[Issue 110] Why do boycotts work?
Facebook is in the spotlight yet again, this time because the company is struggling to address the demands of the “Stop Hate for Profit” campaign. So far hundreds of large brands from Unilever to Coca-Cola have pledged to stop buying ads on Facebook - already resulting in billions of dollars lost.
It has really picked up steam over the past several days and is even spreading outside of the United States.
While I don’t have a particularly interesting or unique opinion about Facebook's stance, I do have a lot of thoughts about boycotts.
Since the early days of writing this newsletter I’ve been obsessed with when they do and don't work - and, most importantly, why? The #StopHateforProfit campaign has reignited this for me.
One thing I’ve seen several media outlets report on is that large companies make up a small slice of Facebook’s ad revenue pie. Rather, the company is dependent on millions of small businesses that buy ads.
Simple enough to understand, but to focus on that is to miss the point: Boycotts aren't really about money, they are about power.
If you know what movie this is from, we are officially best friends!
Hear me out...
Yes. There are times when boycotts work because customers prevent companies from making any or as much profit as they were expecting. In those situations, money IS their source of power. That power is the result of individual consumers banding together at a scale large enough to gain influence via their impact to the company's bottom line.
In the case of Facebook, however, we have brands with relatively small pieces of the revenue pie shifting the conversation in a meaningful way.
Why is that?
It's because of the power they already hold - both in the amount of attention they are able to bring to this conversation and the way executives at the companies hold sway with lawmakers and other executives.
That is why this boycott is working.
Think about Sleeping Giants, which launched shortly after the 2016 election. Their campaigns haven't been successful because they just ask consumers to pull their support of companies. They are successful because they convince consumers to demand that the companies they support end their investment in and partnership with other companies.
Same thing applies to #BoycottNRA started by the youth of Parkland, Florida. Can we take a moment to remember how badass they are?
I think there’s so much research that needs to be done on boycotts, especially in this social media era.
In the meantime, I’m grateful that organizations like Color for Change are using the tools we currently have to effect change.
Until next time,
Nikita T. Mitchell
Sam and I thoroughly enjoyed hosting the June book club! I'll share my review of Reimagining Capitalism soon, but in the meantime, be sure to pick up a copy of Winners Take All so you can join our next one in August (date TBD).
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