Category: + Fairness

Selling Social Issues

6/5/2022

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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Is Netflix Content 'Good Enough'?

4/23/2022

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

How old were you when you made your first solo shopping trip? If you’re a Boomer, Gen X, or Gen Z, your answer might be 8, 12, or even 18. Japanese youth apparently run errands much earlier—as in age two—to the amazement of many Americans who are now streaming the cultural curiosity. Whether toddlers should be by themselves on road-trips is a worthy question, as is why people a half-world away are watching a decade-old television show.

From ‘Stanger Things,’ to ‘Bridgrton,’ to ‘Squid Game,’ tastes for Netflix series change like the seasons. Now, one of the streaming giant’s popular properties is an unlikely reality series that comes courtesy of East Asia and the 1990s.

‘Old Enough!’ is a documentary-style television program in which Japanese parents send their toddlers on their first independent errands. Camera crews capture the highly cute and often humorous action, while witty narration added in editing gives viewers a window into what the tots may have been thinking at the time of their adventures.

In light of today’s often hovering helicopter parents, it’s refreshing to see young people given real responsibilities and freedom to act independently. However, it’s also kind of unnerving to watch a kid, who’s still wearing diapers, wander by himself more than a half mile to a grocery store to pick up ingredients for dinner.

In terms of social skills, these parents are placing their children far ahead on the developmental curve. Given what these kids are doing under age four, there’s no telling what they’ll be capable of by the time they’re 10 or 20 . . . if they live that long!

In terms of safety, there’s likely little danger to the children. Camera crews are filming them the entire time, so in some sense they’re safer during shooting than they may be any other day. However, no camera operator could intervene in time if a three-year-old suddenly skipped off the sidewalk, into the path of a moving vehicle.

Another issue to consider any time children are placed in media roles is informed consent. How can a child under the age of five possibly understand what they’re doing: the risks they’re incurring at the time and the implications their ‘celebrity’ may bring in the future? Most fathers and mothers pursue their children’s best interest; yet there are always unfortunate cases in which parents become blinded by their offspring’s potential popularity and prosperity and intentionally place them in harm’s way.

This potential may be even more of a concern in today’s social media infatuated society. Now any parent with a smartphone can capture their child doing ‘something special’ and broadcast the clips or stills to anyone in the world.

All the above are real moral concerns; however, it’s hard to paint ‘Old Enough!’ as irresponsible entertainment. Most parents who aggressively promote and profit from their children probably have never seen the show. Also, given the series’ longevity and apparent track record of ‘safe success,’ the show seems like acceptable diversion.

So, back to the second question posed at the outset of this piece: Why have so many Americans suddenly been smitten by a decade-old Japanese documentary featuring toddlers running errands? ‘Seinfeld’s George Costanza’s gave a reason for watching ‘a show about nothing’ that may help answer the question: “because it’s on TV.”

Of course, there’s sarcasm in that answer, but there’s also truth. Although the increasingly competitive streaming market is saturated with shows, after spending 18 months or more homebound in a pandemic, many people feel they’ve already seen everything worth watching on Netflix, which has left the company scrambling for new content—scouring space and time for entertainment that will keep people from unsubscribing.

Speaking of subscriptions, during the first quarter of 2022, Netflix lost 200,000 subscribers and even more staggering, it expects to lose 2 million more by July—an announcement that has precipitated a decline in the company’s stock price of more than 30%.

During video rental era and in the early years of streaming, competitors had largely the same video libraries, so cost and convenience were key to attracting customers. Now content is the most important differentiator, as evidenced by the rapid rise of relatively new competitor Disney+, which has ridden the popularity of proprietary shows like ‘The Mandalorian,’ ‘The Beatles: Get Back,’ and a long list of Disney movies.

Netflix needs original content. Over the past five-to-seven years, it’s certainly had success creating content, but subscribers burned through that content with a flurry of pandemic-prompted binge-watching. Creating compelling original content takes considerable time, money, and expertise, but even then, there are no guarantees it will be well-received.

These reasons are likely why Netflix acquired the streaming rights for ‘Old Enough!’—a show the company could make available immediately to a subscriber base that, by and large, had never seen it, but would find it at least a little entertaining, since reality TV still resonates and people like cute kids.

Netflix also probably didn’t overpay for those rights. True to the show’s name, the 20 episodes now on Netflix were produced in 2013, nearly a decade ago, giving ‘Old Enough!’ a double meaning and likely meaning that the series was a bargain. Unfortunately, inexpensive does not necessarily mean good.

My wife and I are not representative of all Netflix subscribers, but after watching three episodes of the grocery-toting toddlers, we had our fill. The children were cute, and the scenarios were kind of funny, but reading the subtitles made the entertainment feel a little like work. Even though a fourth episode promised a different kid in a unique situation, it didn’t seem like we’d really see anything new.

Perhaps ‘Old Enough!’ has outperformed Netflix executives’ expectations. Still, the show can’t be more than a bandage on the company’s expanding wound of subscriber attrition, which will only be healed by a more drastic strategic prescription.

Interestingly, Netflix is now looking to incorporate advertising. Such sponsorships could help contain, if not lower, the cost of the platform; however, people won’t stay subscribed just because rates don’t rise, any more than they'll watch shows ‘just because they’re on TV.’ Subscribers of any streaming service must believe there’s enough new, engaging content to warrant whatever amount they’re paying.

There are no serious moral concerns over a show about toddlers ‘doing nothing,’ but there’s also little economic upside for a streaming giant that desperately needs more compelling original content. For these reasons, Netflix’s ‘Old Enough!’ is good enough to be “Simple-Minded Marketing.”

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Recognizing 'Kid Concerns'

3/11/2022

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

What worried you as a child? Maybe it was not having friends at your lunch table or embarrassing yourself in PE class. For kids, those are real concerns. Of course, they pale in comparison to adult anxieties, like deciding who to marry or how to make the next mortgage payment.

