Boycotts, buycotts and the rise of consumer activism

Make Me Smart March 12, 2024 Transcript

Note: Marketplace podcasts are meant to be heard, with emphasis, tone and audio elements a transcript can’t capture. Transcripts are generated using a combination of automated software and human transcribers, and may contain errors. Please check the corresponding audio before quoting it.

Kimberly Adams 

Hello everyone, I’m Kimberly Adams. Welcome back to Make Me Smart, where none of us is as smart as all of us.

Kai Ryssdal 

I’m Kai Ryssdal. Thanks for joining the pod today. It is Tuesday the 16th. No, it’s the 12th of March. I don’t know why I thought it was the 16th. Sorry, it’s written there right in front of me.

Kimberly Adams

Cause we’re trying to make it go faster.

Kai Ryssdal

Because I would like to make things go faster. Yes. We are going to talk consumer activism today, boycotts and the like. They have been in the news, whether it’s the war on Gaza, to Doritos chips to beer. I mean, you name it. Consumer discontent and consumer boycotts are trying to motivate a whole bunch of change in this world. And we’re going to talk about that and how it works.

Kimberly Adams 

Right, and how well it works because it comes up all the time, but it’s sort of unclear how well consumer boycotts actually work and how social media has impacted consumer activism. So, here to make us smart about this is Brayden King. He’s a professor of management and organizations at the Kellogg School of Management. Welcome to the show.

Brayden King 

Thank you. I’m glad to be here.

Kimberly Adams 

So, first of all, is this a real phenomenon? Are we seeing more consumer boycotts these days than usual?

Brayden King 

Well, it’s not clear if there are more, but there are definitely more visible now because of social media, the ease with which people can get on any of these platforms and make a stir about a boycott is, is just greater today than it’s ever been. So, it certainly seems as if there are more boycotts.

Kai Ryssdal 

Are they working, do you think? Generally speaking.

Brayden King 

So, how they’re working kind of depends on how we define boycott work.

Kai Ryssdal 

Even as I asked that question, I knew it was too vague. But anyway, go ahead since you’re answering anyway.

Brayden King 

So, boycotts. The theory of boycotts is that you get consumers to stop buying a product or a service from a company because you don’t like that company’s policy or practice. And that reduction in sales revenue puts pressure on the company to change. That’s the theory of why boycotts work. And it really depends on consumers to go out and like, do something or stop doing something, in this case, buying their product. It turns out that boycotts are not very effective at getting consumers to do that. Consumers are pretty habitual creatures. They like what they like. And even when they say they boycott something, or when they’re ideologically aligned to the boycott, they often don’t actually change their behavior. And so, for that reason, we don’t see a big impact of boycotts on sales revenue or on profitability. Sometimes we do, but most of the time we don’t. Yet, boycotts are pretty effective at getting companies to at least publicly concede to what boycotters are asking of them. We found that about 25% of the time when there’s national media attention given to the boycott, that companies will concede to some of the boycotters demands.

Kimberly Adams 

Wait. So, what you’re saying is the boycotts don’t actually work in terms of hurting company revenues. It just embarrassed them into action.

Brayden King 

Exactly. So, the main reason that companies give into boycotts is because they don’t like the negative spotlight that’s put on them due to the boycotters’ activities. So, you can think of boycotts as really effective public relations tactics or activists. You’re more likely to get the media to listen to you. You’re more likely to get other people to pay attention on social media when you do a boycott than if you just complain about something.

Kai Ryssdal 

Yeah, it’s very much, “that’s a nice brand you got there, it’d be shame if something happened to it.” Right? That’s kind of what it is.

Brayden King 

Exactly. Exactly. And also, companies really do care about their reputations. And if you put the negative spotlight on them long enough, it can start to tarnish that reputation. That’s a motivator for companies to do something about it.

Kai Ryssdal 

Right. Just because you mentioned it a second ago, social media and consumer activism. Discuss.

