In Corporate Responses to Black Lives Matter, Commitment Speaks Volumes

This new customer expectation has resulted in more companies issuing corporate responses to a wide variety of issues. To better understand the reputational implications of these statements, we analyzed public response (on Twitter) to corporate statements issued by five companies— Airbnb, Amazon, Apple, Netflix, and Pepsi—on the recent events around police brutality and the Black Lives Matter movement. We picked these brands for the analysis because each had a substantial volume of conversations that we could analyze before and after its response.

We observed that most of these brands issued corporate responses that affected public sentiment positively (i.e., they increased positive emotions). We did so by measuring the change in the percentage of words reflecting positive emotions in tweets about a company between the week prior to the statement and the week after the statement. We measured this change relative to a control sample of 100,000 random tweets per day during the same duration to make sure the results reflected the impact of the corporate responses and not a change in overall sentiment on Twitter.

The companies in our analysis are far from alone in having had to issue additional statements, publicly apologize, or change their stance after customers felt their response was inadequate or inappropriate. One example is Starbucks, which had to reverse its policy prohibiting employees from wearing Black Lives Matter–related clothing in stores after a public outcry. Not only did it change its policy, but the coffee chain also said it would make 250,000 Black Lives Matter shirts for baristas who wanted them.

Crafting the right corporate response, one that includes not just sentiment but also concrete actions and initiatives, is a balancing act. The delicateness of this task is further exacerbated by increasingly divergent political views. For example, a Pew Research Center study conducted in late April finds that 82 percent of Democrats viewed the coronavirus outbreak as a threat to US health, but just 43 percent of Republicans viewed it as such.

Given the perils of getting the response wrong, and the difficulty in getting it right, it would be wise for companies to develop a nuanced strategy and an associated playbook to guide them in creating thoughtful responses to social issues. Naturally, the right strategy won’t be universal: it will incorporate the company culture and ethos, the values and beliefs of the company’s customers and employees, the perceived seriousness of the topic, and the magnitude of the response that customers are likely to expect. The nature of the business will also have implications, as retail and consumer-facing businesses are more likely to be subject to heightened scrutiny by the public, whereas other businesses would need to be concerned primarily about employees and other internal stakeholders.

The specifics of an appropriate response to social crises may vary considerably across businesses, but the prudence of planning for such responses does not. Customer (and employee) expectations of corporate purpose and social response will likely only increase. And as 2020 has shown us, the next crisis is always around the corner.

Pradeep K. Chintagunta is the Joseph T. and Bernice S. Lewis Distinguished Service Professor of Marketing at Chicago Booth.

Yogesh Kansal is a consultant at Boston Consulting Group and a recent graduate of Chicago Booth’s MBA Program.

Pradeep Pachigolla is a research assistant at Chicago Booth and an incoming PhD student at Cornell.