Beware the secondary boycotter

July 6, 2011 by
Filed under: Politics, The RSA 

Tomorrow we host the first of two events being held with the Advertising Association: What are the opportunities, roles and responsibilities of advertisers in today’s world? There are echoes here of some of the themes of my annual lecture with its focus on behaviour change and corporate responsibility.

But I expect there will also be reference to the impressive attempt to use Twitter to organise a corporate boycott of advertising in the News of the World. If it succeeds – and it isn’t entirely clear whether the campaign’s aims extend beyond simple retribution – it is sure to be cited worldwide as an example of how social media can turn individual consumers into a powerful force.

There isn’t much doubt that many people see this as payback time for the Murdoch empire (I touched on why this is understandable in yesterday’s post), but to threaten to punish companies – from Ford to Weightwatchers – just for advertising in a newspaper which behaved unethically is to cast the net of corporate responsibility quite wide.

The campaign illustrates not only the speed with which customers can organise and punish but also the ‘soil to dustbin’ span of accountability. As I said in the annual lecture, companies now find themselves being asked questions not only about their own internal processes but also about what is going on in their supply chain and the ways consumers use and misuse their products. Thus if Ford pays money to News of the World and the newspaper is deemed anti-social then some badness could rub off on the car manufacturer.

It is vivid evidence of how power has shifted from the sphere of production to the sphere of consumption. Twenty five years after Margaret Thatcher outlawed secondary picketing, secondary boycotting is taking off. It may be a restraint of trade but a Government which recently published a strategy on empowering consumers is unlikely to criticise, let alone ban, it.

The backlash against Murdoch is political but the always excellent John Kay highlights another area of corporate vulnerability in his FT column today. His target is offers which are explicitly designed to fool and con us by combining a low headline price with unavoidable extra costs and charges. There is again an echo with the annual lecture in which I accused the financial services industry of exploiting our cognitive frailties with dodgy products and extortionate charges.

The problem here goes wider than the individual companies and the consumers who get ripped off. Kay writes:

‘Business practices whose rationale derives from consumer ignorance and producer knowledge create a larger problem. When people see many examples of minor exploitation of consumers in their daily lives, they will conclude that extensive exploitation is characteristic of business as whole’

And here’s another possible parallel with trade unions. In the seventies and eighties the extreme and foolish actions of some trade unionists provided grounds for a wider ideological link to be made between worker power and economic decline. Now, as living standards fall fast and many wonder why they seem to benefit so little from global capitalism, might the behaviour of those sectors and companies which see their customers as people to exploit legitimise a deeper and wider backlash against big business? If so, the vehicle may not be the slow tide of shifting political opinion but the rapier like thrust of social media.

Looking back to the seventies it seems inconceivable the trade union leaders didn’t see they were walking into a crisis of legitimacy. But go to the next CBI dinner or IoD business breakfast and you will most likely face just the same complacency.

We desperately need enterprise and entrepreneurship to develop new routes to (sustainable) economic growth, but if companies  are to protect the trust which is an increasingly important component of modern consumer relations and product innovation, it’s time good business gave bad business a loud wake up call.               

 (oops, nearly forgot the joke…a friend of a friend tells me that since Rebekah Brooks moved to the country she has become a keen horse rider. Apparently she is particularly fond of her new hacking jacket)

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6 Comments on Beware the secondary boycotter

  1. Ian Duffy on Thu, 7th Jul 2011 5:49 am

    2. Not as funny as your old people joke the other day…

  2. Neil McNaughton on Thu, 7th Jul 2011 1:48 pm

    3. As we write this NotW episode seems to be spinning out of control. The changed nature of the scandal is the fear that is clearly being generated. The police are afraid of the journalists, journalists are afraid of editors, and politicians are afraid of red tops in general. This is no longer a case of ‘ are we justified in reglating a newspaper in case it is the thin end of the orwellian wedge’ ? It now has undertones, as has already been suggested, of the mafia in Italy. There is hope – that the rats will realise the ship may be sinking and turn on each other so we will hear the whole sorry story. But one suspects there will be too much obfuscation and fudging for that. Both the police and the journalists may be constratined in case the blasme arrives back at their door – even the door of number 10.

