Chocolate Brands’ Communication
of
Corporate Social Responsibility
in
Germany
Nina Langen and Monika Hartmann
Theoretical and empirical research reveals:
Ethical branding can provide a critical point of
differentiation
Firm‘s CSR activities
Stakeholders‘ response
Firm’s intangible assets
• Evaluation of and
• Loyalty
• Trust in the company
Relevance The Study Results
2
Theoretical and empirical research reveals:
Ethical branding can provide a critical point of
differentiation
Firm‘s CSR activities
Stakeholders‘ response
• High level of complexity
• Credence attribute
• Buy
• Boycott
Information asymmetry
Signalling /
Communication
Relevance The Study Results
3
Research Question
Firm‘s CSR activities
Stakeholders‘ response
• High level of complexity
• Credence attribute
• Buy
• Boycott
Information asymmetry
Signalling /
Communication
(How) do chocolate manufacturers communicate their
social and environmental engagement
to (which) stakeholders?
Relevance The Study Results
4
Chocolate: Relevance for CSR
Demand Side
Supply Side
• Most important producing
country: Ivory cost
– 40 % of global cocoa
production,
66 % of the cocoa processed
in Germany
– Problems: deforestation, child
labour, non-sustainable wages
• One of the most favoured
luxury food in Germany
 11.4 kg/person/year
consumed
• Companies producing chocolate
– Can influence environmental
impact of cacao production
– Can change producers’
livelihood
• Surveys: German citizens
 Are strongly against childlabour
 Care about externalities
and ecological production
• Second most important
importer of cocoa after USA
Relevance The Study Results
Chocolate: Relevance for CSR
Supply Side
Demand Side
• Certification of cocoa is considered as
• an effective strategy to advance
producers’ livelihood
• reduce environmental problems
• CSR activities of companies in the
chocolate industry can serve as important
differentiation strategy if communicated
Relevance The Study Results
Potential CSR communication channels
• CSR reports
• Advertisement, in e.g. the store, print media, TV,
radio, internet
• (Certified) labels on product packages, such as
organic, Fair Trade
• Cause-related Marketing activities
Relevance The Study Results
Standard
in Europe
Visible
at the
POS
What is Cause-related Marketing (CrM)
Marketing tool
where product purchase
leads to
target-oriented donations
regarding a designated
cause
which is
promoted on the product
by label
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8
Study design
1st Market analysis in 12/2011 (Pretest 12/2010) in Bonn
• Complete inventory count of chocolate products
–
–
–
–
–
•
Discounter: Aldi Süd, Lidl
Primarily private brands
Full-range provider: Edeka, Real, Rewe
Organic supermarket: Basic
Organic store: Bergfelds
Only manufacturer brands
Store: Kaufhof
Focus: CSR communication on the products
2nd Web analysis in 01/2012 (Pretest in 01/2011)
• Analysis of CSR communication on web pages of
– 6 retail brands
– 10 organic/Fair Trade manufacturers brands
– 31 conventional manufacturer brands
Relevance The Study Results
Market analysis 12/2011
• 1001 chocolate bars analyzed
• 293 if not considering different flavors
• 57 with CSR label (20 %)
• 18 in conventional retail stores
=>Pretest 12/2010 – NONE
• % of chocolate assortment with CSR-label
• Conv. : from 0 % (Aldi) to 13 % (Lidl)
• Org.: 100 % (without organic label 46 %)
• CSR Labels on private as well as
manufactured brands
• CSR label: Social and ecological 3rd party
certified production (organic, Fair Trade,
Rainforest Alliance, UTZ certified, others)
Relevance The Study Results
Unweighted average price of chocolate bars in Euro/100 g in
2011 with and without CSR labels
Average
Total
Price mark up CSR labeled
Aldi Süd
0.71
./.
Lidl
0.85
-0.15
Discounter
Full product range supermarkets
Edeka
1.19
0.24
Rewe
0.93
0.64
Real
1.29
0.75
Kaufhof
2.37
0.12
Basic
2.81
./.