Brayden King 

So, social media has just made it much easier for anybody to complain about anything. And also, to make a case for doing a boycott. So, we definitely see more boycotts appearing on places like Twitter, what used to be Twitter, X or other platforms like Facebook. But it also comes at a cost, which is that they’re all competing for the attention of the public eye. The more boycotts you have on social media, the easier it is for any one of them to drown out the attention given to any other boycotts. You know, social media has enabled people to say a lot, but we’re also competing all the time for attention. That’s the scarce resource now. And so, it just so happens that boycotts go away faster in their effectiveness due to the competition that they create for each other, as well as for all the other news that’s barraging us on social media.

Kimberly Adams 

So, if boycotts are not particularly effective at hurting a company’s bottom line, I’m wondering about other kinds of consumer activism that may be more effective. And I can’t help but remember this video I saw on social media of this young woman who is encouraging people, instead of boycotting Starbucks to go in and ask them for a cup of water in a pup cup because these are things that cost them money in small amounts, but they don’t make anything off of it. And so like, are there other kinds of consumer activism, you know, in mass that actually make a difference?

Brayden King 

So, it turns out all of these kinds of behavior, which are by the way, really creative ideas. I love the idea, but they all require people to do something, right? And usually, people are far more vocal about their politics on places like social media than they are in engaging in actions. And there are a couple of reasons for that. One of which is it’s, they kind of get the public payoff, the recognition that comes from activism when they say it online, so they’re given the reward that creates that endorphin rush. By simply saying that and getting attention online, that reduces the likelihood that they’ll actually go out and do something about it in person. The same would hold true for the asking for the pup cup of water. Now there are certain circumstances though when you can get people to engage in boycotts or other kinds of disruptive action. One of which is when they have public kinds of accountability. So, when people are holding them accountable for buying this product that they said they wouldn’t buy, they’re more likely to actually go through with the boycott. Another is if there’s a substitutable product available. So, if you think about, like, you know, if you have to, like drive 10 miles to get the pizza, an alternative pizza compared to the one that you said you’re going to boycott, you’re probably not going to do it. But if there’s one that’s just like a block away, maybe you will boycott that pizza place. So, having a substitutable product makes it more likely. I think one reason why the Bud Light boycott that we saw recently was successful was because one, it’s a very substitutable product. Bub Light is not exactly, you know, that different. Maybe once you’re a big connoisseur of lite beer. It’s not that different than all the other products. So, sorry, Miller Lite, but you’re not that different than Bud Light. And so, it was very easy for consumers who are wanting to boycott to do so. They could just go to the refrigerator, you know, at the grocery store and you know, pick up another six pack. The other reason though, is because beer drinking is by nature very social. So, people tend to drink beer with their friends in places like bars or restaurants or, you know, at their friend’s house. And people tend to have the same political views as their friends. So, when our friends say, hey, you know, I’m boycotting Bud Light because of XYZ. We are also probably likely to think and say the same thing. And then when we drink beer together, it would be very weird for one of us to be drinking a Bud Light when we all just said we wouldn’t do that anymore. So, the public nature of it. The group nature of it makes it easier for us to be held socially accountable for that kind of a boycott. I think that combined with the fact that certain venues, like music venues said they were we’re not going to sell it anymore, is what led to the decline in sales revenue associated with that boycott.

Kai Ryssdal 

Is there a left, right split in in boycott and consumer activism effectiveness? You mentioned the Bud Light thing, which happened because a trans influencer had had gone online and said nice things about Bud Light, and the right spectrum of this country. On the right, that is, went just all kinds of “Oh, my goodness.” And it was very effective, as you said. Does it apply for progressive causes as well?

Brayden King 

It’s a really good question. I don’t know that there’s been a progressive cause that has recently that has been as effective at mobilizing consumers to actually change their behavior and a boycott as the way that Bud Light boycott did. So, you can kind of pull that one up as an example of hey, it actually can work sometimes. I can’t think of a progressive cause that did quite as well. We actually did a study a few years ago where we were looking at progressives who said they were going to buycott Starbucks. Says they’re going to buy more coffee from Starbucks because if you remember at the time, Starbucks said they were going way to hire more refugees from countries that, where you had immigration bans in place. So, progressives said they were going to buycott Starbucks. Well, we were able to get like, the hold of a data set that showed people’s receipts, whether they actually spent more money or not at these places. And we found that progressives were way more likely to say they were going to buycott. If you had voted for Hillary Clinton or if you read the New York Times, you are more likely to say you’re going to buycott. If you voted for Trump or if you watched Fox News, you said you’re going to boycott. Turns out, neither of them were associated with any kind of change in behavior. And so, it’s not really progressive versus conservative I think that’s driving the, you know, whether it’s effective or not at shaping consumer behavior. I think it’s just that in certain kinds of products, it’s easier to boycott, right? So, if liberals said they were going to boycott a beer, it probably would happen in the same way.

