COMMENT: Starbucks - keeping coffee kind
Starbucks' decision to modify its corporate philosophy is clearly in recognition of recent public relations problems caused by lobbying from pressure groups. The move reflects the growing influence that pressure groups and consumer values can have in shaping the marketing direction of packaged goods players.
Starbucks' plan seeks to ensure that coffee sold in its world stores comes from environmentally-friendly farms paying workers a fair wage. Currently, only about 10% of its coffee is bought from suppliers following such rules. However, under the new plan, Starbucks expects that 60% of its coffee will come from ethical production practices by 2007.
Protecting its ever-expanding empire of 8,500 coffee shops from consumer boycotts and negative publicity has become routine for Starbucks. The chain is often targeted by activists protesting the negative implications of globalisation: in 1999, protesters at the World Trade Organisation meeting in Seattle trashed a Starbucks store.
More recently it lost a substantial amount of business in the UK during a campaign by the charity Oxfam, which highlighted the global coffee crisis and problems associated with unethical production. Since then, the company has entered into a partnership with Oxfam to work on a rural development program in a coffee-growing region of Ethiopia.
Oxfam itself continues to fervently champion the movement towards ethically-produced coffee. This week sees the charity group open the first in a chain of fair trade coffee shops in the UK, with the stores appearing under the name Progreso.
Oxfam's move is the result of collaboration between the charity and coffee cooperatives in Ethiopia, Honduras and Indonesia. The venture aims to redress the trading balance by giving the three cooperatives a 25% share in the business.
There is mounting pressure on firms to act with, or at least present an image of, corporate social responsibility. This implies a greater emphasis on the need for products and services to fit in with and reflect the lifestyle and ethical choices that consumers wish to make.
With non-corporate organisations championing ethical consumerism ever more proactively, it seems inevitable that industry players will continue to seek partnerships with external groups that will assist in satisfying a broad range of stakeholders' ethical concerns. It seems both Starbucks and Oxfam have been shrewd enough to realise that there is a need to cater for the socially-conscious coffee drinker.
Sectors: Soft drinks
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