Images of war in Ukraine, including bombed buildings, fractured families, and bloodied bodies have made us realize that our daily worries are ‘kid concerns’ compared to the existential threats Ukrainians face. Paying more to fill our cars' gas tanks is nothing next to the calamities those in Ukraine are enduring.

Businesses, however, have a much wider range of concerns than individuals do. Unlike you and me, they need to navigate the complexities of supplying products, making payroll, and paying dividends. For the world's largest organizations, customers, employees, and shareholders number in the millions.

Despite these very real stakeholder obligations, a growing list of 300+ multinational corporations have decided to cease operations in/with Russia. Among the notable are Apple, Amazon, Coca-Cola, Disney, Exxon, FedEx, Goldman Sachs, Ikea, KPMG, Mastercard, McDonald’s, Nestlé, Netflix, Nike, Pepsi, Procter & Gamble, Samsung, Shell, Starbucks, Toyota, UPS, Visa, and Volkswagen.

It’s no small thing to curtail commerce with Russia. With a population of 145.9 billion, it’s the ninth most populous nation in the world. For instance, 4.5% of McDonald’s 2021 revenue, and 4% of Pepsi’s, came from Russia. Those percentages may seem small, but for companies with sales of $23.3 billion and $79.4 billion, respectively, those are hits of over $1 billion and $3 billion for each firm.

Although, it’s become increasingly popular to spurn Russia, is it fiscally prudent and morally right for companies to do so, given their multifaceted stakeholder obligations, not to mention the notion that withholding Big Macs and Pepsi is unlikely to deter Vladimir Putin from his geopolitical goals. Some may even argue that with so many competitors closing shop in Russia, it’s a good time to gain market share.

So, why should McDonald’s, Pepsi, or any of the other 300+ economic objectors bother to boycott Russia?

It’s because, even though many of these corporations have revenues that exceed the GDPs of entire nations, the current crisis is bigger than any company. These companies’ self-interests are certainly real, but they’re ‘kid concerns’ compared to what’s happening in the world now and where it could lead.

It’s hard to imagine how any individual or organizational benefits could outweigh the death and destruction Russia is enacting on Ukraine. What’s more, it’s possible that this unprovoked infringement on one nation’s sovereignty may only be the beginning.

Given Putin's past comments, it’s possible that other former Soviet republics are on deck for annexation. There’s also speculation that China is carefully weighing other nations’ responses to the war in order to assess its potential for taking Taiwan.

Many believe that Ukraine’s fight for freedom foreshadows a much bigger battle for democracy. Given the gravity and plausibility of that prediction, it’s difficult to understand how a company could put limited and likely short-term losses ahead of civil liberties and self-determination for potentially billions of people, for possibly centuries to come.

Yet, some companies still aren’t taking a stand against Russia’s aggression. As of this writing, “companies that remain in Russia with significant exposure” include: Bridgestone Tire, Cargill, Caterpillar, Citi, Deere, Hilton, Hyatt, Kimberly Clark, Marriott, Mondelez, and Whirlpool.

Perhaps some of these organizations are still planning to act, they just need more time to execute their exits. Hopefully, none are thinking that their absence in Russia won’t make a difference, as it most certainly will.

Because of tightly controlled media, the Russian people can’t see the devastation their country is inflicting on its neighbor. What they will notice, though, are unavailable products, closed stores, and lost jobs, as well as a ransacked ruble.

Although unfortunate, that sudden economic distress will cause Russians to question what’s happening and why. Eventually, the truth will spread beyond the thousands who already know the ugly reality and have courageously protested the incursion.

As abhorrent as the currently conflict is, hopefully a positive outcome will be a new recognition of companies’ collective abilities to stand down aggression and precipitate peace. There are times when the most helpful thing marketers can do is not market.

We all have legitimate responsibilities to ourselves and others. We all also must recognize when larger societal concerns should supersede those smaller self-interests. Such self-awareness is a prerequisite for “Mindful Marketing.”

Here are 11 verified charities to support Ukrainians.

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Marketing Ideology

2/27/2022

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

Principles of marketing professors teach that “products” are more than tangible goods; they’re also services and ideas. While it’s easy to identify organizations marketing goods and services, noticing idea marketing takes more discernment. Recently, the world witnessed one of the most blatant examples of idea marketing ever. It worked but unfortunately not for good.

In the annals of persuasion, one of the hardest ‘sales’ must be convincing one’s country to start a war, given the likelihood of loss of life, property, political allies, and more. In persuading Russia to invade Ukraine, Vladimir Putin, achieved such a seduction, while providing an example of idea marketing at its worst.

Of course, Russia’s largely autocratic regime doesn’t require the consensus-building demanded in a democratic state. Still, Putin was undeniably successful in marketing a momentous idea by convincing other government officials, military leaders, and to some extent the Russian populace to embrace the notion that invading Ukraine served a national security interest while accomplishing historically based cultural and ethnic reunification.

Mindful Marketing rarely tackles politics. I’m addressing this situation not just because it’s a poignant example of idea marketing but because of its significant human and economic impact, as well as its potential to become one of history’s biggest geopolitical events.

Russia’s incursion into Ukraine is also personal for me. Both of my wife’s parents were born in Ukraine, where they endured extreme hardships during WWII. Consequently, my wife and our children share Ukraine’s rich cultural heritage by birth, as I do by marriage.

The necklace in the picture above is my wife's tryzub, which her father brought back for her from one of his many return visits to his homeland.

Of course, millions of others also have personal connections. In fact, as I was writing this article, I read a post by one of my LinkedIn connections, Cait Mack who wrote:

“This has been one of the worst days of my life. The war in Ukraine feels like it’s pulling at the very fiber of my being. For those who don’t know, I’m Ukrainian. My grandparents came over during WW2, fleeing from Nazis. I am sick with grief. Everything feels so stupid and trivial in comparison to what’s going on over there.”

“I think of my grandparents. Our extended family in Ukraine. All the innocent people. The parents with their children. The harsh reminder that we can’t really keep our families safe.”

As Mack mentions, the secondhand angst that any of us feel can’t compare to the fear and horror that those in Ukraine are experiencing, which reminds me of the focus of this piece—Putin marketing the idea of invasion.

