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Is good karma good business? A communication analysis of hummel’s corporate social responsibility in a marketing perspective Bachelor Thesis in Marketing and Management Communication Rasmus Frost Hansen Exam no. 302095 Characters: 54.315 Abstract This paper seeks to identify the degree to which hummel uses CSR-communication on their website to help consumers differentiate the company from its major competitors. The purpose of this study is to see if the communication of corporate social responsibility to consumers provides hummel with a competitive advantage. This will be done through analysis of the contemporary consumer situation, CSR’s relation to business and a communication analysis of hummel’s website. Theories within consumer behaviour and postmodernism, CSR, marketing, and multimodality will form the basis such an analysis. The results show that hummel emphasises interpersonal relations with the consumer when communicating its corporate social responsibility, which is interpreted to help the consumer differentiate between hummel and other sportswear brands. Further research of hummel’s CSR-communication in other media is encouraged, because it can give a more integrated perspective of hummel’s marketing communications. Analysis of hummel’s competitor’s CSRcommunication can also reveal if hummel’s approach is unique within the apparel and sportswear industry. Table of Contents Introduction ....................................................................................................................................................... 1 Problem statement ......................................................................................................................................... 2 Theory of science .......................................................................................................................................... 3 Choice of theory ............................................................................................................................................ 4 Method........................................................................................................................................................... 4 Structure ........................................................................................................................................................ 5 Validity .......................................................................................................................................................... 6 Delimitation ................................................................................................................................................... 6 Analysis ............................................................................................................................................................. 7 Consumer situation ........................................................................................................................................ 7 The postmodern consumer......................................................................................................................... 8 Sub-conclusion: Consumer situation ........................................................................................................... 11 Corporate social responsibility (CSR) ......................................................................................................... 12 Defining CSR .......................................................................................................................................... 12 Sub-conclusion: CSR-approach .................................................................................................................... 14 Motivation for CSR-engagement............................................................................................................. 15 Sub-conclusion: CSR motivation .................................................................................................................. 17 Hummel’s online CSR-communication ....................................................................................................... 18 Presentation of hummel Karma United ................................................................................................... 18 hummel’s CSR-activities ......................................................................................................................... 21 hummel’s persuasive appeals................................................................................................................... 26 Karma structure ....................................................................................................................................... 26 Sub-conclusion: hummel Karma United ................................................................................................. 27 Conclusion ....................................................................................................................................................... 28 Discussion........................................................................................................................................................ 28 Sources ............................................................................................................................................................ 30 URL-sources ................................................................................................................................................. 32 Appendix ......................................................................................................................................................... 33 Competition and marketing strategies ..................................................................................................... 37 CSR-review ................................................................................................................................................. 41 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Introduction In the competition for consumers’ attention, money and loyalty, it is necessary to be different from competitors, because as Kotler et al., (2009, p. 360) explains “no company can be successful if its products and services resemble every other product and offering. Corporations and especially marketers seem to be aware of this, which may be why the marketing industry seems to have had a large influence on modern societies. Now, since the economic crisis appears to challenge companies to work even harder to make a profit, it is interesting to see how companies use marketing communication to secure or improve its position in the marketplace. Also, the debate about global warming and sustainability seems to have made consumers more concerned about corporations’ responsibility towards their external environment. Insight to how communication of corporate social responsibility is communicated as a means of differentiation is therefore considered beneficial, because it may provide corporations with knowledge that can help them compete better in the marketplace. Since the industry of apparel and sportswear is affected by fierce competition1, it is interesting to see how smaller players on the global market use and communicate corporate social responsibility (CSR) in order to stand out in the eyes of the consumer. With this in mind, hummel is in this thesis used as a case of such analysis, because its position in the global market appears to be