Storytelling & Diversity – Drive Your Success Up with DEI Narratives

Right now, we're balancing on a major tipping point in diversity policy that, despite many forces trying to convince you otherwise, can make all the difference for your storytelling success and revenuw. That’s why today we’ll look at the numbers and the narratives on why Diversity, Equality & Inclusion (DEI) is so incredibly good for the bottom line. However, we’ll start with that nightmare story on what happens when DEI goes wrong...

(Source) Thank you for understanding Memes of the Dank

A Sustainable and Diverse Tipping Point

We need to talk about the elephant in the room... and no, I don't mean Tesla. I mean that company also starting with a T: Target.

After the MeToo and Black Lives Matter movements, retail giant Target decided to refresh its product policy and reposition its brand on diversity, equality and inclusion. They famously invested 2 billion in inventory purchases from more local, ethnically diverse businesses and added a 100 million dollar fund, exclusively targeted at supporting DEI goals.

This empathetic policy was picked up by consumers and gave them 12.7% growth from 2020 to 2021, alongside a market capitalization at its peak of $129 billion. Investors just adored the brand.

After five extremely successful years, the CEO decided in January 2025 that under the new conservative wind from the White House, the DEI policy had to be abolished. A boycott from its clientèle followed almost immediately. In the first two weeks after that announcement, the company lost 24% of its market value. A few months later, it dove into the red, now with a market capitalization around $45 billion and falling. At the time of writing, it has cost the company $12 billion in revenue. A tailspin, which no one explained more brilliantly than comedian Josh Johnson. The CEO has since been fired. No one knows when the bottom is in sight. And the question now is what can still be saved of the brand.

The Stratospheric Revenue Risks of Poor DEI Policy

Of course, we live in a world where political differences are currently amplified and attacks on DEI policy are simply a part of that. Many brands have chosen to let go of DEI policies in favor of currying (perceived) favors. However, I'm not here to teach you the ethics of it all. In this article, we're looking at it primarily from a positioning and revenue perspective. In the data surrounding DEI positioning, we see 2 major extremes emerging:

• Pro-DEI policy is extremely good for revenue.

• The risk of anti-DEI policy is so great it can become irreparable.

  
  

In short, there's a clear tipping point.

I'll start with that damage risk. We've already seen very large brand boycotts like those against Target and Tesla, but other boycotts are also effective. Such as against Marriott, due to its support of harsh migration raids in the US, while ironically enough, its cleaners are often migrants. The boycotts that came down on ABC News and Disney+ or Paramount also proved very effective, due to the 'free speech' issues surrounding comedians Stephen Colbert and Jimmy Kimmel.

The consumer's punishment toward Disney was particularly harsh during Kimmel's 'break': a 7% dip on the stock market in one day. So many millions of people wanted to cancel their subscriptions simultaneously – worldwide – that the servers crashed. Online, the message circulated: "Let's make Disney the new Target." The Disney corporation could barely save the situation by putting Kimmel back on air.

In America, this is part of the current culture wars where a large conservative-Christian group has influence, profiling itself as anti-rainbow and anti-diversity. We also see boycotts on this 'side.' There was the Budweiser case in which the use of a transgender person in a commercial led to a boycott among conservative voters. The Cracker Barrel restaurant chain had to reverse a rebranding that was too 'woke' according to this target group. And the American Eagle jeans case played fairly ostentatiously with the word 'genes' instead of 'jeans,' which – probably deliberately for sales – gave the impression of white supremacy.

But all these cases are very small compared to Target or Tesla and Disney. In other words: the anti-DEI side is, measured in revenue, considerably less important than the pro-DEI side.

The Gaming Industry as a DEI Indicator

This is a worldwide phenomenon and not just an American one. The gaming industry is a great indicator here. Game publisher Activision-Blizzard quickly became less valuable when a widespread anti-women culture came to light (harassment, assaults, and a suicide). The CEO even threatened to kill a woman when she critized him. A shareholder revolt followed, with a sharp devaluation on the stock market. The not so friendly takeover by Microsoft was its end result.

