Case Study: When Your Brand Is Racist

Shawn Lewis kept one eye on his laptop while footage of the protests in support of Black Lives Matter flashed across the TV. His family was asleep, but he was waiting for a press release draft from his colleague Angela that would go out tomorrow. Angela Howell was the head of PR at Cork Beverages, a brewing and distilling company based in Nashville, where Shawn was a senior brand manager. The release concerned the brand he was responsible for: Overseer Whiskey. When Slack finally dinged, he opened the attached document: We recognize that Overseer Whiskey’s history and name are closely tied to our country’s history of racism. While we have worked over the years to update the brand to be respectful of all races, those changes have not been enough. We are evaluating further measures and will announce our plans soon. Cork Beverages believes in diversity, equity, and inclusion and wants our product portfolio to reflect that commitment. In addition, we are donating $3 million to organizations that support and engage the Black community.1 Angela followed up a few minutes later. “Any changes?” He wrote back: “I’m still worried it’s vague. Is it enough to say that we’re evaluating changes?” “Jim doesn’t want to back the company into a corner,” she replied. Cork’s CEO, Jim Worth, was known for hedging his bets on strategic decisions. “But I agree that we need to get out in front of this thing. We don’t want to come off as reactive.” Shawn wondered if they were already too late. Over the past several weeks, many brands had been called out for their racist product names or histories. He was getting hourly alerts from Google indicating that searches for “Overseer” were increasing. It felt like a matter of time before a tweet pointing out the brand’s troubling past went viral.2 Samuel Vernon, a distiller and plantation owner in Tennessee, had started making the whiskey in the early 19th century. According to brand lore, he named it Overseer after an enslaved man whom he promoted to foreman of his cornfield, a highly unconventional act at the time. Throughout the 1800s and well into the 1900s, ads for the brand depicted a smiling Black man in field clothes and a broad hat, carrying a long stick. When Cork bought the whiskey brand, in the 1950s, it redesigned the label to feature Vernon’s home instead. Over the past 40 years, as Overseer became a household name across the United States, Cork had downplayed the image of the plantation house, making it smaller on each version of the label. The company avoided advertising for the product, relying more on reputation and word of mouth. But Overseer remained Cork’s best seller, and the senior team didn’t want to tinker too much with a winning brand. Shawn had taken over as brand manager for Overseer three years earlier. He was well aware that putting a Black man in charge of a brand with racist origins worked in Cork’s favor, especially in an industry not known for its diversity. But whatever the motivation for his promotion, he wasn’t going to pass up the opportunity to lead the company’s crown jewel. He felt pressure to get it right, not just for Cork, but for himself. Rereading the press release, he was proud that he’d persuaded the board to make a meaningful contribution to Black causes.3 Angela pinged him again. “I just heard from Carla that she’s good with the press release as is. Do I have your sign-off?” He trusted Carla Tasha, his boss and Cork’s chief marketing officer. If she’d signed off, he could too. He knew she’d have his back if things went sideways. “Yup, all good,” he typed. As he hit send, he thought to himself, Now my work really begins. This will be the biggest challenge of my career. The Options on the Table Shawn’s first Zoom call the next morning was with Carla and Eric Reid, the head of finance for Cork’s spirits division. “Let’s start with a review of our options,” Carla said. The idea of altering the Overseer brand had been on the table for some time; in fact, Cork had conducted extensive customer research to gauge perceptions of the brand and potential reactions to changes.4 Shawn and his team had been strong advocates for dealing with the brand’s racist origins even before George Floyd was brutally killed by the police and the national dialogue around racism exploded. They’d hoped to execute a plan without fanfare, but the board had been reluctant to make a move, fearing a revenue hit for Cork’s best-selling brand. Now their hand was being forced. “If we really wanted to make a clean break,” Shawn said, “we’d kill the Overseer line. I realize it’s highly unlikely, but I have to mention it.” “Kill our most profitable brand?” Eric asked with eyebrows raised. “No one’s going to take that seriously.” “I agree,” said Carla, “though it would make a strong statement.” “It would also piss off our customers,” Eric pointed out, “especially in the Southeast and the Midwest. We know from our market research that they have no problem with the name or the history. Only 42% of our whiskey drinkers even know what an overseer is.” 5 “True, our customer data shows that most people don’t associate the brand with slavery,” Shawn said. “But if we want to do more than avoid a potential PR crisis and put Cork out there as a leader in the fight against racism, getting rid of Overseer will do that. But it’s probably a nonstarter, so let’s move on.” As Shawn discussed developing a new brand around the same taste profile, he heard Carla sigh. Having been in marketing her entire career, she had numerous war stories of failed rebranding efforts. She’d never been in favor of a complete rebranding, and given the price tag, neither had Eric or his boss, Cork’s CFO. “Then we’ve got the option of tweaking the brand,” Shawn said. “We change the name but not so much that we lose brand recognition. In customer testing, the names ‘Seer’ and ‘Chattanooga Seer’ scored the best.” 6 Shawn shared his screen and walked them through the key takeaways from the research. “This is helpful,” Carla said. “And what about rebranding as ‘Element’?” Another