While it’s been awhile since I’ve
been in business school, there are still a few things that I remember from my
marketing and strategy classes. I do
remember a few of the maxims of the late great consultant, Peter Drucker, who
famously asserted that “the purpose of a business is to create a
customer.” Other classes taught us
about market segmentation, the acquisition costs of a customer and how to build
brand loyalty. I have clear memories of
an excellent Harvard Business Review article on the Boston Red Sox, who,
despite a long World Series drought, were able to build a tremendous brand and
fierce brand loyalty.
Major League Baseball, in
particular, has some real challenges.
Its core fan base is aging out.
Younger fans perceive the game to be slow and boring. And it has lots of competition for
entertainment dollars.
Yet last week MLB was compelled
to jump into politics and announce that it was moving the Midsummer Classic
from Atlanta to Denver in response to Georgia’s election law that requires a
photo ID. MLB moved the All Star Game
to Denver despite the fact that Atlanta has a 51% black population vs. Denver
at 9% and the move would disproportionately hurt black businesses in
Atlanta. To rub salt in the wound, Hank
Aaron, the man that broke Babe Ruth’s home run record as a Brave, and an
African American that suffered racial abuse as a result, died this year. The game would have also served, in part, as a celebration to his life and achievements. Twitter erupted with charges of hypocrisy. The
move was to a state with a black population of only 9% and it cost black businesses
millions in revenue. The usual
slow-footed Marco Rubio skewered MLB commissioner Rob Manfred for not giving up
his membership at Augusta. But MLB
marched on.
MLB had another choice—do
nothing, say nothing. Simply carry
on. But MLB felt compelled to react and
thereby offend a nonsignificant segment of its customer base.
Businesses go through a great
deal of work to learn about customer preferences, and how to keep customers and
sell those customers other things. I
fail to see how MLB’s decision does any of that. From what I can gather from the reaction of
fans on social media, baseball will likely suffer some level of drop off as did
the NFL and NBA after their leap into politics.
Certainly, the move by MLB
created quite a kerfuffle and there is some logic to the notion that “there is
no such thing as bad publicity” but that only goes so far.
MLB joins a lengthening list of
companies that have gone Woke. The president of Coca-Cola chimed in with his
criticism of the Georgia election law (only weeks after it was disclosed that
their implicit bias training urged employees to “stop being so white”), as did
Delta Airlines. United Airlines
announced that it was going to apply affirmative action to pilot training and
hiring. Demonstrations of Wokeness
heated up a couple of years ago when Nike deep sixed the Betsy Ross flag
sneaker.
Perhaps the personal wealth of
the CEO’s of large corporations is too insulated from risk these days. Even if they are fired, most get severance
packages larger than the GDP of most developing nations. In a bygone year, CEO’s burnished their
images by taking high level board positions in civic institutions. Today, I suppose it is more important for
them to make visible demonstrations of their Woke bona fides. But I am stunned by the fact that they are
willing to do it at the expense of their customer base and their shareholders.
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