The takeover of gaming giant Electronic Arts by a Saudi-led consortium is the most recent example, not least because of EA's failing diversity policy, including very explicitly toward women. This of course, is not likely to improve under a crown prince known for his human rights violations. A staff exodus is looming. The call for boycott among gamers is growing on Reddit. Analysts now rate the company as a 'B': the highest loan risk that exists for the $20 billion loan underlying the deal.

And it's not just these 'big' players. Even for small players in this field there's major risk when you let go of your diverse and inclusive policies. The game Runescape experienced an exodus the moment its annually recurring in-game Pride event was canceled due to the new conservative winds. That's 25 years of reputation building down the drain. Players, rainbow or not, just left, leaving no revenue.

Sephora's DEI Billions... and in Your Market

As such, anti-DEI policies are financially very damaging, despite the loud conservative voices that would wish it otherwise. And the opposite is also true: the data marks pro-DEI policy as an unmistakable opportunity. A perfect example of this I found in Forbes DEI expert Doug Melville his blog (see his article here) on Sephora.

This cosmetics corporation embraced the principles of DEI a few years back as a reaction on major societal incidents such as the Black Lives Matter movement sparked by deaths such as those of George Floyd and Brianna Taylor and the MeToo Movement that exposed the scale of sexual misconduct to women.

Sephora started an ongoing research project among its customers and its staff revealing that a disproportionately large part of its their clients experienced types of 'hidden' discrimination. Think of color palettes in cosmetics that work better on light skin than on dark skin. Or service discrepancies between cultural differences.

This became an innovation issue for Sephora on both product and service that redefined the entire shop's floor plans. Growth figures shot up (25% even in one year!)) and the company crossed the $10 billion revenue threshold. The brand is therefore seen by investors as the most important part of the Louis Vuitton Moët Hennessy stock portfolio. And the ceiling of that market value is still missing, because that holy grail of business also came with the these pro-DEI changes: market share. In Doug Melville's words: "It's a trillion dollar DEI blind spot."

It makes a lot of sense. Brands live in the same culturally diverse society as their customers. These DEI developments are simply part of the next phase in the development of brands, where brands are asked to also stand up for a diverse democracy, which is simply now a reality, whether you like it or not. And in a world of hyper-competition, with margins under constant pressure, good DEI policy seems like a no-brainer.

High Profits with Empathetic Behavior

In fact, it even explains the distrust that many brands suffer these days to a large extent. Figures from the large Meaningful Brands study (MB) by Havas Media show that many brands often don't even come close to the sustainability and diversity demands of consumers. (This research was conducted in 144 countries, among several million respondents over the past 15 years, with between 2,000 and 2,500 big brands measured.) Roughly between 70% and 80% of brands are behind on both subjects, explaining their low trust numbers.

Because of this distrust, these brands can ask significantly less for their products and services. On top of that, these figures are averages, pulled up by Asian brands. In the West, brand distrust even greater. It takes very little for large groups of people to turn away, as we've seen in the examples discussed.

If we look at brands that do meet the more empathetic expectations, we see the opposite. MB mentions a 222% better performance on the more empathetic 'meaningfulness' factors that measure ROI (in 2024). The 2025 report shows there's a leading group of roughly 13% of these brands that have 'diverse, sustainable, social and inclusive' aspects responsible for big returns on investment.

Humans as Social – and Economically Powerful – Animals

I could go on and on... If you follow the news worldwide, it leaves the impression we are deeply divided. The logic it seems to suggest is that identity politics, even in business, are the best, even the only way to go.

But how big is that division really? The numbers tell us a very different story on the narrative of DEI. Expressed in purchasing behavior, we turn out to embrace diversity. In our relationship with each other, and crucially, also in our relationship with brands. In that light, the obvious conclusion is that anti-DEI policies are bad storytelling. All those figures tell the narrative of a more powerful undercurrent, namely that of unity in our diversity. 

That makes DEI policy perhaps the biggest blind spot in the markets right now. And once you've seen it, it's hard to look away.

Love, as always

And check out my book The Whole Story - The Ultimate Guide to Storytelling here.

The Whole Story - The Ultimate Guide to Storytelling