How should companies navigate polarized politics in the Trump era?


JUDY WOODRUFF: But first: It has become a routine question. What kind of separation there is between the president, his family and the promotion of their businesses?

Kellyanne Conway's comments today about Ivanka Trump fueled a new round of criticism and concerns for the companies involved.

So, how should businesses navigate these news waters?

Our economics correspondent Paul Solman explores that with his weekly installment of Making Sense.

PAUL SOLMAN: The Super Bowl, politicized this year through ads, Airbnb branding itself as immigration-friendly, Coca-Cola recycling a 2014 ad that also suggests an alternative definition of American patriotism.

And in the larger world, backlash from Uber customers over President Trump's immigration ban, #deleteUber, that ultimately forced its CEO to step down from a White House advisory panel.

Nordstrom dropping the first daughter's clothing line back in January, with Neiman Marcus following suit, prompting a tweet from President Trump yesterday: "My daughter has been treated so unfairly by Nordstrom. She is a great person, always pushing me to do the right thing. Terrible."

So are we seeing the rise of a new partisan consumerism, echoing the country's polarized politics?

We invited two Harvard Business School professors, Nancy Koehn and Len Schlesinger, to answer the question.

NANCY KOEHN, Professor, Harvard Business School: What we're seeing now is, I think, the culmination or perhaps the next logical step of a long series of events and trends among consumers, many of them previously alienated from the political process, where they use their dollars to vote on social, political and economic issues.

LEN SCHLESINGER, Professor, Harvard Business School: And relative to today's administration, there are countless examples of how that's being played out on a daily basis.

So we have the scenario of the Ivanka merchandising line, which has now been essentially removed from Nordstrom and Neiman Marcus, a hashtag, #boycottNordstrom, hashtag #boycottNeimanMarcus for actually tossing our Ivanka out of the store, and the same on the other side of the equation.

PAUL SOLMAN: So, boycotts, consumer boycotts have been used to express political beliefs and to try to affect political outcomes for…

NANCY KOEHN: For at least 50 or 60 years, right, and probably going back farther than that.

What, again, is new, I think, Paul, is the reach and the speed. And that's all running on the high-octane fuel of social media. And I think the other thing that's new and different is the emotional energy that social media allows. These are all businesses that have a very big word of mouth component to them. They have a big ego or identity component to them.

So the ability of these boycotts to affect those aspects of business success, consumer loyalty, word of mouth, brand power, that's a big deal.

LEN SCHLESINGER: And the interesting thing is seeing where it really is a big deal and where it isn't. So, in the context of Uber, it is a service that people hate to love or love to hate, OK?


LEN SCHLESINGER: And the CEO announces he's going to join the president's business advisory council. In the midst of everything that was going on at Uber and everything that was going on in the administration within the immigrant community, he had no choice but to withdraw from being on the president's advisory council.

You wonder what got him possessed to actually join in the first place.

PAUL SOLMAN: Because he ought to have anticipated the uproar that that might cause.

LEN SCHLESINGER: Given the population he is serving and the populations, quite honestly, that the Uber services having a huge negative impact on, it should have been obvious.

NANCY KOEHN: I would ask or want business leaders to have the same kind of consciousness about the divisiveness, about the electorate, about the different kinds of issues that were, if you will, uncovered, again, in very emotionally intense ways, during the campaign.

So it's by no means stay away. It's let's think this through very carefully as we think about how to respond, react, predict.

PAUL SOLMAN: But aren't you saying stay away?

LEN SCHLESINGER: But it's precisely those terms that give me pause, OK, and have me advising in more situations than not for CEOs after doing their balance sheet, OK, to actually lay low until there's a bit more certainty as to how the administration truly is going to govern going forward.

PAUL SOLMAN: Are we seeing what's been called identity politics playing out now across the board?

NANCY KOEHN: Think about how people that are on the boycott-Trump- businesses side of things are thinking of themselves. They're thinking of themselves first as, I don't support the president. Secondly, I want to make a difference here in voicing and in doing something with my opposition, my resistance.

So, that is in some ways an exercise in identity. So, interestingly, when we talked on the campaign about identity politics, we talked it often on the side of Trump supporters. I'm not sure of my identity, I'm not sure where I belong in this country, I'm not sure that people in Washington understand or are acting on my behalf.

PAUL SOLMAN: Because candidate Trump embodied their sense of identity sort of counter to the mainstream.

NANCY KOEHN: Absolutely.

I wonder if we're not going to see a kind of consumer activism, identity politics, potentially a cohesion of the resistance or the opposition to Mr. Trump that actually has to do with an emerging patriotism?

A huge amount of the resistance when you dig down deep in is about the integrity of Trump's actions with relation to the Constitution or fundamental American values.

PAUL SOLMAN: How might it manifest itself in terms of consumption?

LEN SCHLESINGER: Well, the first level is, you see it play out just this week at the Super Bowl, OK? So I'm fascinated by listening to all of the responses to the Lady Gaga halftime show.

But the reality is, she started singing "God Bless America," right? And she had a whole portrayal of what I will call incredibly patriotic songs by someone who wouldn't be naturally assumed to be among the great patriots. And the reality is, it's exactly, I think, what you were talking about, Nancy.


NANCY KOEHN: And then think about the ads.

PAUL SOLMAN: For example?

LEN SCHLESINGER: Well, you know, the Anheuser-Busch commercial celebrating the arrival of August Busch, the Airbnb commercial celebrating the diversity in the American population, without ever talking about what Airbnb is or what Airbnb does.

PAUL SOLMAN: I literally didn't know that that was an Airbnb commercial.

LEN SCHLESINGER: Yes, yes, yes.

NANCY KOEHN: Think about that. If you think tactically from a marketing perspective, it's not — we're not talking about what Airbnb is. But we are talking about the values of the Airbnb brand or the values of the Anheuser-Busch ads.

It's a little bit like Nike towns, right? We make these investments in our brand that may or may not translate quickly into profitability or feed the bottom line, and yet they're long-term investments in how we want our consumers to understand who we are.

PAUL SOLMAN: And your point about the Airbnb ad being like Nike, I mean, Nike is all about image and identity, and not function, right?

NANCY KOEHN: Just do it, absolutely. And it's been, viewed from the long term, remarkably successful.

PAUL SOLMAN: Do you think that there will be a group of companies now, or even a group of products or services, that actually embody the oppositional form — I don't know how to quite put this — the oppositional form of American patriotism? And, if so, what would they be?

LEN SCHLESINGER: Well, I think we saw some of it this weekend, as we saw some of the more subtle messaging that came out of the commercials, which is, we're about all Americans, we're about being open to everybody, we're about being absolutely clear that we welcome all to our country and to our businesses.

PAUL SOLMAN: So, last question. Do you guys imagine that, four years from now, we will have a country that's as divided in terms of what it shops for as who it votes for?

LEN SCHLESINGER: If I extrapolated from the trends of the last several months, I would say yes.

But that requires me to actually predict that what we're experiencing today continues and in fact gets exaggerated over the next four years. I, as an academic, can say that would be really interesting. As a human being, I would say, that's scary.

PAUL SOLMAN: From the Harvard Business School in Boston, this is economics correspondent Paul Solman, reporting for the PBS NewsHour.

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