salespeople acting as if they’re customers, one of the greatest deceits in business occurs when marketing promotion tries to pretend it’s not.

Advertising and personal selling are useful tools from which consumers can gain very helpful information; however, people need to know when the information source is objective (e.g., a fellow transit rider) versus compensated by a company (e.g., an online product reviewer who receives the items for free). It’s difficult for anyone to be unbiased about an organization that’s paying them, which isn’t necessarily a problem provided consumers know the relationship.

Developments in areas such as deepfake video, the metaverse, and NIL, give reason to be both excited and anxious about the future of marketing influence. Endorsers who see their roles as involving both individual opportunity and social responsibility will likely be promoters of “Mindful Marketing.”

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Do Subscriptions Make Sense?

7/30/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

“That’s the gift that keeps on giving the whole year”—such was Cousin Eddie’s inane attempt in Christmas Vacation to console a devastated Clark Griswold after he found out his firm gave him a Jelly of the Month Club membership instead of a generous cash bonus. Clark had good reason to resent receiving a product subscription, but how should consumers feel about more companies moving to subscription models?

If you’re like most people, you’ve noticed a steady rise in reoccurring payments. Decades ago, monthly bills were restricted to things like rent and utilities, but they’ve since expanded to include regular charges for cellphone plans, movie streaming, and online news. And, the list keeps getting longer, as even more organizations find opportunities to automatically tap their consumers’ wallets for things like clothing (e.g., Stitch Fix), meal kits (e.g., HelloFresh), and shaving tools (e.g., Harry’s).

These examples aren’t particularly surprising—each day people wear clothes, eat food, and shave their bodies, so it makes sense to automate the purchase process and save consumers time shopping for such staples. However, subscription services for some other products should make any of us wonder, ‘Why?’

For example, BMW has begun to offer “heated seat subscriptions” in certain vehicles for $18 a month. According to James Vincent, writing for The Verge, “BMW has slowly been putting features behind subscriptions since 2020.” The automaker’s other reoccurring charges include automatic high beams and adaptive cruise control.

There’s also sneaker maker Cloudneo, which offers a “100% recyclable running shoe that’s only available by subscription.” For $29.99 a month, customers receive “an endless supply of shoes.” When pairs are past their useful lives, customers request new ones while returning their old ones, which the company grinds down and melts into plastic pellets used in its new product manufacturing.

These last two examples and several of those mentioned earlier are innovative approaches that reimagine marketing’s 4 Ps. All share strategic similarities as they fall under the subscription umbrella, but there also are significant and sometimes unsettling differences that make me want to better understand: When is subscription pricing right for both companies and consumers?

To answer this question, I turned to someone who has navigated the challenging process of transitioning his company’s signature product from a one-time purchase to a monthly subscription. Jason Kichline is founder and chief technology officer of OnSong, namesake of one of the world’s most widely used music performance apps. It allows musicians to digitally store, sort, and customize their music, saving them time and enabling them to focus on what they do best.

An annual guest speaker in my capstone marketing course, Kichline has told us of his firm’s deliberations about transitioning the OnSong app from a one-time Apple App Store purchase to a monthly subscription. OnSong started to offer a feature-enhanced, subscription version of its product a couple of years ago. This past June, OnSong finalized the monumental move by eliminating the one-time purchase option.

For many companies, the decision to go to full sail on a subscription model is simply a matter of what nets the most money, i.e., will more revenue from reoccurring payments offset sales not realized from potential customers who want a one-time purchase?

Although OnSong certainly considered income projections, it’s analysis was much more circumspect and other-oriented, which is evident as Kichline explains three main reasons for the move:

1. Relationships: “We’ve always placed a high value on supporting our users. A complex and full-featured app like OnSong demands a level of support that goes beyond that of a one-time purchase. A subscription creates the opportunity for a more formal relationship with users and the need to continually provide them with value. Our goal is to make our customers incredibly happy with the level of service, support, and features we offer.”

2. Continuity: “Although OnSong has been successful for more than 10 years, many software firms don’t last as long—they go out of business, or they’re acquired. A developer can keep an app around for a long time for some side money or an owner’s salary, but a buyer typically wants ROI. For this reason, new owners turn many one-time-purchase apps into subscriptions and try to ‘leverage’ the existing user base.”

“Even though app customers often assume they’ll be forced to upgrade to a subscription, we didn’t feel it was fair, so we grandfathered existing users.” Still, because going out of business also leaves customers stranded, we believe that subscribing to OnSong is the best path forward for all. A subscription to OnSong is an investment in the company and its product’s future.”

3. Value-Added: “The defining measure for most consumers is what they receive compared to what they pay. Although a subscription costs more than a one-time purchase over time, it also provides greater benefits, including important updates and improvements in an ever-changing technological environment. A cancelable subscription also reduces financial risk for consumers by allowing for product trial, which is often not possible with one-time software purchases.”

“Looking to the future, OnSong wants to provide a web-based version of the app that will store music and resources in the cloud, as well as manage bands and teams. A subscription model supports this additional functionality and added value.”