Kimberly Adams 

So, I mean, you kind of touched on this before. But like, if you’re a consumer, and you want to change a company’s behavior, what actually does work?

Brayden King 

So, one thing to do is to think about the story that you’re telling and focus on one company and keep that campaign going for as long as possible. And the boycott can’t be the only tactic that you’re using. I think one of the most successful boycotts that has been done in you know, the last few decades anyway, was the boycott that college students who were in, you know, I’d say progressive college students did against Nike in the 1990s. So, in the 1990s, Nike and every other athletic apparel retailer was involved in having factories in their supply chain that were abusive of their employees or used sweatshop conditions in their factories. The activist could have gone after any of the companies because they all did it, but what they did is they focused on Nike because Nike was the biggest brand around. And it was making a case for being the, you know, the brand of athletes. The ones that athletes really.

Kimberly Adams

And you’re embarrassing Michael Jordan.

Brayden King 

You’re embarrassing Michael Jordan. Yeah. And so, they made this narrative that how can our athletic departments be associated with this brand when it is clearly, you know, abusive of its employees, violating human rights standards. And they put Nike under the gun. They not only boycotted them, but they had protests outside of basketball games. They use a variety of tactics to keep that issue in the news, recognizing that public attention is the greatest asset you have when trying to name and shame a company and force them to change their policy. And, you know, Nike was upset, Phil Knight said, “Why us? You know, we’re not the only company doing this.” They said, “Yeah, but you are Nike. And that’s why you shouldn’t do it.” And so eventually, Nike not only changed, but they became the industry leader in setting standards for better labor conditions in their supply chain. It wouldn’t have happened if the activists hadn’t sustained that effort over a long period of time and been flexible with the kinds of tactics they were using.

Kimberly Adams 

Wow, I had forgotten about that, but it was so huge at the time, right? Well, we’re going to end it there. Brayden King at the Kellogg School of Management. Thanks for making us smarter.

Kai Ryssdal 

Thanks a lot.

Brayden King 

You’re welcome. Thank you.

Kai Ryssdal 

It works. Takes time. Gotta pick your causes, but it can work. I think.

Kimberly Adams 

The boycotts don’t work. It’s the long-term campaigns that work.

Kai Ryssdal

Right, right. Well, there you go.

Kimberly Adams 

All right. Well, if you have ever participated in a boycott, let us know. That number is 508-827-6278. Also known as 508-U-B-SMART. How have we made you feel about boycotts now? Now that you know what you know. We’ll be right back.

Kai Ryssdal 

All right, we’re going to do some news. Kimberly Adams, you get to go first.

Kimberly Adams 

You know me, I love a good regulation story.

Kai Ryssdal

Dork. Oh my God.

Kimberly Adams

I am proud to be who I am. I have been following with interest the sort of machinations of the joint employer rule. So, as a refresher, the National Labor Relations Board issued a final rule in October changing the way that some companies will be considered employers. So, that made it so that say if you were a franchise owner like McDonald’s. Even if your local McDonald’s is owned by an individual person, McDonald’s still would hold some responsibility, and that’s just an example. But many, many, many big, big companies hate this rule to the tune of like the U.S. Chamber of Commerce, which is one of the biggest lobbying groups in the country. And so, they have been fighting this new rule. And just as an example, on Friday, a federal judge in Texas struck down the joint employer rule, which was supposed to take effect on Monday. So, it was supposed to take effect yesterday. But on Friday, a federal judge in Texas struck it down and basically put it on hold. And it said that the U.S., here’s a story from Reuters, “U.S. District Judge J. Campbell Barker in Tyler agreed with the challenges to the ‘joint employers’ rule, including the U.S. Chamber of Commerce, that it’s too broad, and it would violate federal labor law. Barker said the rule is invalid because it would treat some companies as employers of contract or franchise workers even when they lacked any meaningful control over their working conditions.” So, this matters a lot to the sort of people working for franchises such as McDonald’s, Burger Kings, Dunkin, whatever. It also could matter for some of these gig economy workers because you know, this could apply to potentially a company like Uber because the rule was saying that if you are meaningfully setting the parameters of how someone works or their pay structure, even if you’re not day-to-day managing them, you’re still a joint employer. So, if McDonald’s corporate says what everybody has to wear, and what the wages are going to be, and sort of the policies of the workplace, then even if they’re not managing people day-to-day that individual franchise, they’re still part of the employer. And this matters in terms of who has liability if something goes wrong. This matters in terms of what kind of regulations apply to a different company. So, it’s just a very interesting story. I’ve been watching it, and the NLRB is expected to appeal likely, and activists obviously are getting involved. But there are a lot of very big business interests trying to get this thing knocked down.

