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Article • 17/06/2024

Brands Go Quiet this Pride Month, Fearing Rainbow Washing

Every June during Pride Month, the corporate landscape transforms into a kaleidoscope of rainbows and pro-LGBTQIA+ messages. Ideally, it’s an opportunity for corporations to show support for the queer community and advocate for social change. However, it can often come across as “pride-for-profit.”

Rainbow washing (a.k.a. pinkwashing or rainbow capitalism) is the marketing practice of using rainbow-themed symbolism in campaigns without lasting or meaningful action to support the LGBTQIA+ community. While Corporate Pride campaigns have been known to boost profits and improve media perception, these moments often fail to provide lasting benefits once products leave the shelves, deeming them tokenistic and exploitative. 

Analysis of external media intelligence shows that after public brand controversies last year, rather than speaking out, companies are shying away from Pride campaigns in fear of consumer backlash and culture wars. Here’s how companies can move beyond rainbow-washing to support the LGBTQ+ community as allies in a genuine way.

Key takeaways:

  • Pride-for-profit can stain a company’s reputation: Last year, Target and Bud Light’s Pride campaigns faced boycotting and consumer backlash. Bud Light’s campaign controversy with Dylan Mulvaney accounted for 86% of Bud Light’s coverage in June, most of which was negative.
  • Companies have shied away from Pride, stepping back from culture wars for fear of backlash: Our data shows a 141% decline in news media coverage of LGBTQ+-focused marketing campaigns since last year’s Pride Month.
  • Inauthenticity hurts brands more than silence: Companies struggle to reconcile diverse customer expectations amidst deep cultural divisions. Successful communication campaigns during Pride month are designed around long-term, consistent, and inclusive commitments.

Target & Bud Light faced reputational damage for Pride marketing campaign backlash

Last year, during Pride Month, Bud Light partnered on a marketing campaign with transgender influencer Dylan Mulvaney, sending her a personalized beer can. This initiative caused an outcry from their anti-LGTBQ+ consumers, consisting of abusive messages and threats of boycotting Bud Light products. 

In response, Anheuser-Busch CEO Brendan Whitworth stated that Bud Light “never intended to be part of a discussion that divides people.” This sparked massive criticism as the company was perceived to lack sympathy for Mulvaney amid the backlash, demonstrating a “lack of fortitude in upholding its values of diversity, equity, and inclusion.” 

As shown in the chart below, last year’s Bud Light campaign controversy accounted for 86% of all the coverage received in June and was overwhelmingly negative.

This includes only mentions in the headline or lead paragraph.

Critics were also quick to notice that two years earlier, the Stonewall Inn refused to serve Bud Light during Pride due to allegations that Anheuser-Busch donated large amounts of money to anti-LGBTQ+ legislators

In the digital age, these contradictions are easier to spot, and if they reach consumers who increasingly vote with their dollars, they can have significant financial consequences for companies. For Bud Light, this controversy is estimated to have cost them $395 million in lost US sales.

In a similar reversal last year, Target removed some items and relocated LGBTQ+ displays after customer confrontations. This move then faced backlash for yielding to anti-LGBTQ+ pressure, resulting in a wave of negative coverage of the company’s action (see Fig. 1).

As you’ll see in the spike of negative coverage for Target in May 2024, Target declared that it won’t stock Pride Month merchandise at all stores in June due to lower sales. The retailer attributed this decision to “guest insights and consumer research,” but skepticism remains widespread. 

This highlights the struggle corporations have in reconciling diverse customer expectations amidst deep cultural divisions, particularly concerning transgender rights.

For More: How UEFA’s Rainbow Ban Negatively Affected their Reputation

Companies are staying silent this Pride Month to avoid controversy

Transgender and gay rights issues have become a conservative battleground, with many bills restricting LGBTQ+ rights and rising harassment and violence against gay and trans people both in Europe and in the United States. After years of addressing divisive issues like abortion, immigration, and racial equity, the data shows businesses are now avoiding culture wars.
More brands are opting out of Pride Month campaigns or choosing to be less vocal about them—evidenced by a 141% decline in news media coverage of LGBTQ+-focused marketing campaigns since last year’s Pride Month (Fig. 2).

Companies that use Pride campaigns as a marketing ploy without taking meaningful action or that quickly backtrack in the face of backlash may find it to be the riskiest move of all, as it gambles with brand loyalty. 

Looking at the lessons learned from last year, this approach can cost companies more than just their reputation.

Some view pride campaigns as a sign of support and increasing acceptance, while others condemn them as pride-for-profit. But is there a right way for companies to show their support for the LGBTQ+ community during Pride Month?

How can companies show true support for the LGBTQ+ community during Pride Month?

The LGBTQ+ community no longer sees printing rainbow flags and empowering slogans onto a pack as being sufficient –evidenced by the negative consequences companies face when they are unclear or deceitful about their approach.

Opinions on how to appropriately engage with Pride Month are as varied as the community it represents; some believe that corporations should not be involved, while others, knowing that companies wield considerable resources, outreach, and influence, think they could provide access to a valuable platform for fostering positive change.

According to a 2023 survey, taking a political stance to support LGBTQ+ and transgender rights is seen as a stronger sign of allyship than merely offering pride-themed merchandise. Supporting LGBTQ+ employees and implementing year-long outreach programs are also highly valued within the community. Recognizing the vast diversity within the LGBTQ+ community is essential.

4 Ways to Show Support

To genuinely support the LGBTQ+ community, companies must move beyond superficial gestures. For the companies who still want to demonstrate their support for the LGBTQ+ community, these are some aspects they must keep in mind:

  • Focus on campaigns that directly benefit the LGBTQ+ community: Brands should genuinely support the LGBTQ+ community, with products displaying pride-themed packaging benefiting LGBTQ+ organizations and creators directly. Companies should also clearly communicate how their efforts support the LGBTQ+ community and openly address criticism from LGBTQ+ consumers.
  • Pride month should be every month: Companies should commit to year-round progress, regardless of packaging redesigns, and remain steadfast in the face of anti-LGBTQ+ backlash.
  • Supporting the LGBTQ+ community inside and outside the organization: Action, not just symbolism, is needed to support LGBTQ+ employees and ensure their inclusion and advancement within the company. Ensuring an inclusive representation of the LGBTQ+ community at all levels of the organizational chain and ensuring fair and inclusive recruitment practices is key.
  • Shining a light on the achievements of LGBTQ+ people: Pride month provides an excellent opportunity to spotlight the LGBTQ+ community. LGBTQ+ employees should be involved in Pride-related packaging design and marketing to prevent insensitive ideas and damage to a brand’s reputation.

Signal AI ingests and analyzes external data and content from over 5M documents daily, covering over 226 markets and in 75 languages. Our AI-powered Web App provides companies with actionable insights and access to data & media coverage, key industry trends, topics, and events. Learn more here.

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