Tesla and Disney’s popularity plunge is a warning sign for corporations
Some PR observers see corporations wading into political debates as a crucial step in communicating their values. However, new evidence from the 2023 Axios Harris Poll 100 suggests that how a company navigates these risky waters is key.
According to the poll of 16,310 American adults, two companies actively in the news cycle – The Walt Disney Company and Tesla – have suffered significant reputational damage, with wrongheaded political engagement to blame. While the circumstances surrounding Disney and Tesla are different, each case provides useful guiding points for corporate messaging.
In the third annual Axios Harris Poll, which measures categories such as character, trust, and vision, Tesla saw their reputation fall sharply from the 12th most trusted company last year to 62nd out of 100 in 2023. Amid controversy over CEO Elon Musk’s acquisition of Twitter, Tesla under Musk’s leadership was widely seen as unfocused and chaotic, even though most criticism of Musk has little to do with the company’s underlying business.
Many Americans are likely turned off by the unorthodox billionaire’s usage of Twitter to insert himself into political and culture wars, including voicing skepticism of vaccines and support for a Republican takeover of Congress. Such actions antagonized half the country and alienated a sizable customer base.
Without Musk’s increasing political involvement via Twitter, it’s difficult to see Tesla’s reputation sliding so much. Among the nine categories of reputation polled, Tesla’s smallest decline from 2022 was in the category of Products and Services; proving that attitude changes toward electric vehicles fail to explain the reputational slide. Instead, the biggest categorical decline was in the poll’s Culture metric.
In this case, Musk’s public relations approach of being a highly visible, social media-centric CEO has backfired on the reputation of Tesla. But Tesla isn’t the only high-profile company that saw a significant reputational decline.
Disney, a company historically known more for its cartoon characters than political skirmishes, found itself in the crossfire of Florida Governor Ron DeSantis following the company’s public opposition to legislation banning the discussion of topics relating to sexual orientation and gender identity in primary grade levels.
In the last two versions of the Axios Harris poll (the public conflict began amid survey collection for the 2022 version), Disney has seen its reputation slide from 37th overall to 77th.
Many Americans undoubtedly supported Disney’s position. But whether you agree or not, receiving frequent attacks from the governor of America’s third-largest state is likely to harm your reputation. And taking a very public stand on an issue for the first time, while the noise surrounding it was at its highest decibel, exposes you to criticism from wide swaths of Americans on the other side of the issue.
Disney’s problem was that their denouncement of a high-profile bill and public figure was the company’s coming out party on public issues; Disney had not been widely known for political activism in years past. Without a pre-existing reputation for significant advocacy, the company staked out a position for the first time under the intense limelight of national attention.
This made their decision to speak out all the newsier, and by extension, ripe for criticism by political opponents. Even those who should’ve been allies weren’t pleased, with the Human Rights Campaign criticizing Disney for remaining silent for too long on the issue. And to make matters worse, Disney didn’t speak out until the bill was already heading to DeSantis’ desk, meaning they took a public position after most of the work was complete, making it look more like a tit-for-tat with DeSantis.
The takeaway here is not that discussing social or political issues is always harmful. Outdoor clothing retailer Patagonia was the company most favorably viewed by the American people, despite their widely advertised commitment to sustainable business practices and fighting climate change.
Patagonia is proof that if your company smartly picks its spots, avoids personality disputes, and has a reputation of advocacy when the cameras aren’t on, a company’s reputation doesn’t have to suffer from taking a stand.
But in a time of divisive politics, Elon Musk and Disney’s decisions to endorse political platforms, heavily engage personalities, and engage on issues at their most heated moments can hurt a company’s reputation with the American public.