Thursday, November 29, 2018

Sales dip for Dick’s after assault rifle stand

Companies that take a stand on a hot-button issue should be ready to put their money where their mouth is.

The popular opinion in PR says that companies should speak out on controversial social issues that matter to them. Some even argue the move will boost the bottom line.

However, Dick’s Sporting Goods is an example of how the hard decision to speak up might not reap immediate financial rewards.

The retailer chose to remove assault rifles from its stores following the Parkland shooting in Florida nine months ago. It also tightened restrictions on gun sales at all its stores.

As we reported on PR Daily:

The message stayed on brand for the retailer, which sells sporting equipment for children.

In the press release, Dick’s conceded that it had sold the Parkland shooter a weapon—though not the weapon. It also looked at the big picture:

Following all of the rules and laws, we sold a shotgun to the Parkland shooter in November of 2017. It was not the gun, nor type of gun, he used in the shooting. But it could have been.

Clearly this indicates on so many levels that the systems in place are not effective to protect our kids and our citizens.

Gun control advocates applauded the move […]

Now Dick’s says its sales have suffered because of the decision.

[RELATED: Take the first step in achieving corporate communications excellence]

CBS reported:

The Pennsylvania-based retailer earlier reported a third-quarter net sales decline to $1.86 billion from $1.94 billion in the year-earlier period, with adjusted same-store sales down 3.9 percent.

"Sales continue to be negatively impacted by double-digit declines in hunt and electronics," CFO Lee Belitsky said. "Specific to hunt, in addition to the strategic decisions we made regarding firearms earlier this year, the broader industry has decelerated and remains weak, as evidenced by most recent background-check data" for firearms purchases.

This might seem to fly in the face of conventional wisdom. Don’t consumers prefer a strong stance from places where they shop?

PR Daily reported:

Sprout Social’s Championing Change in the Age of Social Media report revealed that 66 percent of consumers want organizations to take a stand on political and social issues—and more than half (58 percent) are open to that happening via social media.

Sprout Social said:

Intentionally or not, social media has provided an easy-to-access environment for issues to become more partisan. However, the ability to hide behind a digital profile has paved the way for aggressive, even hostile, social media communications. This is especially true in the wake of the 2016 presidential election, and this divide shows itself most clearly in the void between liberal and conservative parties online.

On platforms that have become so polarized, what’s a brand to do? The reality is, brands can’t please everyone. Their customer communities are simply too broad. Instead of letting this scope paralyze their communications efforts, brands making their values clear must understand and prepare for reactions that are just as diverse as the people they serve.

Sprout Social has consistently argued that brands should speak out.

It wrote:

According to a 2018 survey by Sprout Social, two-thirds of consumers (66%) say it’s important for brands to take public stands on social and political issues. And Edelman’s 2017 study, “Beyond No Brand’s Land,” found that more than half (51%) of respondents believe that brands have more power to solve social issues than the government.

Never before have brands held so much influence over societal changes. And although some brands may be uncomfortable stepping into this new role, they may not have a choice.

However, brands that take a hard stand are likely to lose some customers in the short term. Target was boycotted after it announced a bathroom policy meant to support inclusion for gender-nonconforming people. Dick’s should have expected the drop.

The retailer’s response

Dick’s has worked to avoid the narrative that it is paying for taking a stand. The retailer instead is leaning into its decision, weighing the possibility of removing all hunting gear from its stores.

CBS reported:

The retailer, which stopped selling assault rifles earlier in the year, in late August said it would also rid 10 Dick's stores of "virtually all" hunting items. The stores involved were those where hunting sales had fared the most poorly.

"We'll have to wait and see how the 10-store test does," CEO Edward Stack said during an earnings call Wednesday.

That said, Stack noted, Dick's is "looking at a number of stores where the hunt category significantly underperforms." Additional moves will involve deciding what's "a smart thing to do from a business standpoint," he added.

The CEO also talked about the changing marketplace for sporting equipment as a whole.

"As the football business has declined, baseball and soccer have picked up," he noted.

Take note, brand managers: A principled stand may not be immediately rewarded by consumers, and any bad news, regardless of its origin, will bring scrutiny for your decision. Savvy communicators should be ready to tell their story—and have the guts to stand their ground.

On social media, some promised to support the retailer this holiday season:

Others said they would avoid the retailer:

How would you advise Dick’s Sporting Goods to proceed, PR Daily readers?

(Image via)



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