Will the David Jones harassment case be bad for business?

Many people, on this blog and elsewhere, think that the David Jones sexual harassment case is commercially dangerous for the company:

The case will definitely have an effect on the DJs brand in the long term, leading brand analyst Richard Sauerman of Brand Alchemy said. …

But Mr Sauerman said he expected some women would show how they felt about the sexual harassment allegations by shopping elsewhere.

He said once this sentiment grew it could have an effect on the company’s bottom line, and then even its share price.

And indeed social attitudes surveys show that this kind of consumer behaviour takes place. The ABS General Social Survey 2006 found that over a twelve months period a quarter of those surveyed had ‘boycotted or deliberately bought products for political, ethical or environmental reasons’.

On the other hand this isn’t the first time in recent years that David Jones has been accused of sexual impropriety. In 2006 the Australia Institute accused it of ‘corporate paedophilia’ because David Jones allegedly used sexualised images of children in its clothing catalogues.

Unlike the sexual harassment case against McInnes, the David Jones catalogues were an official part of its core business, and not the result of a staff member breaching company policy. Many parents are concerned about their children growing up too quickly due to a sex-saturated culture.

But did the corporate paedophilia controversy have a negative effect on DJ’s bottom line? It can’t have been helpful (unless we assume that all publicity is good publicity), but it doesn’t seem to have interrupted the steady increase in DJ’s profits over the subsequent years.

During a media storm people often imagine it will have lasting effects, but generally attention quickly moves on to the next story. Kristy Fraser-Kirk’s spectacular over-claim and the apparent determination of McInnes and David Jones to fight the claim will bring this back to the spotlight. But I doubt too many people will silently protest by taking their business elsewhere. After all, they were only ever interested in what the store had to offer them, and were not rewarding it for its good corporate citizenship or its choice of CEO.

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Unsurprisingly, Miranda Devine’s views on the Fraser-Kirk claim are similar to mine.

6 Responses to “Will the David Jones harassment case be bad for business?

  • 1
    Leo Kovalensky
    August 4th, 2010 19:47

    It won’t have an ounce of impact for DJ’s business – if anything, it adds an element of risque excitement to the branding of DJs. Just look at Alannah Hill’s comments yesterday . . .

    On the other hand, McInnes career as an executive of publicly listed companies is probably dead as a doornail. Why would any board bother taking the risk?

  • 2
    Son of the Ratpack
    August 5th, 2010 07:43

    “McInnes career as an executive of publicly listed companies is probably dead as a doornail”. He can always get a senior job in Italy, where such behaviour among senior execs is not only tolerated, or even expected. It is almost mandatory.

  • 3
    Rajat Sood
    August 5th, 2010 09:14

    I also don’t think it will have much effect on business, given that McInnes is now gone. But I think Devine is wrong to cite Alannah Hill’s comments as having any relevance. Just because Hill would have welcomed an advance doesn’t change the fact that Fraser-Kirk did not. And any bloke over 25 knows full and well when an advance is not being welcomed, even more so a grope.

  • 4
    Son of the Ratpack
    August 5th, 2010 09:23

    “Just because Hill would have welcomed an advance”
    Alannah Hill is 47 years old. It’s hardly a surprise she would have welcomed an advance from Mark McInnes. KFK is 27 and can do a lot better than him.

  • 5
    Lannie Paytes
    August 12th, 2010 17:07

    “There WAS a movement called "lesbian separatism" which is now defunct, that was around during the ’70’s. It has about as much to do with Feminism, as separatist Christian groups such as the Children of God, the people of Jonestown, and the followers of David Koresh at Waco have to do with Christianity.”

  • 6
    Peter Patton
    August 14th, 2010 14:36

    Actually, after reading her statement of claim, David Jones should be penalized substantially, rather than McIness