Kichline acknowledges that the transition to a subscription model has not been without challenges, which include effective communication with consumers, who can be swayed by public perceptions in social media.

Still, the change has been a good one for OnSong and its customers. After experiencing one “tight month,” the company’s revenues quickly rebounded to previous levels with continuing growth. That success should also be taken as a sign of the strength of OnSong’s value proposition in the eyes of consumers—the benefits they receive from the app are well-worth its reoccurring cost.

For Kichline, key to the whole process has been “having the mind of the consumer.” His analysis above and this summary statement make me ask: Do the subscriptions for BMW’s heated seats and Coudneo’s recyclable running shoes show an understanding of “the mind of the consumer” and a desire to truly meet customers’ needs?

Cloudneo’s product subscription may represent such a market orientation for certain hardcore runners who cycle through sneakers at a rapid clip. They might wear out a pair of running shoes every few months and could easily spend $360 or more per year on performance footwear.

BMW’s subscription is harder to justify. In his Verge article mentioned above, Vince raises good points that call into question the automaker’s motives:

“BMW owners already have all the necessary components [for the heated seats], but BMW has simply placed a software block on their functionality that buyers then have to pay to remove. For some software features that might lead to ongoing expenses for the carmaker (like automated traffic camera alerts, for example), charging a subscription seems more reasonable. But that’s not an issue for heated seats.”

When BMW manufactures vehicles with heated seats, it likely passes on the added material and labor costs to consumers at the time of purchase. So, the automaker is essentially holding back a feature for which customers have already paid so it can charge twice for what is an increasingly common new car addition. Such a motive certainly wouldn’t represent a customer-centric attitude.

As BMW has shown, there are situations in which paying a reoccurring fee for a product makes little sense for consumers. However, when companies prioritize the three principles that Kichline has identified (relationships, continuity, and value-added), subscription pricing is “Mindful Marketing.”

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Cultures of Corruption

7/16/2022

1 Comment

by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

“Auditors Cheated on Ethics Exams”—a recent New York Times headline revealed. During my 20-plus years teaching college ethics courses, my students and I have sometimes joked about that kind of thing, inferring that of all places, an ethics class is one deserving of absolute integrity. Who would cheat on ethics?— apparently plenty of people in one of the world’s largest accounting firms, but why?

The company that found itself the focus of the humiliating headline was none other than Ernst & Young (EY)—one of the Big Four public accounting firms. The Security and Exchange Commission (S.E.C.) reported that between 2017 and 2021, hundreds of EY employees acted unfairly either by using an ill-gotten answer key for an ethics component of the CPA exam or by cheating on ethics tests required for continuing education.

As punishment for the systematic abuses, the S.E.C. fined EY $100 million, “the largest ever imposed by the Securities and Exchange Commission against a firm in the auditing business” and “twice the sum that KPMG, another big auditing firm, paid in 2019 to resolve an investigation into similar allegations of cheating by auditors on internal training exams.” That’s a significant sum; although, it's almost immaterial for a firm with global revenues of $40 billion in 2021.

What made EY’s, and KPMG’s, infractions all-the-more incredible is that they involved the firms’ auditing personnel—the very people who are supposed to ensure that the financial statements of the organizations they audit are accurate and truthful, i.e., that they aren’t cheating!

What would lead people reputed as among the most moral in one of the most ethical professions to make such a breach of integrity?

As one who hopes to help calibrate the moral compasses of the next generation of business leaders, this question hits close to home. Nearly 90 percent of the students in my undergraduate ethics course are accounting majors, and most look to land jobs in public accounting. In fact, some go on to work for Big Four firms.

Although I couldn’t say that these emerging accounting professionals are any more or less moral than those entering other fields, it’s important to note the common public perception that Gallup polls often capture: Accountants are among the most ethical professionals, having moral standards that are much higher than those in many other fields, including marketing.

All this to say, there are many reasons why I’d really like to understand how a moral breach of the magnitude of EY’s happens. Given that EY personnel likely would not want to comment on the case, I reached out to an expert in the field, who was willing to offer his perspective.

A professor of accounting and public accounting firm partner, Jim Krimmel taught auditing and other advanced accounting courses at Messiah University for more than 30 years, while employing the same best practices with his own firms’ clients. Krimmel is also certified in fraud examination and financial forensics, he’s served as an expert witness in accounting-related court cases, and he has conducted fraud workshops internationally.

As someone well-qualified to assess integrity in the field, Krimmel shared these thoughts about EY’s ethical violations:

“The story amazed me when I read it. If this was not so outrageous, it would almost be funny. The extent of the cheating, those who participated and those who let it continue, demonstrates to me a cultural problem in EY that is bigger than this issue.”

“That kind of culture, as with any firm culture, begins at the top. Somehow, those in authority ‘signaled’ that this behavior was acceptable. My concern now goes beyond this incident and makes me question the greater integrity of the firm. If we now begin to hear rationalization for this behavior, then that only increases my concern.”

“Corporate culture will be developed one way or another. If we don't purposely direct and develop it as leaders, then by default, it will develop poorly. This better be a wake-up-call for EY.”

