'Disrespectful' and 'aggressively left-wing' advertising spurs growth of parallel economy

Business executive Jennifer Sey spent more than 30 years as a "left of left of center Democrat," but dropped that label as she said the party's positions grew increasingly radical.

"So many people feel alienated by the aggressively left-wing stances that businesses are taking," Sey said. "They're disrespectful, some of these brands that are touting aggressively ‘progressive’ positions."

Sey put air quotes around "progressive," because she doesn't believe it's progressive for the International Olympic Committee to let a boxer with XY chromosomes "beat a woman up on the world stage," to name just one recent example.

That attitude spurred the former Levi's marketing chief — who says she was forced out after her outspoken stance against school closures during the COVID-19 pandemic — to launch the pro-female apparel company XX-XY Athletics this year.

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It's one of the latest additions to a growing "parallel economy" catering to conservatives and other customers turned off by hyper-politicization among mainstream brands.

Amid conflicting research on the popularity of polarized shopping — some surveys show an increase in desire for values-driven brands, while others suggest Americans are burned out on companies taking controversial stands — consumers have more options than ever, with anti-woke coffee, clothing, cell phone service providers and social media platforms popping up left and right.

"Marketers aren't stupid. When they see an opportunity, they seize it," longtime brand consultant Will Burns told Fox News Digital.

How the economy turned ‘away from meritocracy’ and toward polarization

The advertising world has long skewed liberal, according to Burns, who has been in the industry for more than 30 years. He described an echo chamber in which everyone convinces themselves that "the world believes what they believe."

"But it’s never been with the vitriol that we see today," he said.

The CEO of online marketplace PublicSquare described a two-decade turn "away from meritocracy and excellence."

"[Companies] started focusing on things like the climate or certain social initiatives," Michael Seifert said. "The economy took a turn away from meritocracy and excellence and innovation toward these sort of socially-engineered, politicized initiatives out of corporate boardrooms."

Burns noticed the shift more recently. After the 2016 presidential election, he penned an op-ed in Forbes wondering whether liberal ad agencies could effectively sell to Trump supporters.

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The political polarization started innocuously, he said, but grew. Airbnb committed to treating people fairly, regardless of race, gender or religion in a 2017 Super Bowl ad aired shortly after then-President Trump’s temporary travel ban. Starbucks vowed to hire 10,000 refugees, potentially alienating swaths of unemployed American citizens, he said.

Target allowed transgender customers and employees to use the bathroom of their choice. Nike made Colin Kaepernick of the San Francisco 49ers the face of its "Just Do It" campaign after he made waves kneeling during the national anthem. 

Brands that have used polarizing political messages have paid a price, especially within the last few years.

Anheuser-Busch shed about $5 billion in value in the weeks after Bud Light partnered with transgender activist Dylan Mulvaney. Target’s market cap fell billions amid a backlash to its Pride displays featuring "tuck-friendly" women’s swimsuits.

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Burns didn’t predict that a swell of conservative or anti-woke alternatives would eventually enter the marketplace, but it didn’t surprise him either.

Instead of Tinder or Bumble, there’s The Right Stuff for conservatives looking for love. If Nike just doesn’t do it for you anymore, there’s a new sneaker brand from NBA star Jonathan Isaac, who made headlines in 2020 for standing during the national anthem while teammates knelt.

"Whenever there's alienation, there's market opportunity because these people are now feeling negative towards a category or a brand," Burns said. "Their bet is that more people don't think that way than do, and think they can build a business on that."

It’s hard to say whether that bet will pay off.

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While Seifert points to initiatives like ESG investing and diversity, equity and inclusion (DEI) as early signs of the turn toward "stakeholder capitalism" over catering to customers, the coronavirus pandemic — and the outsized impact of the government’s response on small businesses — tipped him over the edge.

He launched PublicSquare in early 2021. Three years later, the online marketplace (similar to Amazon or Etsy) has more than 84,000 merchants selling everything from coffee to cleaning products, and firearms to furniture.

They may be part of the "parallel economy," but Seifert said most of those businesses are apolitical.

"They certainly agree with our core values," he said, referencing PublicSquare's pro-life, pro-America, pro-Constitution and pro-small business tenets. "But they also don't use their political views at all in their marketing of their own services … they’re looking for the quality of their product to speak to everything they want a customer to recognize in their business."

