WTPR?! On Luxury Brands, PR Agencies, Politics, Polarization and Profits
Nov 08, 2019 / By Danny Saba
The world’s largest luxury brand conglomerate, the LVMH Group, recently celebrated the opening of a Louis Vuitton workshop in Texas (and its third in the U.S.), graced by the presence of our President, Mr. Donald Trump.
In previous administrations, no one would have cared that much. But in today’s ever-divisive political climate LVMH took a big risk inviting the Donald and creating a potential backlash for lovers of the Louis Vuitton brand.
Did you even know Louis Vuitton already had two US workshops? Consider the brand devaluation in that alone, knowing that a very pricey “French designer bag” was actually made in America’s heartland.
Add in the Donald’s contentious appearance at its workshop opening and Louis Vuitton might have more than a few negative tweets (see below) to deal with. It could lose loyal customers.
This is a great example of the risk brands take when they associate themselves with celebrities (and now, politicians). Remember the Soul Cycle snafu?
Who’s at Stake? Loyal Customers
From brand lovers to brand betrayers, it takes just one an ill-advised move for a brand’s most loyal customers to suddenly start tearing it apart. What sparks this change of heart?
Brand loyalty is often put on the line when the leader of an organization (or someone close to the leader) does something completely opposite to the mission or belief system of that brand.
It happened to Ivanka Trump’s brand shortly after the Donald became president. A #GrabYourWallet movement urged consumers to boycott retailers that sold Trump family–connected goods. Consumers particularly targeted Nordstrom for stocking the Ivanka Trump brand, and by February 2017, Nordstrom dropped the line, a decision it described as being “based on the brand’s performance.” Ahem.
It's important that as consumers, we understand the power we have to change things and realise small actions in our consumer habits can make a huge difference in our politics.#GrabYourWallet— Paola Roldán (@paolaroldan) October 21, 2019
Whether Louis Vuitton has a similarly fatal case on its hand remains to be seen. Either way, the brand’s move has already left many in the fashion industry aghast. It’s also opened the door for the consumer in all of us to question the conglomerate’s ulterior motive and become more mindful about the brands we support with our hearts, minds and wallets.
It’s another in a long line of controversies that speak to a broader, polarizing contradiction between profits, politics and people. And one that’s not limited to the brand/consumer relationship either.
Who Cares About the Politics When We’re Focused on Profits?
Attracting political controversy isn’t exclusive to brands, especially when there are big profits to be had. In an earlier article we covered an internal crisis at the global PR firm Ogilvy on whether the agency should work with US Customs and Border Protection.
The coverage was quick and the fallout was fast. Several employees expressed frustration over working with a client they believed went against their personal and professional values. But Ogilvy CEO John Seifert said the work would go ahead, stating Ogilvy’s work with CBP was limited to helping the government agency recruit applicants.
And then another eminent PR agency entered the news cycle in a vaguely familiar way…
Edelman was slated to start work in July for GEO Group - a private, multi-billion-dollar prisons company with contracts from the Trump administration to run immigrant detention centers. The messaging was intended to counter negative, “factually inaccurate” coverage of GEO Group, according to a spokesperson from the company.
“We have sought out a number of strategic communications firms to help us tell our story, which we believe has been largely misrepresented in the media,” the spokesperson said.
Employees at Edelman vehemently objected to the contract, and the firm quickly dropped the GEO Group account. The decision to cancel the contract followed nearly 10 days of internal debate over the pros and cons of retaining with such a client, according to Edelman sources.
From an ethical and moral standpoint, the Edelman controversy might be seen as a favorable outcome.
But from an agency/employee relationship standpoint, accepting a contract only to reject it days later screams confusion. This ‘flipflopping’ approach doesn’t build trust with employees, it shatters it.It also reinforces the polarizing environment in which brands and agencies are operating in. One wrong move can lead to consumer backlash and shutter a company or cause an employee walk-out (Hello, Google.)
3 Ways to Avoid Flipflopping & Disloyalty
In this age of employee and consumer empowerment it’s clear we should be compelled to scrutinize the values of brands and their purpose more than ever. One way to do that is to ensure the companies we work with (or buy from) share a common value with us in some way.
At ThinkInk, here’s how we find common value (and how we believe other brands and agencies can, too):
- Partner with companies that walk in your shoes: Work with companies that share your niche industry or consumer, or who have experience dealing with your specific product or service.
- Eschew politics and polarization: Don’t give in to the allure of media coverage driven by political agendas or polarizing topics. It’s not worth the devasting risk to hard-earned brand equity.
- Value a shared purpose (as well as profits): Drive business growth for companies that share a common brand purpose, like helping progress an industry at large, or helping to solve a shared customer need.
Ensuring there is a clear value alignment between people, partners and brands is universally important – luxury brand, PR agency or otherwise.
Because our values are intrinsically linked to our emotions. When we’re forced to question these deeply held and highly personal beliefs, suddenly the brands we love, or companies we’re devoted can seem largely insignificant. The opposite is also true. When we get value alignment right (and consistently!), we spark positive emotions and invite loyalty.
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