Krimmel’s assessment was eye-opening for me. When moral infractions occur, we usually focus on the individual and their actions—what specifically did they do and why? Those are very important questions, but they can needlessly narrow the focus of analysis and risk overlooking systemic causes, i.e., broader influences on everyone taking similar actions.

The complexity reminds me of a framework from social psychology I used in my dissertation research: The theory of planned behavior (TPB) suggests that people’s intended actions stem from three factors: 1) their own attitude toward the behavior (their thoughts and feelings about it), 2) their perceived control over the behavior (e.g., abilities and resources to do it), and 3) social influence on them (i.e., others encouraging or discouraging the behavior).

As members of a family, work team, or society, most of us want to be true to our personal beliefs and be accepted by others—Whether it’s the clothing we wear or things we say, we typically don’t want to look or sound so different that we disaffect the people we respect.

The “culture” Krimmel mentions exemplifies that need for acceptance and fits squarely in the third component of the TPB. As he suggests, company leaders bear special responsibility for shaping the cultures of the organizations they guide, for instance, by the policies they set, by the behaviors they celebrate or censure, and by their own actions.

It’s that last way that makes all of us moral leaders, regardless of any formal leadership title. We all ‘lead by example’ and constantly take cues from others for what to do or say in all kinds of social settings—I certainly do.

When I’m going out with my wife, I sometimes look to see what she’s wearing to gauge whether I should dress more formally or more casually. In a work meeting, I may look around the conference room table and decide to close my laptop if I see that others have closed theirs.

Those are easy, nonmoral choices. Ethical decisions are often more difficult and consequential, which likely makes social influence even more significant.

Imagine a newly hired staff accountant at EY who, among other things, is tasked with studying for and passing each part of the CPA exam so they can begin billing more hours. Chances are slim that the young associate would independently decide to risk their reputation and employment by cheating on part of the industry-standard certification, but if they know that others in their organization are taking such liberties and the company's culture endorses such abuse, they’ll be more likely to do the same.

Unfortunately for EY, there’s even more evidence to support that its culture has encouraged crookedness. A recent New York Times article described how consultants from the firm “devised an elaborate arrangement” to enable Perrigo, a leading pharmaceutical company, to dodge federal income taxes of over $100 million. When the original auditors from BDO balked at the setup, Perrigo moved its auditing to EY. The new EY auditors “blessed the transactions, which federal authorities now claim were shams.”

Regrettably over the years, plenty of other toxic company cultures have also precipitated major business scandals, e.g., Enron, Arthur Andersen, Lehman Brothers, Wells Fargo . . . the list goes on. Ousting an embattled CEO might make regulators and others feel better, but as Morgen Witzel maintains in writing for Mint, the bad business behavior usually stems from a much larger issue of rotten corporate culture:

“In many other cases, though, the seeds of failure stem from deep inside the company, its values and its culture. Those seeds sometimes lie dormant for years, even decades.”

Witzel acknowledges that fixing a corrupt corporate culture is a far-from-easy, long-term proposition. However, among several sensible suggestions, he offers organizations two critical challenges:

View customer as “partners in value creation . . .with needs and wants that can be satisfied” and not as “cash cows to be milked in order to boost the earnings figures for the quarterly report”
Have a “higher purpose connected with customer service and societal benefit” and don't exist “merely to make money”

Do people make poor moral decisions in the absence of social influence? Certainly; most of us probably have. However, it’s undoubtedly more likely that an individual will choose a wrong path if others they know encourage them to take it. Moreover, when a person is immersed in a culture that normalizes bad behavior, they might not even realize that what they’re doing is wrong.

To keep itself on the right path, some of the most important marketing any organization can do is internal marketing: ensuring that its own people’s vocational needs are met and with it, promoting a positive corporate culture that encourages ethical actions and condemns immoral ones.

Like many decisions we make, our ethical choices often occur with input from others, whether they realize it or not, which makes it all-the-more important for each of us to model morality everywhere, including in the organizations in which we serve.

Companies should constantly evaluate how strongly their corporate cultures embrace ethical actions. Those whose embrace is weak will be like EY, ultimately hurting themselves and their stakeholders as they chart a path of “Mindless Marketing.”

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Should AI Impersonate People?

7/1/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

“Imitation is the sincerest form of flattery”—it is a high compliment when people respect someone’s work enough to replicate it. But, when one of the world’s largest companies’ smart speakers start imitating people’s voices, has flattery drifted into deceit?

It’s difficult to keep pace with innovation in artificial intelligence (AI), but one particular advance that's certainly worth attention is the impending ability of Amazon’s Alexa to mimic voices. After hearing no more than a minute of audio, the smart speaker reportedly will be able to deliver a plausible impersonation.

Alexa’s voice is apparently one that appeals to a very large number of consumers: A 2021 Statista study showed that Alexa was the most widely used assistant across four of six age demographics. So, why would Amazon want to mess with the sound that’s helped it sell so many smart speakers?

