A scene from the same-sex wedding ad that sparked a pre-holiday hullaballo (Photo courtesy of Zola)

When caught in the unfamiliar glare of public outcry, Hallmark Cards issued a statement this week that encapsulated the company’s dilemma in two adjacent sentences. On the one hand, “We are an inclusive company and have the track record to prove it,” the company declared. On the other hand, it said, “It is never Hallmark’s intention to be divisive or generate controversy.”

Yet in today’s polarized America, is it possible to have it both ways, especially for a company that’s a household name? This week Hallmark unintentionally provided a case study in the quandaries faced by companies being pushed by their stakeholders to take sides on issues ranging from climate change to gun safety.

Over a matter of days, Hallmark aggravated a highly publicized fuss by seeming to embrace gay rights, then trying to avoid the issue, and then reasserting its belief in diversity and inclusion while apologizing for “the hurt and disappointment this has caused,” said its CEO, Mike Perry. The result was backlash upon backlash, but perhaps providing some lessons for business leaders navigating a highly politicized public arena.

The brouhaha began when the Hallmark Channel, one of three TV channels the company operates in its Crown Media Family Networks division, ran a series of ads for Zola.com, an online wedding registry and planner. At least one of the ads showed a same-sex wedding with two brides kissing. The company had already been getting complaints from viewers about recent comments by Bill Abbott, CEO of the Hallmark networks, saying that the network would be open to LGBTQ-friendly programming, according to the Wall Street Journal.

The Journal’s story was headlined, “In Three Days, the Hallmark Channel Managed to Upset Pretty Much Everyone.” Indeed, much more was to come. One Million Moms, a division of the conservative American Family Association, published a petition urging Hallmark to “please reconsider airing commercials with same-sex couples.” It was a sensitive moment for the Hallmark Channel, which profits over the holiday season from a surge in Christmas-themed programming. Top managers huddled over last weekend and decided to yank the offending ads. The company felt “it was in the best interest of the brand to pull them and not continue to generate controversy,” a spokesman said.

LGBTQ-advocacy groups keep an eye out for this kind of cultural censorship, as in a case earlier this year when two Delta Air Lines inflight movies were edited to remove same-sex love scenes.  One such advocacy group, Glaad, reached out to Hallmark in recent days and said it would start contacting the channel’s advertisers and asking them to protest by pulling their ads. Glaad compiled a list of 37 advertisers to target and planned to launch a media blitz to announce its protest. Meanwhile, the emerging controversy was providing raw material for mockery of Hallmark by everyone from Ellen DeGeneres to the Weekend Update anchors on Saturday Night Live.

Hallmark’s top management huddled again and decided to reverse itself. “The Crown Media team has been agonizing over this decision as we’ve seen the hurt it has unintentionally caused,” said Perry in a press release. “Said simply, they believe this was the wrong decision. Our mission is rooted in helping all people connect, celebrate traditions, and be inspired to capture meaningful moments in their lives. Anything that distracts from this purpose is not who we are.”

So who is Hallmark? Founded in 1910 by J.C. Hall, a high-school dropout, the Kansas City-based company has grown into a $4 billion enterprise with 30,000 employees and interests well beyond greeting cards including the TV channels, a chain of 2,000 retail stores, real-estate holdings, and the Crayola crayon company.

Hallmark’s embrace of diversity has been fitful. Its website testifies to the company’s “welcoming work environment.” The company has won recognition as one of America’s best employers for women and “featured more actors of color than ever before in the 2018 lineup of original Hallmark Channel holiday movies,” the company said.

Even so, “the Hallmark Channel has long been a place of blatant erasure,” wrote Trish Bendix on NBCnews.com. “This year (2019!), for the first time, it attempted to acknowledge Hanukkah (poorly), and the ‘diversity’ of its casts remains laughable (take a look at the Hallmark holiday movie homepage and you'll see it's looking like another straight, white Christmas). The Hallmark Channel has also continually ignored the existence of LGBTQ people. There is no room for queer people in the channel’s fantastical rom-coms and tales of family cheer.”

Among the lessons from Hallmark’s holiday hullabaloo: In the business world, the arc of history bends toward diversity. Brands ranging from Tiffany to Walmart have embraced LGBTQ representation in their advertising, as well as support of events aligned with Pride month.

Another lesson is that in today’s world of lightning-fast, social-media reaction, you have to move quickly, but also thoughtfully. “It’s hard to keep everyone happy, but flip-flopping doesn’t help,” Allen Adamson, co-founder of the marketing consultancy Metaforce, told the Associated Press. “These are difficult issues to navigate but when you’re going to make a call one way or another, make sure you understand the ramifications. You only want to pull the Band-Aid off once.”

Fortunately for Hallmark, the company got back to its original position without further wavering. “It seems they learned a very hard lesson very quickly,” Todd Sears, founder and CEO of Out Leadership, told NBC News. “Its apology was very heartfelt and there was an earnestness, a sincerity in the apology.”

Of course, not everyone was pleased. One Million Moms said it was “extremely disappointed” in Hallmark’s reversal, adding, “This is an enormous mistake that will cause a majority of its viewership to turn the channel.”