Woolworths' decision to reintroduce Australia Day merchandise in 2025 confirms the concerns many raised last year after it removed these products in 2024, citing declining demand and cultural sensitivities. I warned that it risked entangling business with politics. Now, with this reversal, it's clear those warnings were justified.

This situation highlights important lessons for businesses moving forward.

The Fallout from 2024

As soon as Woolworths announced it would not be selling Australia Day merchandise in 2024, the trouble started. People began voicing their dissatisfaction on social media. Then, Opposition Leader Peter Dutton called for a boycott. Woolworths' attempt to frame the decision as a response to "declining demand" and "broader discussions" about January 26 did not dampen the controversy.

Financial and Reputational Damage

Immediately, the financial impact was evident, reflected in customers voting with their wallets. The reputational damage was equally severe, with Woolworths labelled "unAustralian" by critics and its employees facing abuse from frustrated shoppers.

The CEO's Missteps

Then, the handling of the situation by CEO Brad Banducci's comments about the decision being "commercial" rather than political rang hollow. By stepping into the divisive debate of Australia Day, Woolworths blurred the line between commercial decisions and political statements.

2025: A Course Correction That Proves My Point

Fast-forward to now, and Woolworths has reversed its stance. The retailer said it will now sell Australia Day merchandise on a unique stand in its stores on Australia Day, again including Australian-made flags and themed products available in stores and online. A spokesperson admitted that last year's decision was a mistake, stating, "We listened and recognised that many customers and teams wanted us to do more to help them celebrate the day."

What Changed?

Customer Feedback

Woolworths acknowledged that many customers traditionally wanted to celebrate Australia Day, pushing the company to rethink its approach.

Focus on Local Products

By selling Australian-made flags instead of imported ones, Woolworths has aligned its offerings with patriotic sentiment while supporting local manufacturing.

Neutral Framing

This time, Woolworths avoided framing its decision within broader social or political discussions, focusing instead on meeting customer demand.

These changes reflect a strategic pivot back to customer-centric decision-making—a point I emphasised in my critique last year.

Why Businesses Should Avoid Political Stances

Woolworths' experience underscores why businesses should avoid politically charged issues unless they are central to their brand identity or values. Here's why:

Alienating Customers

In 2024, we saw that taking a stance on divisive issues can alienate customers. In competitive markets like retail, where products are similar, this leads to lost sales and reduced loyalty. If I am upset with Woolworths, what is the big ask for me to go to Coles? It is a right or left turn in my local shopping centre.

Financial Risks

Businesses thrive by meeting customer needs—not by engaging in ideological debates.

Employee Morale

Woolworths' statements acknowledge that the decision also affected its employees. Many of them felt hurt regarding their patriotism, which led to unnecessary tensions in the workplace. These people, much like you and me, take pride in our country and are deeply affected when its name is tarnished.

Perception Becomes Reality

Even if the announcement was made for commercial reasons—which I am not so sure—as Woolworths claimed last year, it can easily be interpreted as ideological—especially when amplified by public figures or media coverage. These people do not want the truth; they want a story.

Lessons for Businesses

Woolworths' reversal offers valuable lessons for companies navigating today's polarised climate:

Listen to Your Customers

Customer feedback should always guide business decisions, especially in retail, where consumer loyalty is critical.

Stay Neutral When Possible

Avoid stances on divisive issues unless they align directly with your brand values or mission.

Focus on Core Offerings

In Woolworths' case, providing great products at competitive prices should take precedence over engaging in cultural debates.

Communicate

If potentially controversial decisions must be made, consider whether you need to communicate and ensure that silence is golden.

Be prepared to reverse course.

If caught up in a potentially controversial decision, consider immediately reversing course. A simple comment like "I did not mean it like that..." can do wonders.

Why This Reversal Matters

When I wrote about this issue last year, my argument was simple: businesses should focus on their core operations rather than wading into politically sensitive waters. Woolworths' decision to pull Australia Day merchandise in 2024 was a misstep that hurt its reputation, finances, and employee morale—all of which could have been avoided by staying neutral.

This year's reversal validates those concerns. By reintroducing Australia Day merchandise and focusing on customer needs rather than broader social conversations, Woolworths is taking steps to rebuild trust and repair its brand image.

Final Thoughts

The lesson here is clear: when politics enters the boardroom, it rarely leaves unscathed. While businesses might feel compelled to engage with social issues to demonstrate values or connect with specific audiences, doing so often carries more risks than rewards—especially when those issues don't directly align with their brand.

This reversal isn't just about being right—it's about highlighting how businesses can avoid unnecessary controversies by staying focused on what they do best. In today's polarised world, neutrality isn't just safe—it's innovative business.

What do you think? Was Woolworths right to reverse its decision? Share your thoughts below!

Do you ever wish you could read your customers' minds? Knowing what they like and what they're interested in would help you sell them exactly what they want! Well, one of my clients asked me this. What could I say so? I said, "Well, that we all do."

Do not think that because you like it, your customers do. I had a client who had a clothing store. His daughter told them that she knew what young girls wanted. So, based on her recommendation, they brought some stuff, and their customers did not like those items.

