This interview deals with Woolworths and its values and the social conversation, woke, etc. I think it is a perfect example of how politics and business should not be mixed and why you should not do it.
Firstly, are the effects of Woolworth's announcement on Australia Day still with them? I suspect yes.
The Share Price Impact
When Woolworths went public with its decision to pull Australia Day products, there was an immediate backlash from customers and politicians alike. Looking at the share prices in the month since shows that this decision likely in part impacted Woolworths' bottom line:
The share price of Woolies vs Coles over the past month. Green Square is when Woolies went public over its decision not to sell Australia-themed merchandise on Australia Day. As you can see, Wooly's share price on the graph was slightly ahead of Coles. Today, Coles is 2.90% up, and Woolies is -0.06% down. That is close to 3%. See the Black line.
You cannot claim that it is the supermarket business as Coles is up. Looking at the figures, I would say that the share market found something it prefers in Coles to Woolworths, and politics likely played a role in this divergence. Customers voted with their wallets; the share market will react to this fall in the customers' wallets.
So, let us go to the interview and see what Woolies' CEO said.
Banducci: Woolworths' CEO said in the article.
"Our customers are saying focus on delivering value for us and not getting engaged in conversations that are broader than that."
My views: If you find this comment offensive, what am I, some ignorant, uncaring person? Also, this statement ignores the genuine customer dissatisfaction with Woolworths' decision. Many customers made it clear on social media and in complaints that they care about these political issues and disagree with Woolworths wading in.
Overall, modern Australia is better informed than ever; we are politically aware and care. Issues are important to them. In an industry that Woolies is in, where Coles and Woolies often have almost the same products and are close together, it's easy for someone to create by walking into one or the other. Politics will affect buying decisions in such an environment, mainly when well-known and influential political leaders such as Leader of the Opposition Peter Dutton say something. Let us face it: he has about 50% of Australia's vote.
Banducci: Woolies “could clearly have done a better job” of explaining its decision over the merchandise.
My views: That is for sure; Woolies could have done better by saying nothing, which is what almost all retailers did. Why antagonise people necessarily?
Banducc: said, “I do feel anxious about the impact this is having on our team. They are proud, hard-working Australians, and for them to be seen as anti-Australian or woke is fundamentally unfair,”
My views: I agree. It appears that most, almost all, the team members of Woolies were against the announcement; see here, here and here
Banducc: denied that Woolies was making a political statement with its decision,
My views: There is certainly a smell of political involvement in this statement. Many retailers made a similar decision for commercial decisions, but I am unaware of any of them publicly announcing it before this happened. Once it broke out, it could have been fixed quickly, but it was not.
Once politics enter the conversation, separating business decisions from political perceptions is almost impossible.
A Lesson for Business
The fallout from Woolworths' choice shows why business is generally best served by avoiding political stances. Even if well-intentioned, politics are inherently divisive and risk alienating your customer base.
Focusing solely on business operations rather than wading into political debates is usually safest. Let your customers view your business decisions through an economic lens rather than an ideological one.
The Australia Day controversy provides a cautionary tale for companies considering taking a political stand. In our polarized climate, politics and business remain uneasy bedfellows at best.
If you have a subject you care about, say it as an individual. It's a free country, and you can do it and keep your business out of it.