option was to fold Overseer into Cork’s second-most popular brand, Element Gin, and call it Element Whiskey. “That’s still on the table,” Shawn said. “You’ll also present a ‘no changes’ scenario to the board?” Eric asked. “You know they’ll bring it up.” Overseer had dominated whiskey sales in every region of the country for the past two decades, and thanks to limited discounting and minimal advertising, it was very profitable. “Why would we throw that away?” was a constant refrain from a few board members. Like Eric, they pointed out that most customers didn’t seem to know or care about the link to slavery. “I know our research was done before George Floyd’s death,” Eric said, “but so far there hasn’t been a public outcry, and sales are actually up—pandemic drinking, I guess.” Shawn knew that Eric liked to play devil’s advocate. “You really think doing nothing is an option after that press release?” 7 Eric nodded. “I do. Look, I’m not advocating for that, but you should be ready for pushback from the board. Nobody in that room is ready to kill the cash cow.” “That’s been true for a long time, but the calculus has changed,” Carla said.8 “I bet they’ll be very interested in what you have to say, Shawn.” Her implication was clear. Because he was Black, the board might listen more seriously to his recommendation on how to handle the situation. “Besides, you know the brand and our consumers better than anyone.” The Right Thing The next day, Shawn and his three direct reports met on Zoom to go over the board presentation. He began by asking where each of them stood on the options before they dove into the data. “I’ll go last,” he said. Chrystal laughed. “You always say that!” It was true; Shawn had learned from a mentor that when you’re the most powerful person in the room, the quickest way to sway a conversation is to share your opinion first. Becca jumped in. “I’ve always been firmly in the Element camp. It won’t be an easy transition, but if the halo effect is real, we could recoup the cost of rebranding and return to current sales levels within a year, if not the same level of profitability. Cork has built equity in the Element brand—now we need to leverage it.” “I think the projections from finance on the Element option are overly optimistic,” Chrystal said. “Remember the focus groups?” Shawn thought back to how frustrating those discussions had been. No matter how carefully his team explained that Element Whiskey would be the exact same recipe made in the same way in the same distillery, just with a different name and label, the participants refused to believe that it would taste the same. “The other risk is damaging our gin brand by dragging it into the situation,” Chrystal added. “Ken, you’re quiet,” Shawn said, looking at him on the screen. “Yeah, let’s hear the argument for no changes again,” Chrystal teased. Ken always went back to the data: Most customers associated the brand with “authority” and “assertiveness,” not antebellum slavery. But Ken surprised them. “I’ve actually done a 180 on this,” he said. “I’m leaning toward a new brand. It’s an expensive undertaking, but if there ever was a time to get senior management and our customers on board, it’s now. We need to think about social impact as much as profit here.” 9 “Isn’t that what the $3 million donation is for?” Chrystal asked. “Social impact?” “But is it enough?” Ken asked. Who’s Pouring? After dinner that night, Shawn sat down on the couch next to his father, Arden, who’d moved in with Shawn’s family right after the pandemic started to shut everything down. He was a widower, and no one wanted him to quarantine alone. And as a retired school principal, Arden had been able to help Shawn’s children with online classes. “Dad, you pouring?” Though neither was a big drinker, during the months-long lockdown, they’d begun a nightly ritual of having a snifter of whiskey together. “Good thing you get this free,” Arden said, smiling and holding up the almost empty bottle of Overseer. Shawn smiled back fondly. His dad always supported him. At every milestone—business school graduation, his wedding, his promotion at Cork—Arden had said the same thing: “I respect the choices you’ve made, Shawn.” He wanted to make his dad proud. As they both sipped quietly, his phone buzzed. “Duty calls,” Arden joked. It was an email from Carla: “Just got off the phone with Jim. We’ve got to move fast on this. Things are heating up, and we will want to announce plans soon. How close is your team to making a recommendation?” The Experts Respond: What should Shawn recommend to the board? Jori Bolton Geoff Edwards is an executive creative director at GALE and a cofounder of Saturday Morning: Shawn should discontinue the Overseer brand and immediately build a new one from scratch. While Carla is right that rebranding has a hefty price tag, this is a “pay now or pay later” situation. Consumers are savvy, and many will easily discover Overseer’s racist backstory. In particular, Millennials and Gen Z—the fastest-growing customer segments—are often unwilling to associate with brands that conflict with their values. Cork needs to make the investment in rebranding now to avoid losing current and future customers. A full rejection of Overseer would allow the company to demonstrate its values and commitment to diversity. Yes, Shawn will have to answer to the CEO, the board, and other stakeholders, including the bottlers and distillers, but he can be confident that this courageous move won’t hurt the bottom line over the long run. In fact, it’ll do the opposite. Shawn and his team can start by figuring out what the new brand story should be. I’d aim for something with a positive, nothing-to-hide spirit that emphasizes freedom and equality. The other options seem untenable. Tweaking the name or pulling the product under the Element brand will feel like a smoke screen—as if Cork is trying to hide the fact that the brand was built on the back of an enslaved Black man. Customers will see through that, just as they might question whether the $3 million donation to