When Bud Light partnered with transgender influencer Dylan Mulvaney in 2023, the backlash was swift. Sales dropped, social media erupted, and the brand quietly stepped back from Pride Month messaging. Around the same time, Target reported a 5% decline in quarterly sales, which it attributed to customer pushback over its Pride merchandise. These high-profile stumbles raise a question that marketing teams everywhere are grappling with: Can efforts to be more inclusive actually drive existing customers away?
A new study published in the Journal of the Academy of Marketing Science set out to investigate exactly that. Across ten experiments, a team of researchers found that diversity initiatives can indeed backfire, but only under specific conditions. The negative reaction isn’t always about politics or values. Instead, it often comes down to something more personal: customers worry that the brand will no longer represent who they are.
The question behind the research
Previous explanations for why customers react negatively to diversity, equity, and inclusion (DEI) efforts have centered on things like political disagreement, skepticism about a brand’s motives, or a sense that the effort feels inauthentic. Louise May Hassan, a researcher at Birmingham Business School at the University of Birmingham, along with co-authors Miriam McGowan of Durham University and Edward Shiu of Bangor University, wanted to explore a different angle. They suspected that customers sometimes push back not because they oppose diversity in principle, but because they fear the brand will no longer help them express the identity they want to project.
To understand this, the researchers drew on a concept from psychology called “dissociative groups.” A dissociative group is any group of people that an individual actively does not want to be associated with. This is distinct from a simple “outgroup,” which is a group someone doesn’t belong to but doesn’t mind being linked to. For instance, a young fashion consumer might not identify with middle-aged shoppers (an outgroup), but might actively not want to be seen as an “older” consumer. In that case, mature shoppers would be a dissociative group for that young person.
The central idea was this: when a brand starts targeting a group that existing customers view as dissociative, those existing customers may feel that the brand no longer signals the right things about them. The researchers coined a term for this feeling: “identity signaling threat.” It is the worry that using a product or service would limit or prevent a person from expressing their desired identity to others.
How the studies were designed
The research team ran ten experiments, each building on the last, with participants recruited primarily through the online platform Prolific. Study contexts ranged from local cafes and craft beer brands to fashion labels and a real Facebook advertising campaign. In most studies, participants first identified groups they considered dissociative, selecting from provided lists or describing them in their own words. They were then presented with a scenario in which their favorite brand announced a new initiative to welcome and serve that dissociative group.
A key variable was the duration of the brand’s diversity initiative. In some scenarios, the brand’s effort was described as short-term or one-off (what the researchers called “episodic”), such as a single-month campaign. In other scenarios, the effort was described as permanent or ongoing, such as a year-long commitment with new product lines. After reading the scenario, participants answered questions about how likely they would be to reduce their spending with the brand, stop purchasing entirely, or unfollow the brand on social media.
One study went beyond hypothetical scenarios. The researchers ran a real advertising campaign on Facebook for a fictional hat brand called Accessories Loft. The ads featured an older couple wearing the brand’s products, with taglines signaling the brand was expanding from younger to mature consumers. One version described the collection as “one-time only,” while the other called it “permanent.” The team then tracked how many younger consumers (under age 45) clicked on each ad.
What the data showed
The pattern across the experiments was consistent. When a brand’s diversity initiative targeted a dissociative group, customers reported stronger intentions to distance themselves from the brand. And that distancing was more pronounced when the initiative was described as ongoing rather than episodic. In the cafe study, for example, there was no difference in how customers responded to short-term versus long-term initiatives targeting a simple outgroup. But when the targeted group was dissociative, the longer-term initiative led to significantly higher intentions to reduce spending at the cafe.
In the Facebook field experiment, the click-through rate among younger consumers was 0.67% for the episodic ad and 0.36% for the ongoing ad, a statistically significant difference. Younger consumers were less likely to engage with advertising that signaled a permanent shift toward older shoppers.