Bergfeld’s
2.18
./.
1.54
0.67
Organic stores
All stores
Results of the web analysis – selected brands
• Lindt & Sprüngli
– high-price chocolate, not available at the discount
• Ritter Sport
– medium priced, available at the discount as well as in
full-range supermarkets
• Choceur
– low-price private chocolate brand only available at the
discounter Aldi Süd
Relevance The Study Results
Brands selected - Lindt
•
•
•
•
•
Lindt & Sprüngli is located in Kilchberg/Switzerland
Sales volume of EUR 1.9 billion in 2009
7,409 employees
100 g of chocolate cost EUR 2.20
The impression and brand image is high quality due to
Swiss production
Brands selected - Ritter Sport
• Ritter Sport is sited in Waldenbuch/Germany
• Sales of the company amount to EUR 274 Mio. in 2009
• 800 employees work for Ritter Sport
• 100 g of chocolate costs EUR 0.85
• The image is ‘dynamic’ which is influenced by
advertisement and the chocolates quadratic form
Brands selected - Aldi Süd
• The home of Aldi Süd is Mülheim/Ruhr/Germany
• Neither sales volumes nor number of employees reported
• 100 g of chocolate of the private brand Choceur cost EUR
0.35
• Aldi is the most trusted retail brand in Germany
Keyword Analysis
• To assess the chocolate manufacturers CSR communication
systematically the analysis started with the search for the
following keywords on the respective websites:
•
•
•
•
•
•
Sustainability
Environment
Social
Responsibility
Health
Animal welfare
•
•
•
•
•
Engagement
Company
Sponsoring
Charity
Activities
Relevance The Study Results
16
Results of the Keyword Analysis
Keyword
Brand
Lindt
Ritter Sport Choceur
Activities
37
25
0
Animal welfare
0
0
0
Charity
1
6
0
Company
30
52
1
Engagement
8
20
0
Environment
9
31
1
Health
6
36
0
Responsibility
21
19
0
Social
0
2
1
Sponsoring
0
0
0
Sustainability
9
6
1
Communication
of CSR
is of
considerable
greater
relevance for
Lindt and
Ritter Sport
compared to
Aldi Süd
Web page analysis - Lindt
Relevance The Study Results
Web page analysis – Lindt: Assessment
• CSR information available on the website
• Very detailed
• Very comprehensive
• Covers all dimensions of CSR
• Company
• Not only member in some international organisations,
such as the UN Global Compact and NGOs
• Also initiated own projects related to cocoa production
• Information only in English, except the annual CSR report
Relevance The Study Results
Web page analysis – Ritter Sport
Relevance The Study Results
Web page analysis – Ritter Sport: Engagement
• Ecology
• Enhancement of production processes
• Product package
• Logistics
• Energy seems to be an important field
• Energy efficiency measures presented
• Information given which energy is used in production
process
• Awards mentioned, e.g. ‘Ökomanager des Jahres’, given to
the CEO
Relevance The Study Results
Web page analysis – Ritter Sport: Details
• Long-term engagement in Nicaragua: small-farm cocoa
production for Ritter Sport in a cooperative founded in 1990
– Comprehensive information provided regarding the
cooperative and social implications for producer families
– A film also placed on the webpage
• Art sponsorship information:
• less detailed than information available for the other two
issues
• Only shortly states that sponsorship of young artist is
regarded as investment in future
Relevance The Study Results
Web page analysis – Ritter Sport: Assessment
• Engaged in all three dimensions of CSR
• Ritter Sport is
• No member of international organisations concerned
with issues such as child labour or sustainable
production (or at least does not communicate this)
• Focuses its CSR activities on own initiatives, e.g.
