Third-party coalitions get seal of approval

It is not just Prime Minister David Cameron that needs third-party support, household brands are discovering that accreditations from independent organisations can be used to improve sales figures.

Simon Cowell has seen many wannabe stars stand before him at The X Factor auditions and proclaim that they are amazing singers, only to sound like a cat in pain when they attempt to hit the high notes. The entertainment entrepreneur’s job isn’t made any easier by the fact he doesn’t have an impartial person available to warn him of the truth about someone’s talents. Rejection swiftly follows.

Consumers face the same issue with corporate brands. Those companies that make bold claims about improving lives and the world through achieving environmental, ethical, or social milestones can face the same rejection – unless they look to accredit themselves through unbiased third-party authority.

As Mercedes Tallo, director of sustainable value chains for the Rainforest Alliance, puts it: “You can do as much good work as you like, but when it comes to communicating that, you need an independent, reliable voice to verify it.”

Third-party branding does not just have a positive influence on a brand’s external perception; aligning with the right authority can have a quantifiable effect on a brand’s bottom line. Many consumers now make purchasing decisions based on whether a brand has received third-party validation or not. In the US, 56% of consumers said the Energy Star efficiency logo was “extremely important” in considering what electrical appliance to purchase, according to Interbrand’s Brandchannel service.

Such is the power of the third-party mark that these seals of approval are developing their own brand reputations. The Kitemark logo, which is used in the UK for health and safety standards for products such as bicycle helmets and smoke alarms, has made it into the Top 500 Business Superbrands list for the third year running.

Most people need a shorthand to indicate whether a company is doing the right thing. The use of a logo shows brands are taking serious steps to reduce their carbon emissions.

Harry Morrison, Carbon Trust Standard

In a survey carried out by the Business Standards Institute (BSI), which runs the Kitemark scheme, 93% of people say they believe products carrying the Kitemark are safer than those without it. Claire Lynam, head of communications and alliances at the BSI, says: “A big percentage of the population actively looks for the mark. A number of our clients tell us that their business has increased since using the Kitemark, so it definitely pays off.”

Depending on what a brand needs from its accreditation, there is a third-party mark for almost every product and service. One strategy sees brands adopt a mark because it addresses a specific stance or agenda. For example, using Fairtrade accreditation shows that a brand is doing its bit to improve working conditions in the developing world.

Another strategy sees companies use third-party marks to demonstrate to consumers that their product has better attributes than its rivals. Organic brands might use one of a number of bodies’ badges to show that their ingredients have been certified as genuinely lacking chemicals.

Q&A with Euan Murray, Carbon Footprinting Company general manager at the Carbon Trust

Marketing Week (MW) What evidence is there that the Carbon Reduction Label influences consumer decisions?

Euan Murray (EM) In a study earlier this year, 86% of consumers said they wanted their favourite brands to help combat the threat of climate change by reducing their carbon footprint. Half said they actively seek information about the carbon impacts of the products they buy; half also said they would be more loyal to a brand if they could see it was taking steps to reduce its footprint.

MW As it becomes more common for companies to declare their commitment to reducing carbon emissions, are brands that don’t put a Footprint logo on their products losing out to competitors?

EM There is a clear reputational benefit to carrying the Carbon Reduction label. It gives brands an easy and effective way to communicate to customers their commitment to fighting climate change by reducing their carbon footprint. This is what has attracted major brands like Dyson, Kingsmill, Tesco and Walkers to it.

MW Do consumers really understand what the Carbon Reduction Label means?

EM We are working with a number of brands to increase recognition and understanding of the label. This includes busting some of the common myths about carbon footprinting so that consumers can make an informed choice on the products they buy. For example, transportation – unless by air – isn’t usually the major contributor to a product’s carbon footprint.

MW Does the Footprint logo change consumers’ perceptions of a brand?

EM For a lot of brands, the labelling process isn’t necessarily about changing perceptions from negative to positive. It’s about maintaining positive perceptions and brand loyalty. Therefore, not having the label (rather than having it) has the power to change consumer perceptions. The logo has been appearing on products for less than two years and market research has showed that one in ten shoppers recognise it. The logo is on over 5,000 products, so visibility is increasing all the time. 

Strategy: Using multiple third-party marks

The organic sector

Brands that want to market their products as organic are required by the EU to be accredited by an authority. These can include the Organic Food Federation and The Organic Farmers Association, but the most prominent is the Soil Association.

