In the U.S. and throughout the world, public trust in media, government and religion is lagging. Brands and corporations are not exempt from this erosion of public trust. Couple this with a hyper-partisan political atmosphere and you get a new dynamic in that people can see companies as part of the problem – but would also like to see them as part of the solution.

“There’s an increasing expectation that brands will stand up and be counted and be part of the solution,” says Peter Horst, founder of CMO Inc. and former CMO of Hershey.

The danger for brands is the possibility of political realignment of their customer base. Consumers are less trusting of corporate communications and more likely to believe claims of wrongdoing. Taking a stance on nearly any issue – from immigration to the minimum wage to free trade – can quickly turn off half of your customers. It’s a tricky landscape made all the more complicated by the Twitter feed of President Donald Trump.

Within 140 characters, as many companies have seen already in Trump’s young presidency, the president can launch a brand into the political spotlight whether they want to be there or not.

What’s a brand to do? Do you express an opinion as a brand, or even just as a leader, owner or CEO?

The first thing to do is understand the risk, argues Ipsos in a research paper looking at these issues of brand trust in an age of populism.

Download the Point of View: Brand Risk in the Age of Populism

 

With less confidence in formal institutions, people have turned to social groups and ideology as organizing forces for their identity. Paradoxically, while formal political parties have declined in stature, the power of partisan identification has exploded. Party ID now ranks as one of the most central aspects of how consumers organize their lives and increasingly, how they relate to brands. Data from dating apps indicates the extent to which ideology and partisanship are important factors for Americans. They are among the most important criteria, just behind race and equivalent with education level in order of entertainment preferences.

As people sort themselves philosophically and geographically, they are often quick to boycott or switch products if they perceive that the brand has adopted a political stance counter to their own. But all brands aren’t necessarily at the same level of risk.

For one thing, it’s important for brands to be consistent. They shouldn’t surprise their customers. As an example, Linda Bean, granddaughter of LL Bean’s founder, received a positive tweet from Trump and it came as a shock to many who viewed the company itself as having more liberal policies related to its workforce and manufacturing. Bean’s  heavy contributions, as a citizen, in support of Trump’s campaign did not seem in line with the company.

 

Thank you to Linda Bean of L.L.Bean for your great support and courage. People will support you even more now. Buy L.L.Bean. @LBPerfectMaine

— Donald J. Trump (@realDonaldTrump) January 12, 2017

 

Another factor is the type of brand and the type of product.

“It’s possible that analog brands are more resilient,” says Horst, who will be discussing these issues at TMRE. “There may also be a difference between an Uber and a Tesla, both of whose CEOs were on Trump’s council. For these businesses where my relationship is essentially a digital icon, it’s perhaps easier to vent my anger at them than if I’ve got $70,000 of metal sitting in my driveway.”

Consider also, the role of the executives within the company. Is leadership tied to the brand, or does the brand supersede its people? For example, the north side baseball team in liberal Chicago is currently owned by the Ricketts family, which has deeply conservative ties for the most part. But the Cubs brand has such tradition and loyalty associated with it, that most fans made their peace with this disconnect.

Horst is of the opinion, backed up by Ipsos’ research, that “Corporate reputation is much more connected to brand health (now). The digital accessibility of social media and transparency of information and all this pent up unsatisfied social energy has changed the rules.”

So brands, companies and their leaders need to be prepared should the spotlight swing in their direction – either by deliberate action on their part or because someone else thrust it on them.

Brands should be communicating and building trust with their customers day-to-day. But they also need to have a communications plan in place should something arise on social media. Brands need to react quickly.

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