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Risky Business; Social Justice Creates Problems for Nike, CNN, Starbucks, Facebook

by | Oct 18, 2019 |

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With the internet, we live in our own personalized echo chambers. The dark side effect, we have become psychotically intolerant of anything outside our safe spaces. Borrowing from McLuhan, the medium has become our lifestyle. We now live on a planet that never looks up, never looks in each other’s eyes. We’ll never see the meteor coming.

Lifestyle Marketing.

It’s one of the most effective ways to sell things. The fashion, apparel, perfume, automobile, travel, sports, outdoor and other consumer industries depend on it. It’s about segmenting and beguiling human beings to transform them from disinterested parties into devoted purchasers. It’s brainwashing for financial gain. Since the days of Madison Avenue and Marshall McLuhan, America has become probably the most finely tuned consumer selling machine ever known to mankind. We have conditioned consumers to snobbishly crave products and hate alternatives not on measures of objective utility; but on how well they soothe our egos.

Many of us now have more virtual friends than real life ones. Author Julie Albright’s recent book, “Left to their Own Devices” chronicles how human value systems are changing because we have put our lives on the net; how we have become utterly alone with a tiny portal in our hands to experience life. Humanity has become lonelier even as it has become more wired. Lifestyle marketing has achieved its apex goal, a world where humans almost entirely connect via machines designed to package and sell personal dreams.

We are entertained by the popularity of fads. A plethora of fads. Transient fads the go viral and just as quickly disappear. Fads segmented and tailored for each one of us. It’s made us hyper-tribal. Intolerant to degrees we would, until very recently, never be in person. We have become afraid to speak out of turn lest we be judged and rejected for being “incorrect”. Or vocal about our views so that we block off those who don’t soothe our fragile feelings. Either way, it’s a dysfunctional, traumatic experience to navigate. We allow ourselves to be codependent on people we’ve never met, or barely know, for affirmation. We declare everyone else to be blood enemies.

I’ve always viewed social justice to be one of those fads. Invented by academics to deconstruct theories of societal organization and analyze them, it morphed into a pop culture tool to bludgeon people.

The feeling of entitlement and elitism being able to write one’s own rulebook with impunity in any way you’d like to imagine. It is the drug permeating the internet. It is a cancer-causing drug that is killing our souls. Plurality, that tolerance respect for disparate values, ceases to have practical meaning in such prickly times. It is replaced with an ocean of hate groups, each one thinking they are the most virtuous. And underneath the noise makers, an orphaned society struggling to find its voice to call bullshit.

Artifacts of a Changing World.

This system that serves the demigod of the for-profit echo chamber may be omnipresent, but it’s still a house of cards. It’s built on a ground rule and assumption that you can exploit lifestyle marketing forever without consequence. Such grand assumptions have never been true. Every innovation has a half-life. Every belief set reaches a threshold of impracticality.

I believe we are beginning to see some of the tenets of the social justice fad weakening. I’m a bit of a student of societal artifacts. I’ve been studying for a while corporate sustainability reporting, an element of a public company’s financial filings. Investors know them as 10-K’s, 10-Q’s, 8-K’s and other documents filed with the Securities and Exchange Commission.

SEC filings are an echo chamber of sorts that gives you insight into what businesses America considers to be their “safe spaces”. Don’t be fooled into thinking every company is unique. That’s not how the so-called soft and squishy part of business works. It’s more like lemming.

The reality is that the sustainability portion of a company’s filings is more like the practice of carbon copying what lawyers and risk consultants tell you will work to put into that section, what the safest thing to say is. At any time, corporate America is likely to pretty much be saying the same thing.

It’s faddish just like any other fad. For some time, copying and pasting approved platitudes about social justice and environmental sensitivity have been considered the “safe” words.

That’s beginning to not be the case. In the Internet triggered era, such platitudes have themselves become the seeds of corporate reputational risk. As social attitudes change, and in America they change and rebalance very quickly, they lead markets to question if corporate management and governance are acting in the best interest of the company. Let’s look at some case studies,

Nike, Inc.

Nike is part of the apparel industry. It is one of the most aggressive users of lifestyle marketing to carve out market share in a highly competitive environment. Nike relies on edgy attitude to not only spot fads and trends; but to make them. They walk the fine line of whom to extoll and who to disrespect in the name of aiming for maximum sales volume.

Politics aside, there’s serious mathematics in the economic calculus of a company like Nike. Inventory is just one element in a larger evaluation. For instance, to sell or junk a shoe design. If a few people in the core demographic of trendy social justice lifestyle buyers indicate they might get a little uncomfortable, is it better to take a write down loss on the shoes and parlay it into lots of free viral advertising that will make Nike’s core lifestyle purchaser’s affinity grow? For the Nike’s of the world, that’s a decision they ponder all the time.