relatively small, but still significant in its home market (Denmark) and large parts of Europe. Furthermore, CSR is recognised as a tool in terms of marketing public relations (MPR), because it seems to help corporations in “the process of planning, executing and evaluating programmes that encourage purchase and consumer satisfaction through credible communications of information and impressions that identify companies and their products with the needs, wants, concerns and interests of consumers” (Harris, 1993 ctd. in Pickton and Broderick, 2005, p. 555). Hence, CSR-communication is viewed as a way for hummel to market itself and its products to consumers, and thereby develop a potential competitive advantage. Then, according to Solomon, Barmossy, Askegaard, and Hogg (2010, p. 8), it is important to know who the consumer is, because “understanding consumer behaviour is good business”. It is good business, because corporations are to satisfy consumers’ needs and wants, which is one of the most basic assumptions within marketing. According to the American Marketing Associations, marketing is“the activity, set of institutions, and processes for creating, communicating, delivering, 1 See appendix: Market Analysis Rasmus Frost Hansen Page 1 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 and exchanging offerings that have value for customers, clients, partners, and society at large”2. Hence, by understanding consumer behaviour, it is possible for companies, including hummel, to deliver value to consumers and other stakeholders, which is assumed to determine hummel’s success in the marketplace. Next, research of CSR’s role in companies’ attempt to deliver and communicate value to consumers may reveal why corporations engage in CSR. According to Kapoor and Sandhu (2010, p. 186), with regards to CSR, “an organisation simply gives back to the society what it has gained from it, to receive it again in the form of increased demand for its products and services and higher mobilisation of funds from the market”. Thus, communicating socially responsible practices to consumers is viewed as a marketing tool, because being socially responsible seems valuable to those affected by corporations’ practices. The communication of CSR may therefore improve the performance of the company, too. Then, it is interesting to see if hummel makes use of the business potential CSRcommunication is assumed to have, and if it persuades the consumer to evaluate hummel positively. Hence, this thesis is concerned with the contemporary consumer context and corporate social responsibility in a marketing perspective. Problem statement To which degree does hummel use CSR-communication on their website to help consumers differentiate the company from its major competitors? In order to answer the problem statement of this thesis, some research questions will be answered, too. 1. What characterises the contemporary consumer situation? a. How can hummel benefit from this knowledge? 2. What is corporate social responsibility, and how does hummel communicate it online? a. What motivates corporations to engage in CSR? b. Which communicative elements characterise hummel’s CSR-communication, and what are their potential effects? 2 http://www.marketingpower.com/aboutama/pages/definitionofmarketing.aspx Rasmus Frost Hansen Page 2 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Theory of science This thesis is based on the scientific concept of philosophical hermeneutics, which is explained by Gadamer (1975, ctd. in Skinner, 1986). Gadamer argues that “understanding is not a matter of trained, methodical, unprejudiced technique, but an encounter in the existentialist sense, a confrontation with something radically different from ourselves" (ctd. in Skinner, 1986, p. 24). The argument suggests that no one can be 100% unprejudiced and open minded, and thereby understand the true meaning of a text, as intended by the author. Moreover, Gadamer’s approach relates well to the hermeneutic circle, because the pre-knowledge/preconceptions of the hearer are considered fundamental in terms of interpretation and understanding. So, according to Gadamer, “Understanding is not a matter of forgetting our own horizon of meanings and putting ourselves within that of the alien texts or alien society; it means merging or fusing our own horizon with theirs” (Skinner, 1986, p. 25). The scientific approach of this thesis will therefore not seek to identify one single truth, but look into how readers may understand and interpret the messages in hummel’s CSR-communication. The communication between hummel and the consumer helps create a mutual understanding about the company, since the speaker/sender and listener/receiver continuously interacts and influence each other. However, Gadamer’s philosophical hermeneutics does not offer a clearly stated methodology, since “(...) understanding is (…) an encounter in the existentialist sense (…)”. Hence, interpretation is not a method of understanding, but a premise of existence. This means that we cannot understand texts in a completely objective manner, because our pre-knowledge/prejudices determine how we interpret messages. Then, regarding hummel’s CSR-communication, it can be argued that hummel and the consumer fuse horizons to understand what hummel is and what it stands for, which can be used as a way for hummel to help the consumer distinguish between hummel and its competitors. Hence, by communicating in a specific way, hummel may be able to persuade the consumer to take a positive stand towards the company. However, it is possible to analyse the CSR-communication of hummel’s website by the use of communication theory. This will then offer insight into what the messages of the CSRcommunication can be interpreted to mean, even though there is no single truth. Finally, the view on the theories and the interpretation of hummel’s online CSRcommunication is considered positivistic. Based on inductive logic, a valid insight is provided, because the various theories and their applicability to hummel’s case are critically addressed. The Rasmus Frost Hansen Page 3 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 theories are not sought to be falsified, but a significant amount of theoretical perspectives are taken into consideration in order to make a valid conclusion in this thesis. Choice of theory The theories used in this thesis first concern consumer behaviour and postmodernism, because they clarify the context within which hummel communicates. Next theories within the field of corporate social responsibility are applied to reveal why hummel communicates CSR. Then a multimodal analysis of hummel’s CSR-communication takes place via the use of theories within the field of visual and textual communication, to show how the consumer is sought to be persuaded by hummel’s communication. Finally, marketing theories provide the scope of this thesis in order to reveal the value of communicating CSR. Method The overall method of this thesis is based on interpretation, because a single truth is not sought to be identified, but the theories used will support the interpretation process in order to provide an understanding of hummel’s CSR-communication. Various scholars will form the theoretic approach of this paper within the fields that concern: 1) The consumer context (consumer behaviour and postmodernism). As a point of departure, consumer behaviour insights from the work of Solomon et al., (2010) are used. Then, Reed et al., (2012) reveals how consumers see themselves, and presents consumption’s relation to the consumer’s shaping of identity(ies). Furthermore, Holt (1997) clarifies the characteristics of consumption patterns and lifestyles. Then, Brown’s (1992) definition of postmodernism is taken into consideration, where the characteristics postmodernism are presented. Brown also reveals that general marketing concepts are challenged by the postmodern trend. Next, Firat and Venkatesh’s (1993) conditions of postmodernism are used to give insight in today’s consumer situation, from which fragmentation and hyperreality are found relevant for the work of this thesis. Furthermore, Simmons (2008) acknowledges that there are difficulties for today’s marketers when targeting the postmodern consumer, but also provides marketing insight that may help the marketer be more successful in the contemporary consumer context. 