Wine Companies and the Temptation to Speak Out on Divisive Issues
Do wine companies gain or lose by being vocal on social and political issues? I’ve had an opportunity to advise a number of clients on this question over the years. In almost every case when a divisive social or political issue has arisen it has been my advice that the company does not take a public stand.
But I have either had to revisit my initial question above in the wake of 2020 when so often the question of race, health and politics seemed to overwhelm the conversation—whether interpersonal or public and increasingly it looks as though Everything Is Broken. The question is the same: is it good business for a public-facing company to take a stand on a controversial issue dominating the social conversation?
WHAT DRIVES THE IDEA OF SPEAKING OUT?
This question also came up and was given a good deal of time in the recent Silicon Valley Bank “State of the Industry” live stream (See Part 2 Video at 7:50). In discussing the different outlooks of Boomers and Millennials, the panel noted that while Boomers believed the Civil Right Movements and its principles drove positive change, Millennials tend to believe that social and ethnic diversity leads to change. This led Silicon Valley Bank’s Rob McMillan to state what many others in various facets of the industry have said:
“When we are talking about diversity, what are one of the things you can do? Well, one of the things is being transparent in your social values. You’ve got to talk about it. You can’t hide from it. If you don’t, somebody’s going to out you. So, it’s critical that you take a policy stand on diversity….If you aren’t addressing this fact, there’s a threat to you being outed….It’s political, it’s messy and it’s hard to talk about.”
Amy Hoopes, President of Wente Family Estates and a panelist on the live stream weighed in with a similar opinion:
“The wine industry has really tended to stay away from what it calls politics. And the difference in the younger group…is they feel what is being discussed now and what is happening is political. It’s life. It’s reality…I think it’s interesting that we have wineries engaging in the digital landscape by completely ignoring what’s happening around us as a world and as a country and this doesn’t play well with this consumer. They want to know where you stand.”
The implication here is that, at least where Millennials and younger wine consumers are concerned, it’s good for the wine business to be transparent about where they stand on the volatile issues of the day. But the question still arises, is there damage done to a brand or to sales if no public position is taken on a volatile political or social issue? Is there value in silence?
THE CAPITOL SIEGE – BLACK LIVES MATTER – CLIMATE ACTION – PANDEMIC
It should be clear by now that we are talking politics, not humanitarianism. I’ll go out on a limb here and say there is nothing to lose and likely a good deal to gain in karma, goodwill, and the reinforcement of social ethics by broadcasting your concern for a community that has suffered from an earthquake or a wildfire and urging your customers to pitch in via this method or that method. We aren’t talking about his kind of taking a stand. We are talking about the Siege on the Capitol, Black Lives Matter, action on climate change, restaurant closings during the pandemic, and the like. We are talking about the kind of issues that polarize.
One reason it is difficult to offer generic advice about wine companies taking a public stand on volatile issues is due to the different levels of public exposure a wine company may possess. The statements and actions of a Gallo travel farther and have more impact than the statements and actions of a 5,000 case winery tucked away in the hills of Oregon’s Van Duzer Corridor. Similarly, a winery with a celebrity or well-known owner—no matter its size—is likely to receive outsized attention for its public statements than a similarly sized winery with an unknown owner.
That said, it strikes me that any wine company owner contemplating speaking out on a divisive social issue on behalf of their company should first ask themselves, is there any compelling moral, ethical or practical reason for them to speak out? In reality, the answer to this question will very rarely be “yes”.
Take the case of Black Lives Matter. While one might be truly touched by the issues revolving around this issue, it will be a very unique business that is intimately connected to those issues to the point they are compelled to speak out. There are a few companies that have incorporated racial justice into their branding and company actions and products. In this rare case, the company has an ethical and practical reason for speaking out not only to stay consistent with their company’s public-facing messaging, but also because the expectations of their customers—who presumably have at least in part been drawn to its products due to their consistent messaging on the issue—have justified expectations the company will speak out.
Likewise, I can imagine a wine company that has championed agricultural worker rights and well-being in a good deal of their marketing and messaging in an effort to elevate the living conditions of these essential wine industry participants. Imagine an administration (state or federal) embarking on widespread deportation sweeps and efforts. Like the Black Lives Matter example above, here is an example where the very mission of the company that has devoted a good portion of its public messaging to workers well being compels it to speak out on the issue, despite the fact this it might be highly divisive. Speaking out would not only be expected by its customers and clients, but any real commitment to the issue of workers’ wellbeing would compel public comment from an ethical perspective.
Very, very few wine companies find themselves in the situations outlined above. The overwhelming majority of wine (or any other type) companies do not actively or casually associate their brand and actions with political or social issues. As a result, most wine companies do not possess any compelling moral, ethical or practical reason for them to speak out on a divisive issue.
PROFIT V DAMAGE V. SAYING NOTHING
But this brings us back to the contention made in the “State of the Industry” live stream and in other places that Millennial and younger consumers expect and demand companies to be transparent in their political positions and will, to some degree, base their purchases on whether or not a company is transparent and open about its views. In other words, setting aside compelling moral and ethical reasons to speak out on social issues, is there a sufficient profit motive to speak out on such issues?
