Inside USD

Boosting the Bottom Line with Social Branding

Friday, September 18, 2009

socialbrandingmainEven in recessionary times, companies can do well by doing good,  speakers said at a conference Friday at the University of San Diego.

“Increasing Market Share through Social Branding” was the theme for the second annual Peace and Prosperity through Trade and Commerce Summit, sponsored by USD’s Ahlers Center for International Business and the World Trade Center San Diego.

“When companies are aligned with a cause, 90 percent of consumers will consider switching brands, and 82 percent say they are not as price sensitive,” said Jake Kloberdanz, chief executive officer of ONE HOPE, a lifestyle brand whose cornerstone product is wine and whose mission is to donate 50 percent of the profits for each product in its portfolio.

But a good product is still a requirement for success, he added. “You sell the first bottle because they like the cause and the first case because they like the wine.”

Making a commitment to social responsibility isn’t always easy, said Dennis Macray, who oversees initiatives for company-wide ethical sourcing at Starbucks Coffee. The company has made a commitment to have 100 percent of its coffee responsibly grown and ethically traded by 2015, but it means monitoring a complicated supply chain of growers, buyers and distributors. Starbucks is currently the largest purchaser of Fair Trade Certified Coffee, he said, and has developed a set of guidelines and scoring on topics like child labor, wages and environmental practices.

Starbucks has been closing stores and seeing revenue declines in recent years, although its stock price is on a rebound and hit a 52-week high on Friday. Macray said the challenges of the last few years haven’t prompted Starbucks to retreat on its environmental and social commitments; in fact, it has “doubled-down” on them as it refocused on its core mission and values. For example, the company aims to achieve Leadership in Energy and Environmental Design (LEED) certification for all new company-operated stores beginning in 2010, he said.

Starbucks didn’t wait to become a big company before fostering a commitment to social responsibility, something speakers encouraged the audience filled with students to consider as they start their own firms.  They also said that if students have a great idea for a new firm, especially one  that combines passion with profits, they should consider starting it even before they leave school, where a network of resources from fellow students and professors is readily available.

“School is the best place to start a company,” said Priya Haji, chief executive officer and co-founder of World of Good, a company that connects shoppers with ethical buying opportunities through companies like Whole Foods and eBay.

— Liz Harman

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