But increasingly, it’s not a decision that doesn’t also come with business sustainability risks. Attitude can radically alter what market segments you have access to. There was a reason the Betsy Ross Flag show design made it all the way into stores. Someone at Nike did the research that said there was purchase intention there; that the market is turning.

In my opinion, Nike management chickened out. There was no danger their core market was going to abandon them. They went for the “safest word” in their version of corporate sustainability.

They elected to not offend the market share they knew instead to exploring how to expand their business to address objectively found emerging areas of demand. That’s leaving money on the table for competitors. That’s hardly ever a good thing for a company. Other lifestyle apparel companies will gain strength wherever they are not. I suggest that Nike’s board of directors should be asking some serious questions about the incident. Quoting tongue in cheek from Douglas Adam’s Hitchhiker’s Guide to the Universe, have they crossed their “shoe event horizon”?

CNN

Cable News Network is another company that invested heavily in lifestyle marketing. At one time the world’s premier global news company, CNN made a big bet that Blue America, the world of a Democratic Party controlled national agenda was the media territory that was its path to greatness. It relinquished fair and balanced reporting, gave the right of aisle market to Rupert Murdoch’s FOX News, and put their attention into battling other left of center media outlets for dominance.

The 2016 election of Donald Trump threw a wrench into that plan. Suddenly, CNN had to make a choice whether to return to the center or hold out for two years until the mid-term election. They chose the latter and proceeded to double down on their lifestyle marketing bet.

The network put its lifestyle persona bet on things like Mueller investigation and it’s ended disastrously. The network’s ratings went into free fall. They lost 24% share in as of April 2019 and estimated additional 16% of their primetime ratings in the month of May 2019 alone. They now have an estimated 1/3 the audience of rival FOX. It’s a shadow of Ted Turner’s former empire.

It hasn’t helped CNN retain audience share that the once invincible Blue Dream of the Democratic Party has descended into it’s own chaotic nightmare that sees leadership like Speaker Nancy Pelosi and Minority Leader Charles Schumer being challenge by Saikat Chakrabarti’s Justice Democrat harem who seem to be as good at confounding the Establishment Democrat leaders on Twitter as President Donald Trump can. Sparring with AOC? Really Nan? That’s beneath you.

And then there’s Barack Obama’s prediction of the Democratic Presidential Primary Race turning into “circular firing squad” playing out like a zombie apocalypse to the horror of orphaned centrist Democrats and the delight of Trump’s MAGA voter base.

This is about as perfect a storm as it gets.

This is wounded bird case of corporate failure that just cannot be ignored. And they’ve run into a merger with AT&T, a company that runs strictly by the numbers and is looking to economize following the acquisition of CNN’s parent Time-Warner. The word is that WarnerMedia boss John Stankey wants CNN to go down the path of developing a digital arm to rival FOX’s Digital with specializes in aggregating light news to fill the internet and yield many millions of page hits per day. Can you imagine a world where TMZ has more meat than the major outlet on the same story? You don’t have to. It’s been happening at FOX and soon it’ll be happening at CNN too.

That’s kind of a journalist’s version of a perfect storm.

Seeking redemption, I’ve also noted that the opinion section of CNN online has even begun carrying contributions that are not overtly hostile to the Trump administration, albeit with the “this op ed does not represent the opinion of the company” disclaimers prominently on display. Well, post debacle, one starts somewhere.

That is an artifact that says hell may be freezing over.

CNN are not the only ones centering up. It’s back to business by the numbers for the industry. My question is whatever possessed them into thinking dividing the country into political factions was a sustainable business model? Supernormal return for a while yes. But all overtime pay eventually ends. CNN got addicted to it. These choices are ending predictably.

Starbucks

There’s probably no business model where managing social justice expectations is more problematic than a distributed retail franchise like Starbucks. With just shy of 300,000 employees deployed at over 28,000 stores, touching humans looking up from their phones just long enough to recite mystical incantations that turn into cups of coffee is about as lifestyle retail as it gets.

Keeping the balance of peace within the interior of their store spaces has evolved into some macabre rules. Anyone can be in a Starbucks but no one can fall asleep in one. That’s a new rule to deal with homeless people coming in and hanging out in a place designed for people doing business and homework to come in and hang out while drinking coffee. You used to be able to take a nap between reading book chapters or composing article paragraphs. No more of that.

Social justice has the weirdest side effects.

