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Is Being 'Woke' Good or Bad for Business?

A man in a blue suit standing on a staircase.
​Jay McDonald

​Anheuser-Busch, brewer of popular beer brands including Bud Light and Budweiser, has received significant backlash in recent weeks after partnering with transgender influencer and activist Dylan Mulvaney.

On April 1, Mulvaney promoted the company's Bud Light brand in a sponsored social media video that went viral. While some applauded Anheuser-Busch's attempt to promote inclusion, others criticized the company for alienating its customer base, which has historically been perceived as socially conservative. Many called for a boycott of Anheuser-Busch products.

The company has reportedly lost more than $5 billion in value since the Mulvaney partnership became public. Alissa Heinerscheid, Bud Light's vice president of marketing, took a leave of absence amid the controversy.

"We never intended to be part of a discussion that divides people," Brendan Whitworth, Anheuser-Busch's CEO, said in response to the backlash. "We are in the business of bringing people together over a beer."

The situation gave rise to the conversation of "wokeness" in a business setting. Woke is a slang term that was originally used to describe someone who is alert to racial injustices.

Jay McDonald, a business consultant and former CEO, spoke to SHRM Online about how wokeness relates to the Bud Light controversy and how this term shouldn't deter organizations from pursuing their diversity, equity and inclusion (DE&I) objectives.

SHRM Online: From your perspective, what is wokeness? And are there any benefits or negative implications of businesses being woke?

McDonald: The term "woke" has been used to describe a cultural shift towards greater awareness and sensitivity to issues related to social justice, diversity and inclusivity. While the concept of woke is subjective and can be interpreted in different ways, in general, it is seen as a positive movement towards creating a more equitable society. It's derived from the 1960s term "consciousness."

However, a large part of society considers [wokeness] as a cause that indiscriminately judges others and classifies large segments of the population negatively due to generalizations on the part of the "woke community."

Sadly, the term has been hijacked by differing viewpoints and often weaponized inappropriately. It can trigger emotions, both positively and negatively. You should acknowledge that as with "cancel culture," "critical race theory" and even "structural racism," the contested nature of the term imposes a pre-emptive barrier to productive disagreement. It can be a barrier to communication.

In terms of business, being woke can have both positive and negative implications, depending on how it is executed.

On one hand, companies seen as socially responsible and committed to diversity and inclusivity can attract a broader range of customers, particularly younger consumers who are more likely to support brands that align with their values. A level of social consciousness by customers, investors, boards and the public, in general, has brought a spotlight on responsibility beyond only making a profit.

On the other hand, if a company's commitment to being woke is perceived as inauthentic or superficial, it can backfire and lead to negative publicity and a loss of trust from customers and employees. If a company's commitment to social responsibility is not backed up by concrete actions, such as implementing policies and initiatives to promote DE&I within the organization, it can come across as insincere and may not result in any meaningful change.

People are also tired of having their freedom of choice questioned or dictated by others. Too often, individuals are being preached to or told how to live our lives, when most just want to "live and let live." Naturally, when we feel we're being "force-fed," we will rebel. This can lead to backlashes or boycotts of the businesses which seem to dictate to us.

I don't think companies need to sacrifice one market segment for the other, either. Certainly, there can be trade-offs, and I hope companies can be open and inclusive enough to attract their total market rather than giving up one for another.

When it comes to taking a stand, leaders must think about three things: the community the company serves, the issue or cause in question, and the company's bottom-line interests.

SHRM Online: What is your reaction to the backlash Bud Light has received for the ad campaign that includes a transgender spokesperson? And what can companies take away from this story?

McDonald: This backlash highlights the ongoing challenges that companies face when trying to be inclusive and diverse in their advertising and marketing. While many consumers appreciate and support diverse representation, others may feel uncomfortable or offended by it. Companies must carefully consider their target audience and the potential impact of their marketing efforts to avoid causing unintended backlash.

But companies should not let the fear of backlash prevent them from embracing diversity and inclusivity in their marketing efforts. In fact, studies have shown that companies perceived as socially responsible and committed to diversity are more likely to attract and retain customers and employees who value these traits.

With the Bud Light situation, I don't think the company was intentionally trying to exclude a major part of their customer base, but some of the things that have been publicly said by representatives of the company imply that they are trying to attract young people. And young people are more attuned to social matters in some respects than older people.

To avoid negative reactions, companies can take steps to ensure that their advertising and marketing efforts are inclusive and authentic. This includes involving diverse voices in the creation of marketing materials and being transparent about the company's commitment to diversity and inclusivity while responding promptly and appropriately to any criticism or feedback received.

Overall, the Bud Light ad campaign backlash underscores the importance of taking a thoughtful and intentional approach to diversity and inclusivity in marketing while also recognizing that not everyone will be on board with every campaign. Companies should strive to be authentic and genuine in their efforts while also being open to feedback and willing to adjust when necessary.

SHRM Online: How has the move toward inclusion impacted the way companies approach marketing?

McDonald: The move toward inclusivity has had a significant impact. In the past, many companies focused their marketing efforts on a narrow segment of the population, often excluding individuals with diverse backgrounds, beliefs and lifestyles.

However, with the increased emphasis on inclusivity and diversity in modern society, companies have had to rethink their marketing strategies to ensure that they are more inclusive and reflective of the diverse customer base they serve.

One of the most significant ways in which companies have shifted their approach to marketing is by prioritizing inclusivity in their messaging and branding.

Many companies have recognized that using more diverse and representative images, language and stories in their marketing materials can help them connect with a broader range of customers and build stronger brand loyalty. For example, some companies have embraced the use of nontraditional models in their advertising campaigns to represent different body types, skin colors and ages.

Additionally, companies have also started to consider the impact of their products and services on different communities. This includes recognizing the unique needs and challenges faced by different groups, such as individuals with disabilities, members of the LGBTQ community and people from different cultural backgrounds.

By acknowledging and addressing these needs, companies can demonstrate their commitment to inclusivity and build stronger relationships with their customers.

Overall, the move toward inclusivity has forced companies to rethink their marketing strategies and consider the impact of their messaging on a diverse range of customers. By embracing DE&I in their marketing efforts, companies can build stronger connections with their customers and position themselves as leaders in their industries.


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