FIR #534: Is A Scandal-Based Marketing Campaign Worth the Risk?

When brands deliberately provoke outrage, is the backlash a crisis or a planned part of the marketing strategy? Reformation’s campaign featuring Olivia Jade Giannulli, whose family was embroiled in the college admissions scandal, raises questions about using controversy to sell products. The campaign’s charitable donation from each sale adds another layer to the discussion, but does generating attention justify the risk to a brand’s reputation? In this episode, Neville and Shel explore the differences between calculated provocation, taking a principled stand, and accidentally causing offense. Drawing on campaigns from Reformation, Nike, American Eagle, and others, we debate how to measure success beyond mentions and whether communicators should have the authority to stop a campaign when the reputational risks outweigh the likely benefits. Attention may be easy to count; the cost to trust is something else altogether. Links from this episode: Marketing Brew Article Brands can use scandal to their advantage — but it can easily go awry The Reformation / Olivia Jade campaign Celebrity Ads Keep Making People Angry. Is That the Point? Nothing Says ‘Sorry for the College Admissions Scandals’ Like Selling College Sweatshirts! From Sydney Sweeney to Olivia Jade: Why Fashion Brands Are Betting on Controversy Olivia Jade’s Reformation campaign pokes fun at college admissions scandal Olivia Jade Reformation campaign / college admissions scandal Rage bait and outrage as brand strategy The Outrage Economy: Why Companies Are Embracing Rage-Bait in High-Stakes Gamble Are brands betting on backlash? How controversy became the new brand strategy Ragebait is everywhere. Should marketers lean in? What happens when the ragebait marketing machine runs its course? Brands Are Paying to Make You Mad Research on whether bad publicity pays When Is Bad Publicity Good? Finding Your Company’s ‘Controversy Sweet Spot’ Any PR is good PR: A little online controversy is not bad for business Balenciaga’s controversial new campaign and the long history of ‘shockvertising’ Scandal-to-comeback arcs How celebrities work their way back into the spotlight after scandals Being on ‘The Traitors’ can rehabilitate a celebrity’s image. It can also ruin it. Lean in vs. apologize When the apology becomes the crisis So, you’re facing a boycott. But will it hurt you in the long run? Crisis or comedy: when should brands laugh it off? The next monthly, long-form episode of FIR is tentatively scheduled to drop on Monday, November 30. We host a Communicators Zoom Chat most Thursdays at 1 p.m. ET. To obtain the credentials needed to participate, contact Shel or Neville directly, request them in our Facebook group, or email [email protected]. Special thanks to Jay Moonah for the opening and closing music. You can find the stories from which Shel’s FIR content is selected at Shel’s Link Blog. You can catch up with both co-hosts on Neville’s blog and Shel’s blog. Disclaimer: The opinions expressed in this podcast are Shel’s and Neville’s and do not reflect the views of their employers and/or clients. Raw Transcript: Neville Hobson: Hi, everyone, and welcome to For Immediate Release. This is episode 534. I’m Neville Hobson. Shel Holtz: And I’m Shel Holtz. When a brand deliberately builds a campaign around a scandal, is that courageous? Or is it just rage bait masquerading as marketing with a charity twist? Marketing Brew’s Jennimai Nguyen tackled that question last month in a piece that’s been popping up in my feeds more than once. Let’s talk about it, because the case at the center of it is almost perfectly engineered to divide a room of communicators. Back in 2019, influencer Olivia Jade Giannulli was at the center of Operation Varsity Blues, the college admissions scandal. Her parents, Lori Loughlin and Mossimo Giannulli, pleaded guilty to conspiracy to commit fraud after she was admitted to the University of Southern California through a fake rowing recruitment. She dropped out, went quiet, and eventually came back as an influencer. Fast-forward to this fall. Reformation, the fashion brand that went public over the summer, made her the face of its “Good Sport” campaign. The hero product is a crewneck sweatshirt that just says “College.” The Instagram caption—and I’m paraphrasing only slightly—says she’s back on campus in a crew that suits her better than the other kind. Net proceeds from sales of this product go to YES Scholars, a nonprofit that helps underprivileged students get to college. People commenting on the campaign split pretty much the way you’d expect: half the audience calling it iconic and the other half calling it insensitive. The Marketing Brew piece doesn’t just describe the controversy. Nguyen gets Derek Rucker, a