Beware the secondary boycotter

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)