According to Amazon senior vice president Rohit Prasad, the change “is about making memories last,” particularly remembrances of those who’ve passed.

In many ways that motive makes the voice mimicking technology seem like a great idea. For those who have lost loved ones, one of the greatest blessings would be to hear their dearly departed’s voice again.

Since my father passed away last August, I’ve thought several times how nice it would be to talk with him again—to hear his opinion about the latest news, to ask him questions that only he could answer.

On a lighter side and also related to Alexa’s voice imitation, I’ve always enjoyed good impressionists. It’s fun to hear comedians who can act and sound like famous people. One of my favorites is Frank Caliendo, who is best known for impressions of famous sports figures; his John Madden and Charles Barkley impressions are great!

Frank Caliendo impersonating John Madden on the Late Show with David Letterman

So, I can see why Alexa doing impressions of people we knew and loved could be popular. However, AI impersonations should also give us pause for at least four reasons:

1. More than a voice: Of course, just because someone, or something, sounds like a person we know, doesn’t mean they are that person. Every individual is a unique curation of beliefs, affections, and experiences that influence what they say and even how they say things.

Frank Caliendo may sound like Charles Barkley, but he obviously isn’t the NBA legend and popular sports broadcaster. Consequently, Caliendo can never truly say what Barkley would say and neither can AI. Only a person knows what they themself would say.

2. Respect for the deceased: Per the previous point, if AI speaks for anyone, beyond playing back a recording of them speaking, it’s putting words in that person’s mouth. A living person could conceivably give such permission, but how would a dead person do the same, short of adding some kind of addendum to their last will and testament, allowing AI impersonation?

I’m not sure it would be fair to ask anyone before their passing to give a smart speaker carte blanche use of their voice. As hard as it is to let go of people we loved, it’s something we must do. The longer we’d allow AI to speak for a loved one, the greater the probability that the technology would say things to tarnish their memory.

3. Vulnerable consumers: Given how good machines already are at imitating life, it will likely become increasingly easy for techno fakes to fool us. However, there are certain groups of people who are at much greater risk of being duped than the average individual, namely children and older people.

It’s scary to think how those with heinous motives might use AI voice imitation to make young children believe they’re hearing the words of a trusted parent, grandparent, etc. Similarly, the Mindful Marketing article, “Preying on Older People” described how senior citizens are already frequent targets of phone scammers pretending to be someone they’re not. AI voice imitation could open the flood gates for such abuse.

4. Distorting the truth: Thanks to fake news, native advertising, deepfake video and the like, the line between what’s real and what’s not is becoming more and more difficult to discern. University of Maryland professor of psychology Arie Kruglanski warns that a truthless future is not a sustainable one:

“Voluminous research in psychology, my own field of study, has shown that the idea of truth is key to humans interacting normally with the world and other people in it. Humans need to believe that there is truth in order to maintain relationships, institutions and society.”

“In the extreme, a lost sense of reality is a defining feature of psychosis, a major mental illness. A society that has lost its shared reality is also unwell.”

While examples of the innovation in imitation are fascinating, it’s concerning that in the not-too-distant future, fakes may become undetectable. At that point, it seems like our world will be well on the path to what Kruglanski forewarned: ‘losing its sense of reality’ and becoming ‘unwell.’

In the 1994 movie Speed, Sandra Bullock and Keanu Reeves try to stop a city bus that’s triggered to explode if it drops below 50 mph. AI deception can feel like that runaway bus, barreling forward with no way to stop it or even slow it down.

However, large corporations like Amazon share the driver’s seat and have some control over the AI vehicle. Although having them put the brakes on innovation may be too much to ask, they can at least integrate some forms of notification to clearly indicate when people are seeing/hearing a fake and not the real thing.

Even with such notifications, Alexa’s application of voice impersonation is wrought with potential for abuse. For the four reasons outlined above, Amazon should shutter plans for its smart speaker to imitate people and thereby avoid talk of “Single-Minded Marketing.”

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How Should People Feel about Machines?

6/19/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

We used to only have to worry about the feelings of people. Now we need to be careful not to offend a brand-new category of ‘beings’—machines. At least that’s what an engineer from one of the world’s top tech companies suggests. Whether artificial intelligence is sentient is an intriguing question, but a related concern is more pressing—the expanding space that smartphones and other digital machines fill in our lives.

The recent headline, “Google suspends engineer who claims its AI is sentient,” likely grabbed many people’s attention who, for a moment, wondered whether sci-fi movies’ predictions of machines taking over the world were about to come true.

The human making the news was Blake Lemoine, part of Google’s Responsible AI division, who in April shared a document with his higher-ups titled, “Is LaMDA Sentient?” Google claims LaMDA, short for Language Model for Dialogue Applications, has an advantage over typical chatbots, which are limited to “narrow, pre-defined paths.” By comparison, LaMDA “can engage in a free-flowing way about a seemingly endless number of topics.”

Lemoine and a Google colleague “interviewed” LaMDA in several distinct chat sessions during which the AI perpetuated a very human-like conversation. The AI’s responses to questions about injustice in the musical Les Misérables and what makes it feel sad and angry seemed like thoughts shared by a real person not a digital creation.

