Arnold on ethical marketing

CHRIS ARNOLD

They are just a few of the major brands that feature at the two ends of the Ethical Reputation Index. Karen Fraser (who founded the ERI – one of the longest running tracking studies of consumer’s opinion of brands and their ethics) gave marketing directors a lot think about at the London Business Forum this week. From an insight into the ‘conflicted consumer’ to advice on how not to trash your brand reputation.

As if there isn’t enough choice about, now we have to make ethical decisions too. Do I buy a cheap t-shirt from Primark or the more expensive ethical one? Can I even find somewhere to buy one? What if I have to drive 10 miles to get there?

But there’s another conflict consumers face and Fraser has christened it the ‘conflicted consumer’. 25% of consumers may appear loyal but in fact they aren’t happy buying from certain brands. Given a more ethical option they would switch. Unfortunately many consumers don’t feel they have an option. It highlights the need for complacent brands to wake up and start to take ethics seriously and to monitor exactly what consumers think about then. (Not just rely on marketing spin and green wash.)

One area in the supermarket that has been challenged is instant coffee. Dominated by Nestle, FFI (the largest producer of Fairtrade coffee) has launched Fair Instant. The product is priced at the same level as Nescafe (not the standard 30% more). They also donate 20p to Save the Children for every jar sold. Not surprisingly they are one of the fastest growing brands in sector.

Fraser sighted an interesting test in the US where two identical towels were sold side by side. One was labelled  ‘FAIR & SQUARE’ and sold as an ethical towel. Both were the same price. The Fair & Square sold best, even when the price was raised. 26% of people are prepared to pay more for ethical goods.

More than ever, consumers are discussing brand reputation with each other, bad news spreads fast. No matter how glossy the green wash ads are, the truth cuts through. Consumers are smart and not easily misled. The internet has seen to that.

Top of the list are Boots (trusted as part of our establishment), Body Shop and the Co-op (both built around an ethical ethos and values) and M&S (delivering the promise).

Bottom are McDonalds and Burger King. But surprisingly, just above the bottom is BSkyB. This may puzzle a few people because Sky have invested heavily in environmentalism – from set top boxes that turn off to school projects. Alas, the other side of Sky is an aggressive dominance of the market, grabbing TV content – especially sport - and selling it back to us. It may be good business for them but the public resents it. People come before planet.

One of the new growing ethical issues (and there and over 50 ethical values I use working with brands) is data. Consumers are becoming more concerned about what data is held and its security – our confidence is not helped by incompetent authorities losing discs weekly. Equally concerning is how data is invading our privacy – it has been said that Tesco’s knows more about you than Mi5.

Although everyone is talking ethics, and especially green, the customer wants it easy. Gone are the days of sacrifice, convenience green is what’s desired. But ethics still comes with a higher price tag, which is OK for the ‘eco elite’ but for the average consumer presents a dilemma and begs the question, “is it ethical to charge more for ethical products?”

One driving message to brands was honesty. Don’t lie. Don’t over claim. It’s not the talk but the walk that defines what customers think of you. M&S now top the ERI, not just because Rose has promised to make M&S a good citizen but because customers can see it in action – they are delivering against their promise. Unlike some brands that are more talk.

You only have to look at oil companies (my favourite target). BP has tried to redefine itself as Beyond Petroleum. It has a nice flower as its logo. Although it fairs better than Shell, it’s still an oil company and after millions of dollars spent of advertising, it’s name is still the colour of oil.

But simple actions, like Ariel’s wash at 30 degrees campaign, has raised customer perception of the brand.  It’s a simple action that also demonstrates Aerial’s washing power.

Consumers want to know that brands are taking responsibility and caring for people and the environment, especially people. The days when you could make a brand look good through advertising are long gone – the public sees right through it. In fact the word brand is an outdated term. Reputation is the key word. It’s more important as  a term as it’s what the City uses. And if you screw up your reputation you could be damaging not just your market share but your share value.

The London Business Forum have a forthcoming event featuring Green & Black that I recommend.  Details on their site – www.londonbusinessforum.com.

For more about the Ethical Reputation Index visit www.ethicalreputationindex.com.