Brand Immunity Doesn't Exist: 5 Tips to Survive this New Era

As a GenXer growing up on the East Coast, it was absolutely awful to wear "no-name" brand anything. Whether sneakers, jeans, eyeglasses, or food, peer approval made it extremely important to utilize the hottest brands. God forbid, you had a parent like mine that insisted on "saving money" with no-name brand items.

Just as hip hop music has endured through that generation, the GenXer philosophy about the importance of brands has also persisted. Nevertheless, over the years, some brands have faded while others have flourished. Rapper and actor LL Cool J had a preferred clothing brand called Troop Sport that he wore in music videos and during concert appearances. Rumors that the company was owned by the KKK and that there were hateful messages inside the lining of the apparel would not go away-- even with contradictory evidence. Troop's core market, who were 95% Black and Latino, abandoned the company within 5 years.

On the other hand, Tommy Hilfiger epitomizes a brand that endured. In 1996, there was a vicious rumor that Tommy Hilfiger didn't want Blacks or Asians to wear his brand. Someone even went as far as to assert that Oprah Winfrey could substantiate the debacle (but she did not). Yet, the boycott campaign could not withstand Hilfiger's strong brand. Hilfiger reported that his sales increased from $1 to $2 billion during that tumultuous time. What saved Tommy Hilfiger? For one, GenXer's were not as connected to Oprah-- they loved her, but they watched Jerry Springer. Second, Tommy Hilfiger diversified his target market. Hilfiger achieved brand notoriety by giving away his clothing for free to aspiring hip hop artists, but he also developed a solid base with rock and roll sponsorships. In addition, Hilfiger continued to diversify the company's product offerings to appeal to different audiences.

What lessons can we learn, with today's near-daily viral assaults on diverse customers? For one, we're no longer dealing with rumors, but with a powerful tool called social media on the world wide web-- which works faster at mobilizing people to act and enables more individuals to share their own experiences or opinions. Simply stating that it is "fake news" is not a very effective strategy for employers. Second, too many organizations are in reactionary mode because they are operating on outdated management platforms or 19th century business models.

For example, American Airlines recently announced lay-offs after the NAACP issued a travel advisory. Within 6 months of the travel advisory, American Airlines felt the impact on sales. American responded with bias training and the NAACP lifted its ban in July 2018. After the arrest of two Black men in a Philadelphia store, Starbucks acted swiftly to offer unconscious bias training to staff-- but the damage was done after several other customers came forward with their personal stories of discrimination. In spite of the CEO's direct involvement and his quick action, the company missed sales targets and will close over 100 stores next year. Finally, the founder of Papa Johns made a few incendiary statements on Twitter during the NFL protests that resulted in his resignation as CEO in 2017. In May 2018, the founder made new inflammatory remarks during a company conference call. In response, the Board requested his resignation as Chairperson. After John Schnatter resigned, however, the founder regretted his decision.

Corporations are not alone. As school prepares to resume, parents and students alike are afraid of the risks posed by bullying, harassment, and unrestricted guns. Home schooling appears very attractive in those suburban areas where administrators are reluctant to install the same metal detectors and heavy police presence that is used in inner city schools. On college campuses, who wants to work at, or attend, an institution where the Diversity Officer files a racism or discrimination lawsuit? The University of Connecticut's former graduate diversity officer claimed she experienced retaliation and racial discrimination after complaining about the university's policies. Also, the Diversity Officer at SUNY Plattsburgh accused the school of racial and sexual discrimination. These universities have to know that folks will do a Google search before deciding where to work or attend school.

Since the 1990's, brand failures resulting from Diversity and Inclusion were far and few between-- until recently. From a Diversity and Inclusion perspective, the world's best known brands are just as susceptible to failures as no-name brands. So what can organizations do?

