UK: THE POLITICS OF COMMERCE. - Can companies ignore protestors who boycott their products?

Last Updated: 31 Aug 2010

Can companies ignore protestors who boycott their products?

First consumer pressure persuades Shell to cancel its plans to dispose of the Brent Spar platform in the North Atlantic. Then consumers boycott French goods in protest at France's nuclear test programme. Admittedly the Campaign for Nuclear Disarmament called for the boycott, but there seems little reason to doubt its claim that the protests came 'from the ground up'. So are these actions straws in the wind, signifying the emergence of 'people power' as a force that businesses will have to reckon with?

Shell claims to have suffered only temporary damage as a result of the Brent Spar fracas. The 11% fall-off in custom which the company experienced at the pumps in Germany apparently came to an end as soon as it abandoned plans to dump the redundant platform at sea. But Shell did after all back down, so in this instance the protesters may be said to have carried the day.

According to Peter Sheldon, of Sheldon Communications, the rebellion in the high street is itself a temporary phenomenon. 'We are going through a phase of post-Thatcherite social awareness in this country' - and one that will no doubt pass - believes the author of Reputation Risk Management. Sheldon's advice to firms which find themselves caught in a storm of protest is to play down the effects and 'keep your mouth shut'.

In the case of French nuclear testing this was pretty much what businesses did. CND claims that 'hundreds' of off-licences have been picketed by activists and sympathisers, and that a lot of shops sold hardly any French wine in July. On the other side, Nicola Grandorge of French Wine Farmers - UK agent for numbers of small vineyards - maintains that the protest had no impact on sales at all. Reports from Sainsbury and Tesco also suggest that the effect of the boycott has been limited. The full story may not emerge until next February, when the CSO publishes its breakdown of third-quarter EC imports.

So far there has been very little research into what drives consumers to acts of protest - whether they genuinely hope to change company policy or intend simply to 'send a message'. But nor can companies be confident that a temporary loss of business will not have longer-term effects. Remember that Perrier never recaptured its share of the bottled water market after the product was taken off the shelves following health scares in 1991. Sheldon believes that Perrier's misjudgments gave consumers 'an opportunity to sample alternatives' - and that this is probably more significant than 'any rolling resentment factor'.

In any case, he argues, there is little that business can do to keep politics out of commerce. It may be unfair of consumers to punish French wine growers for the perceived misdeeds of their government. (It could even be counter-productive: it's noticeable that Greenpeace declined to give its support to the boycott lest that might weaken opposition to the tests within France itself.) But it's not easy for a company to protect itself against unfairness on the part of the ultimate purchaser. 'One feels like saying: "That's the way it goes, son",' muses Sheldon. 'If you're selling something the whole point is to make people love you.' And you don't do that, he adds, by accusing them of not being fair.

Companies must nevertheless be wary of the possibility that pressure groups will learn to use their leverage with increasing effect. 'The power of the consumer has not begun to be seen so far. There is no reason why the consumer should not become as powerful in the next three decades as the unions were,' argues Wally Olins of Wolff Olins, image guru and author of several books on corporate identity. 'The brand will become much less important,' he predicts, 'and the global corporation will have to become much more high profile and much more educational - and claim consumers' emotions.' If that's the way we're going, it could mean that companies will in future have to take clear moral positions on all sorts of issues - and that could affect the entire way in which their business is conducted.

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