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What’s with all the boycotts?

From #DeleteUber to #BoycottStarbucks Trump's presidency has switched people on to consumer power

Although Donald Trump is now (apparently) the most powerful man in the world, consumers have been tapping into their own form of power to make their voices heard.

By not buying products from a company which does something you disagree with – or 'boycotting' it – consumers force the company to take notice. The aim is to hurt its profits, which might make it change its behaviour.

And although in the Trump era boycotts seem to be everywhere, it’s nothing new. In 1977, a boycott of Nestlé products was launched after it marketed baby formula in the developing world. Nestle eventually agreed to sweeping reforms as a result and the boycott was seen as a great success.


Nestle Boycott
Source: https://www.stopcorporateabuse.org

So what have the boycotts achieved so far?

In response to the leaked tape of Trump talking about grabbing women "by the pussy”, Shannon Coulter, a brand and digital strategist, started the hashtag #GrabYourWallet, which relates to a list on a website of the same name. The list shows which companies are associated with Trump and in what capacity and encourages consumers not to buy from them, and then also lists the ones which have changed their minds.

They’re having some success. Although it didn't directly credit #GrabYourWallet, Nordstrom (a big American department store, like Macy’s) just dropped Ivanka Trump’s clothing line from its stores due to a drop in sales. To date, 13 companies have been dropped from the #GrabYourWallet list.



But it’s Uber that’s been making all the headlines. When Trump took office he set up a group of big business CEOs to help him come up with economic policy, called The Strategic and Policy Forum. Uber CEO, Travis Kalanick, was one of them. This obviously didn’t go down well with the #GrabYourWallet people and Uber was put on the list of companies to avoid.

On top of this, when the huge protests in reaction to the immigration ban were taking place outside JFK Airport in New York, Taxi drivers called a one hour strike in support of the protesters. Uber tweeted that it would not be putting prices up – what it calls its "surge pricing" – as it normally does when there is a high demand for cabs.

Not only was Uber not supporting the strike but it seemed as though it was taking advantage of the situation by undercutting the taxi drivers on price. Uber was hit on twitter with the hashtag #DeleteUber.

Pretty quickly people started doing just that and Lyft (direct competitor to Uber in the US) saw a massive spike in downloads. As if by magic Kalanick announced that he would be leaving Trump’s Strategic and Policy Forum due to the backlash and has been removed from the #GrabYourWallet list. So the boycott strategy seemed to work pretty well.

And what about the pro-Trump consumers?

It's not just anti-Trump consumers using their consumer power to make their political opinions heard. Pepsi CEO Indra Nooyi was reported as having told Trump supporters to “take their business elsewhere.” She denies this but does admit saying that “all” of her staff were crying after the election result. She apologized but the hashtag #boycottpepsi had already started. Nooyi later joined Trump's Strategic and Policy Forum, so is also on the #GrabYourWallet list, confusingly.

Another victim was the GrubHub website. After the election result CEO Matt Maloney wrote an email to all his employees which said, among other things: “While demeaning, insulting and ridiculing minorities, immigrants and the physically/mentally disabled worked for Mr. Trump, I want to be clear that this behavior - and these views, have no place at Grubhub. Had he worked here, many of his comments would have resulted in his immediate termination….If you do not agree with this statement then please reply to this email with your resignation because you have no place here.”

Maloney came back saying he did not mean that Trump voters should resign (although you can see why it sort of sounded like that!) but as a result of the #BoycottGrubhub movement there was a significant drop in GrubHub share prices and a 1.5/5 star app rating. But, it didn’t last long. Shares are back up now and the app has 4.5/5 star rating again.

And then it was Starbucks's turn. Its CEO Howard Schultz announced that the company would be hiring 10,000 refugees in response to Trump’s policy. Some people felt that he should hire unemployed Americans, especially veterans, instead. So what happened? You guessed it: #boycottStarbucks.

Do boycotts like this really make a difference?

Aram Sinnrecih, Professor of communications at the American University in Washington DC, says probably not. He told Market Watch that consumers in 2017 have a short attention span, take how brief the blip in GrubHub shares was, for example. One hashtag one day will be replaced with another the next. A recent study from Northwestern University agrees that these tactics do not significantly hurt sales in the short term.