This is the mark of choice for brands such as chocolate brand Green & Black’s, which uses its organic status as its unique selling point. This is similar to children’s food brand Ella’s Kitchen, which has 100% organic status that head of marketing Nicole McDonnell says sets it apart from its rivals.

“We recently carried out a consumer survey to understand people’s thoughts on our hierarchy of messaging, from the brand itself to the logos on pack and the product names. We looked at what helps mums make their purchasing decisions,” she reveals. “What came out strongly was that they loved the fact they could glance at our products and know they are 100% organic. The Soil Association logo is the stamp of approval that gives piece of mind to our customers.”

Although McDonnell is clear on third-party accreditations playing a major role in marketing, she thinks there is a limit to how many endorsements should be displayed by brands. Too many and the impact is lost.

With this in mind, she says Ella’s Kitchen has chosen to work with the Soil Association and recycling company Terracycle, prioritising these ahead of endorsement from a vegetarian body.

In the same way, Green & Black’s has chosen not to use a vegan-endorsed label for relevant non-milk products in favour of the Fairtrade symbol. Innocent Drinks has multiple endorsements – from environmental standards to carbon footprints – but it chooses not to focus on them for fear of making its marketing too confusing.

While Innocent qualifies for the Carbon Trust Footprint label, it doesn’t use this on its products because it says that it would be information overload next to the nutritional values it lists. The firm says: “Working with the Carbon Trust was not about getting a symbol on pack that we can use as part of our marketing. We have tried to communicate our carbon footprint in a meaningful way on our website, which is a more complex picture than we could fit onto a label.”

McDonnell explains: “If you have lots of endorsements you are diluting your message and creating confusion on your packaging. The organic message is the most important one for us and that’s the one we have chosen to go with. What’s key for us is to make sure we are all about being pure and simple.”

But McDonnell says half of her consumers actively seek out the Soil Association logo when they are shopping, while the other half looks specifically for the Ella’s Kitchen brand, so the brand’s marketing messages must cater for both these segments.

Yet McDonnell feels that as a brand itself, the Soil Association accreditation could do better at building its own identity. She suggests that consumers still lack a comprehensive meaning of what that brand stands for. “I think people have a better idea of what something like Fairtrade means, but there is a lot of work to be done to educate and build awareness of what organic means to make the accreditation far more powerful. The Soil Association has a responsibility to mark out what that is,” she notes.

Fairtrade
Starbucks: Has used Fairtrade to improve the quality of its coffee

Strategy: Choosing between third-party marks

Fairtrade v Rainforest Alliance

Both the Fairtrade and Rainforest Alliance accreditations have seen huge brands sign up for their services over the past year. Cadbury signed up its Dairy Milk brand for Fairtrade, as did Nestlé for some of its KitKat line. Meanwhile, Mars Galaxy has opted for the Rainforest Alliance.

The two accreditations share some characteristics, including a supply chain assessment process, a requirement to pay a premium to accredited suppliers, strict guidelines for how the logos are used, and for what claims are made in a brand’s advertising.

But the two certifications stand for very different things. While Fairtrade focuses on paying a premium to suppliers in the developing world, Rainforest Alliance is about certifying environmentally sustainable farms and plantations. Fairtrade is also seen on a wider range of goods than its rival, with non-food brands including Bulldog, Body Shop and Lush signing up.

Fairtrade Foundation marketing director Cheryl Sloan says the power of the Fairtrade brand enhances what she calls “host” brands. But as the mark achieves success and signs up more brands to its scheme, this requires the brands to communicate fairly traded status with more than just highlighting the mark itself.

Twinings
Twinings: Has secured Rainforest Alliance accreditation

Sloan cites Starbucks and The Co-op as brands that have both leveraged Fairtrade successfully, but in different ways. “Starbucks is new to being an extensive Fairtrade partner and has done a good job at promoting this fact – using the logo in all stores and point of sale,” she says.

“It’s a good shortcut that consumers can immediately grasp and has had a positive brand impact on Starbucks. The Co-op has longstanding Fairtrade credentials and is strengthening its ethical story across different categories, as its ‘Blowing in the wind’ ad campaign demonstrates.”

Starbucks has become so close to its network of Fairtrade suppliers in South America and Africa that it is also fast becoming the brand of choice for farmers to work with. The coffee giant has set itself

up in these markets as a provider of agricultural advice and analysis and is well on its way to establishing a tight hold over its supply partners.