Black communities is enough. From the Washington Redskins to Eskimo Pies, many brands are recognizing that reckoning with a problematic past takes a lot more than onetime financial gestures or image tweaks. Bold moves are far more effective. Think of the way Ben & Jerry’s denounced white supremacy after George Floyd’s killing. There was no doubt in anyone’s mind where the company stood; its leaders didn’t care if they lost customers because of it. Cork should take a lesson from that book, communicating openly that it was in the wrong and is taking action—before being asked to. I feel empathy for Shawn. As a Black man leading a brand with a racist history, he’s in a difficult position. While I haven’t been in exactly the same situation, I’ve been asked to work for organizations whose values clashed with mine: cigarette companies that targeted inner-city youth and fast-food chains led by founders who held racist views. And I used those opportunities to make clear what I stand for. When you’re given a megaphone, do something positive with it. That’s what Shawn needs to do. He can fulfill his commitments to Cork, his family, and society by blowing up the brand and giving it a fresh, aspirational start. Jim Birch is the general manager at Dixie Brewery, which has committed to changing its name in the fall: Overseer’s brand needs to be tweaked; that can’t even be up for debate. But I don’t see a reason to destroy the brand entirely. As the CFO suggests, Cork could do nothing, but that would almost certainly limit its whiskey’s appeal to an ever-smaller segment of customers as modern societal norms prompt people to avoid products with problematic pasts. Cork’s leaders clearly understand that Overseer has a brand problem, and they’ve been distancing themselves from its past for decades. Just because 42% of whiskey drinkers don’t know that the word “overseer” has connections to slavery isn’t a reason to do nothing. At the same time, Shawn and his team need to remember that people enjoy the whiskey, and they should do what they can to hold on to that positive association. By tweaking the name—perhaps to one of the suggestions that have done well in market testing—they can build on what’s working and move away from what’s not. Part of the problem in this case seems to be the internal decision-making process. Carla implies that the board will take Shawn’s recommendations more seriously now, which indicates unconscious bias could be at play. The directors should have been open to Shawn’s advice all along, since he knows the brand better than anyone else. Why weren’t they? Had Cork really been committed to hearing from all employees regardless of race? Had there been a culture of silence where it wasn’t OK to suggest a name change? The company’s leaders need to address these cultural issues as they consider the brand tweaks. This case hit close to home, for sure. As I write this, our company, Dixie Brewery, is in the process of retiring its 113-year-old name; we plan to announce a replacement brand in October. We’re doing this not because there has been a public outcry or demand for change but because we’re increasingly cognizant that the word “Dixie” has been co-opted over the years to mean something other than what our brand represents. Our brand is “New Orleans in a bottle”; it’s a symbol of survival. After Hurricane Katrina, we had to move production out of Louisiana, but this past January we returned home to New Orleans East, and our loyal customers rallied around us. With aspirations to be a national brand, we started reaching out to wholesalers in other states but heard concerns about our name and how it would translate outside the U.S. South. Like Shawn’s market research, ours shows that not everyone believes the Dixie name is offensive. Our friends in the Black community told us that even if they weren’t necessarily offended, they couldn’t defend the name. And we don’t want to either. We want to make a product that brings people together, not one that pulls them apart. We’ve engaged local PR firms and are in the process of conducting focus groups with various sets of customers. With their help, we will test product and brand names until we land on one that feels right for us and what we stand for. This is what Shawn and his team need to do. They already have options that they know resonate with their target customers. They need to lean on the board to finally abandon the status quo. The brand is impaired, and a name change is the only way to save it. Case Study Classroom Notes 1 In an August survey by Pew Research, 52% of U.S. adults said it was important that companies make public statements about political or social issues, while 48% said it wasn’t important. 2 What are the advantages of making changes to a potentially offensive brand proactively rather than doing so in response to customer complaints? 3 Do donations make an impact, or are they a form of “virtue signaling,” whereby a firm says it’s taking action without making real change? 4 What other stakeholders should Cork involve in this process? 5 Does the fact that the term “overseer” has several meanings make using it in this way OK? 6 Many firms successfully rebrand by using a shorter name or acronym. For example, LG started out as Lucky Goldstar. 7 Researchers liken rebranding to Darwin’s “evolve or die” theory. Do some brands reach a point where they can no longer adapt to changes in their environment? 8 In the wake of recent protests, companies that have long resisted calls to alter their brands—namely, Aunt Jemima, Mrs. Butterworth’s, Uncle Ben’s, and Cream of Wheat—have promised to make changes. 9 How important is it to make a business case for the change? Should a moral argument suffice? HBR’s fictionalized case studies present problems faced by leaders in real companies and offer solutions from experts. This one is based on the Ivey Business School Case Study “Reckoning with Jemima: Can the Brand Be Remade for Good?” by Joseph C. Miller, Michael A. Stanko, and Mariam D. Diallo.

Case Study: When Your Brand Is Racist

Partner Center