The Pros And Cons Of Politics

Shareholders get justifiably nervous when a company takes a stand on a divisive social issue. But when the right brand sends the right message, the results can be good for sales and stocks alike.

- Ryan Derousseau

YOU DON’T HAVE to watch Gillette’s INVEST recent commercial for long to realize it’s no typical shaving ad. There are no shots of blades gliding through lather or water splashing on a freshly trimmed face. Instead, the ad shows men standing up to bullies and sexual harassers, all part of a message about resisting “toxic masculinity.”

It’s more social plea than sales pitch—and it’s the kind of gesture that’s far more common now than it was a decade ago. Whether it’s Nike’s ads last fall supporting quarterback turned activist Colin Kaepernick, or Dick’s Sporting Goods’ decision last year to restrict its own gun sales, companies are more willing to take sides on politically divisive issues. And such stances can be more than acts of principle: They can boost sales, luring customers who share the same views—albeit while alienating those who don’t—and helping brands stand out in crowded product categories.