Walmart’s Deal With Ellen DeGeneres Shows How Much America Has Changed

(Bloomberg Businessweek) -- Ellen DeGeneres is on television every weekday. Sometimes she’s on twice. Her daytime talk show, The Ellen DeGeneres Show, brings in more advertising revenue than Dr. Phil’s and Kelly Ripa’s combined, and her prime-time special, Ellen’s Game of Games, gets consistently good ratings. DeGeneres produces movies, voices a popular Pixar character, has her own digital content network, and has earned at least $500 million on endorsement and TV deals, according to a Bloomberg Billionaires Index analysis. She has her own lifestyle brand and last year formed a partnership with Walmart Inc. to create a clothing and accessories line that’s awash in American flags and rainbows and is sold in 2,300 Walmart stores. “I’m still gay, by the way. It’s really working out for me now,” DeGeneres said in her Netflix stand-up special last year..That the largest U.S. retailer finds value in aligning itself with a 61-year-old lesbian who has a recurring segment on her talk show called “Oh, Straight People,” is, in many ways, a testament to how thoroughly Americans have accepted LGBTQ rights. It’s been 50 years since the Stonewall uprising in New York marked the start of the modern gay rights movement. Almost two-thirds of Americans support same-sex marriage, Gallup polls show, the opposite of what they reported when DeGeneres first came out two decades ago. The chief executive of America’s first trillion-dollar company, Apple Inc., is gay, and yet iPhones still fly off the shelves. Walt Disney Co. this year had its first gay characters on both its youth cable channel and in its latest Avengers film. According to GLAAD, 8.8% of prime-time TV characters are gay, bisexual, transgender, or queer. Walmart even has a Pride shop online..Such mainstreaming of LGBTQ products, characters, and culture would have been almost unthinkable 22 years ago, when DeGeneres publicly came out as a lesbian. Back then, being gay almost killed her career..DeGeneres had spent the first few decades of her life pretending to be someone she wasn’t. Her stand-up rarely included jokes about dating or relationships, as if she were avoiding the issue. That changed in April 1997, when she came out in an interview with Time magazine, which put her on its cover along with the headline “Yep, I’m Gay.” That month 42 million people watched her character come out on her sitcom, Ellen. The episode—with Oprah Winfrey guest-starring as her therapist—was funny, well-received by critics, and enthusiastically celebrated by lesbian, gay, bisexual, and transgender fans. Advertisers felt differently..“Everybody warned me. My publicist, my manager, my agent. Everybody making money off me said, ‘Don’t do it,’ ” DeGeneres said in her Netflix special. The blowback hit her fast and strong. Evangelical pastor Jerry Falwell called her “Ellen DeGenerate.” A bomb scare, which cleared the TV studio shortly after the episode’s taping, was the first of many threats against her. Advertisers soon backed out. “We don’t think it is a smart business decision to be advertising in an environment that is so polarized,” a spokeswoman for Chrysler told the New York Times, explaining the carmaker’s decision to pull commercials from the show..One Ellen episode was even slapped with a parental advisory warning after DeGeneres’s character shared a platonic kiss with a woman. Soon after, ABC canceled the show, and the job offers stopped coming..“If I’d been fully aware of all the consequences—that the public was going to hate me and the press was going to attack me, that I was going to lose a lot of people—maybe I wouldn’t have done it,” she told writer Eric Marcus in early 2001, when she was still struggling to get back on TV. “But I didn’t feel like I had a choice.”.DeGeneres’s rare act of honesty couldn’t change the fact that the 1990s were a bleak time for the LGBTQ community. AIDS was killing thousands of people, primarily gay men. In 1996, President Bill Clinton signed the Defense of Marriage Act, banning federal recognition of same-sex marriages. Two years later, a gay student, Matthew Shepard, was tortured and killed in Laramie, Wyo. DeGeneres spoke at a vigil for Shepard held on the steps of the U.S. Capitol in October 1998. “This is what I was trying to stop,” she said, in tears. “This is exactly why I did what I did.”.At the time, no company better represented the cultural climate DeGeneres was hoping to change than Walmart, the multibillion-dollar enterprise co-founded by Sam Walton, who taught Sunday school at his Presbyterian church and preached a Christianity-laced corporate gospel of service, respect, and sacrifice..“If you want to reach the Christian population on Sunday, you do it from the church pulpit,” Ralph Reed, the architect of the politically powerful Christian Coalition, once said. “But if you want to reach them on Saturday, do it at Walmart.”.In the 1990s the company refused to sell albums that contained swear words; even John Mellencamp’s heartland rock was censored and sanitized for shoppers’ protection. Then in 2001 female Walmart employees accused the company of denying them promotions and equal pay in a litigation campaign that evolved into a class-action lawsuit. (In 2011 the U.S. Supreme Court ruled that the then 1.5 million-women-strong group couldn’t be considered a class; individual lawsuits have since been filed and are ongoing.) In sworn statements, women at Walmart said they endured comments such as “God made Adam first, so women would always be second to men.” A spokesman for Walmart says the allegations “are not representative of the positive experiences millions of women have had working at Walmart” and that it will defend itself against the claims..Walmart’s revenue and profit soared, but by the mid-2000s the company was grappling with withering criticism of its business and labor practices. It also wanted to break into urban markets such as New York City and Chicago, where social attitudes are more liberal. So, Walmart changed. In 2006 it plunged head-first into LGBTQ activism by joining the National Gay and Lesbian Chamber of Commerce (NGLCC), donating to gay-friendly charities, and hiring a consulting firm that specialized in marketing to gay consumers. Not all of the company’s 1.3 million employees liked the stance. Nor did Christian conservative groups, which called for a boycott over the Thanksgiving weekend. Its business threatened, Walmart quickly caved. In 2007 it dropped the NGLCC partnership and released a statement saying that it would “not make corporate contributions to support or oppose highly controversial issues unless they directly relate to our ability to serve our customers.”