Big news from Amazon: a new $15 an hour minimum wage for all its employees in the U.S. starting November 1. Including all temp and seasonal workers. Including all workers at each of its subsidiaries. Everyone.
This is a huge change, and a PR coup, for a company that faces a lot of criticism and that sometimes can't get out of its own way. Like when it locked customer accounts for no apparent reason. Or turned a group of its employees into a Twitter army -- okay, probably more like a squad -- to say how wonderful it was to work at the giant. The company's face recognition software matched members of Congress, including civil rights icon John Lewis, with people arrested for crimes.
And yet, Amazon has also sometimes shown genius in branding and public relations as well. Its Prime Day turned corporate branding into an accepted national sales event that even competitors have latched onto. Upping pay for all its domestic workers is equally smart, although in many ways subtler.
Undercuts "rapacious Amazon" theme in the press
One running theme in coverage has focused on Amazon's ruthless and expansive nature. Think of all the stories about terrible working conditions in warehouses, schemes to avoid the collection of sales taxes, heavy-handed tactics targeting publishers, hard and demanding conditions for temporary workers in warehouses, and so on. Amazon has developed a bully's reputation over the years.
By raising wages for everyone -- including for all people hired through temp agencies -- Amazon suddenly presents an "enlightened" image. (Even those in operations and customer service already making $15 an hour are scheduled for an "increase," although no indication of how much that will be.) The press will respond accordingly and chances are good that negative pieces about the company, particularly those centered on conditions of workers, will disappear for a long time.
Improves personal branding for Jeff Bezos
Founder and CEO Jeff Bezos has received a lot of criticism over his strategies. They've only grown of late as he became the world's richest man while reporters could point to employees struggling with their wages. Why couldn't the person with the most wealth share some of it?
Well, he just did. And Amazon is going to lobby for a higher national minimum wage. Next topic? (Future presidential run?)
Sets blockades for competitors
One way to mess with competition is to create conditions that make rivals look bad. If you can pay $15 minimum, why can't everyone else, like Target and Walmart and grocery stores (remember who owns Whole Foods)? It makes other pledges for raises, like those of Walmart, look piddling in comparison. Now those competitors will feel the pressure to match the "good corporate citizen" positioning Amazon has just snatched away from them.
Addresses one reason why consumers might shop elsewhere
Many people shop at Amazon, whether directly with the company or through its marketplace vendors. And there are also a good number of consumers who won't because they see Amazon as "evil." This move, more than any other Amazon could have made, helps clear the way for a lot of potential shoppers to now see the company as "good" and to send money its way.
It may be that Bezos and his management team have come to the genuine conclusion that they were wrong in the past not to raise wages. Or perhaps not. There's evidence that Nike's use of Colin Kaepernick in an ad may not be in keeping with its broader political strategies. However, even if Amazon's move is calculated -- and, frankly, if you're in business, particularly a publicly-held one, financial calculations are part of your responsibilities -- it's hard to see how this one could backfire.