Still, I can tell you that some tools are available to help you discover more. There's no magic trick; there are several ways modern retailers can find out what makes their customers excited. Big businesses spend a lot of money on research, but smaller retailers have a secret weapon—they can talk directly to their customers!

Let's Get Chatty

The best way to find out what interests your customers is to ask! It's often as easy as talking to them. You can start with "Got any fun plans for the weekend?" or "What do you like to do in your spare time?" You'd be surprised at what people share!

Run informal focus groups.

When a few people come in to buy a product in a group, and you are helping them, ask them what they are looking for, what they want from the product, etc. Once they have brought it up, maybe ask them a few open-ended questions like: “What do you like and dislike about the products?” "What other similar products have you seen?" "What factors influence your purchase decisions?" Details here.

The Digital Detective

The internet now is a treasure trove of information about your customers. Here's where to look:

Social Media

Why not check some of your customer's Facebook pages? See what they share, like, and comment on. Look at the groups they're in and the events they RSVP to. Do a little 'detective' work on their profiles. Of course, be respectful of privacy, but public posts often give you great clues about their interests.

Google Trends

This fantastic (and free!) tool tells you what people are searching for. You can even narrow it down to your local area. Search for products you sell and see what else pops up. Are they searching for recipes? Maybe you've got a bunch of foodies coming into your store. Check here for some details on how to do it.

POS Systems sales reports

See if any patterns emerge. Do you sell heaps of gardening stuff in spring? Maybe your customers are green thumbs! What sells well before the Grand Final? What happens about Easter? Details here.

Experiment

The simple fact is that most ideas do not work. You need a thick skin. You will fail many times more than you succeed. Not every idea will be a winner. That's okay! Do not reinforce a defeat. Stop and go elsewhere. Look at the ideas that work and then look for ideas around the concept that works. I had a client who did well-selling phone cases. They then looked for other products they could sell to the customers who were buying these cases and decided to increase their range to include some mobile accessories; what went well were the charging cables.

The trick is to try different things and pay attention to what gets customers buzzing.

Success! How Do You Know It's Working?

If it's not measured, how do you know what is happening? There are a few ways to tell your customer sleuthing is paying off:

Happy Customers = More Sales

If people buy it, you promote the right stuff!

Loyal Friends

Customers feel special when you stock what they love. They'll keep coming back.

Buzz and Excitement

A great sign is if your products produce this buzz and excitement.

Wrapping It Up

Understanding your customers doesn't have to be complicated. Use a mix of these ideas, and don't forget to have fun along the way. The more you know what makes your customers tick, the better you can give them what they want.

A supplier to newsagencies approached us about a range of sustainable products they are releasing, eco-friendly greeting cards.. This brought up the Sustainability Dilemma: what "Customers Say vs. What They Buy." Do customers want these cards? 

This is a frequent problem in retail, where people express their wants but act differently. A famous example of this is studied extensively in marketing textbooks, in the 1950s when Ford introduced the Ford Edsel. This is widely regarded as one of the biggest marketing failures in history. One factor in this failure was Ford's decision to listen to the public's feedback and create a car based on this. However, when presented to the public, the car was a flop. What the public had said did not align with their actual desires.

Now, as a retailer, you understand that consumer demand is critical. Yet, often, you need some intelligence. The fact that customers frequently support strongly eco-friendly products does not mean they buy them.

Here is a study that shows what happened when consumers and senior retail executives were surveyed on sustainable products. Two-thirds of consumers said that they would pay more for sustainable products. However, most retailers stated consumers do not pay more for sustainable products. The retailers based their claim on what they said the public was doing. Read the report here.

So Are Customers Truly Ready to Pay More for Sustainable Products?

Let's explore what it means for your business.

The Conflicting Picture

• The Vocal Demand: Surveys consistently indicate that consumers care about sustainability. They say they are willing to pay more for products that align with their values.
• The Reality: Retailers see that old habits and price sensitivity often reign supreme in the market. Sustainable options get much interest but rarely make it to the sale.

Understanding the Disconnect

Here's what might contribute to this gap between what the public says and their actions:

• The Cost Barrier: Even well-intentioned consumers balk at significant premiums for eco-friendly alternatives.
• Trust: People have been burnt before eco-friendly and need convincing that your product is eco-friendly.
• Established brands: People like the products they buy now.
• Change: Sustainable products are often different, and people often do not want to change.

What This Dilemma Means for Retailers

• Missed Opportunities: If you rely solely on people's comments, you will probably overestimate the immediate market for sustainable goods.
• Long Game: Consumer behaviour rarely moves quickly. You must educate, show value, and build long-term relationships with eco-conscious shoppers. This is not always possible in a shop.

Tackling the Challenge

• Start with Data: Use your sales figures to understand which sustainable options resonate with customers. Don't guess! Please use your sales reports. Facts do not lie.
• Transparency Wins: Build trust by being transparent about specific sustainable aspects of your products. Be prepared to have info to back it up.

The takeaway: Customer opinions about sustainability matter, but they don't predict sales on their own

. Innovative retailers keep a pulse on the public conversation while making strategic, data-driven decisions on where and how to invest, e.g. small test displays of sustainable products first.