Wednesday, August 19, 2009

When customers attack!

Over the past week or so, I've run into an interesting confluence of things that all relate to the cultural meme of consumers rebelling against brands they were formally loyal to - or at least bought from.

The first of these was Whole Food's CEO John Mackey's rather ill-advised Wall Street Journal Editorial, titled "The Whole Foods Alternative to Obamacare." Well, this caused quite the kerfuffle among Whole Foods customers. Why? Well, Whole Foods is positioned as a place that focuses on selling "whole food" and, basically, all kinds of good stuff, like sustainability, community involvement, best practices for employees, etc.

Their actual core values can be found here. Their core values are much longer and detailed than I've summarized and, quite honestly, I'm also stating how Whole Foods's customers perceive Whole Foods, which is really the important point of positioning - irrespective of how managers might wish consumers perceive them.

Which gets to my point. Who do you think shops at Whole Foods? I'm guessing the majority of customers are progressive people: people who value organics, have higher than average disposable income, have higher than average education levels, believe in social justice causes, vote democratic or progressive, and probably voted for Obama more than the average American. (Disclosure: I actually own Whole Foods stock and I have been Whole Foods Fan ever since I found them in Chicago more than a decade ago. I actually picked my apartment in Evanston based on the fact that there was a Whole Foods between Northwestern and the apartment. That also means I have a pretty good bead on their customer base.)

Anyway, CEO John Mackey writes the above op-ed piece and, no surprise had he been thinking, his customers REVOLT! Although citing every nasty, "let's have a boycott" piece in the blogosphere is beyond the scope of one posting, here's a sampling:
  • Facebook has a few "Boycott Whole Foods" groups, the biggest of which is up to 19,000+ members just more than one week after the WSJ op-ed appeared (the Whole Foods page has 115,000, has been up a lot longer, and has an incredible number of people posting who are pretty ticked off),
  • The Daily Kos wrote a scathing review of John Mackey's op-ed, and then an equally scathing satirical bit on Whole Food's PR team to address the ticked-off customers (the "annotated version" is pretty spot-on),
  • The Huffington Post ran a number of pieces, summarized here, and also had a poll showing that 58% of respondents planned on boycotting Whole Foods and another 20% disagreed with Mackey's views, but didn't think they were boycott-worthy.
Although some postings on Whole Foods website, Facebook, and various conservative blogs suggests that some people are "new" fans of Whole Foods, it's not really clear how long they'll stay once they've shopped there once or twice (or ever).

Instead, it seems that John Mackey really stepped in it. What's amazing to me is that John Mackey's ill-conceived op-ed piece ironically violated one of Whole Foods's Core Values: CREATING WEALTH THROUGH PROFITS & GROWTH.

Seriously, it shouldn't surprise anyone the op-ed piece ticked off a large portion of Whole Foods customers. Assuming John Mackey has any sense of what his customers are like, publishing that op-ed as CEO of Whole Foods was like flipping off a good chuck of his customers. Which is exactly what happened.

What may have surprised Mackey - and the point of this post - is that with today's technology, a CEO can no longer assume he/she can print something in the Wall Street Journal and have only business people see it. Quite the contrary. Various social networks - and Facebook in particular - allow for an incredibly easy way for consumers to communicate and organize very, very quickly. It's not clear when the largest "Boycott Whole Foods" page showed up on Facebook, but it was instigated by the op-ed piece and, therefore, it could not have been more than eight days before it hit 19,000+ fans. That's not good if you're Whole Foods.

Related to all this, Michaela Draganska (Northwestern, PhD) turned me on to Huggy Rao's (Case/Weatherhead Ph.D. in Organizational Behavior) book "Market Rebels: How Activists Make or Break Radical Innovations," via a nice little interview published by Stanford Business School.

One of Rao's points is that the social identity of customers, as the collective core of any market, are an important factor in explaining why some innovations take off and others do not. The challenge, of course, is when a company built on a collective identity has its CEO mouth off in a way that runs counter to that collective identity and the company's customers find out. Maybe as a Whole Foods Stockholder I should send John Mackey a copy of Huggy's book? Then again, that would only be helpful if I had a time machine....

Finally, yesterday I happened upon two anti-United Airlines music videos created by David Carroll, a musician whose guitar was broken by United baggage handlers. He wasn't able to get resolution through United, so he promised to make three videos about United. After the first one - which was a HUGE hit on YouTube and currently has 5M+ views - United changed its mind. Dave said "too late" and has since published a second video. When customers attack, indeed!

Here's the first:

And the second, which has better production values:


Dr. Bryant A. said...

I just ordered Huggie's book.

(And I United Airlines is only the 3 or 4th worst airline in the country. But then again, they all suck!)


Gary F Gebhardt said...

I just bought Huggy's book as well!

And I STILL like Southwest and JetBlue better than United!