2) The various definitions of CSR are taken into consideration to frame the perspective on CSR in this thesis. First the view of the public relations scholars, Tench and Yeomanns (2009) defines CSR in terms of its relations to stakeholders. Preble’s (1995) definition of a stakeholder is used in this thesis, because it specifically determines the characteristics of a stakeholder and gives Rasmus Frost Hansen Page 4 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 insight to the different kinds of stakeholders on organisation may have. Then McWilliams et al., (2006)’s definition of CSR is used, because it is developed through the critique of various schools of thought3. McWilliams et al., (2006) also gives room for discussion about the pros and cons related to CSR. Then, Carroll’s (1991) pyramid framework reveal the various responsibilities corporations need to live up to in order to be considered a socially responsible organisation. Next, Lii and Lee (2011); and Galbreath and Shum (2012) reveal some of the possible motivations corporations may have for engaging in CSR-activities. CSR is by Luo and Bhattacharya (2006) argued to affect reputation and quality of a company’s products and services. Finally, Lewis (2001) gives insight to the role of the consumer with regards to companies’ social responsibility. 3) The visual part of the multimodal analysis of hummel’s CSR-communication is based on the work of Kress and van Leeuwen (2006), whereas the textual elements are mainly analysed through the theories provided by Stillar (1998). However, based on Aristotle’s work, Kies (1995) and Corbett (1999) support the multimodal analysis by providing insight to the rhetorical appeals in hummel’s CSR-communication. 4) The marketing perspective is primarily provided by Kotler et al., (2009), because he has collected the many theories within the field of marketing to give an overview. With this perspective in mind, it is possible to identify how hummel can help the consumer differentiate hummel from its competitors. The choices for the used theories and their contribution in answering the above problem statement are accounted for in the analysis section of this thesis. Structure This thesis takes its point of departure in the contemporary consumer situation to clarify the challenges hummel and other corporations face when targeting their marketing communication towards the consumer. Next, the theories regarding corporate social responsibility are accounted for in order to show its relation to business and why it is used. Then a multimodal analysis of hummel’s website is carried out to give an understanding of the degree to which it communicates CSR, and if this helps the consumer differentiate between hummel and competitors. 3 See Appendix: CSR review Rasmus Frost Hansen Page 5 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Validity The findings of this thesis are considered valid, because according to Fowler and Aaron (2010, p. 604), “new knowledge is created when connections between different sources’ ideas and work are inferred”. Hence, the use of theories within the various schools of thought (consumer behaviour, postmodernism, CSR and marketing) help create new knowledge. In addition, Fowler and Aaron (2010, p. 775) state that “a research paper interprets and sometimes analyses and evaluates the writings of other social scientists about a subject”. With regards to the methodology of this paper, interpretation of the various scholars’ work takes place to apply it to the case of hummel’s CSRcommunication. Hence, the conclusions of this paper are considered valid to support the field of CSR-communication and its relations to marketing. Delimitation This thesis is focusing on how hummel uses online CSR-communication on its website, www.hummel.net, to help the consumer differentiate between hummel and its competitors. Due to the limitation of this paper, analysis of competitors CSR-communication will not take place. Then, due to the constant development of the internet, the content of hummel’s website has changed since the work on this thesis began. Some changes have taken place on the front page of hummel’s website, but the analysed elements remain the same, both on the front page and the Karma page. Rasmus Frost Hansen Page 6 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Analysis Consumer situation In order to understand hummel’s context, it is important to study consumer behaviour. Consumer behaviour is “the study of the processes involved when individuals or groups select, purchase, use or dispose of products, services, ideas or experiences to satisfy needs and desires” (Solomon et al. 2009, p. 6). With this knowledge, hummel may be more likely to satisfy consumers’ needs through its marketing activities. hummel will, to a higher extent, know how to market its products when consumers’ behaviour is interpreted (Kotler, Keller, Brady, Goodman, and Hansen, 2009, p. 333; Pickton & Broderick, 2005, p. 10). Then, to understand the contemporary consumer and her behaviour, it is beneficial to know how the consumer sees (understands) herself, how identities are shaped and to look into postmodernism. First, according to Reed, Forehand, Puntoni, and Warlop (2012, p. 310) “It is a fundamental human drive to understand who one is, what one believes and what one does”. In addition, acting according to the understanding of oneself produces identity driven effects. These are effects “(…) including increased attention to identity-related stimuli, a preference for identity-linked brands, more positive reactions to advertisements featuring spokespeople who possess the desired identity, the selection of media catering to the identity, the adaption of behaviours linked to an identity and biased attention toward identity consistent memories”. Thus, hummel can benefit from the knowledge of consumer behaviour, because by appealing to identity driven effects, it is possible to persuade consumers via marketing activities. Moreover, Reed et al., (2012, p. 312) argues that “identities can be anchored in different types of referents: objective membership groups (e.g. gender or family), culturally determined membership groups (e.g. ethnicity and religion), abstracted role ideals (e.g. mother, friend, philanthropist), groups premised on association with a known individual (e.g. a graduate advisor), with an individual who is not known personally (e.g. Tiger Woods), or with dimensions of self that are indexed by an imagined other. Hence, the consumer’s identity can be anchored in e.g. sportswear, which means that when consumers purchase hummel’s products they express a certain part of their identity. Next, Holt (1997, p. 335) argues that “lifestyles are shared consumption patterns, and that social meanings are established when people consume the same category