**Rather than commending his cunning, the intent here is to extract something edifying from the unfolding tragedy—to identify how individuals and organizations should market ideas responsibly.

Autocratic leaders have the advantage of superior political power. Marketers enjoy information superiority, i.e., they naturally know more about their organization and its products than do consumers.

Because of their very intangible nature, the information imbalance involving ideas becomes even more skewed, which means marketers are under even greater moral compulsion to carefully steward their influence on the conceptions of others. The following are five steps toward marketing ideas responsibly:

1. Seek Understanding**
It’s hard to understand when uninformed, which is why the first act in understanding is gaining information by researching the issue at hand and, above all, listening to those closest to it.

Courtroom dramas sometimes culminate with an attorney introducing a new witness or piece of evidence, which unexpectedly changes the minds of jurors. Such are likely violations of legal discovery, but the examples are helpful reminders that additional and possibly more accurate information can help change our minds for the better.

2. Explore Other Perspectives
As implied above, it’s helpful to lean on others, not just because they can provide additional facts but because they might offer their own experienced and informed interpretation of the information. Whether at the boardroom level or shop floor level, the best leaders always avail themselves of others’ insights.

It sometimes seems that people avoid other perspectives, fearing they’ll change their opinions. That may happen, which is not necessarily a bad thing. However, seeking others’ perspectives is often like a fan who's loyal to a certain football team watching two other teams play. Watching them will probably not change the fan’s team loyalty, but they may see in the other teams things that enhance their understanding of the game, as well as things their team does well or could do better.

3. Present a Rational Argument
People can be persuaded in different ways, including by deception (painting an inaccurate picture of facts) and coercion (compelling an action from a position of power). Neither of these alternatives allows people to exercise informed consent, or freely choose to adopt an idea based on its logical merits.

Although we occasionally act otherwise, people are rational beings who can understand and make sensible decisions based on logical arguments. Even young children comprehend reason—‘If you eat your whole meal, you’ll get to have dessert.’ People of any age deserve clear, logical, communication.

4. Don’t Play on Emotion
However, humans aren’t simply rational beings. Our complex psychology also includes emotion, which makes us even more interesting. Yes, we should make most decisions by reasoning with objective information, but sometimes it’s appropriate for people to choose things that they enjoy or that make them happy, like playing a favorite game with a friend.

What’s unacceptable is to use others’ emotions against them, e.g., to persuade them to do something out of an irrational fear or a sense of guilt. Although good in moderation, too much emotion can cloud people’s thinking and cause them to do things that they otherwise would not rationally choose. The outcome is like a doctor tapping a patient’s knee with a reflex hammer: Their leg will move involuntarily no matter how much the patient may reason that it shouldn’t.

5. Be Truthful
The fifth act encapsulates the preceding ones and should go without saying; however, even when people fulfill the first four steps, they still must ensure follow-through of this final one, particularly to avoid selective presentation of facts.

For example, I could support the morality of advertising by referencing Gallup’s annual poll about the honesty and ethics of various occupations and accurately report that advertising practitioners ranked in the top 20 of all occupations. That may sound impressive, but the statement would be misleading because the survey only asked about 22 occupations and advertising practitioners ranked 18th.

What we don’t tell people is often as important as what we tell them.

Again, the point of this piece has not been to detail Putin’s tenuous argument for the invasion of Ukraine; however, this website, among others, provides a window into how his rationalization evolved. In short, Putin appears to have violated more than one of the preceding five steps; for instance, he played on his own people’s emotion with a “rousing speech” in which he called Ukraine a U.S. colony ruled by a “puppet regime.”

From my own reading and experience, Putin’s biggest breach of the steps of responsible influence has been of #5, by being untruthful, particularly with respect to his denial of Ukraine’s historic statehood and his claim that Russians and Ukrainians ‘are one people.’

Soon after my wife and I started dating, I learned two important facts involving her family’s ethnic heritage. First, the nation is not “the Ukraine;” it’s “Ukraine.” Adding the definite article “the” diminishes the country’s stature to that of a territory or colony, (e.g., the Louisiana Territory, the Yukon), which Putin directly suggested in his “rousing speech” referenced above.

Second, my wife’s family and their friends frequently reinforced that ‘Ukrainians are not Russians.’ I experienced firsthand that Ukrainians have a unique language, history, food, customs, and other rich cultural distinctives that distinguish them from their homeland’s northern neighbor.

My evidence spans more than three decades, but it is personal and, therefore, anecdotal. The most compelling proof of Putin’s misinformation is, regrettably, what’s happened during the invasion, as a 2/26 New York Times Breaking News headline read, “Ukraine, outmanned and outgunned, has slowed Russia's advance on Kyiv and two other cities as its forces wage a ferocious resistance.”

If Ukraine were just a Russian territory, if the majority of Ukrainians wanted unification with Russia, and if Ukrainians and Russians were one people, why are so many Ukrainians valiantly fighting and giving their lives to stop the invasion and maintain their nation’s sovereignty?

The disconnect stems from a lack of truthfulness, which many of Putin’s own people have recognized, hence widespread protests by Russians against the “war without a cause.”

Tragically Putin was effective in selling the idea of invasion to some, at the cost of many lives and the freedom of a peaceful people. That underlying deception and unimaginable destruction makes his strategy the worst example “Single-Minded Marketing.”

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Should Social Responsibility be Selfless?

1/16/2022

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

While people gave gifts to loved ones last month, the world’s largest pizza chain was providing presents to some very surprised recipients—other restaurants. True, “it is more blessed to give than to receive,” but was Domino’s philanthropy actually aimed at putting itself on the receiving side?

As you may have seen in the 60-second spot from its feel-good campaign, Domino’s bought over $100,000 in gift cards from local restaurants and gave them to its own customers.

It doesn’t take much business background to know that the goal of an enterprise is to build market share for itself, not competitors. Even Vickie Corder, one of the restaurant owners who appeared in Domino’s commercial, was astonished by the action: “I can’t believe one restaurant is buying another restaurant’s gift certificates.”

