Introduction
The Dannon Company, which is a well known organization in food industry, has been providing outstanding products and services for quite a while. Moreover, the organization has been famous for its rigid set of ethical principles, as well as its compliance with the above-mentioned rules. However, in the wake of global economy, the company needs to attract as many customers as possible in order to stay competitive.
For these purposes, it was decided put a stake on the organization’s consistent use of corporate social responsibility (CSR) as a “marketing ploy” (Marquis, Shah, Tolleson & Thomason, 2004, p. 1). However, many view the above-mentioned decision as a step backwards in employing the organization’s ethical principles and even as a betrayal of its beliefs and values.
Although the use of corporate values in promotion seems unacceptable at the moment, the company should consider integrating the mentioning of its corporate values into the advertisement, yet doing so in a smart manner that gives credit to the target audience as intelligent and does not rub the message in.
To Communicate or Not to Communicate?
Choice
It seems that Dannon will need to communicate its CSR in order to prove that its services are going to be outstanding. Indeed, when defining the characteristic feature of the company that makes it distinguishable among the rest of similar corporations, one must mention the total responsibility management approach that the firm has defined as its foundation (Waddock & Bodwell, 2007).
Therefore, it is reasonable to assume that Dannon should put its stakes on the above-mentioned feature in order to pose itself as competitive in the target market.
Risks
As it has been stressed above, though, Dannon needs to be very smart about mentioning its corporate values in its advertisement, as the audience will immediately recognize insincerity in the message sent in the advertisement, and the organization will be doomed.
In case the target customers do not believe the company’s intentions, the latter is likely to lose both the money that it will spend on the promotion campaign and a range of its loyal customers. Moreover, some companies may refuse to become Dannon’s partners in the above-mentioned scenario due to the possibly dubious reputation of the organization in question. Therefore, the risks that the firm is facing at present are rather high.
Benefits
The benefits of the above-mentioned choice are also quite obvious. First, by putting a strong emphasis on its CSR in the advertisement, the organization will set itself a mile apart from other companies, which do not claim to base their key processes on the concept of CSR (Werther & Chandler, 2012). Another significant benefit, which the declaration of Dannon’s CSR approach will lead to, the possibility for attracting new customers in case of the promotion being made in a smart manner, deserves to be mentioned.
Corporate Parent
Even though the idea of the company promoting its CSR initiatives in order to gain more attention from potential customers might seem as a cheap ploy for attention, the positive impact, which the specified step may lead to, is still beyond impressive. The outcomes for the company’s corporate parent should be taken into account prior to making the above-mentioned choice need to be analyzed first, though.
Defined as the person or entity outside the business that is responsible for making corporate choices, the corporate parent plays an essential role in the process of company’s operations: “The corporate parent is defined as the corporate hierarchy of line managers, functions, and staffs outside the business of a multi-business company” (Krühler, 2012, p. 14).
To a certain degree, a corporate parent defines the existence of an organization. Therefore, the choice made by Dannon as the pivotal one in the history of its operations can be viewed as crucial to the corporate parent, who defines the future of the organization.
As it has been stressed above, the decision to mention the company’s outstanding use of CSR in the promotion campaign may result in a stellar increase in profits. Therefore, in case of a positive outcome, the corporate parent of the organization is most likely to benefit significantly as well. Therefore, the corporate parent of Dannon will need to consider the process of the promotion campaign design and implementation in order to represent the organization as a responsible and honest firm and not as an annoying attention seeker.
Impact of a Corporate Parent
As it has been explained above, as the key decision-making body in the corporate mechanism of the organization, the corporate parent of Dannon defines not only the reasonability of the program in question, but also its implementation. In case the promotion campaign that uses Dannon’s CSR as the key advantage of the organization seems far too risky, the corporate parent may decline the idea of using CSR in Dannon’s advertising at all.
The power to have the final vote in the identification of the company’s further progress, therefore, is what makes the role of the corporate parent crucial in Dannon’s case. The corporate parent may cancel the use of CSR in the promotion campaign altogether, therefore, reducing the threat mentioned above to zero.