of products or services, or Rasmus Frost Hansen Page 7 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 the same brand”. Hence, consumers, who consume the same products, may apply the same meaning to the consumption of a specific product. In addition, Holt (1997, p. 340) says, “People are assumed to have a dominant trait or value system that systematically structures consumer behaviours so that each person can be represented by a single coherent trait or value system structures his or her consumption”. This support the frame of mind many marketers seem to posses4, because these fundamental traits and values can help determine the consumer’s lifestyle and thereby clarify his/her consumer behaviour. However, lifestyles may change over time, either actively or passively. Active changes in lifestyles may take place, because “(…) people experiment with and adopt new lifestyle possibilities or as the universe of lifestyles evolves to reflect social changes, lifestyle meanings can change even when consumption patterns remain unchanged” (Holt, 1997, p. 341). The consumer may therefore change consumption patterns, because he changes e.g. his attitudes and values. On the other hand, lifestyles may change due to changes in the environment even though the consumer remains “the same”. Holt (1997, p. 343) also offers a different view on consumers. It is argued that “(…) poststructuralist (also known as postmodernists) lifestyle analysis presumes that social and cultural structures are mutually and simultaneously constitutive”. This means that patterns of consumption are socially constructed, because “(…) people who share similar social conditions acquire similar tastes that organise their consumer actions” (1997, p. 343). The postmodern consumer According to Brown (1992, p. 21) “postmodernism is characterised by the celebration of scepticism, irony, anarchy, playfulness, paradox, style, self-referentiality, and above all, by hostility towards generalisations”. To give an overview, Brown (1992) also presents the ideas behind postmodernism in opposition to modernism, from which it originated. 4 See section on postmodernism for elaboration Rasmus Frost Hansen Page 8 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 (Brown 1992, p. 22) This change from a modern to a postmodern context has mainly taken place in Western cultures (Firat and Venkatesh 1993, p. 227). Moreover, Firat and Venkatesh (1993, p. 229) propose that “postmodernism call for a diversity or multiplicity of narratives, a liberation from all conformity, and a freedom to experience as many ways of being as desired”. It may therefore be harder for hummel to target its products to a specific group of consumers, because it is difficult to categorise people in terms of classic segmentation, where e.g. demographics and geographics have been used to market products and services to consumers (Kotler et al., 2009). Now, “there is no fashion only fashions”, and “one should do his/her own thing” Brown (1992, p. 27) argues. Hence, the diversity and multiplicity of consumers challenges the traditional view on consumers. Furthermore, Firat and Venkatesh, (1993) propose conditions for postmodernism, where especially hyperreality and fragmentation help explain the postmodernism consumer. According to Firat and Venkatesh (1993, p. 230) hyperreality implies that “signifiers (verbal, visual or material signs) can be detached from their original referents, thereby their original meaning, and consequently become “free floating”. They can thereby be attached with new meanings”. Regarding hummel, it can therefore be argued that its apparel products may not only signify a piece of clothing, but the consumer may attach a new meaning to the products and create his/her own sense of reality. The reality thereby becomes hyper, because there is no longer a single reality, but as many realities as there are consumers. In addition, an implication of hyperreality is “the loss of history in the sense that all historical phenomena are detached from their historical processes or contexts and represented as a collage, without depth, on an even surface” (Firat and Venkatesh, 1993, p. 231). This is interpreted to mean that the postmodern consumer is more superficial and that Rasmus Frost Hansen Page 9 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 he may not be as committed to e.g. hummel or its competitors as in modernism. The consumer may therefore use various products to express his identity instead of committing to a single corporation or brand. This is also why the consumer is said to have a certain level of schizophrenia, because he represents different images in different contexts in order to “make oneself marketable, liked, adored, and appreciated in each separate situation” (1993, p. 232). In addition, Firat and Venkatesh (1993, p. 235) propose that “value is created not in exchange-value (…), but during consumption, in sign-value”. This means that products’ functional benefits are less valued in comparison to the emotional and self-expressive benefits brands may provide (Aaker, 1995, p. 97-99). Furthermore, Firat and Venkatesh (1993, p 235) argue “personal identity is increasingly sought by the consumer, even in its fragmented forms, and recognised by others, not on the basis of what one produces but on the basis of what one consumes”. The postmodern consumers therefore use consumption as a means to define and express themselves, because the sign-value one produces via consumption is important to them. In addition, Simmons (2008, p. 304) argues that “postmodern consumers use consumption as a means of creating and sharing their individualised attitudes, expectations and sense of identity. (…) However, postmodern consumers desire an experienced-based marketing that emphasises interactivity, connectivity and creativity”. Hence, if hummel is to market its products successfully to the postmodern consumer, it has to appeal to the consumer’s emotions to a certain extent, because the emotional benefits are more desired by the postmodern consumer, and as Corbett and Connors (1999, p. 78) propose, “It is the appeal to the emotions that makes the end seem desirable”. The end is, in this case, the support of hummel as an organisation and a brand, through consumption, as this may enhance the consumer’s sense of his/her identity. Moreover, the traditional view on marketing may face some challenges with regards to postmodernism, because according to Brown (1992, p. 23) “Marketing conceptualisations are implacably modernist in orientation. They represent attempts to make universal statements about marketing phenomena”. Today’s marketing tools, like Porter’s 5 forces, generic strategies and growth strategies may therefore not fit in a postmodern society, due to both hyperreality and fragmentation, where it is much harder to generalise. However, there are still some opportunities for today’s marketer, because as Simmons, (2008, p. 303) proposes, “while they (postmodern consumers) love to develop highly individualised identities, through continually fresh and exciting consumption experiences, it appears that they do not want to do it in isolation (…)”. Rasmus Frost Hansen Page 10 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Hence, even though the postmodern consumer is unique, she still seeks recognition from other consumers, who share her ideas or identity traits. The marketer may therefore be able to segment and market products to the postmodern consumer, because the sign-value of consumption is sought to be realised through the postmodern consumer’s interaction with peers or