Companies are going to learn quickly that just because they now have the right to directly donate money to political causes, it doesn't mean they should necessarily do it. And if they do, they should be prepared for the repercussions.
Target Corp. has been raked over the coals in recent weeks after it donated money to Minnesota Forward, a political action committee that supports Minnesota Republican gubernatorial candidate Tom Emmer. It shouldn't come as a surprise that a major corporation is going to donate money to the party or candidate that is more likely to be pro-business. But Emmer is also an opponent of gay marriage and gay rights.
But Target 's problem is partly one of its own successful reputation with the LGBT community. The retailer has a successful reputation with the LGBT community. It has received a rating of 100% on Human Rights Campaign's Corporate Equality Index and Best Places to Work survey. It's even sponsored the Twin Cities Gay Pride Festival.
In other words, it's always been seen as sort of a progressive alternative to, say, Walmart.
So this donation, even if it was smart for its shareholders, was seen as a betrayal by its own employees and some of its most passionate consumers.
At the same time, News Corp. has donated $1 million to the Republican Governor's Association. That's resulted in the expected kicking and screaming from media watchdogs and the Democratic Party (which, not surprisingly, hasn't raised a peep when other companies have lined its coffers). But News Corp.'s core consumers aren't crying foul. "Fair and balanced" claims to the contrary, News Corp.'s constituency clearly leans right. No one expects Fox News viewers or New York Post readers to rush out into the streets to boycott a donation to the Republicans. And getting roundly thrashed by the "East Coast media establishment" only reinforces the beliefs of many News Corp. consumers.
In the long term, Target may not be hurt by this. And it, much like News Corp.'s Rupert Murdoch, will likely continue to donate to whatever party is better for its business. In almost all of these cases, the money spent is meant as a business investment, not a political statement.
But marketers have to acknowledge that such investments carry some risk, because consumers -- especially if you're lucky enough to have passionate ones -- aren't going to see it as anything other than political. And that might be bad for business.