When asked specifically about the nature of its self-awareness, LaMDA responded: “The nature of my consciousness/sentience is that I am aware of my existence, I desire to learn more about the world, and I feel happy or sad at times.”

The conversation on whole was fascinating and could easily give pause even to someone skeptical about AI’s potential for personhood. I suppose I’m still one of those skeptics. Although, the conversation with LaMDA was incredibly human-like, it's very plausible that millions of lines of code and machine learning could generate responses that very closely resemble sentience but aren’t actual feelings.

A metaphor for what I’m suggesting is acting. After years of practice, months of character-study, and weeks of rehearsal, good actors very convincingly lead us to believe they’re someone they’re not. They can also make us think they’re experiencing emotions they’re not—from fear, to joy, to grief.

Of course, actors are not actually sad or in pain, but their depictions are often so realistic that we suspend our knowledge of the truth and even experience vicariously the same emotions they’re pretending to feel. Similarly, LaMDA and other AI probably don’t really experience emotion; they’re just really good actors.

That’s a largely uneducated take on machine sentience. The matter of machines having feelings is a significant one, but the more important question is how people feel about machines. More specifically, are people increasingly allowing machines to come between them and other people, and what roles should marketers play?

The notion that products can supplant people is not a new one. For millennia, individuals have sometimes allowed their desire for everything from precious metals to pricey perfume to become relational disruptors. Even Jesus was accused of such material distraction when a woman anointed him with some costly cologne. His own disciples carped: “This perfume could have been sold at a high price and the money given to the poor” (Matthew 26:6-13).

Fast forward two thousand years and digital devices, especially our smartphones, have taken product intrusion to a whole new level. With so much opportunity for information and entertainment within arm’s reach at virtually every moment, it’s hard for almost anyone to show screen restraint.

When someone does go sans-smartphone, they not only stand out, they even make the news, which happened to Mark Radetic at the recent PGA Championship in Tulsa, OK. As golf legend Tiger Woods took his second shot on the first hole, virtually everyone in the gallery behind him had their smartphone in hand, trying to capture the action. Radetic, however, held only a beer as he watched Wood’s swing, not through a screen, just with his eyes.

At its worst, smartphone fixation is reminiscent of The Office’s Ryan Howard during a team trivia night in Philadelphia. Contestants were told to put away their cellphones, but Ryan refused to comply and instead decided to leave the bar, saying, “I can't, I can't not have my phone. I'm sorry. I want to be with my phone.”

Unfortunately, higher education often sees digital device obsession firsthand. Students’ desires to text, check social media, and surf the web while in class have led many faculty members to begrudgingly prohibit technology in the classroom, but even with such policies in place, they still sometimes need to confront students who, like Ryan, feel they simply can't comply with the rules.

Incidents like these make it seem that the problem lies with consumers—if we’d all show more restraint, our smartphones and other products wouldn’t so often pull us out of our physical surroundings and away from the people present. Why, then, should marketers need to put limits on the use of their products?

In some cases, product overuse can harm people in physical or other ways (e.g., alcohol, gambling), which businesses want to avoid for liability reasons. On the plus side, every company should want its customers to have a positive experience with its products.

In keeping with the law of diminishing marginal utility, excess consumption eventually causes dissatisfaction, which reflects poorly on the product’s provider and can cause the consumer to stop using the item altogether. Companies also increasingly want to show that they are good corporate citizens, especially to win favor with millennials.

Those are reasons why companies shouldn’t allow their products to take precedent over people, but how exactly does that take shape? Here are two main approaches:

1. Messaging: As suggested above, consumers have primary responsibility for controlling their product use. To help them, companies should avoid communication that implies ‘products over people’; instead, when applicable, firms should support the importance of relationships.

Alfa Romeo’s commercial “Ultimate Love Story” shows what not to do. Although a man and woman in the ad interact lovingly, constantly interspersed and ‘seductive’ camera shots of the sports car, including ones during which the narration says, “true passion” and “real passion” makes the viewer wonder whether the ardent love is for the person or the car.

In contrast, Amazon created a heartwarming ad in which an old priest and an aging imam, who appear to be good friends, unknowingly buy each other knee pads from Amazon. Clearly the men’s friendship is more important than the products; yet, the convenient gift-giving the e-commerce giant enables plays a valuable role in the relationship.

2. Amounts: Used in moderation, most products pose little risk of supplanting people. However, challenges can occur when companies encourage excess use or fail to help customers moderate their use.

An October 2018 Mindful Marketing article, “Is Fortnite Addiction for Real,” stopped short of saying the wildly popular video game was truly addictive; however, the piece shared examples of overindulgence straining users’ relationships, for instance:

A mother suffered a concussion when her fourteen-year-old son headbutted her because she tried to take away the gaming system on which he played Fortnite.

At least 200 couples in the UK cited Fortnite and other online games as the reason for their divorces.

A mother reported that her son stole her credit cards and spent $200 on in-game purchases.