likeminded consumers. So, even if it is hard to make generalisations in a postmodern context, fragmentation and hyperreality do not limit the marketer, but instead requires him/her to offer the consumer an opportunity to be playful and creative through the consumption of products and services. Sub-conclusion: Consumer situation There are different views on the contemporary consumer. When consumers behave in certain ways, they are said to have specific lifestyles. However, it is argued that lifestyles change over time. Also, the consumers are considered to be fragmented and to have individual realities rather than one large all-including reality. This challenges the contemporary marketer to reconsider his approach to consumers, because the postmodern consumer is less loyal towards organisations and brands. The many competitors in the marketplace5 all strive for the consumer’s attention, and when the consumer is considered playful, yet disloyal, it will require improved marketing communications to persuade the contemporary consumer. Moreover, today’s consumer situation is not an either/or - but a both/and situation. This implies that marketers should not reject consumers that fall out of the traditional segments, because the playful consumer may find new ways to consume products and thereby offer a foundation for new marketing strategies. Then, even though the consumers seek uniqueness, there are still opportunities to target certain groups of consumers, because they do not strive for isolation. Hence, hummel is given the opportunity to target the contemporary consumers with marketing communication that reinforces the playful way of consuming. Thus, it is possible for hummel to improve its marketing performance, because when the knowledge of the contemporary consumer is available, it is easier to satisfy his/her needs with goods and services. 5 Appendix: Market situation Rasmus Frost Hansen Page 11 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Corporate social responsibility (CSR) Here, it is necessary to define CSR and its relation to business in order to reveal how hummel can make use of CSR in a marketing context and thereby create a potential competitive advantage. The possible motivation(s) for engaging in CSR will be accounted for, and followed by an analysis of hummel’s online CSR-communication to give further understand how the communicative elements help the consumer distinguish hummel from competitors. Defining CSR There are various definitions of CSR. First, Tench and Yeomans (2009, p. 99) argue it is about “how organisations plan and manage their relationships with key stakeholders. CSR is therefore an organisation’s defined responsibility to its society(ies) and stakeholders”. It is, also, necessary to understand the term, stakeholder. According to Preble (2005, p. 409) a stakeholder is “(…) any group or individual who can affect or is affected by the achievement of the organisation’s objectives”. Hence, CSR is based on the actions of those, who are affected or can affect the organisation, e.g. customers or shareholders - and it is their needs a corporation’s CSRcommunication is to respond to. Next, McWilliams, Siegel and Wright (2006, p. 1) define CSR as “situations where the firm goes beyond compliance and engages in actions that appear to further some social good, beyond the interests of the firm and that which is required by law”. Moreover, going beyond compliance and still managing relationships with key stakeholders is further explained by Carroll (1991, p. 42), who proposes four categories of CSR, which explain a company’s responsibilities when engaging in CSR. Even though Carroll’s work has been criticised for being inconsistent (Wisser, 2005, p. 46), it still gives an overview of an organisation’s responsibilities. In fact, Carroll presents the categories as a pyramid, where the foundation is concerned with economics. Rasmus Frost Hansen Page 12 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 (Carroll 1991, p. 42) It is argued that if hummel does not live up to its economic responsibilities it cannot sustain as a business. If it does not make enough money to pay its bills, it will consequently fail to exist. Then, the next level of the pyramid is concerned with the legal responsibilities. These may vary due to differences in e.g. country, size, and operations. The organisation must obey the law, which in some cases is easier said than done. Some organisations are tempted to break the law, because of increased opportunities for profit. For example, even a large corporation like Nike has been accused of breaking the law by using child labour in its production (Boje & Khan, 2009). It may be necessary for families in developing countries to have an extra income from a child’s work in order to make a living, but corporations still break the law if they take advantage of this. This leads to ethical responsibilities, because it is up to the organisation to do the right thing and be ethical even if it means less profit. This part of Carroll’s pyramid relates well to what McWilliams et al., (2006) suggests as going beyond compliance, and the motivation to further some social good (the environment and working conditions etc.). Finally, the top of Carroll’s pyramid concerns philanthropic responsibilities, where the corporation tries to be a good corporate citizen. However being a good corporate citizen based on philanthropy may appear to be superficial, because, according to Tench and Yeomans (2009, p. 101) corporate philanthropy “can be perceived as a Rasmus Frost Hansen Page 13 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 short-term one-way relationship, which is unpredictable on behalf of the recipient and therefore more difficult to manage and strategically plan for”. An example of corporate philanthropy is charity events, which serve to help a specific purpose like breast cancer or African women and children in need. In addition to the economic responsibilities, Milton Friedman argues that “the business of business is simply to increase profits and enhance shareholder value” (ctd. in Tench and Yeomans, 2009, p. 103). Friedman (1970) also argues that CSR is a waste of shareholders’ funding, because instead of engaging in CSR “the corporation should spend its resources on value-adding internal projects or return them to shareholders” (ctd. in McWilliams et al., 2006, p. 3). This is interpreted to mean that corporations should not engage in CSR, because it may be a waste of resources. This may be why Friedman (1970) criticises corporations’ engagement in CSR - it may risk the existence of the company if it fails to gain a profit from its operations. However, if a corporation is able to increase profits through CSR, Milton Friedman’s argument becomes irrelevant, because shareholders will gain a larger share of the company’s profits. Next, the Commission of the European Communities (2002, ctd. in Kapoor and Sandhu, 2010, p. 186) defines CSR as “A concept whereby companies integrate social and environment concerns in their business operations and in their interaction with their stakeholders on a voluntary basis, as they are increasingly aware that responsible behaviour leads to sustainable business success” It is here argued that it pays off to take responsible, yet voluntary, action, because it helps the business sustain. In elaboration, Kapoor and Sandhu (2010, p. 186) argue that being socially responsible is “a way for the organisation to give back to society what it has earned in order to earn it again in the form of e.g. increased consumer demand”. However, Carroll (1991) argues that “corporate social responsibility does not start with good intentions, but from stakeholder actions” (ctd. in Tench and Yeomans, 2009, p. 105). Thus, corporations do not come up with the idea about being socially responsible out of nowhere, but it is a way to respond to stakeholders’ needs and wants. Sub-conclusion: CSR-approach There are several views on CSR, and these vary to some extent. First, Tench and Yeomans (2009) argue it is a way for corporations to manage stakeholder relationships. Second, McWilliams et al. (2006) propose that CSR is a corporation’s way of going beyond what is required by law to further some social good beyond the interest of the company. With regards to McWilliams et al. (2006), it can be argued that it is difficult to further some social good without having any interest in it. So, it Rasmus Frost Hansen Page 14 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 can be assumed that McWilliams et al., (2006) views CSR as a voluntary act that does not directly pursue financial interests. However, Kapoor and Sandhu (2010) reveal that there is a financial incentive for engaging in CSR, because it is argued that by giving back to society, a corporation can improve its profits through increased sales. But Kapoor and Sandhu (2010) still perceive CSR to be a voluntary action, which relates well to the idea of McWilliams et al., (2006). Then, in opposition, Milton Friedman (1970) argues that CSR is a waste of corporate resources that better be used to improve internal operations in the company or returned to shareholders in order to create value. Finally, when considering the CSR-framework of Carroll (1991), it is found that in order for a company to act socially responsible towards stakeholders, it first has to live up to both economic and legal requirements of society. So, with regards to this thesis, it is recognised that there are several views on CSR, which contribute to the understanding that CSR can be used to bring value to both the corporation and its various stakeholders. Hence, CSR is perceived as a tool in the marketing toolbox. Motivation for CSR-engagement The financial incentive mentioned above is assumed to be the main motivation for CSR engagement, but this may be too ambiguous if one is to identify a more specific way for a company to improve its performance via CSR. Therefore, further detail is provided to reveal how corporations can benefit from CSR. According to Fombrun & Shanely (1990, ctd. in Lii & Lee, 2011, p. 69), “communicating CSR is a means to gain a positive reputation”. According to Hosmer (1995) and Williamson (1985), a strong reputation leads to higher levels of trust among stakeholders, which “(…) substitutes for expensive governance mechanisms, because fewer protective devices are needed” (both ctd. in Galbreath & Shum, 2012, p. 215). High levels of trust among the most important stakeholders is interpreted to have a positive impact on the company’s business, because e.g. customers may show higher levels of loyalty and thereby serve as a means for increased sales. Shareholders may also support a trustworthy company more, because they may feel that their money will be put to good use when they trust the company. Hence, the corporation will be able to spend fewer resources on persuading both consumers and shareholders to support the corporation, which then will increase profits through lower costs. Regarding corporate reputation, a company that communicates CSR-initiatives effectively is argued to experience increases in market value (Fornell et al., 2006; Luo and Bhattacharya, 2006, ctd. in Galbreath and Shum, 2012, p. 211-212). Luo and Bhattacharya (2006), found that significant Rasmus Frost Hansen Page 15 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 CSR leads to increased customer satisfaction, which improves market value for the company, because “CSR helps build a satisfied customer base and that customer satisfaction partially mediates the financial returns to CSR” (2006, p. 15). Moreover, customer satisfaction is “(…) an overall evaluation based on the customer’s total purchase and consumption experience with a good or service” (Anderson, Fornell, and Mazvancheryl, 2004; Fornell, 1992, ctd. in Luo and Bhattacharya, 2006, p.3). So, the evaluation of hummel’s products can be improved if the company is considered socially responsible by the consumer. This is also supported by McWilliams and Siegel (2001), who argue that CSR can be interpreted to be a quality improvement of goods or services (ctd. in McWilliams et al., 2006, p. 6). Hence customer satisfaction takes place, because the customer may perceive a company’s CSR-activities as an improvement of its goods/services, for example when clothes are produced with less energy (power and water), or if products are recyclable. The products’ quality is thereby assumed to be improved, since they are more environmentally friendly. Then, when customer satisfaction is improved, it will most likely improve firm performance by reducing costs, increasing return, and generating more sales, because of more repeat business and lower customer defection (Galbreath and Shum, 2012, p. 215). To substantiate this, Aaker and Shansby (1982, p. 57) propose that high price and high quality is a way for brands to position themselves in the marketplace by showing superior quality as an opposition to brands with “value” position, where price is more essential than quality. This means that those brands that charge higher prices are assumed to be of better quality, which thereby justifies that consumers pay more for these better products. Moreover, with relation to the consumer, Ahearne et al., (2005) argue that “when consumers perceive that a CSR-initiative has certain traits that overlap with their own self-concepts, they develop a greater identification with the firm and are more likely to support it” (ctd. in Lii & Lee, 2010, p. 70). This means, that if hummel’s CSR-initiatives respond to issues that are important to the consumer (lowering global warming, preventing child labour or stopping animal abuse), hummel will experience higher levels of support, or even loyalty from consumers. Therefore, it will make sense for hummel to engage in CSR-activities that are important to its customers/consumers, because increased support for or a positive attitude towards the company may function as a foundation for future sales. Furthermore, Lewis (2001, p. 32) argues that “the public increasingly wants to know about the companies that stand behind the brands and products presented to them. And to use their consumer power to reward “good” companies and punish “bad” ones”. This means that corporations are Rasmus Frost Hansen Page 16 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 assumed to engage in CSR, because they want to ensure that they are “rewarded” with e.g. ongoing sales. Corporations can thereby sustain if they engage in CSR, where consistent CSRcommunication helps consumers trust the corporation to a higher degree. This may eventually lead to a stronger position in the market place, because the consumers most likely will prefer the corporation’s products/services when they trust it. Hence, such preference is assumed to provide hummel with a competitive advantage. Sub-conclusion: CSR motivation Primarily, the main motivation for engaging in CSR-activities seems to be based on a financial incentive. This may also be the case even though CSR is, by some, considered voluntary. Since there is a business potential in CSR, it can be assumed that today’s corporations, including hummel, will try and gain a