Black 'Lil Monkey' Dolls: A Very Bad Financial Move

I received a call from CNN today about a major corporate mistake. We talk about such marketing issues in our Finance and Business Management classes at Syracuse University, and this was surely a mistake that will be analyzed in case studies for years to come.

In an apparent slip of intellect, someone within the Costco Corporation decided that it might be a good idea to put out black dolls with the words "Lil' Monkey" on the top of the doll's forehead. Alrighty then, that makes sense.

I don't think that any executive with the Costco Corporation wakes up in the morning saying, "How can I offend as many black people as possible today?" But this does not excuse the fact that this move will be interpreted as a racist one, as it should be. The world is no longer plagued by as much good old fashioned, obvious racism, where a klan member shows up on your porch and calls you the n-word. We now have corporations and other institutions with white male dominated power structures that have not embraced diversity of ethnicity, thought or perspective. Racial ignorance remains acceptable and economic imperialism over people of color is still the rule of the day. The point is simple: Someone should have caught this error before those dolls left the door, but no one cared enough to try.

In order to make this into yet another "teachable moment," let's ask ourselves this question: Why didn't someone notice that it might be offensive to refer to a black baby as a "lil' monkey?" One possibility is that the company does not truly embrace diversity in its management ranks, leading to incredibly flawed and insensitive upper level decisions. So, the individuals deciding how to produce, market, finance and distribute this product could be, as with many corporations, completely ignorant about how to do business with other ethnic groups.

It could also be the case that there are a few token black faces within the Costco organization who have not been empowered to speak up on such issues without fear of reprisal or dismissal. Black folks know that many of us will keep our mouths shut if we are at risk of losing our jobs -- running your mouth got you killed on the plantation, so we've spent 400 years learning how to be fearful enough to survive. I can just see some black mid-level manager who saw the whole thing happen saying to herself, "Oooooh! Ya'll gonna get in trouble for this one!"

The idea that there may be African American managers who didn't feel empowered to stop this "Lil' Monkey Train" before it went out the door is reflective of another persistent problem that is caused by empty organizational quests for cosmetic diversity: If you don't allow for diverse ideas and perspectives, then you have no diversity at all. This is also true in academia, where black professors are invited into the establishment, as long as we don't say anything that our colleagues find objectionable. What we must also understand is that a lack of diversity is not just a black problem -- it's an American problem. America is not at its best when we suppress heterogeneous points of view.

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Gotcha Moments of Retail Shame

Store: Midas
Accusation:California filed a $222 million lawsuit against the owner of 22 Midas Muffler shops after uncover agents discovered in which consumers were charged for unneeded repairs, California Attorney General Edmund G. Brown Jr. announced. Click through to see more stores that got caught cheating.

Getty Images

FilmMagic.com

Gotcha Moments of Retail Shame

Store: CVS
Accusation:California caught the chain with expired merchandise on the shelf. The result? CVS must give $2 coupons to anyone finding more expired items. This isn't the first store caught doing something shady (or even the first time CVS was caught doing the same thing). See more Gotcha Moments by clicking through.

Store: Kmart
Accusation:Marketed paper products as biodegradable that aren't actually biodegradable. The result? Kmart settled the case with the Federal Trade commission. This isn't the first time KMart was caught.

AFP/Getty Images

KMart's Previous Gotcha:Kmart, Ashley, and World Market< were accused of deceptive furniture labeling -- wood that wasn"t wood and leather that wasn"t leather -- in an on-camera investigation by Good Morning America The result? Kmart said full product descriptions were available online, Ashley defended its wording as a description of color only, and World Market acknowledged that a quarter of its supposedly leather chairs were actually synthetic, and it pulled them from sale.

Sears Holdings Management Corp., the parent company of Sears and Kmart, settled a case to stop enticing customers to sign up for a software that spies on them. It must also instruct customers how to uninstall the software that monitored their spending across the web, even on sites that are supposed to be secure, and destroy the data that was collected. The Federal Trade Commission brought the case against the Sears Holdings.

Quizno's Sub Shop has an online video ad showing two girls simulating a porn video by sharing a sub sandwich. The online ad, "2 Girls, 1 Sub," takes its name from a notoriously heinous movie trailer, for a fetish film, which shows women eating their own feces. Critics have pointed out that the Quiznos video, starring Playboy Playmate Hiromi Oshima, is basically comparing the sandwiches to "poop."
This is Quizno's second porn-themed ad to come out in recent months.

If you are dining out -- and many of us still are these days, despite the economy -- make sure to check your bill carefully for extra charges that might creep on there.
Call it the airline a la carte approach, as many restaurants are apparently sneaking in charges for bread, tap water, takeout boxes and mandatory tips. The New York Post found all of these items added to bills on an investigative mission that the paper undertook recently.

For more on advertisers caught misleading consumers, click through our gallery of Gotcha Moments of Retail Shame.

Blockbuster was found guilty of charging customers higher than the advertised prices on scanned items by district attorneys of Los Angeles and San Diego counties. Blockbuster owes $237,750 in penalties, and $62,250 in costs, and is further prohibited from charging amounts greater than the advertised price.

A regulatory organization for the advertising industry demanded that Wrigley change its misleading packaging and advertising for Eclipse gum. The ads for Eclipse say that the gum's natural ingredient - magnolia bark extract - kills germs that cause bad breath. This has not been proven and the National Advertising Division Council of Better Business Bureaus asks that Wrigley clarify this in its ads.

Store:Chase Bank

Accusation: In late March, the bank rescinded a $10 monthly fee it had imposed for several months on hundreds of thousands of credit card accounts, after New York's attorney general decried the practice as a bait-and-switch for customers seeking low interest rates.

Results:The settlement could save customers $22 million over the next year.

Amy Sancetta, AP

Costco is going to learn a huge financial lesson from this fiasco. So far, they've made all the right moves: They've removed the dolls from the shelves, and apologized profusely. This is a good strategy, as corporations are trained to avoid racial controversy at all cost. The biggest price of all? Costco stock has dropped by 3% this week. Black, white, brown or yellow, the only color that matters to executives is green. Being racist is simply not good business.

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Dr. Boyce Watkins is a Distinguished Scholar with the Barbara Jordan Institute for Policy Research and author of 'What if George Bush were a Black Man?' To have more Dr. Boyce commentary delivered directly to your email, please click here.