marketing professor at Northwestern’s Kellogg School, to lay out a framework for thinking about when leveraging a scandal works and when it doesn’t. It boils down to three things. First, the old line that any publicity is good publicity. Rucker’s answer is—and I’m quoting him here—“definitively no.” Brands that court controversy can lose sales, lose audiences, and sometimes spend money cleaning up after the campaign. Second, intentional controversy is really a bet about math. Rucker’s example is Nike’s Colin Kaepernick campaign in 2018. We discussed that more than once at the time here on FIR. Nike wasn’t surprised by the backlash. They were expecting it, but they were betting that the audience that shared their values was bigger than the audience that didn’t. That is a strategy. He notes that it’s an easier bet for smaller brands because there’s less of an existing audience to alienate. Reformation, though, just IPO’d and wants to appeal to a broad swath of millennials and Gen Z. That makes the bet riskier. Third—and this is the part I find most interesting for anybody who deals with crises—you can tell whether the controversy was intentional by watching what the brand does next. Rucker points to two tells. One is the charitable donation attached to the product. Reformation did it with YES Scholars. American Eagle did it last year with the Sydney Sweeney jeans and Crisis Text Line. The other tell is the absence of an apology. Rucker’s line is that these brands aren’t going to apologize because they’re not sorry. They’re targeting a specific audience, and the people who were offended were never part of that target. Contrast that with Converse, which pulled its Karina campaign and issued a flat-out apology within days when people pointed out that the imagery evoked the Ku Klux Klan and lynching symbolism. That’s what unintentional controversy looks like. Rucker’s advice there is the opposite: apologize immediately, take it down, and explain to consumers what happened. I would add, beyond what Rucker said, explain what you’re going to do to make sure this doesn’t happen again. The framework is: intentional or not, and does the response match? Reformation’s silence isn’t a failure of crisis communications. It was their strategy from the get-go. Yet Rucker’s own closing thought is that, if he were starting a brand, he wouldn’t go this route because there are plenty of ways to stand out that don’t involve controversy. Neville, I’m curious where you land on this. Is Reformation being clever, or is this a brand that just told its most offended customers it doesn’t need them? Neville Hobson: It’s interesting. I don’t believe that Olivia Jade story was familiar to a lot of people here. I remember seeing news reports at the time. Isn’t that the issue that Felicity Huffman was involved with, and William H. Macy? Shel Holtz: Absolutely. Same one. Neville Hobson: Now it rings big bells, I must admit. My immediate thought, listening to what you were saying and reading some of the reports on all of these, is that controversy generates attention. We know that. But attention isn’t the same as trust, reputation, or commercial success. Communicators have a responsibility to challenge the strategy, not simply manage the fallout. I’m wondering whether, in these examples—notably American Eagle and Reformation—we’re confusing the ability to generate attention with the ability to build a brand. If everyone’s talking about the controversy but nobody is talking about the product, have they really succeeded? That’s the first thing that comes to mind. How would you measure the success? I guess this is really the crystallization of my thought here: How would you measure the success of a deliberately controversial campaign? Shel Holtz: I think it depends on what their goal for the campaign was. If it was building awareness of the brand, that’s pretty easy. You can measure sentiment: How many people supported this? How many didn’t? Into which camps did they fall? If you’re targeting millennials and Gen Z, and they’re more likely to think this was cool, especially given that the proceeds are going to a charity, then you can call it a success. If the goal was selling a ton of these shirts, that’s pretty easy, too. But the question is, when you release a new product or look at the other items in your product line, have you seen a lift there as well? I don’t think a communicator would have told Nike not to do the Colin Kaepernick ad. I think they said, “Look, you’re going to get backlash, but it’s from customers we’re not particularly interested in. We’re interested in the larger audience that’s going to support this and buy these shoes.” That’s what ended up happening. Nike suffered some backlash. I remember seeing shoes being burned in barbecues and things like that. But at the