Why would Domino’s want to support its competitors’ sales by buying their gift cards, and even worse, giving them to its own customers, making them less likely to buy Domino’s pizza? Some of the ad text suggests an altruistic reason: “Domino’s wants to help the people and restaurants in our local communities.”

One might take that explanation at face value. After all, the firm did fork over $100,000. However, for a company with annual revenues of $4.37 billion and operating income of $801 million, $100,000 is immaterial. There’s also some understandable skepticism--Why haven’t we heard before of Domino’s feelings of responsibility for other restaurants?

Instead, some of the chain’s social responsibility has looked more like ‘marketing gimmicks,’ such as its “Paving for Pizza” program, aimed at filling potential pizza-delivery-wrecking potholes, and its “carryout insurance,” guaranteeing free replacements for customers who inadvertently fumbled their pies.

The vast majority of people probably never had a poor pizza experience resulting from either of those issues and never will, so it’s realistic to suggest that in both instances Domino’s was making much ado about nothing, positioning for the free publicity that each unconventional campaign elicited. So, is gifting other restaurant’s gift cards just another attempt to gain exposure through oddity?

The gift card campaign certainly seems like it could be another gimmick; yet, there are some notable differences, namely that COVID has put unprecedented pressure on restaurants, causing many to shutter their doors permanently. In fact, Domino’s commercial mentions that “over 110,000 U.S. restaurants have closed since March 2020.”

That to say, unlike the exaggerated ideas of potholes pummeling delivery vehicles and consumers carelessly dropping carryout orders, the pandemic’s negative impact on restaurants has, unfortunately, been very real.

The ad also mentions a related phenomenon that COVID didn’t cause but did increase: the use of third-party delivery companies. During the height of the pandemic when most restaurants’ sit-down dining was paused, more and more people started getting restaurant food delivered to their homes and offices by providers like Grubhub, Uber Eats, and DoorDash.

Although selling food, whether for dine-in or delivery, seems like a good thing for restaurants, apparently the math doesn’t work well when third-party delivery companies are involved. Irene Li, another restaurant owner interviewed in Domino’s ad, affirms the profit predicament: “[Third-party delivery fees] take a huge chunk of our bottom line; all of that comes out of our pocket and goes to them.”

Others have echoed her concern, including NPR, which reported that apps often charge commissions of 17% or more, in addition to delivery fees. Likewise, the LA Times found that one local restaurant paid $35,000, or roughly a third of its annual rent, in delivery fees, which led the Times to recommend, “The next time you order takeout, call the restaurant [directly].”

Domino’s suggestion that delivery apps wreak havoc on restaurants’ bottom-lines is on-point; however, the pizza chain is also very well-known for doing its own deliveries. Does that mean that Domino’s is selflessly looking out for others? Not exactly.

Apparently, some of the many people who have grown accustomed to the third-party apps for food delivery have also used them to place orders for pizza, doing to Domino’s the same fiscal damage described above. In fact, another Domino’s ad has suggested such delivery difficulties, warning consumers that third party delivery firms charge “surprise fees,” but it will reward certain loyal customers who use its app with “surprise frees,” or, free food.”

Likewise, during an interview on CNBC’s Mad Money, Domino’s President and CEO Ritch Allision suggested that third-party delivery apps have, to some extent, stunted the company’s growth.

All this to say, by buying and giving away other restaurants’ gift cards, Domino’s has brought added attention to an issue that doesn’t just hurt its local restaurant competitors. It also bruises Domino’s own bottom line.

The question, then, becomes, Is it right for Domino’s to help itself while helping others?

Before considering the ethics of this query, it’s worth noting that Domino’s strategy does seem to be effective marketing. The unconventional approach gains attention, and the corporate social responsibility builds goodwill.

What’s more, because delivery is both the focus of the ad and a key component of the company’s value proposition, the promotion is more meaningful and memorable. When people consider Domino’s brand, the company wants them to think of food delivery, which the commercial accomplishes.

So, what about the marketing’s morality? One consideration could be the amount Domino’s spent on the gift cards ($100K+) versus how much it’s paid for the ads. Excluding production expenses, U.S. television broadcasting costs alone, average about $115,000 per 30-second spot, which means the campaign’s promotional budget certainly far exceeded the value of the gift cards.

The extreme imbalance may make some rightly question the company’s motives. Although Domino’s franchisees did assume some risk by giving other restaurant’s gift cards to their own customers, most people who eat out probably patronize multiple restaurants, making it unlikely that Domino’s lost business. In fact, free gift cards may have led some of their recipients to reciprocate by buying more pizza.

All said, it’ hard to paint Domino’s promotion as selfless: The company benefited from the tactics as did the other restaurants and those who scored the free gift cards. So, is such mutual benefit problematic?

Most business exchanges result in win-win outcomes. From the clothes we wear to the computers on which we type, we’re usually very glad we have those products and not the money we paid for them. Meanwhile, the marketers are grateful for our money and don’t want back their products.

Mutually beneficial exchange, in commercial and noncommercial contexts, is a very good thing. Some may argue that such a philosophy shouldn’t extend to corporate social responsibility, but why not?

Several years ago, two colleagues and I conducted research in which we identified three unique types of corporate social responsibility: donation, volunteerism, and operational integration. In the study we affirmed that helping others was very good, but implementing philanthropic acts that simultaneously furthered the economic goals of the organization was even better. The positive response to this article and another like it suggests that many others share the same viewpoint.

The reality outside business isn’t much different. When individuals give of their time, money, etc., benevolence in some form usually comes back to them. The stories found in the Go Giver artfully describe that phenomenon.

Domino’s did a good thing by buying and giving away other restaurants’ gift cards. Although it wasn’t a major act of corporate social responsibility, it was a meaningful one. The fact that the philanthropy also benefited the pizza chain, doesn’t stop the strategy from being "Mindful Marketing."

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Are Apple AirTags Too Risky?

