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Tuesday, 8 May, 2001, 10:58 GMT 11:58 UK
Do consumer boycotts work?

QUESTION: As environmentalists urge motorists to boycott Esso filling stations, can global corporations be made to sit up and listen to consumers' demands?

ANSWER: Several have been, but those campaigns which have succeeded have found a way to mobilise public opinion beyond pressure groups.


There are two things that set Exxon Mobil apart from its fellows in the oil business.

The Texas-based corporation is the world's most profitable business, having made 3.5bn in the first quarter of 2001. It also aggressively opposes suggestions that the fossil fuels it sells significantly contribute to global warming.

Bianca Jagger
Pump action: Bianca Jagger is backing the Esso boycott
Because of these attempts to discredit widely-accepted scientific opinion and Exxon's reported lobbying to have the United States depart from the Kyoto climate control agreement, British motorists have been called on to boycott the corporation's UK operation, Esso.

Could such a boycott be enough to change the business practices of such a corporate behemoth?

Dr David Marshall, an expert on consumer behaviour from Edinburgh University, says British shoppers have a growing belief in the power of "consumer sovereignty".

Consuming passion

But while we are convinced corporations will bend to our will, Dr Marshall says as consumers we may lack the self-discipline to flex our muscles.

When the Germany luxury car company BMW sold Midlands firm Rover for a paltry 10 last year, many in the UK were angered that British jobs were being put in jeopardy.

Pierce Brosnan as 007
"Get me a Rover, Q, or I quit"
The leader of Birmingham City Council, Albert Bore, urged consumers to support the Midlands car industry by "buying British" - a move which was seen as a thinly-veiled call not to purchase the products of Bayerische Motoren Werke.

Some Brummie BMW owners may have confined their cars to the garage until the storm had blown over, but the prestige cars seem no rarer a sight on our roads.

Indeed, the Munich-based company has seen global sales rise by 8% so far this year. Its 2000 revenue of 35.4bn looks far healthier now that the group has stemmed losses incurred through Rover - estimated to total 2.7bn.

Paper loss

Just as much of the bitterness towards BMW was confined to the area around threatened Rover plants, a boycott of The Sun newspaper following its coverage of 1989's Hillsborough football disaster was largely a Liverpool-based reaction.

The Sun said Liverpool supporters picked the pockets of the 96 people killed in a crowd crush. Sales of the paper in the city dropped by 200,000 a day, and have still not fully recovered.

Boys reading the Daily Mirror
Sales of The Sun dropped in Liverpool
Though localised, the boycott prompted the then editor Kelvin MacKenzie to admit The Sun's story had been a mistake.

Eating humble pie with a simple apology may not be any manager's idea of fun, but it comes at little financial cost.

For a boycott to bring about a profound change in corporate behaviour, the loss of sales has to outweigh the costs a company will incur in complying with protesters' demands.

Abiding by a boycott is made all the more difficult by the sheer range of products a target corporation may boast.

Seeing red

Outraged Liverpudlians might forego their daily Sun, but would they stop watching The Simpsons or Sky Sport's coverage of Liverpool FC matches - both of which come courtesy of Sun parent company News Corporation.

A boycott need not hit a company's bottom line directly. Oil giant Shell shelved a 4.5m plan to scuttle its Brent Spar platform in 1995 following a consumer outcry. It instead adopted a "greener" 43m decommissioning project.

News Corp boss Rupert Murdoch on The Simpsons
Doh!
A boycott of Dutch and German Shell petrol stations was widely credited for this change of heart (A National Consumer Council survey found 6% of Britons also joined the boycott), but scruples inside Shell may have been more instrumental.

Faltering morale and self-respect of workers is perhaps a more urgent priority for a firm - especially in a booming job market - than a slight dip in profits (which at Shell could top 10.8bn in 2001).

While blockades of petrol refineries last year had a dramatic effect on supplies round the country, an earlier "Dump the Pump" campaign persuading customers to boycott petrol stations on one day failed to gather much support. A second day of action abandoned the broadbrush approach, targeting just one petrol retailer, BP.

Those behind the Esso boycott (including Greenpeace, Bianca Jagger, some MPs and The Observer newspaper) may be hoping that simmering resentment towards oil companies and the lack of consumer loyalty to petrol retailers can be harnessed to influence Exxon.

See also:

08 May 01 | Business
Consumer boycott to 'stop Esso'
24 Jan 01 | Business
Exxon Mobil reaps record profits
03 Nov 00 | Business
Oil firms: Excessively high profits?
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