While I tend to most often agree with Rob McMillan’s astute takes on the state of the wine industry, I have to disagree with him on the necessity of being transparent about one’s political and social views in the wake of the emerging Millennial consumer. I’m unaware, for example, of any wine company suffering financially for not having spoken out on, for example, 2020’s Black Lives Matter protests, the Capitol Riots, or issues related to the pandemic.
Moreover, I think in nearly every case, it would be somewhat jarring for a wine company that has no obvious connection to these issues, to speak out and take a strong stand on these issues. While delivering a “jarring” message to its customers and clients is one way of getting attention, it is almost guaranteed that the reaction will not fall primarily in one direction. Instead, the wine company reaching out to its customers to announce its disgust with the “social injustice and systemic racism infecting our nation” is likely to negatively impact many customers while not necessarily prompting an equal number to be more inclined to support the company.
For this contention, I have no evidence. However, I’m unaware of any evidence that suggests speaking out on a divisive issue in an unsolicited way is likely to be such a thorough net gain from a profit perspective that it would outweigh the potential to offend or to dissuade further purchases by some segment of a customer base. I’m willing to be corrected on this issue, but as of this writing, I’m unconvinced that there exist any instances in which it makes good business sense for a wine company to take a public stand on a controversial issue without possessing a strong, well-established connection to the issue.
This is not a change of opinion for me. In 2015, I wrote about the Wine Train incident in which a number of black women were escorted off the Napa Valley’s moving tourist attraction in the middle of its journey up-valley for the charge of continuing to be disruptively loud after being warned. In that post, I counseled any winery or wine company contacted by the media to comment on the issue to make “no comment”. My rationale was simple: You don’t know the specifics of what happened and there exists no benefit to your company in commenting.
THE LIKELIHOOD OF AN EMOTIONAL RESPONSE IS HIGH
If you read through the comments that were left on that post about the wine train incident you’ll see that this appeared to many to be an unconscionable position to take. But it wasn’t and it’s not today. What you’ll see in those comments are a number of opinions clearly driven by the emotion of the moment. This emotional response to divisive, controversial issues is also likely to be one of the primary prompts for any response to a wine company speaking out on an issue today where that company is not intimately connected to the issue they are commenting upon. If you want to get a sense of what these kinds of emotional responses look like, open up your Twitter or Facebook app and scroll for a moment or two. My guess is that it won’t take long to find a reference to Hitler and Nazis.
There may be an era, down the road, in which social conventions demand companies large and small take public stands on the important issues of the day lest they suffer financially for their malfeasance. But this is not that era.
This era is one in which the wrong opinion, expressed in the wrong way and heard by the wrong person, who is inclined to broadcast the wrong opinion to millions of others with the aim of discrediting and dismantling the social viability of the commenter and their business is both commonplace and not too difficult to pull off. Moreover, it is important to recognize that the threat of being “canceled” and its fallout impacts not merely the owner or director of a company, but also the employees of the company, the people whose lives and their family’s lives are dependent upon the continued viability of the business. This era we are in today does not often reward one-off statements of opinion and often can do damage.
Recognizing the dangers of speaking politically to the brand and its employees it is true, as Rob McMillan and Amy Hoopes contend, that younger consumers are more concerned with the social commitments of the companies to which they turn their attention. Studies and surveys have shown, for example, that environmental issues and sustainability are the primary concerns that motivate Millennials and beyond to engage or not engage with a company. This is a social issue with which the wine industry and its varied companies are intimately familiar and is an issue that seems ripe for them to comment upon in an unsolicited fashion without risking much harm. But these kinds of issues are few and far between.
So my formal advice on wine companies making public statements on divisive issues remains the same: Rarely is the company’s profitability enhanced by proactively taking a public stand on behalf of your wine business and it is best to resist the urge to engage in the political and social controversies of the day.
Finally, to those who, despite the risk to their own business and to the jobs of those they employ, still insist that they have a moral or ethical or personal obligation to speak on controversial issues from the pulpit of their position as a business owner, I would relate the following:
1. The risk of a business being harmed by public backlash for an opinion or statement still falls primarily to those expressing ideas perceived to fall on the rightwing side of the opinion spectrum. However, going forward this could change.
2. Backlash is normally reserved for people who work in social and cultural institutions such as academia, media, trade associations, and the like.
3. If a backlash results from a company’s statement on controversial issues, it will almost always come via social media.
4. There are ways to fight back against a mobbing in response to a controversial public statement and anyone preparing to make what is likely to be a divisive public statement ought to be familiar with such methods in advance of speaking out.
4. Public statements unrelated to your business ought to be very carefully prepared and the method of their transmission also considered very carefully. Statements should almost always be vetted through more than one person prior to releasing and it’s not the worst idea to show them to an attorney.
5. No public statement on an issue, controversial or not, should ever be wishy-washy. No one should wonder, after reading or hearing the statement, where you stand on an issue. It makes no sense at all to take on the risks of wading into a controversial or divisive social issue if you do not intend to make as powerful and forceful and rational a statement as possible.