1. Don't take it personally: learn from mistakes instead of hiding them in shame. I am not criticizing employers or putting companies on blast for the sake of nitpicking. This information should be used to help employers learn from their mistakes, but also serve as an example for others to ask questions about practices and policies that may lead to discrimination or be perceived as unfair. One of the biggest problems that we have in the field of diversity is that we blame and shame people and organizations for mistakes. Blaming and shaming makes it difficult for people and organizations to admit that there is pain, and that it needs to heal or to be fixed. Most people want transparency but they can't handle the truth without shaming the folks who admit that there's a problem. This has to stop because it feeds the vicious cycle of covering and reacting only when bad conduct is exposed.
2. Get back to the basics: policies and training. Some folks are emboldened by the politics of the day, which appear to sanction racist and discriminatory behavior. But the individuals engaging in such behavior are not thinking clearly, nor are they aware that there are consequences to their actions. From the CVS Store manager who called police on a customer using a legitimate coupon that he didn't recognize to the apartment complex manager who called the police on a man wearing socks at the pool, some of these employees are either forgetting company policies or their bias is so strong that they want their employers plastered all over the online news feeds. Therefore, now is not the time to skip policy enforcement or diversity training. If the conduct is permitted, more individuals will feel safe to exhibit bad behavior and it will feed a culture that appears to be in constant turmoil. Accordingly, the organization will not be able to focus on its goals while there is a continuous stream of negative news-- productivity suffers, sales lag, and the most talented workers or candidates jump ship.
3. Understand the competitive impact. In this age of hyper-competition, who wins when your employees are divided and your customers are offended? Yup, your competitors. They are going to get new sales, better talent, and more investors. If you are a government agency, folks will move to a new country/state/city, and the people who are left will not be able to support the needs of the tax base, workforce, or hospitality industry, to name a few. Educational institutions will see students transfer, or alumni contributions decline, or they will lose competitive grants. There is a reason why Tommy Hilfiger can't figure out how "the rumor" got started or why it keeps reinventing itself; one of the company's competitors stands to gain a lot by keeping "the rumor" afloat.
4. Focus on the Triple Bottom Line. In addition to making money, saving money and achieving organizational goals through Diversity and Inclusion, employers must focus on sustainability. Sustainability in this respect will include filling the bucket with good works, which will outweigh the bad. Again, Tommy Hilfiger was not perfect, but the good outweighed the bad in the eyes of consumers. And he stuck to his core values, which were consistent with the brand that was already established. Too often, companies take steps that are inconsistent with the perception of their brand after a mistake is made public. For example, if there are years of complaints about the lack of contracts with diverse suppliers, don't introduce a new supplier diversity program when a problem is exposed. Focusing on the Triple Bottom Line allows the organization to identify authentic opportunities and incorporate those ideas into a strategy that will be executed over time.
5. Keep diversifying your market and innovating new products/services. While the organization is not abandoning its core market, it can augment its base with strategic outreach efforts. CVS, Target, and Tommy Hilfiger all have great strategies for reaching diverse consumers where they are. Diversification means that one does not pursue an all-eggs-in-one-basket strategy. For example, Troop Sport's market was 95% Black and Latino. Conversely, some retailers may have a market that is 95% White in a community where Caucasians comprise 55% of the population. At some point, an organization's life span, and relevance to consumers, talent, or students, decreases each year that it delays diversification. Talent diversification also allows for the diversity of thought that fixes problems, produces improvements, and creates new ideas that drive innovation.

Gone are the days when brands are expected to live forever. In the current merger and acquisition environment, and with the expected impact from new trade policies, employers must make better decisions faster. The World Economic Forum asserts that,

"The average life span of today's multinational, Fortune 500-size corporation is  40 to 50 years. For anyone in leadership at a corporation of any size, that should be a sobering statistic. That means the company you're tasked with leading has a 50/50 shot at making it past what we mere mortals call middle age. A further sobering statistic tells us that almost 50% of the Fortune 500 from 1999 had disappeared from the list just ten years later.

Yes, a number of these entities are acquired, merged or split up into smaller companies. Many of them, however, are relegated to the graveyard of failed corporations. And in many cases, when companies perish, one of the contributing factors is that management clung desperately and stubbornly to the status quo."

In other words, the clock is ticking...diversity and inclusion has already gone beyond a "nice thing to do." Employers must learn more, operate better, and embrace the organizational changes that will allow their brand to survive in this new era and beyond.

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Leah Smiley, CDE, is the President of the Society for Diversity. For more information about the Society for Diversity, its membership or certification program, log onto: www.societyfordiversity.org.