That diversity of businesses sparked a surprising diversity in their customer base. While a slight majority of PublicSquare shoppers polled over the last six months were registered Republicans, 26% were registered Democrats, Seifert said. A further 22% were independent or not affiliated with a party.

"It’s easy to try to tout us as simply a conservative marketplace," he said. "The data paints a very different story, which is that America broadly is ready for a new economic system."

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Sey and Burns aren’t keen on the term "parallel economy," feeling it unfairly dismisses legitimate businesses.

"Calling it parallel … means it's not our reality, it's some other reality that isn't important," Burns said. But "these are real market opportunities that are happening right now with real people who are really looking for alternatives to what they see as a real problem in society today."

Sey, whose company enlists brand ambassadors like former NCAA swimmer Riley Gaines, "won’t accept being put in that corner."

"We are part of the regular economy. We are going to be a regular brand that competes with the big boys," she said. "I do think there is a trend of pushing back on the excesses of woke capitalism, and I would embrace that."

Seifert does like the term, but believes it will eventually become "outdated."

"If we win," he said, "the parallel economy will become the mainstream, default economy, which will show us that our mission was successful."

What do shoppers actually want?

It’s hard to pinpoint what exactly consumers want — polls and surveys vary dramatically.

Harris Poll research in 2022 found a whopping 82% of shoppers want brands' values to match their own.

The 2024 Edelman Trust Barometer showed 60% of consumers globally choose or avoid brands based on their politics. That’s up slightly from 58% in June 2023.

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But Gallup polling showed a 7% drop in U.S. adults wanting businesses to take a public stance on current events from 2022 to 2023. Republicans were the least likely to support businesses taking a public position (17%) and Democrats had the highest support (62%).

Burns is firmly in the camp that thinks brands should avoid getting involved in controversial social issues.

"I don't know why they even bother, because all it does is alienate some percentage of the marketplace," he said. "And they're not in business to evolve our societal thinking."

And although he acknowledges that the proliferation of polarization on the left created a chance for conservatives to cash in, he said both sides need to be careful.

"If you target conservative markets, say goodbye to liberal ones forever," he said. "And same thing if you're going to be 100% woke, say goodbye to conservatives. Especially as these conservative alternatives rise up and start to gain strength."

Seifert and Sey both said they keep their political messaging narrow.

"Do we speak out about every political issue? Absolutely not," Seifert said. "We've chosen not to take a stance on certain things that don't really relate to our five core values."

Sey doesn't consider XX-XY to be a conservative brand. That's a label others have given her.

"The vast majority of Americans agree with us," Sey said, referencing a poll showing 69% of Americans believe transgender athletes should play on sports teams that match their biological gender. "We should not be relegated to parallel economy or second-class citizens."

Alternative brands look to the future: ‘There’s still lots of opportunity'

Some mainstream brands have dialed back their progressive marketing and initiatives, but neither Seifert nor Sey are worried their businesses will be at risk if polarization dies down.

"Look, if this issue gets put to rest, I still think women athletes deserve our support," Sey said. "There's still lots of opportunity for a brand like mine."

Some parallel economy brands flop because they simply aren’t making a great product, she said.

"At the end of the day, [customers] may come to us for the mission, but they stay for the product," she said. "I want our product to compete with Nike and Lululemon, be as good as, if not better."

Sey added, "If we don’t do that, we won’t survive."

So far, she said she sees promising results. XX-XY’s return rates are under 5%, she said. Compare that to a Coresight Research survey estimating the average return rate of online clothing orders was 24.4% in 2023.

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And businesses continue to adapt. Seifert said the American marketplace lacked a pro-life diaper company, so he created the baby brand EveryLife.

PublicSquare knew many of their merchants had experienced "cancellation" by payment processors, so in March they purchased Credova, a buy now, pay later provider that catered to the firearms industry.

"It's cancel-proof payment processing that provides a much-needed solution to our merchants," Seifert said. "We actually believe that that will become the largest vertical from a revenue and sales perspective over the course of the next 12 to 18 months."

Sey hopes one day the market will ditch the "hyper-politicized" strategy and revert to what she calls "normie capitalism."

"Unfortunately, this is where we are right now," she said. "And if you have a choice, why not choose a great product from a brand that aligns with your values?"

Ramiro Vargas contributed to the accompanying video.