PR Failure #20: Customers Pedal Away from Equinox, SoulCycle

Aaron Blank / September 4, 2019

 

 


PR Failure #20: Customers Pedal Away from Equinox, SoulCycle

Your company is known by the company you keep. The causes and candidates you support as a private citizen or corporate contributor reflect your values. This is good for business when your customers’ values align with yours, bad for business when they don’t. The intersection of politics and consumerism can pose difficult choices. This has always been true, of course, but in today’s politically charged highly partisan environment, the implications of misalignment can be dire.

Look no further than the recent public relations woes suffered by Equinox and SoulCycle, which came under fire from members after it was discovered that one of the companies’ owners was raising funds for President Donald Trump’s re-election campaign.

The Story:

On August 6, The Washington Post reported that Stephen Ross, a billionaire owner of Equinox and its sister company SoulCycle, would be hosting a ritzy $250,000-a-seat luncheon in the Hamptons to support President Trump’s re-election bid. This set off a firestorm of media and social media backlash.

Ross is the founder and chairman of Related Cos., which manages more than $50 billion in real estate assets. In addition to Equinox and SoulCycle, Related also owns &pizza, Momofuku, Milk Bar and Pure Yoga. His firm also developed the flashy $25 billion New York City development Hudson Yards. While the news of the Trump fundraiser caused a stir for some of the other ventures under Related (restaurateur David Chang implored Ross to cancel the fundraiser), the attention focused mostly on fitness brands Equinox and SoulCycle.

People took to social media to voice their concern, using the hashtags #BoycottEquinox and #BoycottSoulCycle to urge others to join them in no longer supporting these two fitness giants.







The Failure:

Why did this connection set off such a firestorm? Ross’ support for the President isn’t just a matter of rooting for a different candidate, it’s perceived as support for someone many customers perceive as a threat to their values and rights.

The fitness giants are based primarily in liberal cities and promote themselves as inclusive and LGBTQ-friendly. Equinox has supported LGBTQ charities, partnered with GLAAD and sold Pride Month fanny packs and bandanas. The two brands’ apparent connection to the Trump administration incensed the LGBTQ community and allies. They portray themselves as welcoming and inclusive spaces where people are encouraged to be their true selves.

All the while, however, a major investor is supporting a man who regularly makes disparaging comments in public and on Twitter about and to people of color, LGBTQ individuals and women – a huge segment of SoulCycle and Equinox members.

Beyond a disconnect, the realization that their dues were even tangentially associated with a major donor to the Trump campaign felt like a betrayal to SoulCycle and Equinox customers given the Trump administration’s track record of undermining rights for LGBTQ individuals.

The backlash was rapid and rabid as rank-and-file members and high-profile celebrities (including Chrissy Teigen and Jonathan Van Ness) joined the boycott.





SoulCycle and Equinox took to Twitter, Facebook and Instagram to try to ease the outrage. Equinox posted, “No company profits are used to fund politicians. In fact, we are committed to all our members and the communities we live in.” SoulCycle issued a similar statement.



In a further attempt to quell the uproar, Ross gave a statement to Miami Herald reporter Adam Beasley, saying while he has been a friend to President Trump for more than 40 years, he is an “outspoken champion” of racial equality and inclusion.

On August 12, SoulCycle’s CEO pushed out an Instagram Story to take questions from members. The company subsequently announced Community Rides that support instructors’ favorite causes.

It appears most of these efforts were unsuccessful in de-escalating the fury of disgruntled customers, creating an opportunity for other brands. Some took advantage of the bad press to offer customers free workouts or announce donations to nonprofits, such as the Trevor Project, dedicated to suicide prevention for LGBTQ youth.

The Lesson:

Boycotts like the Equinox and SoulCycle events empower consumers to live their values and vote with their pocketbooks. Or at least to look like they are. We’re living in a new age of consumerism where customers have a true say in your business outcomes.

Despite the uproar, it’s unclear the effect boycotts like this actually have. A company spokeswoman declined to provide information on the number of customers who have quit the gym. (SoulCycle does not offer memberships.)

But in an age where social media and the influencers who dominate it hold incredible sway over public opinion, even a boycott that’s mostly talk damages reputation that could have an impact on longer-term customer loyalty.

We can expect more flare-ups as the 2020 Presidential Election approaches. Interest in political contributions and campaign financing is growing among the general public. Consider the popularity of groups supporting transparency. No matter which political side you take, business leaders should at least be aware of the potential outcome.

  • OpenSecrets.org maintains a public and searchable database of donors to political campaigns, giving every customer the opportunity to discover who’s giving to whom.
  • #GrabYourWallet, which emerged on Twitter after the Access Hollywood tape came to light, keeps a list of companies supporting the President and his family and encourages consumers to boycott them.
  • Sleeping Giants, founded after the 2016 elections, takes aim at brands supporting “racist, sexist, anti-Semitic and homophobic news sites” with advertising.  (Thanks to programmatic advertising, your products and services may be showing up on these sites unbeknownst to you.)

As more consumers expect corporate accountability and social responsibility from their favorite brands, any company board, investor, c-suite executive or leader should expect activism and political involvement as a big part of PR issues that can bring on a true failure and damage any company’s reputation. Bottom line: be prepared and think ahead.

Politics and business have not traditionally blended but given today’s state of affairs, you should be well prepared because that’s no longer true. If you sit in a communications or public relations chair at your company, you must determine what contributions have been made by your leaders and to whom. Draft an empathetic and authentic holding statement ready to deploy immediately should a backlash occur. Study the responses of Equinox, SoulCycle and Wayfair (which we explore here) to see what works and what doesn’t. The 2020 election is going to be one for the record books!

Until next time,
Aaron Blank
CEO and President
The Fearey Group

Fearey Blog + News

 

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Aaron Blank

CEO & President, Partner

Aaron has been engaged in the conversation since the late 1990s, where he discovered his love of media while working at local radio stations. After five years as a radio reporter, anchor, producer and promoter in New York and Connecticut, he and his wife, Lacey, ventured west to begin his career in PR. Soon he caught the attention of industry legend Pat Fearey and the rest is history. Two decades later, as CEO and owner of The Fearey Group, Aaron leads with tireless enthusiasm and contagious drive. In 2014, he became the next generation owner of the firm. He takes his breakfast at 4:30 AM and never eats lunch alone. You can find him working to connect the next business with tomorrow’s leader.

Personal philosophy: do something amazing every day and be fearless!