Calls for a boycott of Goya Foods products in 2020 actually caused the company’s nationwide sales to rise for a few weeks before subsiding to previous levels, according to new Cornell research.
Even in geographic areas where customers did forgo Goya products, which include packaged foods and spice mixes, sales revived after a few weeks, according to a new paper co-authored by by Jūra Liaukonytė, the Dake Family Associate Professor in the Charles H. Dyson School of Applied Economics and Management.
“Based on the stories in the press, we saw that the boycott narrative was significant and we expected Goya sales to go down, but the opposite happened,” said Liaukonytė, co-author of “Spilling the Beans on Political Consumerism: Do Social Media Boycotts and Buycotts Translate to Real Sales Impact?” published in the current issue of the journal Marketing Science.
The study was co-authored by Anna Tuchman, associate professor of marketing at Northwestern University’s Kellogg School of Management, and Xinrong Zhu, assistant professor of marketing at Imperial College Business School in London.
With instances of so-called political consumerism (think recent protests against Disney, Spotify, McDonald’s, and others) continually hitting the headlines in today’s politically polarized environment, Liaukonytė and her colleagues sought to understand the actual sales effect of social media posts targeting specific brands.
In Goya’s case, protests favoring a boycott emerged in the summer of 2020 after company chief executive Robert Unanue publicly praised then-President Donald Trump. Twitter posts favoring a boycott were 75% higher than calls for a “buycott” urging buying more Goya products, the researchers estimate.
Analyzing purchasing data from market research company Numerator, they found that Goya’s net sales rose by about 22% during the two weeks after the controversy erupted. The researchers also examined county-level election results from the 2020 presidential season and saw that sales rose far more in Republican-dominated counties than in Democratic counties.
While the sales jump in Republican areas may have reflected the general publicity surrounding Goya, it more likely showed purchases by politically motivated first-time Goya buyers supporting Unanue’s pro-Republican message, Liaukonytė said.
In Democratic-dominated counties, where the Goya brand has traditionally been more popular than in Republican areas, sales also temporarily increased despite the push to boycott, the researchers found. Boycotters in heavily Democratic counties were overshadowed by buycotters, who drove a slight short-term increase in spending on Goya products.
One possible reason: Because only a relatively small proportion of households nationwide are regular Goya customers in the first place, few households could forgo Goya products compared with the number that could become first-time Goya buyers, the researchers note.
Even the company’s core Latino customers largely continued to buy, perhaps because they felt especially loyal to the brand or couldn’t easily find adequate substitutions. Indeed, data showed that sales of certain Goya items such as canned beans temporarily declined in some Democratic areas, likely reflecting shoppers’ ability to switch easily to any of dozens of competing bean brands. But Goya’s adobo seasoning has far fewer competitors, leading Goya shoppers to stick with the company’s adobo spice mix and keeping sales of that product steady even in the most Democratic areas, the researchers said.
Sales data showed that about three weeks after the protests began, Goya’s overall sales reverted to pre-boycott levels, likely indicating that the media had moved on or consumers had tired of the controversy.
“Political consumerism campaigns on social media and their portrayal in the press are not always reflected in sales, and the risk of damage to their companies during a boycott may be overblown,” Liaukonytė said. Nevertheless, she said, more research needs to be done to understand these results, and whether executives need to worry about fallout from contentious political statements. A company’s size, profile, market dominance, and other characteristics all affect its fate amid controversy.
Original source can be found here.
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