    So, if this now transcends the issue of press freedom, how do we proceed ? Appeals to moral regeneration are unlikely to last long as they face the blizzard of the profit motive. Legal action looks draconian and dangerous. With a sigh (because I suspect it will not actually work), a public boycott of the offending newspaper is the best answer, underpinned by the flight of the advertisers. In other words, put them out of business. And, of course, there must be the fullest. most genuine inquiry possible with prosections to follow. Enron here we come. It is a pity the Americans are not doing it. they know how to lock people up !

  3. Ian Christie on Fri, 8th Jul 2011 9:42 am

    4. A good post, and very relevant in the light of the NoW scandals.

    The point about good business needing to speak up against bad business is the crucial one. In the case of the mass media, it’s only with the rise of the Internet that the press and broadcasters have come under suitably tough scrutiny, in a disorganised way. That might now lead to much greater scope for good practice to drive out bad. One great benefit from the unignorably awful evidence of immoral action at NI and NoW is that newspapers have dropped the informal rule that ‘dog doesn’t eat dog’, ie papers should not attack one another.
    There are still plenty of inhibitions in the rest of business. The CBI, Business in the Community and other bodies standing for corporate responsibility and the crucial role of business in society have been conspicuous in not attacking loudly and in public the behaviour in the City, mass media and consumer finance that give the private sector a bad name. When pressed on this, insiders in the CSR industry assure you that ‘behind the scenes’ criticisms are indeed being made and pressure is being applied ‘through private channels’ etc. If so, none of this sotto voce criticism has had any effect. We need CSR champions to start cutting up rough about the behaviour and morals (or lack of them) among their peers in some parts of business.
    John Kay’s point is well made and the risks being stored up are great. Perhaps the biggest one concerns personal pensions, a field where mis-selling and outrageous rip-offs are rife and where the average citizen is simply left baffled and easily exploited (and I am no exception to this). In a decade or so a lot of people are going to discover how little they have in their pension plans thanks to the corrosive effect of obscure charges, conditions in the very small print, and bad investment decisions. There is plenty of outrage to come.
    One other point: is it now possible to hope that politicians in the UK will shed their rose-tinted spectacles and stop being so much in awe of big business and its supposed super-efficiency ? For nearly 30 years we have had political elites in bed with or intimidated by banks, PFI contractors and mass media empires, all of whom have been lionised and given free rein to make a killing. In each case the public interest and the cause of corporate responsibility have been trashed. People tend to learn key lessons in life only in a crisis. We’ve got some crises all right, and let us hope some rapid learning is in train in Whitehall and Westminster.

  4. Robert Burns on Sat, 9th Jul 2011 11:40 am

    5. Hello Matthew

    Been away for a while, good to be back.

    Anyone who has read posts from me before will know that I take a negative view of politician/corporate led ‘morality’ campaigns.

    For all the talk of ‘choice’, ‘individual empowerment’, etc. we live a world where an ever expanding proportion of the population feel and are marginalised.

    This has several facets.

    Speak out to defend the employment prospects, pay and conditions of native British ‘blue collar’ workers from erosion by the use of low wage economic mercenaries from Eastern Europe and outside the EU and you are howled down in a ‘liberal’ backlash.

    Curiously, this does not happen when methods that would otherwise be described as racist xenophobia are used to protect white collar employment.

    Free speech and economic self-defence are not for the poor and the unconnected.

    Similarly, redemption isn’t for the poor or the unconnected either.

    For example, unless you’re a Peter Mandelson a criminal conviction imposes a lifetime ban on certain kinds of employment.

    Many people see themselves as existing in a state little removed from serfdom.

    This being the case a huge part of the population have become unmoored from the value systems espoused by the political class and their corporate masters.

    Let there be no misunderstanding here, that is the true nature of their relationship.

    Subjected to repressive ideology (masqerading as liberalism) and economic terrorism (masquerading as free market economics) these ‘secondary boycotters’ see no distinction between the ‘offender’ and ‘associate’.

    They are acting out the psychology of the ‘war on terror’.

  5. Livy on Sat, 9th Jul 2011 1:35 pm

    6. …erosion by the use of low wage economic mercenaries from Eastern Europe…

    Oh yeah?

  6. Robert Burns on Sun, 10th Jul 2011 6:25 am

    7. To Livy

    “Oh yeah?”

    If you have an argument to put then step up.

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