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Should Your Brand Pick a Side? How Market Share Determines the Impact of Divisive Corporate Political Stances

Author

Listed:
  • Hydock Chris

    (Assistant Professor of Marketing, California Polytechnic State University, Orfalea College of Business)

  • Paharia Neeru

    (Associate Professor of Marketing, Georgetown University, McDonough School of Business)

  • Blair Sean

    (Assistant Professor of Marketing, Georgetown University, McDonough School of Business)

Abstract

When the public opinion on a social matter is divided, it is riskier for large brands to engage in activism than for small brands. As long as a brand’s initial market share is sufficiently small, engaging in activism can result in a net increase in customers even if the brand takes a stance that consumers overwhelmingly oppose. In contrast, large brands can lose more than they gain, even when opponents and supporters are in balance. Product quality or competitive prices are no insurance against taking the wrong stances. Consumers are willing to trade off price and quality for political values. Therefore, brands cannot dismiss the consequences of politics, even if they hold a traditional competitive advantage in price or quality.

Suggested Citation

  • Hydock Chris & Paharia Neeru & Blair Sean, 2021. "Should Your Brand Pick a Side? How Market Share Determines the Impact of Divisive Corporate Political Stances," NIM Marketing Intelligence Review, Sciendo, vol. 13(2), pages 26-31, November.
    • Handle: RePEc:vrs:gfkmir:v:13:y:2021:i:2:p:26-31:n:4
    DOI: 10.2478/nimmir-2021-0013
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