12/19/2021

4 Comments

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

Most of us played ‘tag’ as a kid and loved the simple thrill of chasing others around and trying not to get tagged. Thanks to Apple’s advanced tech, the game has graduated to adulthood; however, criminals are increasingly “it, ” and the stakes are much higher for those being chased.

So, if you’re wondering what to buy for that childhood friend-turned-felon this holiday season, Apple has the perfect present: AirTags--The gift that keeps on taking. This dark humor aims to underscore some disturbing news: More criminals are finding that AirTags are a convenient way to pilfer the valuable property of others or even worse, to stalk people.

Apple introduced the small electronic tracking devices this past April to help individuals more easily locate products they’re apt to misplace like keys and bags. The company’s website explains how the 1.26” diameter tags work:

“Your AirTag sends out a secure Bluetooth signal that can be detected by nearby devices in the Find My network. These devices send the location of your AirTag to iCloud — then you can go to the Find My app and see it on a map.”

Given that this location system leverages a vast network of strangers’ devices, Apple has made privacy a top priority. The company ensures that only the AirTag’s owner can see where their AirTag is, and its location data and history, which are always encrypted, “are never stored on the AirTag itself.”

These measures appear effective in protecting the property owner, i.e., the person who places the AirTag on their own phone, in their own bag, etc.; however, it seems that a major security risk remains, namely preventing those with ignoble intentions from attaching AirTags to the possessions of others.

Of course, most people would notice if an AirTag inexplicably appeared on their coat or keychain, but they’d probably never see one affixed to the underside of their automobile. Unfortunately, it didn’t take long for car thieves to realize AirTags’ wonderful potential for pilfering.

Various news media have reported the troubling trend in which thieves see sought-after vehicles in public places like mall parking lots, attach an AirTag to the car in an inconspicuous spot, and track the vehicle to a more private place, like the owner’s driveway, where it can be stolen more easily.

The notion of ‘auto theft made simple’ is disconcerting, but even more disturbing is the idea that criminals could use AirTags to stalk people. What if you’re in a public place and someone inconspicuously slides one into a bag you’re carrying? The wrongdoer could show up at your home anytime.

Fortunately, Apple claims there are measures to thwart such chilling contingencies; its website explains:

“AirTag is designed to discourage unwanted tracking. If someone else’s AirTag finds its way into your stuff, your iPhone will notice it’s traveling with you and send you an alert. After a while, if you still haven’t found it, the AirTag will start playing a sound to let you know it’s there. Of course, if you happen to be with a friend who has an AirTag, or on a train with a whole bunch of people with AirTag, don’t worry. These alerts are triggered only when an AirTag is separated from its owner.”

These precautions do help ally some concerns; yet, a few questions remain, for example:

What if the person who’s unknowingly been ‘tagged’ doesn’t own an iPhone or have it with them, in which case they wouldn’t receive the alert?
How long does it take for the alert to be triggered?
How far does an AirTag need to be from its owner in order for the alert to be sent?

In keeping with the last question, if a person has an AirTag in a key chain that she hangs in a first-floor entryway, she won’t want an alert to sound each time she takes her iPhone to her second-floor bedroom. All this to say, AirTags’ security features give some significant reasons for pause.

Geoffrey Fowler, a columnist for the Washington Post, substantiated such concerns when he asked a colleague to pretend to stalk him for a week “from across San Francisco Bay.” He found that it took three days for the alert to sound, which amounted to “just 15 seconds of light chirping.” What’s more, if he didn’t own an iPhone, he wouldn’t have received any notification.

Although Fowler credits Apple for trying to do more to keep people safe than other tracking device makers, like Tile, have done, his experience still leads him to conclude that AirTags are “a new means of inexpensive, effective stalking.”

So, should Apple stop selling AirTags? Base on Fowler’s experiment, a natural conclusion is ‘yes.’ However, as it is with so many products that offer both positive and negative outcomes, the answer is not that easy.

For instance, many of us travel in automobiles each day to go to work, school, shopping etc. Tragically, more than 38,000 U.S. residents die in car crashes each year, and many more are injured. Also, we’ve unfortunately seen some use cars maliciously to kill others.

However, such incidents don't make many of us think twice about climbing into a car or crossing streets where others are driving them. Although the potential negative outcomes of injury and death are daunting, the great individual and collective benefits of car use overshadow those remote probabilities.

Similar rationale can be applied to many other products from kitchen knives to prescription drugs. We welcome their use because in the vast majority of cases they help people, not harm them.

Still, it’s fair to ask if AirTags offer a high enough risk-to-reward ratio. Yes, misplacing one’s car keys is annoying and can even be very frustrating, but we usually find them. How do we weigh the convenience of finding lost keys against the use of the devices to track others’ property or people themselves?

Those risks, especially if they become more common, likely don’t outweigh the rewards of quicker key recovery. However, there are several other, potentially more critical functions that AirTags can serve. Writing for Gadget Hacks, Jake Peterson identifies several of those uses, which include:

Lifesaver Beacons: People with severe allergic reactions can place AirTags on life-saving medications like EpiPens.
Location Trackers for Children: Parents can put the devices in their children’s backpacks or pockets and hopefully avoid experiencing their worst nightmare—a lost child.
Location Trackers for People with Dementia: At the other end of the age spectrum, some individuals beset by mental decline wander off. AirTags can make it easier to find them quickly.
Beacons for the Visually Impaired: The Find My app can help people with limited or no sight precisely locate important objects within their homes.
Location Trackers for Pets: An AirTag can help ensure that a beloved animal is found, without needing to insert a microchip into the pet.

Do the benefits of these latter applications outweigh the risks of unscrupulous AirTag use? They probably do, provided that Apple continues to improve AirTag security and that the deviant behavior remains isolated. Assuming those two ‘tag rules,’ AirTags can be useful for many people, helping to make the tracking devices “Mindful Marketing.”

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A Bad Sign: Macy's vs. Amazon Billboard Battle

12/4/2021

23 Comments

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

With the holiday shopping season in full swing, many consumers are unaware of two titan retailers’ battle over a billboard, the results of which could impact how and where shoppers buy gifts for years to come. The clash also could impact what businesses come to accept as moral behavior.

