DEI is officially a third-rail issue for marketers in a currently toxic American political environment.
Experts say at this point it's better to leave it alone when developing campaigns, no matter which side your organization's on -- but especially if it has pulled back on previous diversity, equity and inclusion efforts.
But first, how did we get here? First, President Donald Trump made it a campaign plank to root out DEI programs from the government. Then, after winning the White House, Trump empowered the Department of Government Efficiency to do so. Private sector companies such as Target, Amazon, Meta, Tractor Supply Co. and McDonald's slashed or scaled back their own DEI programs.
Some companies, including Costco, Cisco, Apple, Salesforce, JPMorgan, Starbucks, Microsoft and Goldman Sachs, held firm with their DEI programs.
Companies on both sides, such as Starbucks and Target, are getting slapped with lawsuits as aggrieved customers and politicos take action.
In the retail realm, customers have organized both boycotts of Target and "buycotts," in which activists encourage consumers to shop at one retailer supporting DEI in general or Black businesses in particular.
At Target, these initiatives have led to a five-week decline in foot traffic in its almost 2,000 stores. It might get worse as Black religious leaders call for a fresh Target boycott through Lent, which began March 5 and ends April 17. The boycotts amount to self-inflicted damage to a key bottom-line metric at a time when consumers are spending less overall because they worry Trump's tariffs will cause inflation.
If you thought of DEI as a checklist, but customers thought of it as a promise, you don't get to cry if customers walk out with their wallets when you decide to leave that checklist behind.
Liz MillerAnalyst, Constellation Research
Companies that suffer consequences for enraging their customers could have known better, said Liz Miller, Constellation Research analyst. The first rule of marketing is to listen and know your customers well. Companies that either don't know their customers -- or make decisions without consulting marketing -- will increasingly reap what they sow.
Furthermore, DEI for some companies, such as Salesforce, has deep roots and might not have even been called "DEI" at first, but rather "the right thing to do" or "the culture of the brand," she said. Political winds won't sway them.
Conversely, companies that paid mere lip service to DEI in the last few years and are now uprooting those programs were only performing "checklist DEI" and weren't really in it for the long haul.
"If you thought of DEI as a checklist, but customers thought of it as a promise, you don't get to cry if customers walk out with their wallets when you decide to leave that checklist behind," Miller said. "You don't get to sit back and wonder why they got mad. In their eyes, you broke a promise."
Marketers in a bind
This brings us to the marketers in the trenches at companies that have taken a side -- either side -- on the DEI issue. Charged with filling their sales funnels with upsells as well as new and prospective customers, what are they supposed to do?
Any organization that walks away from a DEI policy is making a poor business choice, said Bill Bruno, CEO of Celebrus, a company that aggregates first-party customer data for marketing and fraud prevention.
It's sometimes hard to prove in the big picture what has affected the bottom line in quarterly financial reports for publicly traded companies. Chances are, though, if a bad DEI decision has caused a revenue decline, customer analytics will show it, as there will be negative noise on digital channels. AI sentiment analysis of customer feedback will reflect unhappiness with the issue. Social media mentions will reflect specific complaints.
But marketing teams at companies facing backlash, such as Target, Meta and Walmart, still have to create new campaigns. The bad news: No new marketing campaign can reverse damage from DEI missteps that have inflamed customers. The good news: There isn't any. It's best to sit this one out and hope your customers have short memories.
"Even the most brilliant marketers on the planet aren't going to be able to come up with a campaign to put a positive spin on walking away from diversity and inclusion," Bruno said.
In a related notion, Miller said the DEI bind in which some companies find themselves proves another marketing rule: With political issues, sometimes, it's better to lie low.
"When it comes to important social issues that are not just important to people, but are deeply important to people's cultures, it might be time for a brand or marketer to take a step back," Miller said. "Take a breath before you rush in and comment. Not every brand needs to have a stance."
Don Fluckinger is a senior news writer for Informa TechTarget. He covers customer experience, digital experience management and end-user computing. Got a tip? Email him.
