Decoding Australian retailers’ decision to distance themselves from January 26

Earlier this month, Woolworths announced it would no longer stock merchandise promoting Australia Day on January 26, a date surrounded by controversy.

While observed as a national public holiday for more than 90 years, a 2021 ABC social survey found 55% of Australians supported changing the date.

January 26 marks the beginning of the colonisation of Australia, bringing violence, theft and oppression to the First Nations peoples who had lived on the land for more than 50,000 years. It is also called Invasion Day, Survival Day, or Day of Mourning.

Many workplaces including ANZ, Telstra and Woodside have encouraged the shift away from celebrating the date as Australia Day by offering employees an alternative day off.

Woolworths is not the only retailer to distance itself from the date this year with Aldi announcing it will not stock Australia-themed products under its Special Buys promotion. Kmart has not sold items specific to January 26 since last year.

The message the retailers are trying to send the community

When corporations wade into sociopolitical activism, they commonly overplay social motivations and underplay expected gains to the bottom line. What is unusual about Woolworths’ position is that the company has defended this as a business decision first and foremost.

This raises questions about big retailers shying away from Australia Day merchandise for business rather than social reasons.

Why pursue a business-first, activism-second strategy? Does this appease shareholders? How does the public interpret “activism without activism” and is it authentic? Is this just a move to deflect away from exorbitant prices?

A business case for activism

Opposition leader Peter Dutton quickly labelled this as “peddling woke agendas”. But a Woolworths Group spokesperson cited a “gradual decline” in demand for Australia Day-themed products. They also acknowledged the broader discussion of January 26th’s significance to different communities.

A 2021 survey found 21% of Australians supported changing the date. Source: Shutterstock/Dave Hewison Photography

A key reason to make a business case for corporate activism lies with shareholders. They typically oppose companies taking a stand on social justice issues believing businesses should “stay in their lane”.

Indeed, when Woolworths supported the Indigenous Voice to Parliament referendum, it resulted in a backlash.

Academic research indicates a brand’s activist position can harm shareholder returns. Investors view this as a misallocation of resources that threatens profit maximisation. Perceived risk of corporate activism is heightened for businesses with large market share, like Woolworths. They have more customers to lose and fewer to gain.

In this instance, Woolworths took a business-first, activism-second approach. This likely appeases shareholders because making merchandising decisions is well within Woolworths’ remit. Also, by the retailer cloaking its activism as profit maximisation, shareholders are less likely to be concerned.

As for customers, they increasingly understand the duality of a brand’s motives. If there are perceptions of sufficient social impact, self-serving motives are also deemed acceptable. Woolworths illuminated the profit-making motive while subtly bringing to light the problematic history of Australia Day.

Activism without activism?

While Woolworths led with business reasons rather than the support of First Nations peoples, it was interpreted by the public as a political act, eliciting debate and grandstanding.

A company of this stature with significant marketing intelligence could have correctly predicted this reaction and made a calculated decision to take a stand on an issue at the front of the public’s mind. Yet this looks like activism without activism. Woolworths brought a sociopolitical issue to the fore but operated behind the curtain of dollars and cents.

Consumers are discerning about corporate activism, requiring companies to move beyond marketing rhetoric and demonstrate meaningful actions. Usually activism attracts criticism when brands are perceived to be woke washing — that is, misleading consumers about prosocial corporate practices. Brand activism is therefore sometimes viewed as a “fake marketing trick” because brands are not backing up their stance on social justice issues.

Woolworths by contrast has taken concrete action — not capitalising on the “Australia Day” term and imagery in its marketing and merchandise on January 26. This move falls short of authentic brand activism.

A deflection tactic?

Australia’s fraught socioeconomic climate has put retailers in the spotlight. Currently, brands like Woolworths are facing media and political scrutiny for price gouging. In Queensland, there is a parliamentary inquiry into the discrepancy between prices paid to suppliers and those paid at the checkout. The Australian Competition and Consumer Commission and Senate are also holding inquiries.

Aside from making room for more profitable merchandise or advancing the reconciliation agenda, is Woolworths deflecting attention from its role in these problems? Changing the conversation to something time-bound (that is, likely to die down on January 27) may be beneficial.

Research speaks to such a values-based strategy. Brands call on social initiatives to deflect from negative issues and improve future discourse about their business. In this case, directing the discussion to their social responsiveness, even if secondary, enables Woolworths to divert attention away from potentially exploitative practices.

Corporate activism: An expanding and evolving strategy

Woolworths’ approach to activism warrants examination. While the company took action that ostensibly opposes the celebration of Australia Day on January 26, it communicated a profit motive fitting for the largest grocery chain in Australia by market share. It skirted full-blown corporate sociopolitical activism, an approach that was possibly more digestible for shareholders and customers (politicians less so).

However, this approach is also less authentic. Woolworths states its commitment to reconciliation through the support of the Indigenous Voice to Parliament and the Uluru Statement from the Heart. So where in this most recent decision was the marketing rhetoric that embraces and respects Indigenous Australians? This represents a lost opportunity to elevate the brand and promote the Change the Date movement.

Amanda Spry is a senior lecturer of marketing at RMIT University and Daniel Rayne is a marketing lecturer at RMIT University.

This article is republished from The Conversation under a Creative Commons license. Read the original article.