Trump’s Name Is Now a Banner of Extremism

Two days after rioters powered their way past police and rampaged through the corridors of the Capitol, everyone from lawmakers to custodial staff are still tallying the damages—a word that suddenly has many meanings. There’s the literal damage in the form of broken glass, bullet holes and ransacked offices. There is the damage to the country’s civic ideals, expressed by an emotional Sen. Corey Booker, D-N.J., who proclaimed Wednesday that “our democracy is damaged.” There is also the toll to the United States' image and reputation abroad. A statement from the House Foreign Affairs Committee lamented that Wednesday’s violence “scarred our reputation and damaged our standing in the world.” Finally, there are the damages likely to present themselves in the years ahead, notably a citizenry still riven by deep ideological differences. And somewhere off in that unknowable future is another potential aftereffect of the violence that many lay at the feet of President Trump. It doesn’t mean he won’t be a favorite [of some people] for years to come—but his brand I don’t think is going to survive.—Hayes Roth, principal, HA Roth Consulting And that is, paradoxically, the fallout for the Trump brand itself. Four years ago, Trump famously observed that he could “stand in the middle of Fifth Avenue and shoot somebody” and still not lose his core supporters. To a degree, even after Wednesday’s violence at the Capitol, that is still true. A YouGov poll conducted the day after the melee found that 45% of Republican voters still support him. But that is Trump the man. Trump the brand is a different calculus. For years, Donald Trump used his property, personality and celebrity to forge a living brand that, at one time, included everything from menswear to cologne to mail-order steaks. After he became president, he used the office to burnish that brand further—most visibly with the Trump International Hotel just three blocks east of the White House, which brimmed with diplomats eager to curry favor with the 45th president. Plans to sell Trump's flagship Washington hotel were iced after nobody fronted the asking price. But now that Trump has lost the support of even staunch allies—“It’s past time for the president to accept the results of the election, quit misleading the American people and repudiate mob violence,” Arkansas Republican Sen. Tom Cotton said Wednesday—the business world is beginning to consider the question of how brand Trump, which today exists in the form of 10 hotels, 19 golf clubs and 33 residential buildings around the world, will fare in the months ahead, or even if it will survive at all. “The events [of Wednesday] have cemented a terminal threat to the survival of what was left of the Trump brand,” Eric Schiffer, serial entrepreneur and regular business contributor to CNN, told Adweek. “It is currently melting down in a dumpster fire.” A name brand’s long decline That fire has actually been burning for several years now. Between 2019 and 2020, Trump lost some $600 million from his estimated worth, a drop of 20%, according to the Forbes 400 list. While some of his losses—such as the $1 billion in vanished revenues his properties suffered in April 2020—stem from the coronavirus’ crippling of the travel business, the red ink began flowing long before Covid-19 appeared. Between 2015 and 2017, for example, the operating income for the Doral resort in Miami plummeted by 69%. “Trump Organization properties,” USA Today reported in 2019, are “no longer desirable to tenants.” Contrary to appearances, Trump does not own most of the properties that bear his name. He owns only portions of some of them and, in numerous cases, developers pay licensing fees for rights to hang the Trump shingle out front. Or, at least, they did. There’s a big disconnect between people who believe in his political ideology and the demographic needed to support his business assets.—Michael Priem, founder, CEO, Modern Impact In 2019, six Trump-named buildings in Manhattan tore their Trump signs down, taking a cue from two Trump hotels outside the U.S. that had already done so. That same year, the Trump Soho hotel in downtown Manhattan became The Dominick. Trump’s name is still on his hotel-condo tower in Chicago, but a recent story in Chicago magazine asked: “When do we get his name off that otherwise-handsome Adrian Smith building?” “In terms of his brand, we know it’s deteriorated—you have financial evidence of that,” observed Hayes Roth, former CMO of Landor and now principal of HA Roth Consulting. “So it’s clear that the name has been tarnished from his early days as president. I’d say, without a doubt, after this [week’s events], his name is anathema. His power and his mental acuity are clearly waning. It doesn’t mean he won’t be a favorite [of some people] for years to come—but his brand I don’t think is going to survive.” A big company with big problems If Roth is correct, there are likely several reasons why. Foremost is the reduced chance that major corporations and organizations, wary of criticism from the public and from