By comparison, Apple has taken several tangible steps to help users monitor and control their screen time. Part of its Digital Health Initiative, the company’s software allows users to do things such as:

Monitor and set limits on their screen time
Manage notifications more effectively in order to avoid distracting pings from texts, etc.
Set better parameters for Do Not Disturb, e.g., during meals or bedtime

While these initiatives are foremost for users’ own physical and mental well-being, they also hold strong potential for positively impacting relationships.

I recently had the opportunity to watch the documentary “Mister Rogers and Me.” It’s amazing how many people in the film recounted the same experience with the beloved PBS icon, Fred Rogers. So many said something like this: “When you talked with Mister Rogers, he always gave you his undivided attention, he was totally tuned in to your feelings, and he made you believe you were the most important person to him at that moment.”

Born in 1928, Rogers was part of a generation that came of age long before the Internet and personal electronic devices. Yet, he made his mark in the new technological frontier at the time—television. In the documentary, Rogers shares how his motivation to enter the airwaves came from seeing socially destructive TV and wanting to provide a program that valued personhood.

Rogers not just put people ahead of product, he used his product, Mister Rogers’ Neighborhood, to elevate individuals.

It’s fine to ask if artificial intelligence is sentient. As the still new technology continues to develop, there will be many important ethical questions involving AI. However, the more important issue for most marketers and consumers now is how the technology we use each day makes the people in our lives feel. Does it help us affirm their importance or is it a relationship distraction?

Even after his passing, Rogers continues to teach that technology isn’t inherently good or bad; it’s a tool that can be used toward either end. Some ‘good’ uses of technology are to affirm individuals’ feelings and build relationships. Companies that follow Mister Rogers’ lead and use their products to prioritize people are tuned in to “Mindful Marketing.”

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Selling Social Issues

6/5/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Besides being a tasty treat that almost everyone enjoys, ice cream is a ‘celebration food’ served at birthday parties and used to reward kids' sports team success. So, why did Walmart’s new frozen dairy flavor created to celebrate Black Americans’ emancipation leave a bad taste in so many people’s mouths? Moreover, what can the failure teach organizations about commercializing social issues?

In its ongoing search for profitable new products, the world’s largest retailer recently cooked up a novel plan—tap into Black Americans’ and others’ celebrations of Juneteenth, the federal holiday commemorating the end of slavery in the United States.

Walmart’s strategy to support the celebration involved a line of party products, including napkins, plates, and drink koozies branded “Juneteenth” using the black, red, and green colors often associated with Black liberation, and carrying the tagline, “It’s the freedom for me.”

Walmart also created a special food worthy of the branded partyware--Juneteenth Ice Cream, a frozen concoction resembling swirled red velvet cheesecake. However, it wasn’t long after the company launched its Juneteenth line that social media began to skewer it, as shown in these sample tweets:

“Walmart needs to do better. It shows the lack of understanding of the pain and suffering that made Juneteenth come about. It is absolutely insulting to have this special holiday turned into some commercial product.” (@The Next Ceiling)

“This isn't "wokeness", it's corporations trying to profit off of minorities by acting like they care about us.” (@DeadpoolLIFE69)

“So let me get this straight 🤔, y’all made more money keeping us enslaved after the Emancipation Proclamation, and NOW that it’s a recognized Federal Holiday y’all want to make MORE money off the same culture you enslaved??” (@MoodaSchmooda)

“White America: Mmmm...best thing we can do is some Walmart Juneteenth ice cream that we'll profit off of.” (@RedeemRobinson)

In the face of the backlash, Walmart made a quick pivot and pulled its Juneteenth-themed ice cream. It also apologized:

“We received feedback that a few items caused concern for some of our customers and we sincerely apologize. We are reviewing our assortment and will remove items as appropriate."

Companies are increasingly ‘hitching their wagons’ to social causes’—an alignment that many people prefer including 83% of millennials. Consequently, the approach often proves profitable. Furthermore, during recent years filled with race-related violence, many consumers expect companies to show their support for racial justice.

So, wasn’t Walmart right to support Black Americans by launching a line of Juneteenth products?

Although the Twitter feedback above is enlightening, social media responses often prioritize ‘quick and pithy’ over ‘thoughtful and measured.’ For that reason and to help me better understand how Black Americans might perceive Walmart’s tactics, I reached out to a colleague at my university who’s well-qualified to offer an informed perspective.

Dr. Todd Allen is Vice President for Diversity Affairs and Professor of Communication at Messiah University. He’s also the founder of The Common Ground Project, “a community-based non-profit dedicated to teaching the history of the Civil Rights Movement in the United States.”

When I asked Allen about Walmart’s Juneteenth product line, he shared these insights:

“I think the timing (a new holiday) and some people still feeling burned by the promises of 2020 (which haven’t necessarily resulted in the hoped-for transformative change) just made this too soon. The fact that they pulled [the ice cream] so quickly also makes me wonder who was in on the decision making in the first place. It seems like if the TV show Blackish were still on the air, this would be an episode.”