• Nicaragua engagement related to the sustainable
production of chocolate
• Promotion of art in developed countries
• It remains unclear how much money is attributed to the
projects
Relevance The Study Results
Web page analysis - Choceur
Relevance The Study Results
Web page analysis – Aldi: Assessment
• CSR info primarily provided regarding engagement for
ecology
• Most of the activities have not only an effect for the
environment but also for the profit of the company, e.g. the
improvement of logistic reduces CO2 emissions and safes
money
• Social dimension of Aldi’s CSR involvement mainly given
by providing information on firm’s membership in
international organisations (e.g. ILO) and initiatives (e.g.
BSCI). Links all lead to anglophone webpages
 The average German consumer might have difficulties
to learn more about Aldi’s CSR engagement
• No specific engagement mentioned regarding the
production of cocoa and chocolate
Relevance The Study Results
Summary: Web page analysis
• Considered brands provide information regarding CSR
activities on web-pages
• Information differs considerably in amount, presentation,
and CSR areas covered
– High-price brand Lindt & Sprüngli: engaged in various
different projects to mitigate social and environmental
problems related to cocoa production
– Medium-price chocolate brand Ritter Sport: as Lindt &
Sprüngli. In addition engaged in projects related to art
– Low-price supplier Aldi Süd: reports no engagement with
respect to cocoa production
Relevance The Study Results
Internet Analysis: Overall results
• Most of the 47 companies communicate CSR related information
on their websites
– Exceptions: e.g. Trumpf-Schogetten; Alpia, Feadora
• Considerable heterogeneity in form and amount of CSR related
communication
• On average, most comprehensive by organic/Fair Trade
manufacturer brands and least so by retail brands
– Exceptions: Lidl and Rewe
• Cocoa production not always addressed on CSR sites
• Formality of communication
– Highest by retailers (addressee: NGOs, etc.)
– Relative low by manufacturer brands (addressee: consumer)
• Neither price nor enterprise size seem to determine the level of
CSR communication
Relevance The Study Results
40
Formality of communication  Who is
adressed?
• Stakeholder groups, e.g. activists and NGOs
• CSR communication in this respect might be primarily seen
as reducing pressure from those groups thereby
maintaining the ‘license to operate’
Further qualitative analysis, e.g.
• Focus groups with consumers to gain insights into
consumers’ feelings when being informed about problems
related to production of cocoa
• Expert interviews with managers could help to understand
the motivation not to advertise CSR involvement directly to
consumers
Relevance The Study Results
To sum up
Firm‘s CSR activities
Stakeholders‘ response
• High level of complexity
• Credence attribute
• Buy
• Boycott
Information asymmetry
Signalling /
Communication
Research Answer: Yes, more in the internet than on products,
form and level very heterogeneous
Open questions:
• Which determinants can explain heterogeneity in CSR
communication?
• How do stakeholders perceive CSR communication in the
chocolate sector and what are the influencing factors?
• Better use scanner data?
Thank You
Chocolate Brands’ Communication
of
Corporate Social Responsibility
in
Germany
Nina Langen and Monika Hartmann
By working with a strict Code of
Conduct , UTZ CERTIFIED sets
stringent requirements for the
farmers when it comes to the
sustainable growing of coffee,
cocoa and tea. Farmers are
trained in the area of business
skills, labor conditions and
environmental protection, and
their operational management is
checked by independent third
parties. The UTZ CERTIFIED
traceability system
subsequently guarantees that
the raw materials have actually
been grown and harvested in a
responsible manner.