So not only has Fairtrade strengthened the Starbucks brand, but it has strengthened the quality of its coffee. “Our partnership with Fairtrade differentiates our brand and highlights the values that run through everything we do as a company,” claims Starbucks vice-president of marketing for UK and Ireland Brian Waring.

chocolate
The Co-op: Has leveraged its association with the Fairtrade mark

Galaxy chocolate, Twinings and PG Tips tea and Kenco coffee are among some of the high-profile brands to secure Rainforest Alliance certification. Mercedes Tallo, director of sustainable value chains for the Rainforest Alliance, says that while the organisation wouldn’t tell companies that using its seal will increase sales, there is some evidence that would indicate this.

“PG Tips and Kenco have seen double-digit sales growth in the past two years and you can argue that some of that is because they have done clever advertising, some of which highlights their association with Rainforest Alliance,” she says.

“There are plenty of good stories to tell and if you choose to communicate it you may see the benefits. If you have focused on the quality of your tea and coffee for years, and all of a sudden you have these great stories to tell that you can communicate with vivid imagery, it’s a good opportunity.”

For companies that do want to choose between Fairtrade and Rainforest Alliance, it seems that both marks have their supporters. Earlier this year, a Mars Galaxy insider told Marketing Week that each accreditation has its own values and they should not be compared but treated as addressing different issues. Rainforest Alliance has a more environmental focus, for example, while Fairtrade is well known from its strength on labour issues.

“It is quite difficult to attain Rainforest Alliance certification,” says the source. “The environmental standards are just as important as the social and economic regulations. Workers must receive a fair wage, have decent housing and health care and their children must have access to education. And farms are audited every year.”

Our source adds: “The far more urgent question consumers should be asking is why are there still companies selling chocolate products that don’t have any certified cocoa?”

For others, however, such as supermarket Sainsbury’s, the difficulty of obtaining a mark like Fairtrade is also its biggest draw. The focus on human rights and labour conditions means its message is very simple to get across to consumers in a meaningful way.

Justin King, chief executive of Sainsbury’s, which now sells more Fairtrade goods than any other global retailer, specifically supports the Fairtrade Foundation because he believes that works best for the business.

At the company’s first-ever UK Fairtrade and supplier conference earlier this year, King said: “I believe in fair trade for fair trade’s sale. But I also believe in fair trade because it gives my business a competitive advantage. I don’t see any disconnect in that.”

Strategy: Third-party endorsement on-shelf

Hovis
Hovis: Uses the Heart UK logo on pack to add another level of integrity to the brand

The health marks

With record cases of heart disease and obesity in the UK, health and nutrition can be contentious issues for food brands. There is much to gain for brands seen as helping consumers navigate this confusing area. As a result, this category is no stranger to the third-party labelling trend.

Bakery brand Hovis has chosen to bear the logo for a partnership with charity Heart UK to tap into concern among consumers about what they eat, while its rival Kingsmill has gone down the Carbon Trust Footprinting label route, Hovis believes that the largest business benefit for its brand is being associated with health.

Hovis has had its recipe and ingredients for a new bread line made with oats analysed by Heart UK. The charity now supports its marketing claim that the product can help maintain healthy cholesterol levels. Hovis has now taken its place alongside brands such as Kellogg and Flora, which also sell Heart UK-approved products.

Hovis marketing manager Claire Low says: “Using the Heart UK logo on pack adds another level of integrity and confidence to consumers. It has allowed us to use the expertise from Heart UK, which demonstrates our commitment to helping people manage their cholesterol. We are looking forward to working with it on sampling and PR activity. Launch plans are scheduled from June onwards.”

Food sector brands could align with a range of organisations once they establish what issues their consumers consider most important. Allergy UK endorses products it deems “allergy friendly”, claiming that 30% of the UK population will suffer from allergies at some point.

Vegetarian and vegan groups will also lend their approval to specific foods, while some retailers want to make clear that the fish they stock comes from a sustainable source.

In a move that could be classed as either controversial or clever, McDonald’s in New Zealand has gained WeightWatchers approval for some of its meals. It has leveraged the brand values of WeightWatchers to appeal to an audience that might have previously shunned the fast food outlet, gaining a new element to its own brand.

McDonald’s move has attracted criticism from health commentators, who say it is misleading. But if it is successful, it is an example of how third-party endorsements can give even the most unlikely brands the chance to flex their marketing muscles.

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