Calls to boycott Nike Inc. over its recent ad featuring quarterback Colin Kaepernick may not have much impact on the company, if social-media data is any indication.
A look at Twitter TWTR, -1.04% mentions of boycotting Nike NKE, -0.12% shortly after the ad came out “doesn’t support a strong negative call against Nike,” argued TickerTags analysts Mark Bachman and Daria Woods in a recent report.
The TickerTags analysts have tracked social chatter around other prominent boycotts over the past few years, and the data they’re seeing on Nike doesn’t strike them as cause for concern, especially when benchmarked against two recent boycotts of Starbucks Inc. SBUX, +1.20%
Folks threatened to boycott Starbucks in 2017 after the company pledged to hire refugees and again in 2018 after two African-American men were arrested for using the bathroom at a Starbucks location. The first boycott generated more buzz, but neither ended up having a real impact on the company’s financials.
Woods told MarketWatch that mentions of Nike boycotts following the ad remained “significantly lower” than mentions of Starbucks boycotts after the 2017 refugee pledge. During the first day of the campaign, mentions of boycotting Nike were lower than mentions of boycotting Starbucks after the racial-bias incident. They were about equal on the second day.
The frequency of mentions is subsiding, Woods added. “We have found boycott mention frequency levels and duration to be more indicative of repercussions than sentiment,” she wrote in her report.
Amid calls for a boycott, many Nike defenders are praising the brand on social media. “Negative posts generally are closely correlated with positive posts, suggesting that controversy can drive revenue growth,” Bernstein analyst Jamie Merriman wrote Wednesday.
Data from San Francisco-based Edison Trends suggest that Nike online sales jumped 31% from the Sunday of Labor Day weekend to Tuesday, whereas some might have expected sales to fall.
Woods said it’s worth noting that unlike with coffee, consumers purchase athletic shoes and apparel on a fairly irregular basis, so it might take weeks to see whether boycotters really avoid Nike products.
Nike is due to report quarterly earnings results on Sept. 25, but those numbers will only cover the period stretching from June to August, before the Kaepernick ad was released. Management may provide commentary on effects of the ad and the boycott campaign during Nike’s earnings call, however.