Shark Tank's Mark Cuban says 'going woke is good for business'
Shark Tank star and NBA owner Mark Cuban has advised that 'going woke is good for business' as Anheuser-Busch and Target Corporation battle backlash from LGBTQ+ marketing schemes.
Cuban told the Pittsburgh Post-Gazette the ongoing backlash would subside despite both companies suffering massive losses worth billions of dollars.
Since their partnership with transgender TikTok star Dylan Mulvaney in April , AB-InBev has seen a market cap drop of $22.6 billion, Ycharts recorded. Bud Light also lost its top-selling beer distinction to Modelo Especial in May.
Meanwhile, Target Corporation saw a $10billion drop from $74.11 billion within 10 days of its promotion of Pride-themed merchandise. Its since seen a slight climb - trading at $59.41 billion as of June 13.
Both companies have seen massive boycotts in recent months because of their decisions. Target pulled its LGBTQ line - including 'tuck friendly' clothes - from some stores because of the criticism.
While experts have attributed the slump to invoking politics within these brands, Cuban has insisted that embracing being woke is a positive for other companies.
Shark Tank star Mark Cuban (pictured) has advised that 'going woke is good for business' as Anheuser-Busch and Target Corporation battle backlash from LGBTQ+ marketing schemes
Bud Light has lost its top-selling beer distinction to Modelo Especial in May.
'There is a reason almost all the top ten market cap companies in the U.S. can be considered 'woke.' It's good business,' he told the Pittsburgh Post-Gazette.
'Most CEOs have enough experience to know to just wait out the news cycle until they go to the next one.'
Since the Mulvaney partnership was revealed in April, AB-InBev has seen a 23.9 percent decrease in its sales on a dollar basis compared to a year ago.
Meanwhile, Target Corporation's market cap lost billions of dollars as products, including a 'tuck-friendly' women's swimsuit, hit the shelves.
Target's stock fell by 3.1 percent on Friday within five days and an estimated 18.5 percent in the last month.
Cuban has insisted that the 'dip' is 'meaningless' and that its unlikely due to individual stockholders taking action following the backlash.
'First a dip in market cap is meaningless,' Cuban said.
'You have to realize that there aren't many individual owners of stocks — almost all ownership is via funds, and most trading is quantitative.
'So, it's not like the drop is because tens of thousands of individual holders sold their stocks.'
The Dallas Mavericks owner said that 'people want to do business with companies that care about their customers,' a quality that is 'an American trait he says reflects who we are as a country.'
Since their partnership with transgender TikTok star Dylan Mulvaney April 1, AB-InBev has seen a market cap drop of $22.6 billion
Last week, analysts at global asset management firm Bernstein said AB-InBev could see a permanent 15 percent dent in sales amid the Mulvaney backlash.
They forecast AB-InBev will see its overall profits for 2023 fall by 6.7 percent.
The controversy sparked after Mulvaney, 26, shared a series of promotional posts for Bud Light with people still boycotting the beer.
Musician Kid Rock responded by posting a video of himself shooting at cases of Bud Light, and country singers John Rich and Travis Tritt dropped ties with the brand.
But media personalities such as Joe Rogan and Howard Stern defended Bud Light's decision.
Bud Light's CEO for North America, Brendan Whitworth, said on April 14: 'We never intended to be part of a discussion that divides people. We are in the business of bringing people together over a beer.'
Whitworth also said he would continue to focus on 'building and protecting our remarkable history and heritage.'
Meanwhile, within weeks after the Mulvaney partnership, two marketing executives at Anheuser-Busch took a leave of absence. It's unclear whether they have returned to work yet.
After Anheuser-Busch tried to distance itself from the Mulvaney promotion, Bud Light also faced backlash from the opposite direction, with pro-LGBTQ groups accusing the company of abandoning the transgender influencer.
AB-InBev CEO Michel Doukeris has downplayed the impact of the backlash, saying Bud Light's US sales declines in the first three weeks of April represented only one percent of InBev's global volumes.
Target Corporation's market cap lost billions of dollars as products including a 'tuck-friendly' women's swimsuit hit the shelves
Meanwhile, Target Corporation saw a $10billion drop from $74.11 billion within 10 days of its promotion of Pride-themed merchandise
'We believe we have the experience, the resources and the partners to manage this,' Doukeris said during a conference call with investors earlier this month.
AB-InBev's other flagship beer, Budweiser, also recorded a drop of 8.5 percent, while Natural Light and Stella Artois saw a 1.5 percent to three percent drop.
Meanwhile, the company's top competitors saw an increase in sales as beer drinkers switched brands.
Coors Light went up 26.3 percent, while Miller Lite went up 23.1 percent. Yuengling saw the biggest increase at 36.3 percent.
Modelo Especial, which is owned by Anheuser-Busch, parent company AB-InBev, saw the smallest increase at 9.5 percent.
Target could also see permanent damage, with Walmart now soaking-up customers who've chosen to boycott the brand.
Conservatives were already unhappy with Target's Pride displays, which included controversial items such as 'tuck-friendly' women's swimsuits.
But a bad situation went from bad to worse after they stripped back their Pride merchandise - enraging the LGBTQ+ community.
Target's Pride collection was linked to designer Erik Carnell of Abprallen, who has expressed support for Satanism and incorporated occult imagery.
Already close to a three-year low, the company's shares have been downgraded several times due to the controversy swirling around the Pride products.
Citi analyst Paul Lejuez downgraded Target's stock from 'buy' to 'neutral' and suggested rival Walmart might gain market share.
Erik Carnell (pictured) is a transgender designer and artist whose products were pulled by U.S. retailer Target from its Pride Collection amid backlash from some customers
'We believe Walmart is likely to continue gaining market share, and Target's high exposure to discretionary sales will not serve them well in the current macro backdrop,' Lejuez said in a note to investors.
'Despite the recent stock pressure, we cannot recommend investors buy the stock given these dynamics, and now believe the risk-reward is more balanced, but the risk is more to the downside near term,' Lejuez added in a note seen by Fox Business.
Target also appears to be experiencing a decline in the numbers of people entering its stores.
There was a 13.9 percent reduction in store traffic during the final week of May.
The fall was put down to inflationary pressures and reduced consumer spending over the Memorial Day weekend.
Source: Daily Mail
