Key takeaways from the Oatly backlash?
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Weeks after Oatly announces its $200M investment, they have been criticised for taking funds from Blackstone Group who allegedly fund Amazon deforestation and have donated $3.7M to Trump’s re-election campaign.
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Oatly responded critcism directly on Twitter, respecting people’s concerns and replying directly to them. Responding to complaints with compassion will serve them well.
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The hyped alt-milk brand stands by the principle that using Blackstone’s funds for good is better than that same money being used to fund other unsavoury projects.
- Treating complaints with respect and responding with compassion is a smart crisis response tactic from Oatly.
- Oatly’s target audience has evolved beyond just eco-warriors. Those who buy Oatly for personal health and lifestyle reasons will ensure the brand still has a future.
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In the first issue of the the Anthro Community Newsletter over on Substack (link) I focused on Oatly’s brand success. How they grew, how they focused on their target audience, and how they owned standing for something. To date, Oatly has demonstrated pure integrity.
In the full article, I wrote about how their brand success enabled them to acquire their $200M investment from the likes of Oprah, Jay-Z and the Blackstone Group.
Why the backlash?
This week, Oatly has faced a mega backlash on social media, as its fans realised that the Blackstone Group also has its fingers in less savoury pies. Those being reported links to deforestation in Brazil thanks to infrastructure company Hidrovias Do Brasil.
This is obviously rubbish, first it’s really sad that anyone is helping fund deforestation, second, it’s sad a company that we all love and trust for their environmental credentials is using dirty money for growth.
Just as bad as this, Blackstone CEO Stephen Schwarzman recently supported Donald Trump’s 2020 re-election campaign with a $3.7M personal donation. GROSS!
Why is this bad for Oatly?
Oatly has positioned itself a good guy in this harsh capitalist world. They ooze virtue. Until now. As a result of these two pieces of unsavoury information going mainstream, fans of the brand are boycotting it. Many are taking to Twitter, saying “Oatly is cancelled” and sharing home made oat milk recipes.
OG fans of Oatly care deeply about the environment, so this public reaction is no surprise. However, the lasting impact of this Twitter outcry and “cancelling” of Oatly may not be that big. Given how mainstream Oatly has become over the last year or so, many of its recent and future converts may not be as environmentally woke as the OG fans. They care more about personal health and lifestyle. So they aren’t going to be taking this to heart as much.
How has Oatly responded?
WITH GRACE! Kudos to the team at Oatly for this graceful crisis response. The brand has been proactively reaching out to those getting angry on Twitter, asking if there are any specific questions the people want them to address. So human, they are engaging with people on an individual basis.
They also stated “We’re still Oatly, and it’s our belief there needs to be a shift in the capital stream toward sustainability investments if we’re to see any – real – change. That’s why an investment from Blackstone is a huge step forward for plant-based foods.”.
And quite frankly, I agree. I support Oatly using Blakcstone’s money for good. If it’s not used for good, it will just be used for more bad stuff. To think otherwise would be naive.
What does this mean?
As I mentioned above, this isn’t great for Oatly. It’s a shame they’re facing this backlash just weeks after the hype of winning their investment. But, it’s good to have this conversation. Blackstone deserve the bad press where bad press is due, they should really reconsider how they invest the other half of their funds. The backlash is a good reminder for Oatly to stay on track as their loyal fan will hold them accountable.
Ultimately, will this impact Oatly sales? Long term, I doubt it. Let’s remember the fact that Oatly’s audience has diversified, you have the OG eco warriors, but you have a huge and increasing number of people who care about their personal health and lifestyle first and foremost.
The scale of this story is also relatively limited and feels like it’s stuck in a relatively small echo-chamber. They will have lost a few fans from this, but soon people will forget.
Brands have unfortunately done far worse and have emerged unscathed. Chipotle and Starbucks are just two examples.