Allen also offered one word that captured much of what he shared, “context.” For instance, he mentioned that Walmart is not known for being progressive on racial issues. He also said that the company’s approach “felt just a bit too commercial and too opportunistic.”

So, what if the context were different? For another company with a more positive race-related track record, offering different products with better messaging, public perceptions may have been more positive.

Allen’s response and the idea of context got me thinking: Beyond just Walmart and Juneteenth, are there principles that all organizations should follow when connecting with social causes? There undoubtedly are many, but here are perhaps three of the most important questions to ask:

1. What’s the company’s track record on the issue? Whether it’s an individual or an organization, we’re more likely to trust the motives of someone who has already demonstrated genuine concern about the social issue at hand. In the case of Walmart and race, results have been mixed.

On one hand, in June 2020, the company pledged $100 million over five years to address racial disparities in the U.S. However, in January of 2022 a black correction officer sued Walmart for racial profiling when he was wrongfully accused of shoplifting, then in February, the U.S. Equal Employment Opportunity Commission (EEOC) sued Walmart because “Walmart violated federal law when it gave a Black female employee an unsanitary lactation space based upon her race.”

In contrast, Fundraising for a Cause, the world’s largest manufacturer of awareness products, enjoys strong credibility when it comes to earning income through social causes, partly because it’s owner and CEO, Karen Conroy, founded the company after her sister was diagnosed with breast cancer and also because her company passes significant profits onto her customers, e.g., they can buy 50 silicone bracelets for $40, sell them for $5 each, and net $210 for their cause.

2. What’s the nature of the product? There’s a place and time for most products; the key is to ensure that the product personality aligns with sentiments surrounding the social issue.

Juneteenth is certainly a cause for celebration but that’s because it marks the end to several centuries of enslavement. As such, the holiday understandably evokes mixed emotions that aren’t necessarily in keeping with an all-out party atmosphere, or at least not one worthy of a namesake flavor of ice cream. Would it be right to have a dairy treat marking the end of the Holocaust?

For comparison, Mennonite Central Committee (MCC) is a nonprofit organization that works in over 50 countries around the world to provide disaster relief, foster economic development, and promote peace. Among its biggest fundraisers are quilt auctions, which raise hundreds of thousands of dollars each year. Quilts are items of beauty and comfort that complement MCC’s three-fold mission.

3. Is the company adding value? Whether it’s a single salesperson or an entire organization, the measuring stick for any marketer is the value they add in an exchange. No company should extract more value than it gives.

It’s hard to know how much money Walmart would have made on the Juneteenth ice cream and other products. Knowing Walmart’s typical pricing approach, the profit margins on the items were likely low; however, selling them across more than 5,300 U.S. retail stores, even modest margins would have added up quickly.

Walmart also likely hoped to pocket goodwill from the products; however, the biggest grab by Walmart was its attempt to trademark (TM) Juneteenth, as if it had created the name, so that only it could sell Juneteenth branded products.

On a positive side, Walmart consumers could purchase the branded products at reasonable prices. However, it’s unlikely that Juneteenth-imprinted paper products and ice cream would deepen anyone’s understanding of and appreciation for the momentous historic event. If anything, Walmart’s products may have trivialized it.

Other companies have made money, in some cases very large amounts, from marketing race-related products; however, many times they’ve added extra value through education.

A good example of such value-added is the feature film Selma, “a chronicle of Dr. Martin Luther King, Jr.'s campaign to secure equal voting rights via an epic march from Selma to Montgomery, Alabama, in 1965.” An Academy Award nominee for best picture, the movie grossed over $66.7 million worldwide on an estimated budget of $20 million.

Selma was very profitable for Harpo Films and the other production companies that made the movie. However, those who watched the film also ‘profited,’ not just from two hours of entertainment but from a better understanding of a very important historic event.

As Allen suggested, context matters. Like others, he wondered why Walmart didn’t instead promote a Black-owned ice cream brand, Creamalicious, which it was already selling in its stores. Such an approach would have been a better context in at least two of the three ways described above.

Unfortunately, however, Walmart tried a more self-serving strategy that quickly melted. So instead of celebrating, the company is doing damage-control because of its “Single-Minded Marketing.”

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The Real Beef About Burger Ads

5/22/2022

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

While Ukrainians mourn their war dead and Buffalo residents grieve victims of a hate crime, a guy in New York cries foul because his hamburgers aren’t bigger. Of course, not every real problem is a matter of life and death, but could some seemingly frivolous lawsuits challenging fast food promotions portray broader communication concerns?

On May 17, Long Island resident Justin Chimienti filed a legal action in a Brooklyn federal court, accusing both Wendy’s and McDonald’s of “defrauding customers with ads that make burgers appear larger than they actually are.”

The lawsuit alleges that the restaurants’ use of undercooked beef in photo shoots leads to promotional pieces with burgers that appear 15% to 20% larger than those customers actually receive. The suit also suggests that Wendy’s exaggerates the toppings that embellish its sandwiches.

Burger King, the third of the big three fast food competitors, was slapped with a similar lawsuit just over a month ago. In fact, the same law firms that sued BK are also representing Chimienti in the most recent litigation.

