With the recent controversies over red Starbucks cups and holiday sweaters, retailers are faced with hard questions about their brand identity. There’s an adage that says “it’s not what happens to you that matters—it’s how you respond that’s most important.” How a business responds to offended customers makes a huge statement about that brand’s values.
In the case of Starbucks, the decision to replace their Christmas-themed cup design (which had been used for years) with a plain red one generated extreme amounts of discussion on social media. Joshua Feuerstein posted a video on Facebook titled “Starbucks REMOVED CHRISTMAS from their cups because they hate Jesus,“ and it quickly went viral, with many people supporting him.
In the case of Target and Nordstrom, both retailers fell under scrutiny for holiday sweaters that some considered to be offensive. Target’s “OCD — Obsessive Christmas Disorder” sweater was criticized for being insensitive to those suffering from mental illness. Nordstrom’s “Chai Maintenance” sweater was attacked for perpetuating a stereotype about Jewish people.
Incidents like these are defining moments for a brand’s identity. While Nordstrom apologized for its offensive sweater and stopped selling it, Target made no such apologies and continues to carry the item. The controversies raise questions that are core to business’ values and how they would like to be perceived in the marketplace:
- Are we more concerned with sales, or making sure we don’t offend a certain customer segment?
- Who is our target buyer, and do we care if some buyers don’t like us?
- To what extent do we react to such backlash and make business decisions based on what offended customers say?
Is our goal to be politically correct, or to increase profits? Are the two mutually exclusive?
If the ultimate goal is profitability, then businesses do best when they are empowered with an accurate view of customer feedback, coupled with data about customer loyalty. Having this data will allow brands to understand what percentage of the online conversation is positive or negative, and the extent to which the negative sentiment will actually impact sales.
Here’s how it works. By using social listening technology, brands can gain a thorough understanding of the conversations across Facebook, Twitter, and other social networks. Applying a sentiment analysis to this data reveals not only positive and negative mentions of the brand, but deeper insights into how customers feel.
For example, a business can detect emotions such as anger, disappointment, frustration, happiness, excitement, and others, and also determine the drivers of those emotions. In the case of Starbucks, Target and Nordstrom, the following questions can be quickly answered:
- What percentage of the total conversation about the red Starbucks cups is positive?
- For the people who like the Target sweater, why do they like it? What are they saying about it?
- When looking at the entire universe of conversations about Nordstrom, how much of it focuses on the holiday sweater?
The key is for brands to be monitoring these conversations 24×7, not just when a crisis emerges. An established social media listening program ensures that brands aren’t caught off guard by viral videos, and can immediately determine the impact.
Beyond social channels, a complete view of customer feedback is only attainable from an omni-source program. Brands that are also collecting and analyzing feedback from the call center, surveys, inbound emails, and online review sites, are easily able to determine if the offended customers are just making noise on social media, or if they are angry enough to complain directly to the business.
Finally, to truly understand the impact of this type of backlash on the business, brands need to look at CRM data. Are the offended customers regular buyers? If so, are they likely to churn because they are offended by a product decision? The challenge is obviously connecting this purchase history data with social listening data. Sophisticated analytics tools can bring this data together and paint a clear picture of the customer landscape: who are the most loyal customers and are they offended?
It’s important to make the distinction between offending customers vs. failing to meet their needs. In the case of Keurig, customers were outraged because they discontinued the My K-Cup product, which limited their ability to choose from non-Keurig brands of coffee. This decision was detrimental to the business and profits fell dramatically. Offending customers is a different story, however, and that’s where a brand’s core values come into play.
In light of these holiday controversies and with the possibility of more on the horizon, brands are faced with difficult decisions. Having as much customer data as possible will go a long way in helping businesses decide how to act in the face of mass public scrutiny.