Kai Ryssdal 

Well, you were right on one thing, Ms. Adams, it is indeed a dorky regulatory story. But totally important. Totally important. And God bless you for you know, loving them. My goodness, my goodness.

Kimberly Adams 

Okay, well, what’s your exciting news?

Kai Ryssdal 

Well, I was just going to say, for every bond market story, I’ve pulled out, you know. Free pass on regulatory stores. So, here’s what happened this morning. Inflation number comes out at 5:30, right? The CPI.

Kimberly Adams 

You really threw me off there. I was like, 5?

Kai Ryssdal 

Well, 5:30 my time. Right? So, it drops while I’m stretching to go for a run. I go for a run. I come back. Liv, our daughter gets up and goes to school. A little later my wife gets out of bed and blah, blah, blah, whatever. She’s stretching for a run. And I’m walking by and I’m like, “Hi, sweetie. How are you?” And she says, “So, what’s up with this inflation story? I thought inflation was supposed to be going down, not up. And that the news this morning was it’s going up.” And that was my clue that I need to remind people that inflation is going to be bumpy, right? If you think that is going to be a smooth trajectory down to where 2% is, my wife is here to tell you that it’s not. Inflation is going to bounce around. CPI came out this morning, just a touch higher than anybody expected. And it’s way higher than the Fed wants, right? It was 3.1 or 2%, whatever it was. Not the 2% year-on-year that the Fed wants it to be. It’s going to be bumpy. There’ll be ups, and there will be downs. We don’t know what next month is going to be, but do not hang your hat on every little note of an inflation report. That is my news. Brought to you from you know, my wife.

Kimberly Adams 

First of all, what a healthy household you have. Look at y’all, both getting up and running. But secondly, one thing I often have to remind my friends and family who pay zero attention to these sorts of data dumps is that, it always goes up. What we’re paying attention to is the speed at which it’s going up.

Kai Ryssdal

Right. Right. Very good point.

Kimberly Adams

So, you know, unless you know we’re in a pretty bad economic situation. For the most part, the number is going to be going up to some extent, and it’s the sort of nuances of how fast it’s going up that that matters.

Kai Ryssdal 

Exactly right. Exactly right. Totally.

Kimberly Adams 

Okay, well, there you go. How far do you run?

Kai Ryssdal 

Five-ish, give or take.

Kimberly Adams

Wow, okay.

Kai Ryssdal

That’s my thing. It’s my Zen time. It’s my internal you know, mental elasticity time.

Kimberly Adams 

I thought you went mountain biking every morning.

Kai Ryssdal 

I do that too.

Kimberly Adams

Both. Or you alternate?

Kai Ryssdal

I alternate. Sorry. Alternate.

Kimberly Adams 

I was just like, whoa. Okay. Did I tell you I tried mountain biking for one of my 40 skills for 40.

Kai Ryssdal

I think you did. Yeah.

Kimberly Adams

And it was unpleasant. It was very unpleasant.

Kai Ryssdal 

I’m sorry because it’s fun. Alright, that’s it for the news. Let’s do the mailbag.

Mailbag

Hi Kai and Kimberly. This is Godfrey from San Francisco, Jessie from Charleston, South Carolina. And I have a follow up question. It has me thinking and feeling a lot of things.