The researchers traced the chain of events behind these reactions. An ongoing initiative targeting a dissociative group led to higher identity signaling threat. That heightened threat, in turn, was linked to stronger feelings of betrayal toward the brand. And those feelings of betrayal were associated with greater intentions to stop buying from the brand or disengage from its communications. The team tested several alternative explanations, including changes in mood, perceptions of fairness, brand arrogance, and brand authenticity. None of these alternatives explained the effect. Identity signaling threat was the only consistent driver.
Not all customers react the same way
One of the study’s more nuanced findings involved the type of relationship customers have with a brand. The researchers distinguished between two types. “Communal” relationships resemble friendships: the customer feels a personal connection and views the brand almost like a close companion. “Exchange” relationships are more transactional: the customer sees the brand as a business partner and expects a fair return for their loyalty.
The type of relationship shaped how customers responded to the duration of a dissociative initiative. Communal customers reacted more negatively to short-term initiatives. From their perspective, a one-off campaign felt opportunistic and insincere, which clashed with the caring, mutual-concern norms they expected. In contrast, exchange customers reacted more negatively to long-term initiatives. Because they focus on the specifics of what they’re getting from the brand, a permanent shift toward a dissociative group felt like a bigger loss to their investment.
This pattern, however, only held for brands that customers perceived as “sincere,” meaning brands seen as wholesome, honest, and dependable. For brands perceived as “exciting,” meaning those associated with novelty, daring, and change, the duration of the initiative and the customer’s relationship type did not produce different reactions. The researchers suggested this is because exciting brands are already expected to be unpredictable, so a diversity initiative is less likely to feel like a betrayal of the brand’s character.
Strategies that can reduce the backlash
The final experiment tested three strategies that brands could use to soften the negative effects. The first was a sub-brand strategy: targeting the dissociative group through a separately named product line rather than the main brand. The second was a customization strategy: giving customers the ability to personalize products with their own symbols or slogans. The third was an inclusivity strategy: explicitly framing the initiative as a pro-social effort to serve historically underrepresented consumers.
Both the sub-brand and customization strategies were effective. They reduced identity signaling threat and brand distancing behavior for communal customers exposed to episodic initiatives and for exchange customers exposed to ongoing initiatives. The logic is that both strategies create psychological distance between the existing customer and the dissociative group. A sub-brand lets customers feel that their original brand is still “theirs.” Customization allows customers to stamp their own identity onto products, overriding the unwanted associations.
The inclusivity strategy, on the other hand, had more limited success. It helped reduce negative reactions among exchange customers facing an ongoing initiative, but it did not help communal customers facing an episodic one. The researchers suggested that for communal customers, highlighting pro-social goals might not be enough to overcome the perception that a short-term effort is insincere.
What this means for business leaders
For marketing executives debating how to approach DEI, the findings offer several practical takeaways. First, the risk of customer backlash does not come from diversity efforts in general. It arises specifically when a brand reaches out to a group that existing customers view as dissociative, which can vary widely depending on the customer base. Second, the duration of the initiative matters in ways that are not intuitive. Longer-term commitments, often recommended as a signal of authenticity, can amplify the problem for certain customers. Third, the type of brand personality and the nature of the customer relationship both shape how initiatives are received.
The research also suggests that brands do not have to choose between inclusion and customer retention. Launching a separate sub-brand for a new audience or offering product customization options can reduce the sense of threat among existing customers. These are practical tools that let brands expand their reach without sending signals that alienate their base.
There are caveats worth noting. The studies relied heavily on U.S. participants recruited online, and most scenarios were hypothetical. The Facebook field experiment offered real behavioral data, but the sample was small and limited to one product category. The researchers also acknowledged that what counts as a dissociative group varies from person to person, making it difficult for brands to predict exactly which initiatives will trigger backlash. And the study does not address whether the new customers attracted by a diversity initiative might offset the loss of existing ones, though a pilot study suggested that dissociative CDIs are unlikely to attract many new customers.
Still, in an environment where major corporations are scaling back their DEI commitments, this research offers a different path. The problem may not be with diversity initiatives themselves, but with how they are designed and communicated. With the right strategy, brands may be able to champion inclusion without losing the customers they already have.
