Reputation Digest – June 2025

Reputation Digest – June 2025

Hello, and welcome to this month’s Reputation Digest, where Fire on the Hill delivers a run-down of the latest stories making waves in the communications sector. This month, AI dominates headlines, Airbnb points fingers and corporations cancel Pride.

Brands shift to AI – and the public takes notice

Two brands have faced a wave of backlash recently, following their announcement of an expansion in their use of AI.

Duolingo is usually known online for its quirky, Gen-Z-friendly content across social channels like TikTok and Instagram. But an announcement from chief executive, Luis von Ahn, that the brand is looking to shift to using more AI hasn’t exactly charmed their users. In positioning itself as “AI-first,” Duolingo may be trying to future-proof its product. But unsurprisingly, given the widespread anxiety around AI-job losses, replacing contractors with automation was not a popular move.

Similarly, Klarna, the buy-now, pay-later giant, saw national coverage after it replaced 700 workers in its customer service team with AI in an attempt to cut costs. They’ve since started rehiring workers after claiming that the move led to lower-quality customer service.

Duolingo has since backtracked as well, clarifying that he didn’t intend to insinuate that AI would replace workers, but rather that it would accelerate their work. But much of the damage has already been done, and this apology, which came after days of silence, has done little to reassure their users. If the brand continues to alienate the very community that helped build its success, the Duo owl might find itself delivering fewer daily reminders and more public apologies.

Airbnb plays the blame game

Protests around overtourism have swept through European cities over complaints of over-stretched infrastructure and housing shortages. In a risky move, Airbnb has pointed the finger at hotels, claiming they’re the main drivers of this issue. It’s a bold stance – one that’s stirred up a fair bit of criticism, considering Airbnb’s own role in reshaping the global travel landscape.

While 63% of tourists do stay in hotels, Airbnb’s statement feels a bit like the pot calling the kettle black – after all, hotels clearly aren’t solely to blame for rising house prices in cities like Lisbon and Barcelona.

Some travel providers have hit back – including Tui, who argue that holiday rentals are a significant problem for many European cities because of the strain they put on the housing supply. The public has also chimed in on social media, pointing out the app can incentivize landlords to turf out existing residents and rent their homes for short-term lets.

Overtourism is a complex recipe, with a long list of ingredients: cheap flights, viral TikToks – and yes, both hotels and homestays. But denying the role that Airbnb plays in this situation is just adding insult to injury – if anything, their latest statement has just brought their association to the issue further into the light.

When corporate allyship goes quiet

Following Trump’s policy on DEI (which we covered in February’s issue), several big-name brands have tried to quietly step back from Pride month. After years of embracing LGBTQ+ support with bold displays, companies like Target, Anheuser-Busch, and BarkBox scaled down their Pride involvement in 2025.

Target shifted Pride merchandise displays to less prominent locations. Anheuser-Busch, after facing conservative boycotts in 2023 over a brief partnership with a trans influencer, ended its 30-year sponsorship of St Lewis Pride. Nissan, Citi and Mastercard also pulled out of sponsorships. The actions of these companies reflect a broader trend: corporate caution in response to political pushback and polarized public opinion.

This left many events short of budget. In New York City, the organizer of official Pride Month events across the city reported a budget shortfall of $750,000 after a quarter of its corporate sponsors pulled back their funding.

The result? A backlash from both sides. Conservatives still criticized these brands for the few initiatives they did participate in, while LGBTQ+ consumers and allies accused them of abandoning the community when it mattered. Social media lit up with calls to support smaller queer-owned brands instead.

Corporate support for LGBTQ+ rights has long walked the line between genuine allyship and opportunistic marketing. What we’ve seen this month is what happens when this support faces genuine pressure. Silence on this issue isn’t neutral, and for organizations that have incorporated social responsibility into their brand over the last few years, their authenticity is on the line.

Image Unsplash / Margaux Bellott