Bill O’Reilly and Fox News have a major branding problem. The only question now is how big the problem will become. And just today, Fox announced that Bill O’Reilly will not be returning on air at Fox.
The issue is that news reports have highlighted a pattern of sexual harassment from O’Reilly. The New York Times previously reported that Fox and O’Reilly have signed a series of settlements to address claims of sexual harassment, with a total payout of more than $13 million.
One interesting question is whether O’Reilly is guilty of the accusations or not. In terms of branding, however, that isn’t the core of the issue. The main problem right now is that perceptions; the wave of ongoing news attention has created the perception that sexual harassment is prevalent at Fox and that Bill O’Reilly is a particular problem. When it comes to branding, the truth is important but perceptions ultimately matter more.
The negative perceptions are clearly having an impact. Initially, more than twenty companies have announced that they will no longer run advertisements on O’Reilly’s show, the “O’Reilly Factor.” A Mercedes Benz spokesperson, for example, told CNN, “The allegations are disturbing and, given the importance of women in every aspect of our business, we don’t feel this is a good environment in which to advertise our products right now.” Similarly, Bayer stated, “Bayer supports safe, respectful and non-abusive environment for women and we have reached out to Fox to voice our concerns regarding this matter. Based on the serious nature of these allegations, we have made the decision to suspect all advertising on the program in question.”
As advertisers walk away, ad revenues dry up. And because of that, O’Reilly’s show was in jeopardy; ultimately the financial results had a major impact on the long-term outlook.
For advertisers, the decision to shift media spending away from O’Reilly’s show was an easy one. Companies do not want to be perceived as supporting sexual harassment, or someone linked to sexual harassment. There are many other media platforms; no one needed to advertise on O’Reilly’s show. There was little downside for the advertisers to walk away.
There is also a bit of peer pressure among marketers; when one company announces the decision, other companies may well follow the move. Nobody wants to be seen as the outlier supporting a questionable character. We saw this happen with O’Reilly’s show.
President Donald Trump stepped into the debate as well, voicing strong support for O’Reilly in an interview with the New York Times. According to Trump, “I think he’s a person I know well – he is a good person.” Trump continued, “I think he shouldn’t have settled…I don’t think Bill did anything wrong.”
Trump’s support possibly made the situation even worse for O’Reilly. Brands are working very hard these days to avoid politics; executives don’t want to be seen as opposing or supporting Trump. It is never smart to publicly oppose a president. At the same time, brands also don’t want to be seen as supporting Trump given his polarizing views and personality. I recently moderated a panel with senior executives and received strict instructions to avoid any questions that were remotely political in nature. If Bill O’Reilly is seen as a Trump favorite, brands may be eager to avoid any connection.
Now, in light of the current situation, O’Reilly needs to take strong steps to address the issue. An apology would help, as well as recognition that harassment is a major issue. He should spend time talking about the topic, reviewing how it manifests and steps we can all take to identify it and reduce its prevalence.
Fox has more at stake; the network is at risk of becoming toxic for advertisers and parting ways with O’Reilly was the right move for them. CEO Roger Ailes stepped down last summer after facing his own set of sexual harassment accusations. The priority for Fox is to continue putting distance between the O’Reilly brand and the Fox brand to head off the issue and limit the damage.