brands under fire

McDonald's, Walmart Draw Criticism Over US Wages, Goodwill

Posted by Dale Buss on July 24, 2013 02:42 PM

Walmart and McDonald's face no easy path these days in the business world, nor in the media echo chamber. McDonald's just posted disappointing earnings that reflect the harsh reality at the chain's restaurants in this economy, while both companies are being scored afresh for not providing a "living wage" for their rank-and-file workers.

This week, McDonald's has been lashed by a New York Times commentator and UMass economics professor, Nancy Folbre, for "remarkably widespread disregard" of low-income Americans, including many of its own workers, in the wake of the McDonald's "Sample Budget" that came under scrutiny last week. The "company's own calculations" in the budget, she scolded, "suggest that it fails to offer a living wage."

But in an interview with Bloomberg TV, McDonald's CEO Don Thompson defended McDonald's approach on both matters.

"We have always been an above-minimum-wage employer," he insisted. "We are about providing opportunity. A lot of people can debate the entry-level pont. We will continue to provide entry-level jobs ... And when we can help to have a viable income, we will provide that opportunity so the person can rise to the system and gain greater and greater wealth."Continue reading...

brands under fire

McDonald's Makes No Friends of Employees with Tin-Eared 'Budget Journal'

Posted by Dale Buss on July 19, 2013 02:13 PM

The notion of a "living wage," who should pay it and who should expect it, is getting quite a workout in America these days. The latest example is the flack that McDonald's has caught for a "budget journal" it and Visa created for McDonald's employees that perhaps reveals more than the chain intended about how it views its own jobs.

The document was created by McDonald's to help its own employees "succeed financially," it said, as "one of the many ways McDonald's is creating a satisfying and rewarding work environment." It was supposed to help employees "take the next step toward financial freedom."

The problem, as critics see it, is that McDonald's won't do the single biggest thing that would actually boost the finances of its workers: pay higher wages. Long serving as rhetorical shorthand for jobs that are low-paying, and even demeaning or dead-end, the "McDonald's burger flipper" typically starts out at around minimum wage. Protesters recently have been demanding wages of $15 an hour, which they've figured is a deserved "living wage"—especially when McDonald's now-retired CEO Jim Skinner made $8.75 million last year.Continue reading...

brands under fire

Chobani Targeted for GMO-Tainted Milk as NGOs Expand Criticism

Posted by Dale Buss on July 17, 2013 05:49 PM

Chobani yogurt, one of the country's fastest-growing CPG brands, is the latest to come under scrutiny from an activist group over its use of GMOs. 

GMO Inside, an organization led by environmental group Green America, is calling on the Greek-yogurt segment leader to stop marketing its products as "real" and "natural" until it stops using milk from cows that are fed genetically-modified feed. The move represents one of the first attempts by US GMO activists to target dairy brands in addition to the cereal, bakery and grocery brands that have previously come under fire.

"So much of the GMO crops are going to animal feeds, so if we could change the way this is happening it could help to convert a lot of cropland back to non-GMO production," Elizabeth O'Connell, campaign director for the GMO Inside NGO, told Advertising Age.Continue reading...

brands under fire

BlackBerry Faces the Music as Shareholders Await Promised Turnaround

Posted by Ben Berkon on July 10, 2013 12:46 PM

It's been quite a while since US phone users considered purchasing a BlackBerry device in favor of Apple’s iPhone or Google’s Android. 

In April 2012, when CEO Thorsten Heins took over Research in Motion Ltd. (RIM), the Canada-based BlackBerry manufacturer, he hoped the supposedly state-of-the-art BlackBerry 10 software (and re-invented touch screen and keyboard phones) would put RIM back on the map. He even enlisted Alicia Keys as Creative Director, following in the footsteps of other high-profile brand/celebrity collaborations. But the heavy investment in the company's future doesn't have much to show for itself yet. After a reported $84 million loss in June, the stock endured a 28 percent drop. New phone sales, in general, lagged.

At the company's annual shareholders meeting on Tuesday, Heins tried to downplay the elephant in the room.Continue reading...

brands under fire

Roxy Rides a Wave of Social Backlash Over Sexy Video Ad

Posted by Sheila Shayon on July 8, 2013 05:40 PM

Sexy; provocative; engaging; sexploitation: Those are just a few of the terms used to describe Roxy's new video ad for its upcoming women's surf contest.

The iconic female surfing and sporting brand has attracted some unsightly attention from its Roxy Pro Biarritz 2013 Teaser video, which was posted to YouTube in late June. The video, which is an ad for the company's famed European competition, features a blonde woman who is half-naked for most of the ad, while the camera focuses on her lower half and never once shows her face—or much surfing. The video asks viewers to guess who the female athlete in the video is—assuming fans can identify pro female surfers by their backsides. 

Consumer backlash ensued, but Roxy, in another 'brands on social media' case study, was quick to defend the sexy ad.Continue reading...

brands under fire

Are Retailers Really Willing to Invest in Reform of Bangladesh Garment Industry?

Posted by Sheila Shayon on July 3, 2013 07:12 PM

Last week, the Obama administration revoked special trade status for Bangladesh in what is a growing tidal wave of international pressure for quicker and better implementation of garment factory safety standards following the Rana Plaza disaster that claimed more than 1,100 lives.

The turmoil over who is responsible for safety and inspection continues unabated, with countries, brands and governments often at odds over the best way forward.

“Inspecting Bangladesh’s garment factories is an acutely complicated task," notes The New York Times. “No government agency is certain of precisely how many such factories operate in Bangladesh, or where they are. Some inspectors are discovering that building plans filed with government agencies do not always match the actual buildings. Many factories built during the 1980s and 1990s have no architectural drawings at all.”Continue reading...

brands under fire

Lululemon Faces Shareholder Lawsuit as it Continues on Road to Recovery

Posted by Sheila Shayon on July 3, 2013 04:13 PM

Lululemon has been hit with a lawsuit from a shareholder accusing the company, founder and Chairman Dennis "Chip" Wilson and departed CEO Christine Day of "defrauding shareholders by hiding defects in yoga pants whose sheerness led to a costly recall, and concealing talks that led to the sudden departure of its chief executive," Reuters reports.

Tuesday's lawsuit, which was filed by Houssam Alkhoury, who owns 7,500 shares, follows a previous lawsuit that was filed in May by the Hallandale Beach Police Officers and Firefighters' Personnel Retirement Fund, which claims Lululemon's compensation committee voted to "boost the maximum payout of the executive bonuses plan just before a $60 million recall of yoga pants," raising executive bonus plans as much as one-third when management knew of the imminent sheerness debacle.

The dust has yet to settle from the Canadian company's March recall, which pulled 17 percent of its black luon yoga pants from shelves after it was revealed that the garments were too sheer to wear. While shares have experienced double-digit drops since, the brand, at least on the stock market, has seemed to recover fairly well.Continue reading...

brands under fire

Facebook Pulls Ads from Controversial Pages in Ongoing Content War

Posted by Sheila Shayon on July 1, 2013 03:51 PM

Facebook will pull ads from pages that contain violent or sexual content after months of contention with brands, users and privacy advocates. 

The social network announced it will start a manual review of pages containing sensitive content with a team of hundreds of employees in offices worldwide, as it attempts to find a balance between a users' freedom to post content and where a brands' ad appears.

“Beginning on Monday, we will implement a new review process for determining which Pages and Groups should feature ads alongside their content. This process will expand the scope of Pages and Groups that should be ad-restricted. By the end of the week, we will remove ads from all Pages and Groups that fall into this new, more expansive restricted list," the company said.Continue reading...

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