LuLaRoe is no stranger to controversy. But the multilevel marketing women's clothing company has really stepped in it after a battle with the National Down Syndrome Society (NDSS) over a shocking video that mocked the disabled. Attempts to spin the controversy are challenging at best.

A lawsuit last October alleged that the business structure was an illegal pyramid scheme. And founders and owners Mark and DeAnne Stidham have been accused of blaming the independent salespeople for problems that might have been the company's.

This latest tussle is particularly ugly. For some time, LuLaRoe has been an official supporter of NDSS, as DeAnne Stidham has a grandchild with the condition. Even that has some questions tied to it, as one promotion that tied a $1 donation to sales of two different special items would be more than offset by increased costs to the salespeople.

The latest situation came about when an independent sales agent mocked people with special needs, as reported by KXTV television, in a video posted to YouTube. The specific remark starts at about 55 seconds in.

NDSS posted on Facebook about the incident. The organization received an apology, but apparently told LuLaRoe that it would not maintain relationships with the company unless the seller was terminated, which did not happen. Here is what NDSS posted on Friday evening:

Within the last 24 hours, it has come to the attention of the National Down Syndrome Society that an online video by a LuLaRoe independent retailer, which mocks a person with a disability, was posted on YouTube. This video is unacceptable and further perpetuates the stigmas we work to fight and end each and every day at NDSS.
While we appreciate the apology from this individual and the previous support from LuLaRoe, we must uphold our mission statement, and end our partnership and any further programming with LuLaRoe immediately.

LuLaRoe posted a response three hours later that said, in part, the following:

We are deeply saddened and disappointed to announce our decision to end our relationship with the National Down Syndrome Society. Our company and the Independent Fashion Retailers have embraced the NDSS and its important work, and have enthusiastically supported the organization's efforts over the past year.
Regrettably, a LuLaRoe Independent Fashion Retailer exhibited unacceptable and insensitive behavior during a live sale, which understandably offended viewers as well as everyone at LuLaRoe. His bad judgment in no way represents the beliefs and character of LuLaRoe or Independent Fashion Retailers.
Immediately after his sale, the Retailer posted an apology. He also reached out to NDSS and said he and his wife have agreed to use the incident as a learning experience and expressed his intention to focus his business on support for the organization and its cause.
After speaking with the Retailer at great length, we believe his apology is sincere and accepted his assurance that this type of behavior would never happen again. We are also using this unfortunate incident as an opportunity to redouble our sensitivity and tolerance training efforts and policies for Independent Fashion Retailers.
Unfortunately, NDSS leadership is unwilling to accept the Retailer's apology and has informed us that unless we terminate his contract with LuLaRoe, the organization will no longer associate with us. We do not believe the most productive response to his actions, which he has fully apologized for, is to close his business and threaten his ability to provide for his family.

Trying to decide who is "right" can be difficult. LuLaRoe claims that an apology that it thought was sincere should have been enough. At the same time, it would seem that NDSS would be the party to decide whether the apology was adequate, as its cause was the one injured and it has doubtlessly faced analogous situations over the years. Words of contrition in uncomfortable cases often are the result of people trying to avoid the consequences of their actions. Would NDSS essentially support the idea that everyone had one free pass to mock people with Down Syndrome? At a time when there seems to be zero tolerance for sexual harassment, why wouldn't other concerns receive the same degree of respect?

Aside from those considerations, however, LuLaRoe handled the situation badly in three ways. When you employ independent people as agents of your company, you have tied yourself to them and their actions. By deciding that "education" had already been achieved, LuLaRoe effectively handed itself a pass on the issue.

Not only did LuLaRoe forgive itself, it compounded that action by blaming NDSS through its choice of words. By saying, "Unfortunately, NDSS leadership is unwilling to accept the Retailer's apology," the company shifted responsibility to the organization by implying that NDSS was unreasonable in its approach.

Finally, the company's navigation of cause marketing is problematic. To partner with an organization and gain some marketing advantage requires the following:

  • Your company's values or interests should have an organic connection to the cause.
  • You need to understand the requirements and implications of partnering with an organization.
  • To be sincere, you then have to not only support the organization and cause, but meet the requirements going forward.

LuLaRoe should have identified any difference in philosophy with the organization before pledging support, no matter how much its founders believed in the cause. Had it done so, it would have known in advance the necessary course of action should a conflict arise and then known whether or not it could live with the conditions.

The seller in question may have been sincere in having learned a lesson, but NDSS had its own need to see that disrespect carried a penalty beyond momentary embarrassment. Ultimately, it is LuLaRoe's fault for not having asked the right questions and then deciding that the organization should change its philosophy to accommodate the company's.

Published on: Jan 28, 2018