However, the same report says that damage to reputation can hurt the businesses in the long term. When consumers boycotted Nike in the ‘90s after it was revealed that it had been using child labor, shares were significantly hit. In terms of Trump’s presidency though, it looks unlikely that it will be set off track by these small fluctuations. As for his personal businesses bookings in Trump hotels spiked after his election despite a brief dip during the campaign. All in all, it seems boycotting products for political gain is perhaps more cat and mouse than all out consumer warfare.

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Reader Comments

  • Macrocompassion

    Look to who owns the land of Greece and why they are not using it properly!

    Discover how much the value of the land is being speculated in by holding it unused and the resulting lack of opportunity. Why can’t small scale farmers begin their own production of farm produce and the selling of it to local suppliers for domestic consumption?

    Adam Smith (“Wealth of Nations”,
    1776) says that land is one of the 3 factors of production (the other 2 being
    labor and durable capital goods). The usefulness of land is in the price that
    tenants pay as rent, for access rights to the particular site in question. Land
    is often considered as being a form of capital, since it is traded similarly to
    other durable capital goods items. However it is not actually man-made, so rightly
    it does not fall within this category. The land was originally a gift of nature
    (if not of God) for which all people should be free to share in its use. But its
    site-value greatly depends on location and is related to the community density
    in that region, as well as the natural resources such as rivers, minerals,
    animals or plants of specific use or beauty, when or after it is possible to reach them. Consequently,
    most of the land value is created by man within his society and therefore its
    advantage should logically and ethically be returned to the community for its
    general use, as explained by Martin Adams (in “LAND”, 2015).

    However, due to our existing laws, land is owned and formally registered and its
    value is traded, even though it can’t be moved to another place, like other
    kinds of capital goods. This right of ownership gives the landlord a big
    advantage over the rest of the community because he determines how it may be
    used, or if it is to be held out of use, until the city grows and the site
    becomes more valuable. Thus speculation in land values is encouraged by the law,
    in treating a site of land as personal or private property—as if it were an
    item of capital goods, although it is not (Mason Gaffney and Fred Harrison:
    “The Corruption of Economics”, 2005).

    Regarding taxation and local community spending, the municipal taxes we pay are
    partly used for improving the infrastructure. This means that the land becomes
    more useful and valuable without the landlord doing anything—he/she will always
    benefit from our present tax regime. This also applies when the status of unused
    land is upgraded and it becomes fit for community development. Then when this
    news is leaked, after landlords and banks corruptly pay for this information,
    speculation in land values is rife. There are many advantages if the land
    values were taxed instead of the many different kinds of production-based
    activities such as earnings, purchases, capital gains, home and foreign company
    investments, etc., (with all their regulations, complications and loop-holes).
    The only people due to lose from this are those who exploit the growing values
    of the land over the past years, when “mere” land ownership confers a financial
    benefit, without the owner doing a scrap of work. Consequently, for a truly
    socially just kind of taxation to apply there can only be one
    method–Land-Value Taxation.

    Consider how land becomes
    valuable. New settlers in a region begin to specialize and this improves their
    efficiency in producing specific goods. The central land is the most valuable
    due to easy availability and least transport needed. This distribution in land
    values is created by the community and (after an initial start), not by the
    natural resources. As the city expands, speculators in land values will
    deliberately hold potentially useful sites out of use, until planning and
    development have permitted their values to grow. Meanwhile there is fierce
    competition for access to the most suitable sites for housing, agriculture and
    manufacturing industries. The limited availability of useful land means that the
    high rents paid by tenants make their residence more costly and the provision
    of goods and services more expensive. It also creates unemployment, causing
    wages to be lowered by the monopolists, who control the big producing
    organizations, and whose land was already obtained when it was cheap. Consequently
    this basic structure of our current macroeconomics system, works to limit
    opportunity and to create poverty, see above reference.