competitive advantage in the market place by incorporating CSR in their respective business strategies. It is found that the business potential is based on increased customer satisfaction and closer relationships/identification between organisation and consumer, where consumers’ trust in the corporation play an important role. Then with regards to the perceived quality of products/services, CSR can help a corporation achieve a favourable position in the marketplace, because it tends to increase the audience’s identification with the organisation if they share the same values. Finally, corporations are free to choose if and how they engage in CSR, as long as their economic and legal requirements are fulfilled, because as van Marrewijk (2003, p. 96) propose, "there is no standard recipe: corporate sustainability is a custom-made process”. However, corporations’ CSR-engagement is not interpreted as being merely philanthropic, where CSR is used to appear as a good corporate citizen, but more as a tool to improve their position in the competitive environment. It is therefore interesting to see how hummel use CSR-communication to improve the consumer’s identification with hummel, and thereby help the consumer differentiate between hummel’s and its competitors. Rasmus Frost Hansen Page 17 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Hummel’s online CSR-communication This communication analysis is chronological. First, relevant communicative elements on hummel’s front page are taken into consideration. Next, hummel’s Karma page (CSR-page) is analysed in a top-to-bottom structure, because this is considered the consumer’s reading pattern. It will thereby provide a better understanding of how the consumer may interpret the communicative elements in hummel’s CSR-communication Presentation of hummel Karma United With regards to hummel’s CSR-communication, it will make sense to interpret the meaning of Company Karma in order to understand the possible meaning behind hummel’s CSRcommunication. Christian Stadil (the owner of the company) presents it as the corporate social responsibility of hummel6. Moreover, according to Longman’s Dictionary of Contemporary English, karma is “the belief that all the good and bad things that you do in this life affect how good or bad your future lives will be, according to the Hindu and Buddhist religion”7. In a corporate context this is interpreted to mean, that hummel believes that in order to sustain as a business tomorrow, it has to do good today – its actions (either good or bad) will affect the company in the future. Then, hummel’s CSR-communication is introduced on the front page of the website below the presentation of the various clothes- and footwear collections. Here, a map with a pin that has hummel’s logo on it, and the name “hummel Karma United” are presented to the viewer/visitor of the website8. The pin, which is placed in Germany on the map, 6 http://www.thornico.com/Company-Karma.2247.aspx - retrieved 06-04-2013 http://www.ldoceonline.com/ - retrieved – 06-04-2013 8 Retrieved 15-03-2013 7 Rasmus Frost Hansen Page 18 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 can be interpreted to symbolise the starting point of the company, and may refer to its history, since hummel originally was a German company9. Furthermore, the map is presented in black and white, which may represent the origins of the company, too. This is found because, when one considers the context of the time in which hummel was established in 1923, there were no colour TVs, which then can be interpreted as a reference to that time. So, a black and white (or grey) visual representation of the map with a red hummel pin is therefore found to represent the starting point of the company. Regarding the text on the front page, hummel first propose a designative action process by saying “Click on the map to see how far we have come” (Stillar, 1998). This means that hummel suggests the reader to take action if he/she wants to know how far hummel has come since it started in 1923. However, it is at this point not clear with what hummel has come far. Hence, the reader may want to continue reading to find out. So, hummel elaborates on what Karma United is by saying “Karma United is a global team for good deeds. United across borders, conflicts and cultures we want to change the world through sports”. Here it is found that hummel communicates its business strategy in the first sentence, because the company’s mission statement10 is presented with emphasis on teams. By saying “Karma United is a global team for good deeds” hummel reveal that they consider themselves as a team. Next, hummel says, Karma United “is united across borders, conflicts and cultures in order to change the world through sports”. Here, according to Stillar (1998), hummel first uses a relational process of identification to clarify who/what Karma United is (a team), and then uses action processes to reveal what it does (change the world through sports). In addition, the last phrase “(…) we want to change the world through sport” reveals that hummel believes the 9 http://www.hummel.net/en-DK/content/about/heritage/ http://www.hummel.net/en-DK/content/about/mission-statement/ 10 Rasmus Frost Hansen Page 19 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 World’s current state is not good enough and therefore needs to be changed, which again is supported by the karma concept – doing good today leads to something good tomorrow for both the World and for hummel. Then, hummel proposes that this change is to take place by the means of sport rather than e.g. lowering greenhouse gas emissions, substantiates hummel’s position as a sports company/brand. However, it is still not explicitly communicated what hummel does to change the World. This may either distract the reader from looking further into the company’s CSR-initiatives, or perhaps the reader becomes more curious to click the map, which hummel suggests. If the reader clicks the map, he/she will enter the Karma United page. Here hummel communicates its CSR-initiatives more thoroughly. Then to expand the interpretation of the map on the front page, it is here found that the map is now full of colours and a lot of pins with hummel’s logo on. This can be interpreted to respond to the sentence “Click the map to see how far we have come” from the front page. Now, it is clearer that hummel is not only engaging in activities in Germany from where it originated, but is now active in large parts of the world. The colours and the pins therefore help the reader understand that this is hummel’s current context. Then, when looking at the visual effects related to “hummel Karma United” in the top of the Karma page, it can be interpreted to symbolise some sort of glorification of hummel, because it shines like a sun above the World (map) and the rest of the page. This glorification of hummel Karma United may relate to the origin of karma, which is based on the religion of Hinduism and Buddhism. According to the religion of Hinduism, “(…) all human undertakings and all things in nature are embraced by the spiritual” (Varner and Beamer, 2011, p. 108). This is expressed by the glorified/divine “sun”. hummel Karma United therefore seems to embrace those affected by hummel’s CSR-activities. Hence, hummel Karma United is interpreted to symbol something bigger than just business. Rasmus Frost Hansen Page 20 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 hummel’s CSR-activities In the next section of the karma page, below the world map, it becomes clearer what hummel is engaging in, with regards