The campaign should have been everything that Keurig needed to stand out and win the coffee company a new, young audience. Nespresso had George Clooney. De’Longhi had Brad Pitt. Keurig would have recyclable coffee pods.
All customers had to do after they’d finished making their morning cappuccino, was peel off the silver top, dump out any coffee grounds, and toss the plastic cup into the recycling bin. “Imagine the possibilities of what your empty recyclable K-Cup pod could become next!” the company announced.
Young people, the demographic that cares most about the environment, would be able to drink coffee from single-use pods without worrying that they were harming the environment. They could even pester their parents to ignore a couple of aging Hollywood superstars and focus on the future of the planet instead.
The campaign was in line with a new age of customer activism and the increasing importance of cause marketing. By aligning themselves with a popular cause, brands can suggest that they’re doing more than trying to make money. Customers can believe that they’re doing more than loading up on caffeine or satisfying a hunger when they make their purchase. By buying something they would have bought anyway, they can turn their consumption into an action for a cause they support.
For Keurig, it didn’t work out that way. In January this year, Canada’s Competition Bureau fined the company CA$3 million for making false or misleading claims about the degree to which the pods can be recycled. In addition to the fine, Keurig also agreed to make an CA$800,000 donation to an environmental charity and pay CA$85,000 in expenses. The fine follows reports of the settling of a class-action lawsuit in the United States over the same issue.
The problem was that while Keurig had changed the plastic it uses in order to make its products easier to recycle, in practice, very few recycling programs are able to accept the pods. Keurig was running a campaign to persuade people that its products weren’t harmful to the environment while the premise of the campaign was largely untrue.
Despite the shortcomings of Keurig’s new pods, the company’s reasons for pushing its environmental credentials were sound. Consumers increasingly care about the environment, and they want the companies they patronize to care too, and not just about the planet. A recent PriceWaterhouseCoopers survey found that as much as 51 percent of customers say that they consider whether a product has been made with a traceable and transparent origin before they make their purchase. Half say that they often or very often consider how the company treats its staff, and 53 percent say that they look at whether the company has strong values and is committed to doing the right thing. As for the percentage of consumers who say that they often or very often consider whether the company makes biodegradable or eco-friendly products, that share reaches as high as 47 percent—reason enough for Keurig to redesign its pods.
That doesn’t mean that customers aren’t more interested in the plastic content of their purchases than in landing a good deal thoguh. PWC notes that while consumers care about environmental, social and governance factors, or ESG, “when stacked up against the basics of price and convenience, ESG fades in importance.” People, PWC says, want to do the right thing for society and for the environment, but products have to be both affordable and sustainable. Companies can’t choose one or the other.
So how much does ESG matter, what kind of causes should companies show they support, and how should they make that support clear?
It’s All Good
A group of researchers in Colombia recently tried to assess the effectiveness of social responsibility marketing on the brand awareness of millennials. They started by defining social responsibility marketing (SRM) as “the design and implementation of marketing programs that seek to generate a change in consumer behavior towards a social or environmental cause,” such as by raising awareness about a health condition or encouraging more tolerance towards particular groups of people.
In other words, a social responsibility campaign doesn’t just tell potential customers that this company is good for the environment. It attempts to use the brand to promote a cause—and in the process associate their own brand image with that cause and in opposition to other brands.
“SRM actions allow a firm to build a positive brand reputation among its stakeholders,” the researchers say, “since, on the one hand, they align its brand identity with the social objective that it is promoting and, on the other hand, they differentiate the firm from its competitors.”
The researchers also warn though that customers don’t always welcome SRM campaigns. Consumers can see them as not very credible or even alienated from the brand, “something that happens frequently, especially in SRM actions.”
The study looked at the activities of three companies. The Medellin Metro ran a campaign to prevent violence against women and girls on its transportation network. Karibik, a clothing company known for using vegan materials, ran a campaign against LGBTI discrimination. And Percimon, an ice cream brand, focused, like Keurig, on its environmentally-friendly materials, this time highlighting their ability to biodegrade.
The researchers asked 547 people aged between 18 and 35 who followed the official profiles of the companies on social media to score a number of statements about the campaign and the brand. The statements described the degree to which the campaign was consistent with the brand; was important to the customer; was persuasive and shared their ideals; and how well they knew the brand.
The researchers broadly found that each of the brands’s campaigns was effective. When brands were familiar, SRM campaigns improved millennial attitude towards the brand. The degree to which the campaign fitted the brand affected the credibility of the campaign. And that credibility, as well as personal involvement with the cause, influenced the millennials’ attitude towards the campaign.
In other words, familiar brands that run suitable social campaigns can win more positive brand engagement. But they have to meet a relatively narrow set of conditions. The brand needs to be already known to the customer. The campaign has to fit the brand, be credible, and ideally be something that the customer is already involved in.
The Cost of Greenwashing
Fail to meet those conditions and the cost can be high. Another recent study looked at the effects of greenwashing on corporate reputations. The researchers defined greenwashing as “intentional communicative behavior aimed at deceiving stakeholders.” They then told respondents about a fictional cruise company (based on Royal Caribbean) that had pitched its new environmentally-friendly wastewater treatment system as a sign of its environmental progressiveness. In fact, the system was installed on just three of its ships that sailed in waters where it was required to install them by law.
The researchers offered audience different versions of the story. In some versions, the company had acted on its own initiative to produce an eco-friendly system. In other versions, it had done no more than it was required to do by law but claimed that it had acted on its own initiative. And in a different version, the company had claimed that it was now more environmentally-friendly even though it wasn’t even meeting the area’s legal requirements.
Regardless of how the researchers pitched the story, whenever the company was seen by respondents as less than completely honest about its environmental activities, its reputation suffered. Even if the company was following environment law, if it had exaggerated its achievements, people would see it as less ecological and would regard its products and services of lower quality.
Organizations that want to implement environmentally-friendly policies and use their green positioning as a reputational asset, must use “honest and transparent communication,” the researchers conclude. “Telling half-lies about green activity does not prove to be significantly better than telling lies about it. Only a truly green positioning can be beneficial.”
And taking credit for actions that the law requires the company to perform won’t enhance the company’s reputation either.
How to Build a Socially Responsible Marketing Campaign
So what can companies do to improve their reputations and build a closer association with customers who care about causes?
The first step is to make your brand known. Researchers found that socially responsible marketing was most effective when people already knew the brand. It’s as though people assume that a brand’s main goal is to sell goods. They’re then pleasantly surprised when they learn that the brand is also trying to do good work. Start by promoting the brand with emphasis on the quality of its goods.
Once your brand is established and familiar, then find a cause that matches your brand’s activities. The closer the match, the more authentic the cause will appear. A food company could contribute to ending global hunger, for example. A sports goods firm could aim to improve healthy eating or promote exercise for people who struggle to eat properly and leave the sofa.
The cause should also match the customer so try to find a topic that your customers aren’t just sympathetic to but are also active in. An outdoor goods firm could emphasize that its goods are biodegradable or recyclable but if it runs a campaign to clear trails and clean up waterways then its customers will feel that they’re contributing just by doing something that they love doing anyway. The brand is able to add a new value to the goods it sells.
And be honest about your communications. Socially responsible marketing benefits by overcoming customer cynicism about a brand’s intentions. If people expect a company to focus on earning money, a brand that tries to do good stands out. But if people see a company trying to earn money out of a good cause they aren’t really supporting, that cynicism is reinforced and the brand’s reputation falls.
Opt for greenwashing instead of socially responsible marketing, and you may as well throw your money at George Clooney and the coffee pods in the bin.