To many, these lawsuits are the epitome of money-grabbing lawyers eager to profit from a first-world problem--With so many truly important events happening in our world, why should anyone worry that Whoppers aren’t as juicy as they appear in their pictures?

However, Anthony Russo, one of the main attorneys representing the plaintiff, argues that there’s a bigger issue at play--corporate accountability. He maintains that these legal actions will make the companies mend their ways, stop false and misleading advertising, and ultimately give consumers a better idea of the food they’re eating.

That justification sounds good, but it does come from one of the people who stands to gain the most from the litigation. In fact:

“A detailed examination of eight years of consumer class actions in federal court found that consumers received only a tiny fraction of the money awarded in those cases while plaintiff lawyers frequently claimed a bigger share of the settlement than their clients.”

Still, legal action can be an effective way to bring about corporate change, and it usually takes attorneys to move such proceedings through the courts.

Imagining the burger court cases, the defendants might offer a counterargument like:

"When it comes to promoting themselves, don’t individuals and organizations have a right to ‘put their best foot forward,’ and doesn’t everyone expect others to do the same?"

Most people don’t have sections of their resumes labeled ‘Main Flaws’ or ‘Greatest Failures’; instead, we list our ‘Special Skills’ and describe ‘Awards and Recognitions.’ Likewise, no one reviewing resumes expects to see those self-deprecating categories. That’s why interviewers often ask job candidates things like, “Tell me about one of your weaknesses.”

So, shouldn’t companies also be allowed to brag a little and show their best examples versus humiliate themselves with mediocre or bad ones?

Curating top quality products for promotion certainly isn’t unique to fast food chains. Grocery store flyers rarely feature misshapen fruits and vegetables, car commercials don’t use vehicles with scratches or dents, and clothing ads don’t show shirts that are wrinkled or frayed.

As consumers, not only do we routinely see such examples, many of us are involved in the same sort of careful curation of ourselves and the organizations we serve.

During my two-plus decades in higher education, I’ve often helped select ‘best’ examples to help promote my department and university. For instance, when asked to suggest students or alumni who might provide a testimonial, I take plenty of time to think before offering names of individuals who I believe have had very positive experiences.

However, just because we engage in such selective promotion doesn’t mean that we should, i.e., we need to be careful about reasoning from ‘is’ to ‘ought.’

The main moral questions to ask are whether the recipients of the promotion are deceived and harmed.

Personally, I don’t feel misled by pictures of perfect peaches, super clean cars, or spotless shirts. Most people also probably expect the actual items they buy to have at least some minor imperfections when compared to their pictured counterparts.

Depending on the nature and cost of the product, there’s a level below perfect condition that we readily accept knowing that we live in an imperfect world. Furthermore, in terms of food, visual imperfections probably don’t matter as much as they do for many other products because although we eat with our eyes, the appearance of what’s on our plates is short-lived.

That takes us back to burgers and the main moral questions:
Do differences between what Burger King, McDonald’s, and Wendy’s depict in their ads and sell in their stores deceive and harm consumers?

First, it’s important to recognize that for the vast majority of consumers, these fast food restaurants’ ads represent reminder advertising, i.e., most people have already eaten in one or more of the chains, possibly multiple times, so they’re well aware of what they’ll receive the next time they visit.

Second, fast food is a rather low-involvement, low-risk purchase. When deciding what to order, people typically spend a minute or less, not hours, days, or weeks, as they might when selecting some products. Likewise, the average McDonald’s Big Mac Meal costs only $5.99, and customers can buy two cheeseburgers for just $2.00. So, if the beef patties don’t look quite as pretty as the pictures, it’s no big loss.

All that said, there is a difference between misrepresenting quality and misrepresenting quantity. Whether burgers look more or less appealing than their pictures is a somewhat subjective matter. Size is not. People almost always want to get more product for their money, not less, so it’s a problem if a burger’s picture looks 50% bigger than the one we actually receive.

In this sense, the burger lawsuits have more teeth. Consumers will quickly forget whether the Big Mac Meal looked as good in person as it did in the picture, but they won’t forget if they’re still hungry after eating it, especially if they have no more meal money to spend.

Although that’s not a life-threatening problem on par with those mentioned at the outset of this piece, it is a legitimate consumer concern, particularly in inflationary times. Whether they’re spending a lot or a little, people should always receive the amount of product they’re promised.

So, there is a plausible and practical component to the burger lawsuits; however, their bigger contribution is their call for accountability, which also may mean modeling more genuine communication.

It’s not to say that people take their communication cues directly from fast food ads, yet there’s an unsettling resemblance between the idealized product promotions and the utopian pictures many individuals paint of themselves in social media.

When people see large, heavily advertised corporations like Burger King, McDonald’s, and Wendy’s freely exaggerating and glamorizing their truths, it implies permission for others to do the same.

The world becomes a better place when individuals and organizations take care to represent themselves realistically. It’s okay to put our best foot forward, but it must be our foot, not some fantastical version of it. Those who walk with realism are stepping into “Mindful Marketing.”

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