.“I was mad. I was very mad,” NGLCC co-founder and President Justin Nelson recalls. “They have spent years correcting that mistake.”.For the next few years Walmart shied away from anything related to gay rights. In 2013, for example, it declined to join Disney, Nike, and Starbucks in urging the U.S. Supreme Court to overturn the Defense of Marriage Act. A year later the company seemed to have a change of heart. It opposed a 2015 bill in its home state of Arkansas that would have allowed businesses to discriminate against gay customers on religious grounds. It earned, then lost, then won back a perfect score on the Human Rights Campaign’s Corporate Equality Index, a highly regarded measure of LGBTQ-friendly workplaces that companies often use as a recruiting tool..Earlier this year, a Walmart commercial featured two gay men shopping together. The American Family Association criticized the ad, saying Walton was “probably turning over in his grave.” Walmart, it noted, had almost always sided with Christian conservatives in the past. “At least with a company like Amazon, we knew they were liberal from the outset,” a statement on its website said. “But this seems more like a betrayal from a well-known friend.”.DeGeneres’s comeback started in 2001 when she hosted the Emmy Awards, which had been postponed twice after the Sept. 11 attacks. Her characteristically upbeat and self-deprecating jokes brought much needed relief in somber times. “They can’t take away our creativity, our striving for excellence, our joy,” she said. “Only network executives can do that.” The audience gave her a standing ovation..With that, DeGeneres was back in Hollywood’s good graces. A second attempt at a sitcom was short-lived, but then came a best-selling book and voice-over work as Dory in Pixar’s animated hit Finding Nemo. Still, her sexuality was considered controversial. When her talk show debuted in 2003, DeGeneres remembers a station manager saying, “No one is going to watch a lesbian during the day.”.That prediction was quickly proved wrong—the show won the Daytime Emmy for outstanding talk show four years in a row—and DeGeneres soon became a coveted corporate sponsor. American Express Co. hired her first, in 2004. Then came a J.C. Penney Co. deal that prompted the threat of a boycott from a group called One Million Moms, which objected to the retailer’s use of a homosexual spokeswoman. (J.C. Penney stuck by DeGeneres.) Today DeGeneres has a lifestyle brand, ED by Ellen, that was born out of the work she and her wife, actress Portia de Rossi, do of buying, renovating, and selling Los Angeles mansions to buyers such as former Google CEO Eric Schmidt. What started as a home decor line has expanded into clothing, accessories, and pet products. Macy’s, Nordstrom, PetSmart, and Bed, Bath & Beyond carry the line, which has an annual revenue in the nine figures..“Her power of influence makes her truly extraordinary,” says Matt Fleming, director for celebrity acquisition at the Marketing Arm. According to surveys conducted by the agency, DeGeneres is as well-known and liked as Paul McCartney..With an average of 2.9 million viewers per day according to Nielsen, her daytime TV show pulls a surprisingly diverse audience. It’s 74% female, consumer insights firm MRI-Simmons estimates, but otherwise mostly matches the general population in age, race, and education..“Ellen is the Oprah of our era, in the sense of how much she dominates the category,” says Dan Wilch, a consultant at Magid Associates, which conducts an annual study of daytime TV. Phil McGraw’s show, Dr. Phil, may get better ratings, but according to Kantar data, DeGeneres’s show pulled in more than twice as much ad revenue..Walmart’s partnership with DeGeneres gives the retailer a widely popular ally in its battle against Amazon. It carries both ED by Ellen and EV1, DeGeneres’s clothing brand, which comes in a wide range of sizes and looks like a cheaper version (everything is $30 or under) of the kind of pants-and-jean-jacket outfits DeGeneres wears. Walmart declined to provide sales figures for EV1 but says it’s “pleased” with the line. “Ellen is Ellen,” says Janey Whiteside, Walmart’s chief customer officer. “She appeals to all ages. She’s great.”.DeGeneres’s clean-cut, friendly image—she ends her show by reminding viewers to “be kind to one another”—is reassuring for brands in this perilous marketing era when any misstep could result in a massive social media backlash. As Jeff Greenfield, co-founder of advertising analytics firm C3 Metrics, puts it, “Ellen is safe.” She loves animals. She dances. She often has her wife on as a guest. The couple have been married for more than a decade. “Even when we talk with very conservative brands, they don’t shy away,” says Stacy Jones, CEO of the product placement firm Hollywood Branded. “She is a family brand.”.The American Family Association today seems uncharacteristically mum about DeGeneres. While it released that scathing rebuke of Walmart for its gay-friendly commercial, it didn’t respond to a request for comment on the chain’s partnership with the comedian..In the Netflix special, DeGeneres joked about how everybody is now fine with her being a lesbian. Instead, her most alienating characteristic is that she’s rich. “Do you think you’re still relatable?” she said a friend recently asked her. “Of course I’m relatable,” DeGeneres replied, then followed her butler into the solarium for breakfast..Later, the butler drew her a bath but left her towel out of reach. “So I had to do that bath mat scoot all the way across the bathroom to get the towel,” she said, acting it out on stage. “And then I stopped and thought, Oh my God, this is relatable! People do the bath mat scoot when the butler forgets to put the towel next to the tub!” —With Tom Metcalf.To contact the editor responsible for this story: Claire Suddath at csuddath@bloomberg.net, James Ellis.©2019 Bloomberg L.P.

Walmart’s Deal With Ellen DeGeneres Shows How Much America Has Changed

Walmart’s deal with the Ellen is in many ways, a testament to how thoroughly Americans have accepted LGBTQ rights.

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