The use of the corporate parent defines the communication patterns that the organization will have to adopt in order to reach the target customer. On the one hand, the benefits of having a corporate parent and allowing it to affect the company’s communication plans are obvious. By making the final decision, the corporate parent takes all responsibilities and accepts the risks that the company may face.
Additionally, by allowing the corporate parent to make the choices related to the key promotional processes, Dannon’s managers will be capable of focusing on the production process and the quality of the goods and services produced. In other words, the issues related to the improvement of the staff’s performance, the enhancement of motivation and engagement rates, quality control, information analysis and its further transfer, etc. will be dealt with while the corporate parent makes the choices related to the promotion process.
As a result of relocation of responsibilities, the Dannon Company may become even more efficient in the target market owing to the interference of the corporate parent (Johnson, Scholes & Eittington, 2012).
However, the use of a corporate parent as one of the key decision-makers also has its problems. Particularly, the corporate parent is most likely to be unaware of the specifics of the key organizational and production processes, as well as the current allocation of financial resources, the budgeting issues, etc.
Therefore, the choices made by the corporate parent may disrupt the system of the organization’s operations, including not only the promotion of a product, but also the production thereof, not to mention several essential financial concerns emerging as a result of the corporate parent’s actions.
The specified threat becomes especially tangible once the issue of CSR factors in. Being unaware of the attitudes towards the company among customers and the target audience, the corporate parent may make the decision that will impede Dannon’s progress in the target market and, worse yet, makes the company lose its loyal customers.
The Communication Strategy
As it has been pointed out above, in order to approach the target customers in a proper manner by emphasizing the company’s CSR and at the same time retaining the firm’s integrity and ethical principles, Dannon will need to deploy a specific communication strategy based on openness and transparency. The firm will have to show its target audience that Dannon trusts its customers and values them.
Therefore, it will be implied that the organization recognizes its decision to use the CSR principle as the basis for the promotion campaign as risky, yet still uses it, as it considers its customers smart enough to understand Dannon’s true intentions. Conveying the above-mentioned idea through a short promotion campaign is quite tricky, as a wink at the camera will not serve as a legitimate hint. Therefore, the organization will have to make a rather bold statement that shows the company’s awareness of the power of CSR as a promotion tool.
Conclusion
Despite the fact that the approach adopted by the company towards maintaining its corporate values and complying with the corporate ethics principles, a compromise must be made between targeting new customers and following its ethical principles. In order to carry out the task in question, the organization will have to assume that its customers are smart enough to give the company credit for its transparency and openness.
It would be wrong to claim that the choice made by the company is going to have an impeccable effect on its overall progress; quite on the contrary, it is expected that some of the customers will not be able to give credit to the company’s openness and transparency, considering the mentioning of the CSR approach a mere act of bragging. Thus, some clients may dismiss Dannon as a possible provider of high quality goods and services.
In addition, the act that the company’s’ corporate parent may gain too much influence over the firm’s key processes should also be viewed as a palpable threat. While the company could use certain assistance in managing some of its issues while its staff could focus on the production process, the marketing issue still seems to have far too great an effect on the overall status of the organization for Dannon to allow a parent company to take complete control thereof.
Despite the aforementioned issues, Dannon still needs to consider the possibility of using its CSR principles as a means of attracting new customers, at the same time allowing a parent organization to handle the related risks. Thus, Dannon will finally have an opportunity to test its brand product and become more popular within new markets.
Since expansion is essential in the contemporary global environment, Dannon will need to use all resources available for promoting itself in the realm of global economy. As CSR is one of Dannon’s doubtless qualities, the company should use it as its competitive advantage in further promotion.
Reference List
Johnson, J., Scholes, K. & Eittington, R. (2012). Exploring corporate strategy: Text and cases. Prentice Hall, NJ: Pearson Education.
Krühler, M. (2012). Managing business portfolios effectively: On the explanatory power of the parenting advantage concept. New York, NY: Springer Science & Business Media.
Marquis, C., Shah, P., Tolleson, A. & Thomason, B. (2004).The Dannon Company: Marketing and corporate social responsibility. Boston, MA: Harvard Business School.
Werther, W. B., Jr. & Chandler, D. (2012). Strategic corporate social responsibility: Stakeholders in a global environment. Thousand Oaks, CA: SAGE.