44
Number of chocolate bars sold in the market with
and without CSR labels in 2011
Without label
Considering
different flavours
With CSR label
Not considering
different flavours
Considering
different flavours
Not considering
different flavours
Total
Own
brand
Total
Own
brand
Total
Own
brand
Total
Own
brand
Aldi Süd
14
13
10
9
0
0
0
0
Lidl
81
46
32
16
8
8
4
4
Discounter
Full product range supermarkets
Edeka
171
3
71
1
4
0
4
0
Rewe
122
22
37
7
9
3
4
1
Real
220
25
56
9
12
0
5
0
Kaufhof
242
0
48
0
3
0
1
0
Organic stores
Basic
99
0
28
0
99
0
28
0
Bergfeld’s
52
0
11
0
52
0
11
0
1001
109
293
42
187
11
57
5
Total over
all stores
Brand
Manufacturer
Organic
Fair Trade Utz Certified
Bellarom
FairGlobe
Lidl
Lidl
X
Rewe
X
Point of
Sale
Lidl
X
Auf dem Weg nach Morgen
X
Lidl
Rewe
Marabou
Daim
Other label
X
Fin Carré
Rewe Bio
Rainforest
Alliance
Kraft Foods
Cote d´or (Sensations)
X
Rewe
RealEdeka
X
Rewe
X
Kaufhof
Edeka
Hachez
(Wild Cocoa de
Amazonas 45%
Cocoa)
Hachez
(Wild Cocoa de
Amazonas 70%
Cocoa)
Bremer HACHEZ
Chocolade GmbH &
Co. KG
Sarotti Bio
Sarotti
X
Real
Ritter Sport Bio
Alfred Ritter GmbH &
Co KG
X
Real,
Edeka
Balisto JoghurtBeeren-Mix
Mars GmbH
Rapunzel
Rapunzel
X
X
Zotter
Zotter
X
X
Basic
Naturata
Naturata AG
X
X
Basic
Gepa
GEPA
X
X
Schönenberger Swiss Chocolat
Choco Roc
Schönenberger
X
X
Rio Napo
X
Original Food GmbH
Mit dem Kauf dieser Tafel retten
Real
Sie 6 m² Regenwald
wild gewachsener Cacao Zertifiziert durch Regenwaldinstitut e.V.
X
Real
Edeka
Hand in Hand
Naturland Fair
Basic
Bergfeld
Basic
Basic
Geo schützt den Regenwald e.V. Basic
Internet Analysis – retail brands
• Six retail brands
– Lidl, Aldi Süd, Rewe, Real, Edeka, dennree
• Language
– German
• Most detailed information
– Lidl and Rewe: adressing the society, environment (only within
Germany) and employees
• Cocoa production adressed
– By none of the retail brands
• Addressee
– CSR professionals and consumer
• Figures provided
– No
47
Relevance The Study Results
Internet Analysis – organic/Fair Trade
manufacturers brands
• Ten brands
• Language
– All German; Gepa: Spanish, English; Natudis; Pronatec, Rosengarten,
Vivani: also English
• Most detailed information
– Engagement for not only the local but also the global environment
– Fair communication and handling with suppliers addressed by 7
• Cocoa production addressed
– By Gepa, Naturata, Rapunzel, Zotter
• Addressee
– consumer, information provided in less formal manner compared to the
retailers
• Figures provided
– Some, e.g. Rapunzel and the Hand in Hand project
Relevance The Study Results
48
Internet Analysis – manufacturer brands
• 31 brands
• Language
– Extremes: Several: Milka, Ritter Sport, Zentis. No German: Marabou
• Most detailed information
– No CSR info: Aero, Alpia, Feadora, Johan Lafer Confiserie Collection,
Lohmann, Piasten Schokolade
• Cocoa production addressed
– By Balisto, Hachez, Milka, Ritter Sport, Valrhona
• Addressee
– Consumer: more hands-on communication via interactive games, music,
films, photos, see Balisto, Cote D’or, Hachez, Marabou, Milka,
Schogetten
• Figures provided
– Milka; Hachez explains online their wild cocoa de Amazonas charity
promotion
Relevance The Study Results
49
First insights and further research needs
• Awareness in the chocolate sector regarding social and
environmental problems related to cocoa production
• 20% of chocolate bars provide CSR related labels
(organic stores 50% if not counting bio-label)
• Most companies communicate their CSR involvement on their
websites though to a considerable different degree
• Open questions:
• What are the determinants that can explain chocolate firm’s
different efforts with respect to CSR and CSR communication.
• Which role plays CSR communication for stakeholders’
perception and decisions in the case of chocolate and what are
the influencing factors.
Relevance The Study Results