The site of the showdown is the corner of 34th Street and Broadway, New York City, at the center of U.S. commerce. It’s there that Macy’s, which once boasted “the worlds’ largest retail store,” is taking what could be a final stand against the encroachment of Earth’s fastest-growing retailer, and one of nature’s most irrepressible forces: Amazon.

Macy’s has filed a lawsuit against Amazon, hoping to keep its close competitor from commandeering a 2,200 square foot billboard that adjoins Macy’s flagship Herald Square store. It’s a signage space Macy’s has leased for nearly 60 years.

The huge billboard, which features Macy’s iconic star and logo typeface set against the familiar bright red background, serves as a beacon for millions of pedestrians and potential shoppers as they walk north on Broadway and west on 34th Street. Millions more see the sign every November in countless camera shots during the retailer’s world-renowned Thanksgiving Day Parade.

Amazon, an organization that can send astronauts into orbit, is capable of just about anything, but how could even it endeavor to place its name on a billboard on the side of such a storied competitor’s flagship store?

Key to the controversy is the fact that Macy’s doesn’t own the building on which the billboard rests; the sign is actually attached to a small separate edifice situated just between the retailer’s massive 2.2 million sq. ft. store and the intersection. The owner of the tiny architectural interloper and its very valuable billboard is Kaufman Realty Corp.

With the contract it signed in 1963 expiring, Macy’s asked Kaufman to renew its billboard ad, but the company told its long-standing tenant that it intended to rent the space to a “prominent online retailer”—one who apparently has deep pockets and who most believe is Amazon.

Of course, both Macy’s and Amazon have physical stores and virtual ones; yet, Macy’s is in many ways the quintessential brick-and-mortar retailer while Amazon practically owns online shopping.

In a very real way, therefore, the billboard battle represents a titanic clash of competing marketing channels and business models, the results of which could impact consumer shopping behavior for years to come, as well as set important moral precedent.

Macy’s firmly believes that its loss of the advertising space, next to its flagship store, would be disastrous, as the suit it filed states, “The damages to Macy's customer goodwill, image, reputation and brand, should a 'prominent online retailer' (especially Amazon) advertise on the billboard are impossible to calculate.”

With net income that’s exceeded $1 billion for eight of the last ten years, Macy’s is doing well compared to many retailers, especially those that filed for bankruptcy over the last 18 months, e.g., Lord & Taylor, J.C. Penney, J Crew, Neiman Marcus, and Pier 1.

However, Macy’s profit margin for 2020 was a modest 2.9%. Amazon, in contrast, had net income of $21.3 billion on revenue of $386 billion, giving it not only much greater earnings but also a significantly higher rate of return—5.5%.

So, although Macy’s is not quite on the cusp, it’s certainly not operating from a position of power versus Amazon, and it truly can’t afford to see its flagship store, which it’s described as its “most valuable asset,” take a serious financial hit.

However, a hit on Macy’s Herald Square store and its effect on the future of retail is only one concern of the billboard battle: Amazon’s aggressive competitive tactic is also a breach of business’s moral bulwark.

Of course, Amazon has a right to buy any billboard it wants, but a key question is why the firm needs to buy that one.

According to Statista, there are over 340,000 billboards, or “big format outdoor displays,” in the United States. Just a ten-minute walk north of Herald Square lies Time Square, which has probably the greatest display of outdoor advertising in the world.

Granted, a sign in this spectacle of commercialism comes at a very high cost: between $5,000 and $50,000 a day, which could mean as much as $18.25 million a year. Still, that amount of money is almost immaterial to the one of the world’s richest companies.

As of December 31, 2020, Amazon’s balance sheet showed cash and cash equivalents of $41.2 billion. Even a $50,000-a-day billboard would represent less than half of one percent of those liquid assets (just 0.0445%).

So, if hundreds of thousands of large outdoor signs are available and Amazon can afford to rent any billboard it wants, why does it have to have the one in Herald Square that’s adjacent to one of its biggest competitor’s flagship stores?

It’s reasonable to infer an intent to attack the heart of Macy’s operations, to steal shoppers from in front of its landmark store, and perhaps even to embarrass the firm before its own customers.

Some might respond to such assertions of over-the-top aggression with, “That’s business,” or “Amazon is just being competitive,” or “The company is playing to win.” There’s a difference, though, between working hard to win and trying menacingly to make others lose. Unfortunately, Amazon’s billboard-buy seems like the latter.

Growing up, I loved to play sports and considered myself a pretty competitive person—I wanted to win and tried my hardest to do so. Although I didn’t like losing, I could tolerate it—it wasn’t the end of the world—especially if I played my best and the other person/team simply outperformed me.

By the same token, I never liked the idea of trying to sabotage or subvert opposing players’ performance. Instead, I thought, “Let them do their best, and I’ll do my best, and whosever best is better deserves to win.” I didn’t have to come out on top every time; I could ‘share the podium.’ Part of competing was knowing how to win and lose graciously.

In contrast, some individuals and organizations compete as if it’s all or nothing, and they have to have it all, all the time. They’ve no sense that ‘the market's big, so there’s plenty of business for everyone.’

Maybe it’s because of the holidays that this self-obsessed way of thinking reminds me of the Christmas classic It’s a Wonderful Life--specifically the film’s antagonist, the greedy and scheming Mr. Potter. Although he and his bank already own half of Bedford Falls, he won’t rest until it’s all under his control, not tolerating even a minor amount of competition from George Bailey’s small Building & Loan. No one else can win; he has to have it all.

My guess is that Mr. Potter would be proud of Amazon’s attempt to pry the Herald Square billboard lease away from Macy’s.

Macy’s is no real threat to Amazon, which can afford any outdoor advertising it wants and doesn’t need to have that specific sign. So, why go after it? It seems like Amazon doesn’t want anyone else to win; it has to have it all.

Macy’s lawsuit claims that all past and present agreements have prohibited the billboard’s owner from ever leasing the space to any other “establishment selling at retail or directly to any consumer.” If that claim is true and Macy’s is offering Kaufman Realty fair compensation for the lease, Macy’s has even more reason to believe its treatment is unreasonable.

