Was the Marmite-gate row with Tesco over post-Brexit price hikes a PR disaster for Unilever?

Arlo Brady, managing partner of the Brewery at Freuds, says Yes.

This has been an uncomfortable few days for Unilever. A company that rightly prides itself as a world leader in corporate reputation has found itself in a bitter deadlock with the British public, withholding supplies of Marmite from the nation’s breakfast tables as it battles out its supply costs with Tesco.

Post the crash, trust in business and politicians has hit rock bottom. Firms must demonstrate they offer a benefit to society beyond profit if they are to regain it. Unilever has led the way as the poster child for industry, with its exemplar sustainability strategy developed under its widely respected chief executive, Paul Polman.

But this unfortunate episode has not helped its well-cultivated reputation. Purpose-driven companies will inevitably struggle to satisfy both shareholders and consumers all the time. Now Unilever has been seen to put profits before values. Whether you love or hate Marmite, blaming a fall in the pound for a hike in the price of a product largely manufactured in the UK, and one of our most iconic foods, has done harm to its cause.

Toby Southgate, worldwide chief executive of Brand Union, says No.

The great thing about Marmite is that it’s a product which has become an adjective, and one about extremes. No-one thinks that Marmite is “kind of ok”. As such, is this a public relations disaster for Unilever? No.

Each of Unilever’s brands has a very strong identity and, love it or hate it, Marmite is here to stay. The loyalty people feel towards the brand runs far deeper than the supermarket it is purchased from. In the past 24 hours, we have seen #MarmiteGate trend across social media as shoppers across the country share their outrage. Arguably, when a brand’s connection runs this deep, people will be willing to seek it out wherever it is sold, which then poses a threat to Tesco.

By taking a stand, Unilever is communicating something interesting, engaging, and brand-relevant. Fewer people than ever are now on the fence about Brexit, a Marmite issue that split the country. As the outcomes of the vote trickle into everyday life, can Marmite itself be the saviour of a divided country?