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Will Americans Buy the New Martha?

Her public image has partially recovered

Fresh from prison, a visibly relieved Martha Stewart spoke to her staff at Martha Stewart Living Omnimedia, Inc., last week about the future of the company. Without ever mentioning the "p" word, Stewart expressed that her legal ordeal has changed her; that she has a new appreciation for the comforts of home, a new understanding of the needs of everyday people, and a new willingness to credit her employees.

While Stewart might be a better person for her recent experiences, is she better off with the American public? She is far better off today than two years ago, when she was in the midst of a legal battle over her December 2001 sale of ImClone Systems stock*. But she is still worse off than before these troubles began. Stewart's favorable rating has rebounded to about where it stood when Gallup first measured it in 1999, but her unfavorable rating has since doubled.

The impact of Stewart's bad publicity -- as well as the good publicity she apparently earned from behind the gates of Alderson Federal Prison Camp -- is well-chronicled in Gallup's favorable ratings trend on Stewart. 

  • In that earliest rating, from an October 1999 survey, about half of Americans (49%) had a favorable impression of Stewart and 16% had an unfavorable impression, with the remainder either neutral or not familiar with her. 
  • In the first few days after the federal investigation into her sale of ImClone Systems stock became public, Stewart's image was 46% favorable and 27% unfavorable.
  • By the following month, Stewart's image had plunged: only 30% viewed her favorably and 39% unfavorably.
  • In June 2003, immediately following her indictment, Stewart's image hit the lowest point recorded by Gallup: 33% favorable and 52% unfavorable.
  • In February of this year, just one month before Stewart was released from prison, her ratings were once again more positive than negative: 53% favorable vs. 32% unfavorable.

When Stewart stepped down as CEO of the company in June 2003, it was unclear whether she would ever again be the face of Martha Stewart Living Omnimedia (MSO). From the homecoming she received from corporate executives and staff, it now seems clear she will. As far back as last fall, the new CEO, Susan Lyne, spoke to Newsweek about Stewart's importance to the future of the brand.

Holding May Be Easier Than Growing

While Stewart will likely be as visible as ever, Lyne does plan some changes. In the same interview, she indicated that while holding on to its traditional market, the company is aiming to expand by targeting new publications at a somewhat younger demographic (25-year-olds to 40-year-olds).

Of course the fundamental demographic for MSO has been, and probably always will be, women. Six years ago, a majority of women (55%) had a favorable view of Stewart, and just 19% had an unfavorable view of her. After falling into the 30s during the stock scandal, Stewart's favorable rating among women has reverted to 55%, while her unfavorable rating remains somewhat elevated, at 32%.

The trend in Stewart's favorability ratings by age may spell trouble, however, if the company is going after a younger demographic. Although Stewart's overall favorable rating has recovered to 53%, this has occurred almost exclusively among people 50 and older. 

Between 1999 and today (leaving out the interim period when her favorability sank), the percentage viewing Stewart favorably rose by double digits among those aged 50 to 64 (+12) and 65+ years of age (+19). It rose by only 5 points among those aged 18 to 29 and fell by 6 points among those aged 30 to 49. 

When taking into account changes in both the percentage favorable and the percentage unfavorable, as is done with the shift in "net favorable" statistic, it is clear that Stewart's image has been hardest hit among the 30- to 49-year-old demographic.

When looking at age and gender together, we see no shift in the percentage of men 18 to 49 holding a favorable opinion of Stewart (44% today vs. 44% in 1999), a slight decrease among women 18 to 49 (-6 points), a modest increase among women 50+ (+9) and a substantial increase among men 50+ (+23).

These shifts may not be the type of movement her stockholders are hoping for. But as has been seen in the past, opinions of Stewart can turn on a dime. It may take nothing more than a successful debut of her version of the Apprentice to ignite support from the younger demographic.

Stewart's Appeal Strengthened With Lower-Income Households

The findings by household income could be good news for the Martha Stewart Everyday line of household products sold through Kmart, but could run counter to the interests of her magazine and the higher-end furniture line. 

Her favorable rating among people living in lower-income households (those earning less than $30,000 annually) has increased 12 points (from 42% in 1999 to 54% today). That figure has increased only 3 points among middle-income earners and declined by 5 points among those earning $75,000 or more.

Bottom Line

Stewart's public image has partially recovered from the battering it took during the ImClone scandal. Having a favorable image above the 50% line today is a good thing. Having an elevated unfavorable rating, however, means less opportunity for converting neutral Americans into fans, and more work at managing or reducing those unfavorables.

This problem is seen across all demographics. Even among groups with whom her favorable rating has increased since 1999, her net favorable rating (percentage favorable minus percentage favorable) is still lower than six years ago.

The good news for Stewart in the demographic trends is that a majority of women again view her favorably. She should also welcome the fact that a component of the traditional market segment -- older women -- is back in her fold. The decline in favorability among younger women (particularly pronounced when looking at her net favorable rating) could be a problem, however, as the new management team at MSO tries to expand the company.

*Results are based on telephone interviews with 1,010 national adults, aged 18 and older, conducted Feb. 4-6, 2005. For results based on the total sample of national adults, one can say with 95% confidence that the margin of sampling error is ±3 percentage points.


Gallup https://news.gallup.com/poll/15274/Will-Americans-Buy-New-Martha.aspx
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