end of the day, Nike’s reputation is fine. Their profits are fine. They didn’t suffer at all. By and large, I think they’re seen as standing up for an important principle when they took the position they did. Neville Hobson: I’ve been reading recently that their financial situation is actually not particularly good. Nevertheless, I think this is not a good place to be doing this kind of activity. That’s my broad opinion. There’s a fundamental difference between deliberately challenging conventions, which some of these people do, and simply offending people. I don’t buy the argument that all these people we’ve offended don’t matter because they’re not our audience. That’s an unsustainable argument in my book. Even if the marketing team believes controversy will generate attention, which is clearly what they do in all these cases, did anyone actually ask whether the reputational hit is worth it? My question to you is: When does a provocative campaign like any of these cross the line from clever marketing into very poor professional judgment? Shel Holtz: There was a Newsweek piece on this. The expert they quoted said that provocation becomes a crisis at the moment consumers stop debating the ad and start criticizing the company. That’s when prolonged negativity undermines trust and erases the attention benefit. As long as they’re just talking about the ad, I think your reputation and the degree of trust you may have earned are probably fine. We can equate this to the very current political situation here in the U.S. I know we don’t like to take sides on the show because we don’t want to offend anybody in our audience. We want people on all sides of the political spectrum to listen because what we’re talking about is how to communicate effectively, and we don’t get into politics. Nevertheless, Vivek Ramaswamy lost his race to be governor by double digits, and he was only down by two points before he released a very controversial ad. This was the ad that featured his opponent’s estranged mother. She hadn’t seen her in 30 or 35 years. She had been removed from her mother’s care as a child because her stepfather had raped her. He was advised not to run this ad, but he felt it was beneficial to his campaign, so he did anyway. What I’ve been hearing is that it cost him 10 points in the race. To the point of this person quoted in Newsweek, the conversation shifted from the ad itself to the guy who decided to run it, and what kind of character is involved in somebody who would make that decision. I think that’s a useful distinction. When they stop debating the ad and start criticizing the company, that’s when you’ve got trouble. There was one other person quoted in that Newsweek article who draws the line between calculated provocation and a brand blunder. What you got with Reformation was calculated. What you got with Ramaswamy was a blunder. The former anticipates criticism as part of the plan. The latter happens when a brand fails to recognize cultural or historical associations. I think Reformation falls into the category of, “We were going to anticipate the criticism, and people are still talking about the ad, not the company.” Ramaswamy, meanwhile, went down to a resounding defeat in a red state because of a blunder where he didn’t anticipate the blowback. Neville Hobson: What troubles me about all this—and I hear what you say, Shel—is that I wouldn’t do stuff like this if I were running communication for one of these big brands. Some brands, as is obvious from this, knowingly accept alienating one audience to strengthen their relationship with another. I think that’s appalling business practice, personally. What troubles me is the possibility that we’re normalizing controversy as just another marketing technique, with reputation management reduced to cleaning up afterward. If a brand deliberately sets out to provoke people, it can’t then pretend to be surprised by the reaction. I wonder where communicators sit with this. Shouldn’t they have the authority to challenge or even stop a campaign when, in their professional judgment, the reputational risk outweighs the likely benefits? Shel Holtz: I think that’s the counsel communicators need to provide. There was an older study—it’s 15 years old—from Stanford and Wharton that found negative publicity actually boosted sales, but only for relatively unknown products or brands, because it stimulated awareness of them. It hurt more established brands. Reformation’s not unknown. This data would suggest that it probably wasn’t a good strategy for them, but so far it doesn’t look like it’s hurting them much. Neville Hobson: It just seems not to be the way you should behave, in my humble opinion. My final thought on it is that controversy may buy attention. We’ve got evidence that it obviously does in these