Kimberly Adams 

Speaking of recapping the last year, I recently shared a story, and I’m so sorry for everyone who had to hear it about my terrible experiences with leeches while hiking in Bhutan last year. I do want to clarify, it’s a lovely country, wonderful place to visit. Just you know, watch out for leeches in the rainy season. And some of you had some leech stories to share, such as this one. Oh, God.

James

This is James in South Dakota. I grew up in Yankton, South Dakota near Martin creek running through town. It wasn’t cleaned up like it is now with a bike trail. But it was very rough and felt like an escape for a kid like me. I had a lot of fun in a near exploring and sometimes came home with leeches on my ankles. Thanks for making us smart.

Kai Ryssdal 

Holy cow. That’s just so wild to me.

Kimberly Adams 

That’s like a scene from Stand by Me.

Kai Ryssdal

Yeah, right. Yeah, totally.

Kimberly Adams

We’re not going to talk about leeches anymore.

Kai Ryssdal 

Yeah. All right, we’re going to leave leeches behind. And instead, we are going to on the way out, as we always do leave you with this week’s answer to the Make Me Smart question. What is something you thought you knew, but later found out you were wrong about? This week’s answer comes to us from Dr. Jasmine Harris. She’s the author of a book on racialized inequalities in education, and it is titled the “Black Women, Ivory Tower.”

Dr. Jasmine Harris

Brown versus Board of Education of Topeka was a landmark 1954 decision meant to jumpstart school integration by ruling that separate but equal racial segregation in public schools was unconstitutional. The integration that followed was supposed to establish schools as equal playing fields regardless of race. When I began as a student, 35 years later, the assumption of equality in the classroom was solidified. So, I, a little Black girl thought, thanks to integration that school was a place where all students could belong and learn equally. I was wrong. Good grades didn’t protect me. My hard work created animosity, and I was discouraged from trying in every direction. I was so wrong, I had to write a book about it.

Kimberly Adams 

You know, my dad once told me that, and he grew up during integration, that integrating the public schools was one of the worst things that happened to the Black kids in his community. Because they went from an environment where everyone wanted them to succeed and was invested in their success. And like, their teachers knew their parents, and everybody went to church together and whatever, to being placed in a situation where everyone hated them and wanted them to fail. And, you know, it was a necessary thing to happen. But, you know, some of the stories that I hear from that generation, my mother has some particularly traumatic ones about, you know, being one of the first Black kids in her school as a child. It was so damaging for them. And yeah. But those stories then of people coming out of the other side of it, like, you know, Dr. Harris. Their stories of resiliency and you know, hopefully making it better for the next generation. But yeah. All right. That is it for us today. But before we go, we have a bit of an ask to make. It is the first day of our March fundraising campaign, and we have a big match this time around. So, for those of you who may not be in the know yet, it is our 35th anniversary of Marketplace. And so, Marketplace Investors have a Challenge Fund, and it will match all gifts today up to $35,000. Match 35th anniversary, $35,000 So, if you give right now, you can double your impact. It’s an incredible match, and we would really appreciate the support you can go to marketplace.org/givesmart, and your gift will go twice as far.

Kai Ryssdal 

While you’re there, check out the 35th anniversary throwback thank-you gifts that just debuted today. We put our old logo, the original logo on a sticker on a glass mug, also a classic tote bag and a t-shirt. Pictures coming to you right now, marketplace.org/givesmart, and thanks.

Kimberly Adams 

Make Me Smart is produced by Courtney Bergsieker. Ellen Rolfes writes our newsletter. Today’s program was engineered by Jesson Duller with mixing by Drew Jostad. And our intern is Thalia Menchaca.

Kai Ryssdal 

Ben Tolliday and Daniel Ramirez did the theme music. Our senior producer is Marissa Cabrera. Bridget Bodnar is the director of podcasts. Francesca Levy is the executive director of Digital and On-Demand. Marketplace’s Vice President and General Manager is Neal Scarbrough.

Kimberly Adams 

You know, we still have some of that old logo stuff here in the D.C. bureau.

Kai Ryssdal

Do you really? Wow, that’s so funny.

Kimberly Adams

Yeah, like signs and things.