Just as weird is Starbucks being a safe space that isn’t safe if a bunch of cops come in for coffee. One squeaky wheel patron causes an employee who, trying to please that person, insults other persons by preventing them from reciting their magical incantations and getting no coffee with their misspelled names on them. Then it goes viral on the internet because that’s what we do in America now whenever safe spaces collide like particles of matter and anti-matter.

Then, Starbucks corporate must send legions of trainers out to those 28,000+ locations to teach everyone a new rule that meets the universal social justice for all algorithm and, of course, to apologize to anyone that may have been slighted; in press releases so they don’t get boycotted again.

And Starbucks does send legions because unlike Nike or CNN, their business economics are about just doing whatever it takes to not pick any fights with anyone. Besides, there’s hardly enough space in one for a good fight and the merchandise display racks have breakables.

Is this just a weird version of America or what?

The microcosm of the damage social justice has created in a store the size of a two-car garage in 28,000 places everyday kind of boggles the mind when you think about it. It’s disruption without innovation. It kind of irks me and makes me want to order my coffee using the app on my phone so I never have to look up. Plus, my name will be spelled correctly on my cup because it’s a sticker.

Is this really what post-Industrial America is supposed to be like? Bizarre rules that bear little resemblance to common sense? And we’re supposed to accept this like happy sheep? Remember what I said about everything having a half-life earlier? We are stretching too many rubber bands. There’s something amiss about believing this is good for ordinary Americans or for America.

Facebook

Social media companies are finding out just how risky lifestyle personalization business strategies can be. Facebook’s Mark Zuckerberg has been dragged in front of Congress to answer for the sins of an industry by a hostile government that 20 years ago didn’t want anything to do with regulating companies like these. Now, Facebook is feared because so many people have established their digital “second lives” on them. We’ve revealed our souls to a machine designed to exploit lifestyle personalization to echo chambers of one person per bubble. A universe where we are connected to each other only through the Matrix of Facebook’s omniscient engine that decides what gets through.

And we want that engine to do exactly what each of us selfishly wants. Connect us perfectly. Amplify our thoughts. Market our message. Show us only what we want to see. Make us happy. Make our experience perfect. Make anything we don’t like go away. Punish those we disagree with harshly because they don’t matter, only we, only I, matter. Make sure noise from robots and rogues is kept at bay. But not my noise. Push that into every one’s face please. Oh, and do this for free.

When you step back and breathe, it’s clear that the world doesn’t really work that way. What does amaze me is how hard Facebook works to make it come close to that as possible. Implementing technology to reduce noise in our personal echo chambers.

There are 2.38 billion active users of Facebook per month. Only 190 million of them are in the United States. The cultural echo chamber separation algorithms that Facebook uses so Americans do not see the other 2.19 billion people on the system is a lot of work just there.

And now, pushed along by the demands of social justice of every left and right persuasion, there’s the work of separating Americans from each other in our increasingly self-segregated culture. Armies of human filterers are becoming algorithmic artificial intelligence and robots tasked to make everyone happy in their disconnected loneliness.

And there’s more. I noted that there were two kinds of major earthquakes in California on 4th of July week. One was natural. A magnitude 6.4 and 7.1 earthquake centered around Ridgecrest, California just outside of what’s called the Long Valley Caldera, the site of an ancient volcano. Maybe it’s not just meteors we need to worry about.

The other, virtual world earthquake, happened on July 3, 2019. On that day, the image servers of all the properties owned by Facebook, Inc. which included Facebook, Instagram and WhatsApp went dark for several hours while Mark Zuckerberg’s technology team made base object changes to the entire network. When it came back up, memes from robots, which had begun to proliferate with divisive political messages, were sparse.

Quoting from another movie metaphor, “A déjà vu means they’ve made a change to the Matrix.”

The question for Facebook is will this be enough to placate the hubris of Americans. That’s an unknown. Will that please everyone? No. That’s impossible. But Facebook can bend reality.

That’s not the important question.

The important question is⏤does demanding Facebook do a better and better job of keeping us happily alone amount to the right thing for the United States national interest? Is this really where we want corporate governance of our infrastructure and our commerce to go? These companies will do what we tell them to either by themselves or by regulations. What should we tell them to do?

Ponder again the warning, we are losing plurality and the need to be tolerant of other Americans as technology makes it ever easier to never have to look up.

Without that cohesion, are we still Americans?

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Dennis Santiago is an author and commentator on national policy and global stability issues. His subject matter expertise was developed during the Cold War as a strategic warfare systems analyst, missile defense architect, and arms control analyst. He is the author of the US Imperfect Defense Theory of Strategic Missile Defense. Dennis has worked on conventional warfare, nuclear warfare, and asymmetric warfare. His expertise includes combat aircraft, ordnance, electronic warfare, command and control, campaign design, and game theory.

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