Hitting the Mark: Business in the Political Crosshairs

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Mark Penn

Stagwell’s Risk and Reputation Unit has been traveling around the country to brace business leaders for a contentious election cycle. This month’s edition of Hitting the Mark – my analysis of developments at the intersection of business, marketing, and politics for modern C-Suite leaders – dives into the three dominant trends we’re seeing this cycle: big business in the political crosshairs, rising polarization among consumers and a longer tail to recovery in reputational crises.

It’s become clear to me that business doesn’t have anyone on their “side” these days. Both Republicans and Democrats are more than willing to turn business into a punching bag to rally their bases. The government is zeroing in on Big Tech with historic antitrust suits, and a new battleground of AI regulation is forming. This debate season, even if your brand is not overtly political, you might find yourself mentioned by a candidate who wants to call out business to fan partisan flames – with little notice and millions of Americans tuning in live.

Rising polarization is making the situation worse. In a 50/50 country, brands that normally enjoy 80% support will fall to 50% if they enter politics the wrong way. To insulate themselves, brands need to avoid activating their consumers’ “political brains.” Once you make consumers think they’re casting a vote when making a purchase, you are dividing your base and subtracting from your brand support.

Brand crises and reputation recovery also look different these days because of that rising polarization. It used to be brands faced crises over their products, services or governance – like Boeing’s 737 Max tragedies, Wells Fargo’s fraudulent accounts or BP’s Deepwater Horizon oil spill. But after an initial dive, when those companies refocused on their competencies, their reputation started recovering within 2-3 years in a U-shape. Today’s corporate crises are driven by politics and culture war issues, and increasingly look like an L-shape with no reputation recovery in sight.

Bipartisan political counsel is one of the strongest tools a business can leverage over the next 18 months. Our integrated Risk and Reputation Unit is here to help businesses navigate the political minefield. For more information on the Unit’s multi-pronged approach for clients starting with an audit of major stakeholders, visit our website. If you would like to request one of our briefings or learn about our indispensable audit, a must for every business, please reach out.

Until next time,

Mark Penn