    The most basic cause of our continuing poverty is the lack of properly paid
    work and the reason for this is the lack of opportunity of access to the land
    on which the work must be done. The useful land is monopolized by a landlord
    who either holds it out of use (for speculation in its rising value), or
    charges the tenant heavily for its right of access. In the case when the
    landlord is also the producer, he/she has a monopolistic control of the land
    and of the produce too, and can charge more for this access right than what an
    entrepreneur, who seeks greater opportunity, normally would be able to afford.

    A wise and sensible government would recognize that this problem derives from
    lack of opportunity to work and earn. It can be solved by the use of a tax
    system which encourages the proper use of land and which stops penalizing
    everything and everybody else. Such a tax system was proposed 136 years ago by
    Henry George, a (North) American economist, but somehow most macro-economists
    seem never to have heard of him, in common with a whole lot of other experts.
    (I would guess that they don’t want to know, which is worse!) In “Progress and
    Poverty” 1879, Henry George proposed a single tax on land values without other
    kinds of tax on produce, services, capital gains etc. This regime of land value
    tax (LVT) has 17 features which benefit almost everyone in the economy, except
    for landlords and banks, who/which do nothing productive and find that land
    dominance has its own reward.

    17 Aspects of LVT Affecting Government, Land Owners, Communities and

    Four Aspects for Government:

    1. LVT, adds to the national
    income as do other taxation systems, but it replaces them.

    2. The cost of collecting the LVT is less than for all of the production-related
    taxes–tax avoidance becomes impossible because the sites are visible to all.

    3. Consumers pay less for their
    purchases due to lower production costs (see below). This creates greater
    satisfaction with the management of national affairs.

    4. The national economy
    stabilizes—it no longer experiences the 18 year business boom/bust cycle, due
    to periodic speculation in land values (see below).

    Six Aspects Affecting Land Owners:

    5. LVT is progressive–owners of
    the most potentially productive sites pay the most tax.

    6. The land owner pays his LVT regardless of how his site is used. A large
    proportion of the ground-rent from tenants becomes the LVT, with the result
    that land has less sales-value but a significant “rental”-value (even
    when it is not used).

    7. LVT stops speculation in land prices and
    the withholding of land from proper use is not worthwhile.

    8. The introduction of LVT initially reduces the sales price of sites, even
    though their rental value can still grow over a longer term. As more sites
    become available, the competition for them is less fierce.

    9. With LVT, land owners are unable to pass the tax on to their tenants as rent
    hikes, due to the reduced competition for access to the additional sites that
    come into use.

    10. With LVT, land prices will
    initially drop. Speculators in land values will want to foreclose on their
    mortgages and withdraw their money for reinvestment. Therefore LVT should be
    introduced gradually, to allow these speculators sufficient time to transfer
    their money to company-shares etc., and simultaneously to meet the increased
    demand for produce (see below).

    Three Aspects Regarding Communities:

    11. With LVT, there is an
    incentive to use land for production or residence, rather than it being unused.

    12. With LVT, greater working opportunities exist due to cheaper land and a
    greater number of available sites. Consumer goods become cheaper too, because
    entrepreneurs have less difficulty in starting-up their businesses and because
    they pay less ground-rent–demand grows, unemployment decreases.

    13. Investment money is withdrawn from land and placed in durable capital
    goods. This means more advances in technology and cheaper goods too.

    Four Aspects About Ethics:

    14. The collection of taxes from
    productive effort and commerce is socially unjust. LVT replaces this extortion
    by gathering the surplus rental income, which comes without any exertion from
    the land owner or by the banks–LVT is a natural system of national income-gathering.

    15. Bribery and corruption on information
    about land cease. Before, this was due
    to the leaking of news of municipal plans for housing and industrial
    development, causing shock-waves in local land prices (and municipal workers’ and
    lawyers’ bank balances).

    16. The improved use of the more
    central land reduces the environmental damage due to a) unused sites
    being dumping-grounds, and b) the smaller amount of fossil-fuel use, when
    traveling between home and workplace.

    17. Because the LVT eliminates
    the advantage that landlords currently hold over our society, LVT provides a
    greater equality of opportunity to earn a living. Entrepreneurs can operate in
    a natural way– to provide more jobs. Then earnings will correspond to the
    value that the labor puts into the product or service. Consequently, after LVT
    has been properly introduced it will eliminate poverty and improve business