Woke Capitalism
There’s a recent business trend where companies are making big statements that seem designed to go viral. In today’s highly polarized environment, diving head first into the culture wars is an easy way to win a lot of free publicity. But is it a good business strategy? Only time will tell, but I see reasons to be cautious.
Some people are calling this trend woke capitalism, and I think that name is apt. These ads generally come from 20 (or 30) -something marketers who live in New York. In that woke bubble, polarizing culture war messages probably get a positive reception with lots of kudos for bravery, authenticy, and leadership. But what about the rest of the country? That’s where most of the customers are, and those bold advertising execs might find out later that they’re woefully out of touch with their market.
Gillette gave us the clearest example of this culture war advertising with their recent ad decrying “toxic masculinity.” Their advertisement succeeded in going viral — it has now been viewed tens of millions of times (and still counting) on social media. The marketing executives behind the ad created a big spike in brand exposure, well beyond what you could normally hope for by purchasing airtime. I imagine they count this as a big win.
While this might be a huge success for marketers, the value to Gillette is less certain. Shareholders don’t usually care about making waves. They want earnings, and advertising exists to boost sales. Among their current customers, there are likely some people who were turned off by this ad and might decide to look for a new brand. Existing customers who liked the message are unlikely to increase their razor consumption, so Gillette is betting that their message will bring in new customers.
I don’t know how many people pick their consumer products based on cultural and political positioning. Are they a big enough group to offset the likely loss of annoyed customers? Is Gillette planning to continue this virtue-signaling marketing strategy? There will always be more issues, so this strategy might not be very sustainable. What happens when they pick the “wrong” message in a future debate? They run the risk of gaining just a few fickle customers for a short period.
It’s possible that these companies really stand for something and they want their customers to know it. But it might also be that some companies face tough competition and are hoping that a wave of attention will help restore their lost market dominance. Will viral publicity and culture war marketing turn into a big win for investors? I’m interested to see how it all plays out.
