Firm social stances boost aligned customer spending by 19% in a month.

Do people change where they spend money when companies speak out on hot social topics? Researchers looked at payment card records to see how customers react to corporate social stances. They used people's past spending to estimate whether shoppers agreed or disagreed with a business's public views. They found that taking a public stance actually raises a company's sales on average. In the month after big stance events, customers who strongly agreed with the company increased their purchases by 19 percent. Shoppers who strongly disagreed cut spending by 12 percent. These spending shifts shrank over time, but they still lasted a year later. Because supportive customers spend more, speaking out on social issues can be profitable for businesses.

Why it matters

Companies increasingly take public stands on controversial social issues. This study shows that such stances directly affect their revenue: customers who agree spend more, those who disagree spend less. For profit-maximizing firms, ignoring social issues may mean leaving money on the table.

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