Trump brand takes a hit

Retailer Neiman Marcus has dropped Ms Ivanka Trump's (above) jewellery line from its website and her brand has also disappeared from Nordstrom.com.
Retailer Neiman Marcus has dropped Ms Ivanka Trump's (above) jewellery line from its website and her brand has also disappeared from Nordstrom.com.PHOTO: AGENCE FRANCE-PRESSE

Early signs suggest US President Donald Trump's actions are affecting his businesses and that of his daughter, Ivanka

NEW YORK • Since the day Mr Donald Trump began his presidential campaign, there were questions about how the Trump brand would be affected.

Would his stream of insults hurt viewership of The Apprentice or sales of Ivanka Trump shoes? Or was all the attention good for business, a marketing adage President Trump could have learnt during his time as a reality television star.

The answer may surprise him.

Major companies appear to be re-evaluating their relationships with the Trump brand, which, in some instances, does not appear to have benefited from Mr Trump's presidency.

Hinting at lacklustre sales, Neiman Marcus confirmed last Friday that it had dropped Ms Ivanka Trump's jewellery line from its website. A day earlier, her brand had disappeared from Nordstrom.com, a move reported by fashion news site Racked.

Nordstrom, which mainly sold Ivanka Trump shoes, said demand for her products had not been strong. The company still has some merchandise from previous orders that it plans to sell in stores. For the time being, the relationship appears to have ended.

Not everyone was happy that retailers were distancing themselves from the Trump name. By last Saturday, some Twitter users were posting #BoycottNordstrom. Companies also seem worried about how protests over the President's actions, particularly his recent executive order on immigration, could hurt sales.

Last Friday, MillerCoors, a brewing company, contacted Ms Shannon Coulter, a founder of GrabYourWallet.org, a campaign pushing for boycotts of Neiman Marcus, Nordstrom and other businesses associated with the Trump name. "He wanted to talk about why they were on the list," she said, adding: "I think all the companies are paying close attention."

At a time when protests and boycotts can easily be organised online, brands face more pressure to respond to consumer demands.

Mr Chris Allieri, a marketing consultant with Mulberry & Astor, said: "Before he became President, I think that a lot of consumers were indifferent to the Trump brand.

"It's going to be harder for people to ignore the connection."

The MillerCoors name appeared on GrabYourWallet.org after Mr Peter Coors, a board member of its parent company, Molson Coors, lent his name to a fund-raiser for Mr Trump last June. MillerCoors said it did not support candidates in presidential races, but respected the rights of its workers to do so.

"Boycotting our brands only harms hardworking employees and their families and is counter to the positive progress that we should all be encouraging and delivering at a time when our nation seems so divided," a spokesman said.

Mr Trump and his daughter have stepped away from executive roles at the Trump Organization, which still earns money from golf courses, hotels and other properties around the world. (Ms Trump has also stepped away as head of her brand.)

Because Mr Trump's company is privately held, it is hard to know what impact his presidency has had on his businesses. But the merchandise side of the Trump licensing empire may be more vulnerable to negative attention.

"Retailers around the country are going to say, 'Do we need the aggravation or not?'" said Ms Wendy Liebmann, chief executive at WSL Strategic Retail, a consulting firm.

"It's hard to imagine that if a brand is really, really doing well, a retailer like a Nordstrom or Neiman Marcus would cut off their nose to spite their face."

Ms Rosemary K. Young, senior director of marketing for Ms Trump's brand, said in a statement that the company would keep expanding and that it had "significant" year-over-year revenue growth last year.

Representatives for Macy's, which sells Ms Trump's clothing, handbags and shoes, did not respond to requests for comment. The retailer dropped Mr Trump's clothing line early in his campaign after he called Mexican immigrants "killers" and "rapists".

Companies have also faced pressure to back away from The Apprentice franchise, of which the President is an executive producer.

Motorcycle manufacturer Kawasaki said last month that it would pull its sponsorship, although the Japanese company seemed to backtrack within hours.

Ms Coulter said the Honest Co, whose products will appear in an episode of The New Celebrity Apprentice, had committed not to advertise for the rest of the season or next year.

The brand confirmed that it had limited involvement with the show, which has not yet been renewed for next year.

As the Trump name has become politicised, so have brands associated with it. Just days after #DeleteUber began trending on Twitter - a response to criticism that the ride-sharing app had undercut protests of Mr Trump's immigration order - Uber's chief executive, Mr Travis Kalanick, resigned from a presidential economic advisory council.

Neiman Marcus said it "continuously" assesses productivity to determine where its products are sold. Some jewellery will still be available in the stores.

After apparel, Ivanka Trump shoes account for the largest portion of her company's revenue.

Three years ago, the brand predicted that shoe sales would reach US$35 million (S$49 million) last year at wholesale, generating US$2 million in royalty fees, according to documents obtained by The New York Times. Jewellery was predicted to reach US$7.5 million or US$300,000 in fees.

NYTIMES

A version of this article appeared in the print edition of The Straits Times on February 06, 2017, with the headline 'Trump brand takes a hit'. Print Edition | Subscribe