Companies in the crossfire

Boycott efforts sometimes veer into slapstick. In 2004, Teresa Heinz Kerry, widow of Senator H. John Heinz III, made headlines campaigning for her second husband, Democratic Presidential candidate John F. Kerry. Conservative talk-show hosts told red voters to buy new W Ketchup instead of H.J. Heinz' signature product. The upstart's slogan: "You don't support Democrats. Why should your ketchup?" Heinz limited the damage by quickly issuing a statement noting that Mrs. Kerry had nothing to do with the company. One corporate counselor says Heinz let the world know that "Teresa is not on the assembly line stomping tomatoes, and the money is not going to her."

Three conservatives angry at Bennett Cohen and Jerry Greenfield, the liberal founders of Ben & Jerry's Homemade Inc., launched Star Spangled Ice Cream in 2005. Its flavors include Iraqi Road, I Hate the French Vanilla, and Smaller GovernMINT. "We're trying to appeal to conservatives, red states, and NASCAR dads who like Ben & Jerry's ice cream but can't [swallow] their politics," says Vice-President Richard Lessner. The boutique brand is available online, at retail outlets in the Mid-Atlantic region, and at 10 military bases in Texas. Lessner says its sales continue to build as conservatives talk it up and spoon it down.

Some companies are caught in the political crossfire. Social conservatives are boycotting Ford because, they say, the auto maker reneged on a promise to stop funding groups that advocate gay marriage. But Ford is also under attack from liberal groups for funneling 84 percent of its political action committee donations to Republicans in the last election. Target Corp., boycotted by the Right for barring Salvation Army bell-ringers outside its stores last Christmas, is being bashed by the Left for sending 76 percent of its PAC money to the GOP in the 2004 election. And Heinz, fighting off a ketchup rebellion, is being criticized by liberals for sending 70 percent of its PAC's campaign cash to Republicans over the past decade. With angry customers on both sides, many companies decide it's best to lie low. "Whatever we say, we just don't win, so we don't say anything," says one embattled executive.

BUSINESSWEEK My brand, my cause Consumers often look at politics before they buy. Click below to see what direction some of America's biggest companies lean. McDonald's Arby's Coors Gallo Continental United Air Exxon Hess Marriott Hyatt Source: BusinessWeek

But that's the wrong approach, communications consultants say. Instead, a company should try to defuse a situation before it gets out of hand. Miller Brewing offers a case study. In 2004, Miller's PAC donated $2,000 to House Judiciary Committee Chairman Jim Sensenbrenner (R-Wis.), author of the tough immigration bill that passed the House in December. That prompted an immigrant-rights group, the Chicago Committee Against H.R. 4437, to announce a boycott of Miller's beers on Mar. 10, the day of a massive pro-immigration rally in Chicago. One of Miller's Chicago marketing managers, Matt Romero, got wind of the boycott when distributors said they got pushback from bar owners and retailers.

The company immediately sought a meeting to discuss the situation. On Mar. 15, Romero joined a five-person team led by Nehl Horton, Miller's senior vice-president for communications and government relations, to meet with group leaders at a community center in Pilsen, a predominantly Latino Chicago neighborhood. Miller agreed to run newspaper ads opposing the legislation and helped to facilitate meetings between immigrant rights backers and lawmakers. On Mar. 18 the group officially ended its boycott.

Whipsawed
The latino groups chalked it up as a win. "We think it was an important victory," says Carlos Arango of Casa Aztlán, one of the 100 organizations in the protest committee. But the outcome was also a triumph for Miller, which resolved the situation before it wreaked havoc on business. Instead of responding defensively, Miller used the situation to reinforce its image as a corporation that's committed to diversity.

In contrast to Miller's sure-handed action, Ford's response to political threats complicated a sensitive situation. The AFA and 20 other groups first threatened a boycott of Ford in May, 2005. Top company executives met in Dallas with religious leaders and Ford dealers. On Nov. 28, Ford agreed to end its sponsorships of Gay Pride parades and stop sales promotions that give donations to homosexual rights organizations based on the purchase of vehicles.

But the auto maker reversed itself after an angry response from gay rights groups, and the conservative boycott began on Mar. 13. "Ford had to make a choice: support the homosexual groups or the mainstream values of its customers and dealers," says Randy Sharp, the AFA's director of special projects. Twice burned, Ford now chooses to remain silent. Says spokeswoman Kathleen Vokes: "All we can do is remain focused on building high-quality vehicles."

Many companies sympathize with Ford and believe it is unfair for activists to seek economic revenge. Take Wendy's, for example. Although the hamburger chain's PAC has given 93 percent of its campaign contributions to Republicans over the past five years, it views itself as a "nonpolitical company" that does not take positions on controversial issues, says spokesman Denny Lynch: "We serve customers on both sides of the aisle." Wendy's backs winners, he says, and today those incumbents are mostly Republican. "We're not a red company," Lynch says. "If Democrats start winning, we'll move our money to Democrats. It's just business."

Other companies say it's better business to steer clear of politics. Costco has won praise from liberals as the un-Wal-Mart, with higher wages and better benefits. But Costco CEO James D. Sinegal has not created a corporate PAC because "we don't believe a public company should take shareholders' money and support political candidates or causes." He and Chairman Jeffrey H. Brotman donate heavily to Democrats, Sinegal says, "but we do it with our own money. I'm a merchant, not a politician." Most American merchants would agree — if only the activists would leave them to their business.

Adrienne Carter in Chicago, Stanley Holmes in Seattle, and bureau reports contributed to this story.

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