Commentary by crisis management expert Edward Segal, author of Crisis Ahead: 101 Was to Prepare for and Bounce Back from Disasters, Scandals, and Other Emergencies (Published by Nicholas Breaely)

A company that publicly proclaims and touts a set of principles and values, but suddenly walks away from them, runs the risk of creating a crisis for the organization and its brand.

Tractor Supply Company, which bills itself as the country's largest rural lifestyle retailer, is a case in point.

The company's sudden reversal learlier this year of its publicized years-long commitment to diversity, equity, and inclusion (DEI) is a cautionary tale about the challenges when serving a diverse customer base in these highly politicized times. It is also instructive on what can go wrong when making public statements about sensitive hot-button issues.

Setting And Achieving DEI Goals

In 2021, Tractor Supply strengthened and increased its goals in several DEI-related areas, Retail Dive reported.

Last year the company received national recognition for its inclusive workplace when it was featured on Bloomberg's Gender Equality Index for the second year in a row, and in Newsweek's inaugural list of America's Greatest Workplaces for Diversity.

Changing Direction

But Tractor Supply's embrace of DEI changed abruptly last June when it was the target of a social media campaign by Robby Starbuck, a conservative podcast host and unsuccessful Republican congressional candidate in Tennessee.

On June 6, Starbuck wrote on X  "that it was 'time to expose Tractor Supply,"which he said was one of conservatives' most beloved brands but was at odds with their values. He pointed to its DEI hiring practices, in-office Pride Month decorations, climate change activism and 'funding sex changes,' among other complaints," NPR reported.

Starbuck's campaign took its toll on Tractor Supply.

Three weeks later the company announced it was abandoning its embrace of DEI by eliminating its DEI goals and staff, would stop providing data to the Human Rights Campaign, cancel sponsorships of Pride festivals, and no longer pursue its carbon emission goals.

What drove Tractor Supply to take these steps? "We have heard from customers that we have disappointed them. We have taken this feedback to heart," the company said.

"These changes mark a stunning shift in policy and messaging from Tractor Supply, which once touted its diversity and inclusion efforts. Just earlier this month, Tractor Supply President and CEO Hal Lawton maintained that the company remained 'very consistent' in how it approaches its own DEI and ESG—environmental, social and governance—programs for a number of years," according to the Associated Press.

Backlash

Tractor Supply's efforts to stem criticism about its policies—while putting out one fire—simply created a new fire of criticism when groups including the Human Rights Campaign, GLAAD, and the National Black Farmers Association denounced the company's actions.

'Embarrassing Capitulation'

"Tractor Supply's embarrassing capitulation to the petty whims of anti-LGBTQ extremists puts the company out of touch with the vast majority of Americans who support their LGBTQ friends, family, and neighbors," GLAAD president and CEO Sarah Kate Ellis told The Advocate. "It sends an appalling message, during Pride month, to see a rural staple go out of their way to bring harm to their LGBTQ customers and employees," NPR reported.

'Appalled By This Decision'

Last Tuesday the National Black Farmers Association  called on Tractor Supply President and CEO Hal Lawton to resign, following the retailer's decision to back away from its equity and climate goals.

"I am appalled by this decision, which is reflective of the ongoing racial tension and division in America," John Boyd, president of the association, said in a statement. "This affects our 130,000 members, many of whom regularly shop at Tractor Supply. Having repeatedly attempted to discuss our concerns with Mr. Hal Lawton, I am now calling for his immediate resignation."

Avoiding No-Win Situations

Tractor Supply's experience demonstrates a hard truth for companies that seek to serve diverse customers: by publicly catering to the concerns or demands of one segment of customers, you might alienate and upset another segment.

There's one strategy businesses could follow who want to do something about controversial hot-button issues and still avoid these no-win situations: don't brag about or tout their actions or the success of their efforts.

While this stealth approach would not please some public relations professionals, crisis management consultants would likely nod their heads in approval.

Having It Both Ways

"Companies can be diverse and reduce carbon emissions without making grandiose announcements with politically aligned terminologies." Ernan Haruvy , a marketing professor at McGill University, observed via email.

The rise of the cancel culture, which seeks to single out and damage businesses that don't align with with with a group's priorities and preferences, played a part in what happened to the company.

"The problem for Tractor Supply was in announcing initiatives that had the appearance of being politically aligned, and then retreating from these same initiatives, thereby upsetting absolutely everybody," he pointed out.

In some cases, there may be a silver lining to that backlash.

"On the one hand, it is regrettable that corporate social responsibility is now subject to political backlash. On the other hand, if cancel culture leads companies to pursue social responsibility with genuine intentions and less fanfare, this could be a net positive to society," Haruvy observed.

'A Big Mistake'

A big mistake Tractor Supply made was "assuming that the loudest people are in majority,"Charlotta Hellichius, an independent brand strategy advisor and researcher, commented in an e-mail interview.

There are other hot-button issues where paying too much attention to minority views and ignoring the majority can be harmful to companies—and society.

"In research on public sentiment across divisive issues, this [approach] has been proven wrong. Look at gun violence, where there—similarly—are a small group of vocal activists that take up the majority share of conversation, but definitely don't represent the much larger silent majority that wants to have a more honest and nuanced conversation about how to solve the very real societal challenges that plague American society right now," she noted.

Reality Check

Business leaders should think strategically before issuing statements or taking public positions on hot-button issues. That means carefully considering the impact a publicized position would have on different segments of its customer base, and how those customers might react.

And don't forget to account for worst-case scenarios when, if they become a reality, would create a crisis.

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