Competition is not only necessary, it’s desirable, as it both benefits consumers and sharpens industry rivals. However, when organizations like Amazon enlist predatory business practices, their strategies are a sign of “Single-Minded Marketing.”

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Four Behaviors of a Peacemaking Brand

9/25/2021

1 Comment

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

In one of my favorite commercials, Liberty Mutual spotlighted acts of kindness that inspired others to pay the good deeds forward. Most people want a kinder, gentler world, but in a society awash in antagonism, how many of us think seriously about whether our daily actions encourage peace?

There are many ways for both personal and organizational brands to support serenity. Top-of-mind for me and accessible for all are four peacemaking behaviors that coincidentally all begin with the letter ‘L’:

1) Listen: Anyone who has dealt successfully with dissatisfied customers knows that first and foremost they want to be heard. More often than not, just listening to and acknowledging their frustration allays their anger.

Brands that genuinely listen, for instance, through other-focused interactions on social media, model humility, which according to Mother Teresa, is an important precursor to peace: “Only humility will lead us to unity, and unity will lead to peace.”

2) Learn: When we genuinely listen, we naturally learn. When that learning is aimed at appreciating and understanding others, interpersonal and interorganizational peace often result.

Most of us have experienced situations in which our exacerbation with coworkers, classmates, or others was largely due to not knowing them well or understanding their circumstances. However, after learning both, our appreciation grew, our annoyance subsided, and a more peaceful relationship ensued.

3) Laugh: Two research colleagues and I recently completed a study about playful teasing in advertising in which we learned that good-natured ribbing builds social bonds. Not only is laughter the best medicine, it’s a great peacemaker.

As a young aspiring athlete, I enjoyed playing basketball at local playgrounds with friends. One day an older, bigger boy, known to be a ‘rough character,’ asked to join our game—with trepidation, we obliged. Tension ran high as we worried about doing something to set him off, then one of my friends playfully teased the older boy, making some ridiculous comment about him playing professional baseball. I gasped, wondering how the short-fused guy would react—he burst out laughing, the mood lightened, and gratefully the game ended without incident.

4) Love: The best way any of us can promote peace is to show others love. It’s difficult to be at odds with those who treat us charitably. Although they might cringe at calling it love, companies are often able to act compassionately on levels that individuals cannot, as this extraordinary example illustrates.

A major meat processor had a smaller competitor whose plant became submerged from unprecedented flooding. While many firms would seize the opportunity to gain market share and eliminate an adversary, the larger company showed compassion, first sending some of its own employees to help clean up the water-logged facility then, unimaginably, lending equipment so the challenger could continue to fulfill orders.

The two competitors eventually returned to vying for business but likely with uncommon mutual appreciation and respect. Like the good Samaritans in the Liberty Mutual ad, these companies remind us that reconciliation isn’t someone else’s responsibility. Every individual and organizational brand can practice peace by listening, learning, laughing, and loving, which ultimately make for “Mindful Marketing.”

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Gen Z Students Teach Their Professor About Thrifting

9/10/2021

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

Remember the excitement of your first time wearing a new jacket or pair of shoes? Did you wonder how the original owner felt when they wore them? You probably didn’t unless you’ve been part of one of the hottest consumer trends--thrifting. For a variety of reasons, it’s now fashionable, especially among Generation Z, to shop secondhand, but this Gen X marketing professor wonders if it’s smart for the apparel industry to embrace a fad that may dissuade people from purchasing its new products.

Scanning my marketing news feeds a couple of months ago, a headline caught my eye, “Letter from Gen Z: Why thrifting is the future of fashion.” Thinking it was a bold prediction, I saved the article to discuss with my fall classes. The semester started, I shared the piece, and I’m stunned how passionate so many students are about thrifting!

However, on the first day of Personal Selling class, before I even mentioned the article, I asked each person to ‘sell us on something important to you.’ With great enthusiasm, a student named Brooke shared how much she enjoyed thrifting. Her tremendous passion for the practice was obvious to all, and very surprising to me.

My impression had long been that shopping for secondhand items was something mostly people on very limited budgets did out of necessity, to save money. Similarly, those who did frequent aftermarket sellers certainly wouldn’t brag about what they’d bought. Apparently, that stigma has subsided, and college students, some of whom come from affluent families, are among those most active in propagating thrifting’s new-found popularity.

To get a better picture of thrifting behavior among college students, I created a brief online survey that I shared with my four classes; about 70 students completed it. The results revealed some surprising behavior, for instance:

70.4% of students had purchased used clothing three or more times, and 54.9% had done so seven or more times.
The most likely places to purchase used clothing were traditional thrift stores like Goodwill and Salvation Army (39.4%), followed by retailers and brands that sell both new and used clothes, such as H&M and Levi’s (33.8%), then consignment stores (22.5%), and finally flea-markets (7.1%).
The strongest motivations for buying used clothing were cost (49.3%), followed by fashion (16.9%), then desire for old/vintage (11.27%), then impact of influencers (2.8%), and last environmental concerns (1.4%).

Before the survey, I didn’t think that so many college students were actively thrifting. To my surprise, only 9.9% of those who responded, said they’ve never purchased used clothing. I was also surprised that the places they thrift are rather evenly distributed.

Comparing the two different findings, it’s remarkable that the percentage of those who are very likely to frequent even the least popular thrifting place, flea-markets (7.1%), is not much lower than the portion of people who have never thrifted (9.9%).

On one hand, seeing cost emerge as the top motivator for thrifting was not surprising; however, I had expected its percentage to be even higher, e.g., 90% or more—again, I always thought that saving money was the only reason people purchased used clothing.

As it turns out, the desires to be fashionable and to own old/vintage clothing were also very compelling. Along those lines, I realized that my simple survey failed to ask about what may be one of the most important motivations!

