Why Brands Are Under Increasing Pressure to Be Transparent About What They Believe In

There's always a risk of alienating customers who disagree

Not all brands have the freedom that Cards Against Humanity has. Cards Against Humanity

Some brands do everything they can to avoid political controversy. Cards Against Humanity is not one of them.

Last November, the maker of the crude-yet-hilarious party game announced it was raising $2.2 million to buy a small plot of land on the U.S.-Mexican border to prevent a wall from being built on it, then dared the Trump administration to sue them over it.

This was not the first foray into national politics for the popular card game. In 2016 co-founder Max Temkin created a Super PAC called the Nuisance Committee, which purchased billboard ads written in Arabic saying, “Donald Trump, he can’t read this, but he is afraid of it.”

Before the election, the company created custom 15-card add-on packs for both Hillary Clinton and Donald Trump, asked fans to vote with their wallets for the candidate of their choice, and then donated all of the proceeds—more than $550,000—to Clinton’s campaign.

Taking a sharply pointed political stance is built into the DNA of the company, which was founded and is still owned by a squad of eight comedy-writing friends from the Chicago area.

“We don’t have investors, a board or shareholders,” says Temkin. “We’re accountable to ourselves. We get to choose our customers through what we do. And if there are some out there who aren’t happy that we stood up for the rights of immigrants and refugees, we’d rather they left us alone.”

Few brands have the freedom—or the chutzpah—Cards Against Humanity does. But nearly all are feeling the pressure to take stronger social, environmental and political stances, especially from the youngest consumers to flex their marketing might, Generation Z. How nimbly brands navigate that minefield is crucial to their future survival.

The new digital

The pressure to step up is driven in part by the rise of direct-to-consumer brands that see social activism as part of their primary mission. For example, with Warby Parker’s Buy a Pair, Give a Pair or Toms’ One for One shoe programs, people in developing nations receive a free pair of glasses or footwear every time someone makes a purchase.

But firms are also feeling the heat from social media-driven movements like #MeToo, #TimesUp and #BoycottNRA, which demand that brands pick a side—and do it quickly.

“Traditional brands can no longer sit on their hands and allow well-scripted corporate statements to shape who they are,” says Tripp Donnelly, CEO of digital reputation management firm REQ. “They have to be dynamic and understand they’re talking to multiple generations of people.”

The increase in brand social awareness has given rise to ad agencies that specialize in purpose-driven clients. One such agency, School in Boulder, Colo., operates with an ethos of #GiveaShit, continually working on campaigns that help fund projects for impoverished children around the world.

School founder and CEO Max Lenderman says having a clear purpose gives brands a distinct market advantage, and those that fail to recognize this will be left behind.

“Purpose is the new digital,” he says. “Brands you wouldn’t normally consider purposeful realize they have a role to play. And their customers are recognizing that this is kind of great.”

The middle path

Many brands play it safe by steering a middle path, sticking to issues important to their constituents and close to their core values. But even then, they run risks.

When the Trump administration announced plans to open up Bears Ears National Monument and other public lands to oil and mining interests last December, outdoor brands like Patagonia, REI and North Face publicly opposed the move.

Alex Thompson, REI’s vp of brand stewardship and impact, admits there was some risk in taking such a public stance, but says the response from its members was overwhelmingly positive.

“REI believes strongly that public lands are a nonpartisan issue and loved by people of all demographics, regardless of party,” he says. “When the Department of the Interior called for public comment, we felt it was our role as a 17-million-member co-op to engage constructively in the conversation. That’s not to say everybody was necessarily on our side, but we think it was appropriate to follow through on our values.”

Similarly, Whirlpools Care Counts program is solidly in line with the company’s family-centric values. Over the last two years, Whirlpool has donated commercial-grade washers and dryers to schools in poor neighborhoods, so students whose families can’t afford laundry machines can show up to class in clean clothes. The result: a dramatic increase in attendance—from 82 percent to 91 percent during the 2016-17 school year—by high-risk students in cities from Baltimore to Los Angeles.

The Care Counts program is part of a larger portfolio of corporate responsibility projects at Whirlpool Corp., which includes support for Boys and Girls Clubs and Habitat for Humanity. But the company remains resolutely nonpartisan, notes Deborah O’Connor, director of global corporate reputation and community relations.

“We’re not a political organization,” she says. “We sell products to make everybody’s lives easier.”

Conversely, brands that stray too far from their comfort zones, or attempt to shamelessly appropriate social or cultural movements, tend to pay the price.

The poster child for inauthenticity remains Pepsi’s Kendall Jenner TV ad, in which the model/influencer joins a peaceful protest march, then manages to quell a potential riot by handing a cop a can of soda.

Pepsi quickly pulled the ad after being accused of trying to commercialize the Black Lives Matter movement.

“That was a poorly executed campaign where both sides tried too hard,” says Tiffany Zhong, CEO of Zebra Intelligence, a SaaS platform that connects brands to teens for research and marketing purposes. “It wasn’t related to Kendall’s brand, and Pepsi hadn’t branded itself as caring about Black Lives Matter or social issues. They were just trying to latch onto a quick trend.”

Z marks the spot

Still, the time when brands can sit on the fence and steer clear of controversy is rapidly coming to an end. The reason? Generation Z.

The first generation to grow up with smartphones in their hands accounts for some 25 percent of the U.S. population, making Gen Z larger than boomers or millennials. Though many are not yet able to legally buy alcohol, they still wield $44 billion in annual purchasing power, according to the National Retail Federation.

Gen Z also has different needs and expectations, says Jamie Gutfreund, global CMO of digital agency Wunderman. They are “venture consumers” who require a lot more information from brands before they’re willing to risk an investment.

“If I’m a member of Gen Z and I’m seen on Instagram wearing a shirt from a company that’s considered ‘unfriendly or bad,’ I’m going to pay a price for it socially,” Gutfreund says. “So I will be extra selective in terms of the brands I support.”

Research conducted by Wunderman shows that nearly three-quarters of Gen Z believe they can change the world, but 85 percent put more trust in private companies than government. And nearly 90 percent say they’re only loyal to brands that share their values.

Yet, there’s paradox at play here. For this generation of consumers, brand loyalty is tenuous and fleeting. The most politically woke, socially responsible, innovative companies in the world are never more than one click away from losing their customers to a competitor.

“Everyone says they’re super loyal until they find something better,” says Connor Blakley, an 18-year-old Gen Z marketing consultant. “And then they jump ship.”

Table stakes

This means asking brands to take risks without any guarantee of reward. Yet those are the table stakes moving forward. Those who fail to be transparent about their values and beliefs will become invisible.

“If a brand doesn’t take a stand, or partners with an influencer who’s taking a stand, people are just not going to see you,” says marketing consultant Cynthia Johnson. “To build a real brand that attracts Gen Z, you will absolutely have to speak up.”

It’s a tightrope for many risk-averse American corporations, which often have difficulty responding to issues at the speed of the internet, notes Mark Ray, principal and chief creative officer at Portland, Ore.-based North, a purpose-based ad agency.

“American business culture is realizing that it doesn’t have the time or expertise to figure this out,” he says. “They need help navigating it from a smart PR person or ad agency that’s paying attention.”

Ultimately it comes down to figuring out what your brand’s values truly are, then articulating them loudly and often.

“If you have a clear idea what you’re about, and you’re willing to take a stand, your customers will respect you and things will work out,” says Cards Against Humanity’s Temkin. “If you’re constantly making every decision on a piecemeal basis, or trying out activism as the buzzword for 2018, people will see through it.”

This story first appeared in the April 16, 2018, issue of Adweek magazine. Click here to subscribe.