their own employees, will want to hold a convention at a Trump property. According to research firm PwC, 85% of the country’s meetings take place in hotels, filling rooms that themselves make up around 68% of an average hotel's revenue stream. If companies won’t book meetings at a Trump hotel, the potential damage speaks for itself. “It’s going to be very unlikely for big corporations to be willing to be associated with the Trump name,” said Nicolas Graf, associate dean and clinical professor of New York University’s Tisch Center of Hospitality. “He's burned all of his bridges. And I think by doing that he's lost his ability to attract people.” Trump’s cheerleading of the Capitol mob this week, Schiffer added, “lit the torch of war with [his] existing prospects and patrons.” Another tidal wave that may be heading for Trump’s brand is a financial one. Trump has personally guaranteed a reported $600 million in loans, much of it from heavily leveraged hotel properties such as his Trump International Hotel in Washington, the Doral golf resort and Chicago’s Trump International Hotel and Tower (on which Trump owes $50 million). While most banks walked away from Trump in the 1990s following the collapse of his Atlantic City casinos—the “Donald Risk,” they called it—Deutsche Bank AG has loaned some $2 billion to the Trump Organization over the years, though even it, too, is reportedly exploring exit strategies. Many Trump properties are heavily leveraged, notably the Chicago tower on which he owes $50 million. So, if any of Trump’s hotels require additional financing, Trump—largely owing to his recent behavior—might have a hard time finding it. “Many people in real estate are highly leveraged,” Graf said. “They need to refinance regularly. He’s going to have serious issues refinancing whatever he needs to.” But what about that fan base? Michael Priem, founder and CEO of marketing and brand strategy firm Modern Impact, noted Trump's “strong base of pro-Trumpers that he continues to selfishly pander to,” but questioned whether it's a strong enough base to sustain his business. "In many of the geographies where his businesses reside, his brand is not as favorable with that base," Priem said. "It’s going to be highly problematic. There’s a big disconnect between people who believe in his political ideology and the demographic needed to support his business assets.” Statistics bear that point out. A Washington Post poll conducted before the 2016 election found that Trump's support was strongest among Americans who did not go to college and earn less than $50,000 a year. A Pew survey conducted in October found that demographic profile to have stayed much the same. This is the group whose earning potential has been hardest hit by globalization and offshoring. With rates for a room at the Trump International Hotel & Tower in New York hovering in the $500-per-night range, it seems unlikely that travelers who aren't on a corporate expense account will be likely to book. “Nobody wants to be associated with his name with the exception of the people at the Capitol,” Graf added, referring to this week's rioters. “These people are not Trump's customers.” That’s not to say that brand Trump will lose so much of its luster that Trump himself won’t be able to take advantage of the myriad income-generating opportunities that present themselves to former presidents. Barbara Perry, director of presidential studies at the University of Virginia’s non-partisan Miller Center, observed that, now more than ever, former commanders in chief have their pick of deals. “The growth of the income potential in the speakers’ market—the growing niche of memoirs, their ability to get in with media organizations and corporate boards—it’s increasing and more lucrative and, therefore, more prevalent,” she said. For example, President Bill Clinton earned $260,000 for a single speech he gave to the Fragrance Foundation in 2016, and that same year made $18 million to be an "honorary chancellor" for a school. In 2017, Barack and Michelle Obama inked a book deal with Penguin Random House worth a reported $65 million, and a year later agreed to a multi-year deal to produce content for Netflix. And Perry suspects that lucrative deals like these may come Trump's way, too. And though the Trump Organization may not be able to hold onto all of its swank hotels and resorts, the brand itself—in whatever form—is likely to live on. “Even if rational people say, ‘That was really bad for him on Jan. 6 to incite a domestic terror mob to take over the United States Capitol and disrupt the constitutional duties of the House and Senate,’ most presidents get a temporary bump coming out of the White House,” Perry said. “We get a rosy glow of our presidents as they age and get further and further away from their presidencies.”

Politics

Exclusive: Trump’s Name, Once a Brand, Is Now a Banner of Extremism

Who will buy from Trump after the chaos of his exit, and what will he be selling?

Robert Klara

About

Subscriptions

Events

Publications

WORK SMARTER - LEARN, GROW AND BE INSPIRED.

Subscribe today!

Robert Klara