examples. But that doesn’t necessarily earn trust at all. If anything, it will damage it, in my view. Communicators need to understand the difference, and they should understand it better than anyone else. It seems to me to be another marketing technique that is not a good thing at all. Shel Holtz: I’m inclined to agree. A campaign like this probably wouldn’t even pop into my mind if I were assigned the task of promoting this particular shirt. Reformation never responded to a request for an interview, and they haven’t confirmed that the controversy was part of their strategy. That was Rucker’s belief. There are so many different approaches you can take to marketing a product and a brand that I wouldn’t go down this road for fear of the damage it could do to trust. But I come back to the Colin Kaepernick example from Nike. I think that was more than just courting controversy or using rage bait, which was somebody’s word of the year this year. What happened there went beyond using controversy and scandal to sell products. Nike was taking a stand. They were putting a stake in the ground and saying, “This is what we believe in.” This was at a time when brands were doing that. We’ve talked before on the show about brands stepping back from taking positions on public issues, despite the Edelman Trust Barometer saying that people want brands to address societal issues and take stands. I think the political climate has led them to dial that way back, but that’s what Nike was doing at the time. I don’t think they were rage baiting or trying to gin up controversy. They were trying to say, “This is what we stand for. We stand with Colin.” They knew from the research they’d done about their brand, demographics, and market that the vast majority would stand with them, which is pretty much what happened. It’s a calculation. If it were an issue central to the organization, its culture, its marketplace, and the like, I might say, “We could do an ad that puts out our position on this issue and lets everyone know where we stand.” Do the research and know that 80% of your market isn’t on the other side of it. But just rage baiting, just ginning up controversy? I wouldn’t recommend that. I find it fascinating that it’s becoming more or less a standard marketing practice. There’s a piece in Campaign that quotes Rosie Brown, head of strategy at a marketing company with a great name: Kill Boring Dead. She says controversy is now planned. Brands treat backlash as a campaign event with KPIs rather than a crisis. Her distinction is that backlash on a campaign is survivable; backlash on your identity isn’t. That’s another way to look at this. If you’re willing to take backlash on your brand, that’s fine. But if your identity is tainted, that can be very serious in terms of the damage it causes. Neville Hobson: I think it’s a great shame that we’ve got someone who says stuff like that. But if that’s the landscape we’re in, then it’s part of what you see with social networks, where they all went down the toilet—notably Twitter, or X—and they think it’s fine. I suppose you could argue that not all controversy is equal. Deliberate provocation, which is what nearly all the examples we discussed today involve; taking a principled stand, which I’d agree perhaps applies to what you said about Nike; and accidental offense are all different situations. But what seems to be gaining acceptance in some quarters, particularly in the marketing arena, is that deliberate provocation is okay as long as you’re able to assess the benefit of the attention you’ll get, much of which may well be hostile to you, and the potential for damage to your brand. I personally can’t imagine anyone being able to demonstrate, with a clear ethical conscience, that this is good business practice. Shel Holtz: Just one more data point I pulled up: Novig, the brand that used the Sydney Sweeney controversy with its ad, saw brand mentions surge 900% after that ad aired. The company’s founder, Jacob Fortinsky, told Front Office Sports that the controversy “forces us into the national discourse.” Again, was that their goal? If that was their goal, they succeeded. Why that would be their goal, I don’t know. Maybe they looked long term and said people would remember their name long after the controversy had receded into the background. But I agree with you. It’s a sad thing to see controversy and rage baiting being used to sell stuff. I think we’re going to see more of it, not less. Neville Hobson: I’m sure you’re right. We might as well just say the end justifies the means, right? Shel Holtz: Yeah. Neville Hobson: That’s very sad. Shel Holtz: It is. And that will be a 30 for this episode of For Immediate Release. The post FIR #534: Is A Scandal-Based Marketing Campaign Worth the Risk? appeared first on FIR Podcast Network.