As Starbucks Retreats From Russia, Pressure Mounts on Brands to Do More

Data from Forrester, gleaned from 1500 consumers in the U.S, the U.K and France, has found consumers want brands to step up as United Nations (UN) numbers pit civilian casualties at 8,462. From Nestlé to Netflix, most major global advertisers were quick to condemn President Putin when he unleashed troops on Ukraine back in February—some, including Ikea and L'Oreal, immediately offered humanitarian assistance.Despite this, adults across the three countries said they wanted companies to speak out against the war. This feeling was strongest in the U.K (77%), followed by the U.S (66%). In France, the support was more muted at 56%.People don't just want brands to speak up, though. 72% and 70% of consumers in the U.S and the U.K respectfully believe brands should be taking more action to help people in Ukraine. In France, this lagged behind at 63%. Notably, people in all markets put more onus on advertisers to act than they did governments. The biggest gap was in France where there was a 10-point difference in favour of brands, with just 53% of consumers expecting their President Macron-fronted government to step up. Quitting Russia for good As consumers demand more from Western brands doing business in Russia, a growing throng of companies have made permanent business decisions to quit the market for good. Starbucks was the latest brand to disassociate entirely. After 15 years doing business in Russia, the coffee giant announced on Monday 23 May it would no longer have a presence there. The coffee chain will shut its 130 stores in the country, which account for less than 1% of its annual revenue and are operated by local partners. Starbucks said it will pay its almost 2,000 Russian workers for six months and help them transition to new opportunities. McDonald's Quits Russia for Good After 30 Years The move follows similar ones from McDonald's and Renualt. The former is selling up its 850 restaurants in Russia after 30 years. The decision carried its own symbolism as the all-American brand dimmed the lights on its golden arches—after becoming symbol of Glasnost in action when it opened its doors in 1990. Recent insight from consulting firm GlobalData, found 72% of purchases worldwide are driven by a brand’s ethics or support shown toward a social cause. Consumer analyst Ramsey Baghdadi said advertisers pulling out of Russia had clearly considered the negative financial impact of continued affiliations with the country. “It is ultimately a low-risk gambit for global mega-chains, such as Starbucks and McDonalds," he explained. "Russia represents a minimal share of their sales. It's more important to limit losses from those 72% of people who may be inclined to boycott, as well as mitigate damage to the brands reputation." He said the next challenge would be finding new high potential markets to offset losses from Russia—and pointed to rapidly-growing outlets in Asia as the answer. An always-on war Forrester's study also offered insight into how the war is affecting consumer confidence. As the conflict unfolds across devices and on platforms including Twitter and TikTok, anxiety is writ across the board. A virtual window to the violence has left most adults anxious about the effects of the war. Personal safety and security were a concern, especially among U.K respondents (64%, versus 59% in the US and 58% in France). French respondents, were most anxious about their personal financial situation at 62%, versus 60% in the U.K and 54% in the U.S. Dipanjan Chatterjee, vice president and principle analyst for the researcher, wrote: "The people of France and the UK, are on edge as the specter of war returns to haunt the European continent. "For others, like those in the United States, virtual proximity has brought a war being fought far away to every device and platform in their screen-tethered lives." He continued: "An always-on war and its naked aggression and heartbreak are being seared indelibly into people’s memories." In April, a study of 2,000 U.K. adults from ad trade body Institute of Practitioners in Advertising (IPA) found 88% of people were in favor of brands addressing the ongoing war. Ukraine Promotes Bravery as Its Greatest Export