CSR, Branding & Consumers ( con’t .)

1. CSR, Branding & Consumers (con’t.) MBA 292 3.4.09 Professor McElhaney

2. CSR in the News • Deloitte Survey /White Paper Highlight the Growing Role of the Board in CSR and Climate Change • 220 directors at U.S. companies with $1 billion or more in revenue • 79% have a strong or moderate understanding of the business risks associated with CSR and climate change • 76% have a strong or moderate understanding of the business opportunities associated with CSR and climate change • 50% think their boards and management are committed to addressing CSR and climate change • 50% think their companies’ response to CR&S is integrated into business strategy and risk management • 41 % report no such integration

3. Mid-Semester check in • March 9   Guest speaker: Biz Stone, Twitter co-founder: Power of Social Technology • March 11          Corporate Green & CSR Strategy Analyses Due • March 16         Guest speaker: Mark Heintz, HP: Community/stakeholder Engagement • March 18           Mid semester project presentations • March 23-27      Spring break • March 30           Limitations of CSR • April 1               Guest speaker: Michael Kobori, Levi Strauss & CO: Opportunities in Supply Chains • April 6              CSR, change management, and organizational structure • April 8               Social Intrapreneurship • April 13             Guest speaker: Matt Kistler, Wal-Mart: CSR & Leadership • April 15             CSR and Innovation • April 20             DeBeers Case • April 22             Practice presentations • April 27             Final presentations • April 29             Final presentations • May 4               Final presentations • May 6              Final presentations • May 11 CSR Elevator Pitch, PSRs, Wrap Up

4. Mid-Semester check in • Key Learnings? • Missing Pieces?

5. McElhaney’s Seven Principles of CSR & Branding • Know Thyself • Get a Good Fit • Be Consistent • Simplify • Work from the Inside Out • Know Your Customer • Tell Your Story

6. Pedigree: Enhances Brand

7. Sign in Dreyer’s Ice Cream Scoop Shop, Berkeley, CA

10. CSR & Consumers Doing the right thing for the Greater Good. Purchases, non-purchases, voting & volunteerism. Journey that begins with attitude change, then behavioral changes. Hartman, 2009

11. CSR & Consumers • Consumers must first be concerned that something they value (condition of environment, economy, ethical treatment of others) is at risk • More recently, sense of hope for the future and a desire to do and feel good more inspiring

12. CSR & Consumers

13. Outsiders 12%

14. Insiders 88%

15. Insiders 88%

16. Highest Product Categories: Food & beverages Personal Care Household Cleaners Consumers Care If It’s… In me, On me, Or around me (or my kids).

17. Knowing your Consumers -Shaping the New Rules of Competition, UN Global Compact Participant Mirror, GS Sustain, Highlights from the BBMG Consumer Report

18. Knowing your Consumers • Females (employees, consumers, investors) • Millennials/Gen Y’ers Ages 8-24 (cause focus) • LOHAS/ Ethical Consumers • More educated • More diverse (gender, sexual orientation, ethnicity) • More affluent (enter Walmart) • Want to be engaged, want to perform quick action

19. They’re Focused on Recycling & Local Shopping Source: Co-Operative Bank, 2006 Ethical Consumerism Report

20. Conscious Consumers • More likely to buy from companies that: • Manufacture energy efficient products (90%) • Promote health & safety benefits (88%) • Support fair labor & trade practices (88%) • Commit to enviro-friendly practices (87%) Source: MORI 2008

21. Millennials(ages 8-24) 89% said they are likely to switch brands if linked to cause 83% will trust company more if socially responsible 79% want to work for company that case about and contributes to society 78% believe that companies have responsibility for making a difference in the world 74% more likely to pay attention to a company’s overall messaging when they see that company has deep commitment to cause they care about 69% consider companies’ CSR reputation when deciding where to shop 61% feel personally responsible for making a difference in the world 56% would refuse to work for an irresponsible corporation Source: 2006 Cone Millennial CauseStudy

22. They’re LionessesSource: P. Diddy

23. The “Lioness Factor”

24. The Queen Lioness: Oprah

25. CSR Opportunity: The Power of Women WOMEN more likely than men to: Volunteerin their local communities Investigatea company’s environmental/ social reputation before making a purchase Investin companies screened for different criteria including environmental practices, the hiring and promotion of women and minorities, labor practices and tobacco manufacture Factor CSR when job-searching Purchase a product with a percentage of profit earmarked for charitable donation Participatein company sponsored social programs

26. The Power of Women More likely than men to: Indicate that it is important to ensure that workers inside and outside the U.S. are paid a living wage(68 percent versus 57 percent). Give corporations a “poor” rating for current CSR performance (18 percent versus 11 percent of men). Men are far more likely than women to rate companies as “excellent” or “good” (31 percent versus 13 percent, respectively). Indicate that it is extremely important for companies to make relevant donations to charities and philanthropies(27 percent versus 19 percent, respectively). Source: Fleishman Hillard – National Consumers League Study, “Rethinking Corporate Social Responsibility,” 2006

27. WOMEN: A Desirable Market Segment Women make over 80% of purchasing decisions in the United States (and influence most others) Women are less likely to act impulsively on brand loyalty, and are more likely to do research and weigh information before making purchases Source: Faith Popcorn and Lys Marigold, 2000

28. March 2008, Goldman Sachs launched new initiative • Will provide 10,000 women in developing countries and emerging markets with educational opportunities in business & management • Partnership with American & European universities • Will contribute $100 million over five years, plus time & effort of employees

29. CSR Must Be Integrated Into Branding Strategy • Cannot be a stand-alone branding strategy • Has to mirror current (or new) branding attributes • Has to be combined, and linked to, price, quality, convenience • Has to be linked to “Good for You” [consumer] first, then can expand to rivers, labor, climate • Will not be effective unless communicated, throughout marcomm channels, and at POS

30. CSR & Voids

31. CSR & Hope