At the end of the survey, an open-ended question invited respondents to share any other thoughts about thrifting. Seventeen students seized the opportunity and offered responses that included the following:

“I love it so much!”
“I love to thrift and over half of my closet is thrifted.”
“Very cheap way of finding trendy clothes”
“It’s how I get 90% of my clothes.”
“I love that I can find articles of clothing that no one else is likely to have. Thrift finds are one of a kind. I also buy clothes from stores like Target, but my purchases [there] are not as unique [emphasis added] because other people have the ability to buy the same thing. Thrifting grants me a more unique [emphasis added] wardrobe!”
At least 50% of my clothes are thrifted, I absolutely love thrifting - both because it limits waste in the fashion industry and because it’s fun! [emphasis added]

The last two comments contained two words that were both eye-opening and full of marketing implications:

1) Unique: I remember, not long ago, when young people wanted to look like everyone else. To be one of the few people who didn’t have the popular brands of sneakers or jeans was often an ostracizing experience.

Now it seems that many Gen Zers want to own clothing that not everyone else is wearing. Moreover, items that are one-of-a-kind, like those that can be found through thrifting, are even better, as they help express individual identity, which mass marketed products can’t easily accomplish.

2) Fun: In my thrifting survey, I kind of included a question about wanting unique clothing (“old/vintage”), but I completely overlooked the idea that members of Gen Z thrift because they enjoy the thrill of the experience.

For many, thrifting is a kind of treasure hunt in which they may or may not know exactly what they’re looking for, and what they find may be a complete surprise. It’s exciting for almost anyone to come across something special that others are unlikely to locate.

Both of these motives, as well as some of the others, are instrumental to the thrifting behavior of Brooke, introduced above, who has been buying secondhand products for 3-4 years and goes thrifting once every two or three weeks. In those outings, Brooke has found used bargains on everything from American Eagle clothing, to Ugg boots, to Vera Bradley bookbags.

Cost is certainly a motivation for Brooke; in fact, she says she loves saving money and showing people the great buys she gets for ¾ of regular retail prices. She also says that she now has “a hard time spending full price on clothing at retail stores.” However, Brooke also enjoys the excitement of thrifting:

“I get a thrill in not knowing what I’m going to find. You don’t know if you’ll walk in and find brand new Nike shoes for $40 or Lululemon leggings for $30, and that’s the fun in thrift shopping, the unknowns.”

There’s little question that many members of Gen Z enjoy thrifting for a variety of reasons, but what can/should marketers do with that consumption behavior? After all, most clothing brands are in the business of selling new clothes, not used ones. Some, however, have found ways to do both, and apparently make money.

One of those brands is the iconic blue jean maker Levi’s, which has made an entire enterprise out of buying back and reselling its used denim. The company runs a well-developed website, Levi’s SecondHand where it resells its classic jeans, jean shorts, denim jackets, and more.

Even though they’re used, the items aren’t cheap. For instance, the site sells preowned men’s original fit 501 jeans for $38. On a recent Labor Day sale, Macy’s offered the same jeans new for $41.70, or less than $4 more. Levi’s used product site also sells Vintage 501 Shorts for a pricey $78 a pair.

However, a webpage that describes Levi’s SecondHand explains why someone would want to pay a premium for preowned: “Denim from past seasons that’s already beat-up and broken in. In other words, perfect.”—That sentiment is very similar to the survey finding mentioned above about generation Z liking clothes that are old, vintage, and unique.

The company also touts several other advantages of SecondHand, especially sustainability:

“If everybody bought one used item this year, instead of buying new, it would save 449 million pounds of waste.”

“Levi’s SecondHand keeps coveted pieces in circulation. It’s all about connecting people to timeless styles they otherwise may not have found, and most importantly, saving clothing from going into a landfill. Old denim has never looked better.”

A big question that remains is if selling secondhand is sustainable for Levi’s. Sure, used denim may be what consumers want and what the environment needs, but can the company make money in the clothing aftermarket? If not, the program has little potential.

Levi’s SecondHand isn’t yet a year old, so longevity is still not the best indicator. However, if the company is successful selling some used products for only a few dollars less than they sell for new, and others for even more, it seems likely that the firm, free from manufacturing costs and with relatively little added overhead, must make a healthy margin on each piece and turn a profit on the program as a whole. Interestingly, over the past year Levi’s stock price has increased significantly, from $12/share on September 21, 2020, to $26.50/share on September 6, 2021.

Can other clothing companies pull off a secondhand program like Levi’s? Few have the history and brand equity that the iconic jean maker enjoys; however, consumers’ appetite for used clothing and the favorable cashflow suggested above serve as an invitation to other suppliers. Furthermore, the fact that those who have entered the aftermarket include clothing retailers J.C. Penney, Macy’s, Madewell, and Nordstrom, as well as the furniture behemoth IKEA, suggests the viability of selling secondhand.

When you think about it, it’s not unusual for manufacturers and new product retailers to sell used products. Auto dealerships have been doing so for a century or more. Part of the reason people are willing to pay so much for new cars is that they know when they’re done driving them, someone else will buy them. Whether it’s Levi’s or Lexus, high resale value is a hallmark of a strong brand.

Still, an important moral issue remains, which a second member of Gen Z brought to my attention. Katie, also a marketing student of mine, helped me see that consumers have a responsibility to ‘thrift ethically.’ Inspired by a variety of posts she’d seen on Instagram and a visit to a thrift store in Colorado, Katie suggested that consumers shouldn’t shop in “low-volume, high-populated areas” and that they should avoid patronizing secondhand places “outside of their fiscal demographic."

The overarching reason for these sensitivities is that some desirable-brand item that we buy in a thrift shop as a ‘little luxury’ might be the same item that a more impoverished person would buy out of necessity. As consumers, we are often accustomed to there being plenty of products for everyone, but Katie reminded me that what we buy secondhand may be taking something away from someone who needs it more.

Of course, not every product lends itself to a profitable aftermarket, but many do. Consequently, for the sake of environmental, financial, and social stewardship, more companies and consumers should consider how they might responsively market and purchase preowned products. Whether new or used, items that offer value to buyers and profit to sellers, can be considered “Mindful Marketing.”

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