to its CSR-initiatives. The three images in the mid-section of the page vary when the page is updated, but they show some of the projects hummel engages in. The image to the left, depicting the logo of PSG Handball, does not specifically reveal the relationship between hummel and PSG Handball, however it implicitly suggest that hummel sponsors PSG Handball. When one keeps in mind the discourse of sport in a corporate context, it is common that corporations like hummel sponsors sport clubs and athletes, just like Nike sponsors Tiger Woods and that Adidas sponsors the Danish national football team. Here, it should be noted that, according to Roy & Cornwell (2004), “sponsorship is one of the most prominent forms of marketing”, and that, according to Harvey (2001), “sponsorships generates more money than all advertising media combined” (both cited in Lii & Lee, 2010, p. 71). Hence, it can be argued that hummel here appeals to those who know PSG Handball in order to make them aware that hummel supports professional teams. Furthermore, the image in the middle reveals that hummel engages in activities in Africa. This is found because the skin of the depicted people is black, and the text related to the image says “Home of the blood diamonds…” which refers to the civil war in Sierra Leone in the 1990’s11. In addition, the middle image is a demand picture (Kress and van Leeuwen, 2006, p- 117-118). This means that since the people in the image looks directly at the viewer, they are presented as “demanding” something from the viewer. Such demand may concern the need for the viewers’ attention, because when people are aware of the issues these people face in Africa, they may be more likely to support the cause. hummel thereby functions as a mediator of the issues in Africa. When one clicks the image, hummel clarifies the background of the project, which is “to spread the 11 https://en.wikipedia.org/wiki/Blood_diamond Rasmus Frost Hansen Page 21 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 positive message of sports”12 in Sierra Leone. A similar case was the NATO-Afghanistan Match, which was a football match hummel arranged for Afghan women. hummel proposes that football was illegal in Afghanistan during the Taliban regime, so they gave the Afghan women an opportunity to play a proper match against NATO-employees under safe conditions. Again, the woman in focus is looking directly at the viewer, as if she “demands” or needs attention. This is supported by the text to the right, which says (when you scroll down a bit) “The match was also a way of bringing the situation in Afghanistan to the attention of the whole world”. So, hummel is the mediator of the people in need for change. Moreover, hummel also says it provides the change the depicted people need. This is found in the sentence, “The NATO match should be regarded as a victory for football, for Afghanistan and for oppressed women all over the world”, because here hummel says that it helped the Afghan women “beat” the former Taliban regime, since they successfully played a football match in their home country where football has been illegal. Hence, hummel communicates that it mediates peoples’ need for attention regarding the troubles they face daily, and makes sure that change takes place. Moreover, hummel also uses offer pictures in its CSR-communication (Haliday, 1985, ctd. in Kress and van Leeuwen, 2005, p. 119). 12 http://www.hummel.net/en-DK/karma/page/24/Flashmob?1365438134718 Rasmus Frost Hansen Page 22 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 These three images are offer pictures, because the viewer is not addressed directly by the looks of the depicted people. The image to the right is a snapshot of the Copenhagen World Cup, which is a football tournament for communities with roots in different countries, who lives in Copenhagen13. The use of such offer picture is interpreted to reveal a certain level of consubstantiation, which means that the consumer is invited to “(…) make things better, because it provides a symbolic motive for the simple act of consuming the product” (Stillar, 1998, p. 76). In this case, the viewer is invited to participate in Copenhagen World Cup, as e.g. an audience, or invited to support hummel through the consumption of Karma products as presented further down on the webpage. Hence, by consuming hummel’s products, one is able to reinforce a personality trait of being socially responsible. This also relates well to the sign-value, which postmodern consumers are argued to develop through consumption. The sign-value of being a socially responsible consumer by consuming e.g. hummel’s karma products is therefore argued to be a favourable behaviour, because it is interpreted to symbol that the consumer helps make things better. Furthermore, the two other pictures depicting Karma United Strikers illustrate that hummel ensures people in Africa experience positive changes through sport. The depicted men appear to be happy, since they are smiling while raising their arms victoriously over their heads, even though their everyday lives may be affected by conflicts. In addition, the men can be interpreted to be a 13 http://www.hummel.net/en-DK/karma/page/12/Copenhagen%20World%20Cup Rasmus Frost Hansen Page 23 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 team, due to their similar hummel clothes and closeness. This is also supported by the text, which identify the people in the images as “Karma United Strikers”. The depicted men are united as a team, and the word “strikers” can be interpreted to mean that they are fighting for a better world, or that they are scoring goals on a soccer team, which may refer to defeating their everyday troubles through sport. With regards to CRS-communication, it is proposed that hummel brings joy and provides change to people who need it. This is also found in the depiction of the “sun” in the two images. It is not the natural sun, but the Karma United sun that shines above the men. This may symbolise that hummel is the light in dark times influenced by troubles and conflict in the African countries. This can be explained by what Kress and van Leeuwen, (2005, p. 79) call covert taxonomy, which means that there exists a relationship between hummel (expressed via the Karma United sun) and the Karma United Strikers. hummel is the superordinate and the strikers are subordinate, because hummel has the power to help the men overcome something they could not themselves. Simply put, hummel has the means to change the men’s world through sport by providing them with football equipment. Then, in relation to the viewer of the images, he/she is offered to help the depicted people (or someone similar to them), by supporting hummel’s activities, since they are offer pictures. This support may take place in the form of a positive judgment/attitude toward hummel, which thereby improves its reputation/image (Spence, 2002, ctd. in Galbreath and Shum, 2012, p. 214-215). This positive judgment of hummel may therefore increase the likelihood of the viewer purchasing karma products. This will ensure that hummel can keep doing good to the depicted people and those similar to them, because increased sales lead to more resources that can be spend on CSR-activities. Then, since hummel communicates that the depicted people need help to overcome and/or endure e.g. armed conflict, it is found that the depicted people have a certain resource dependency towards hummel (Foucault, 1991, in Tench and Yeomans, 2009, p. 234). Hence, they would not be smiling if hummel had not provided the change for them. In addition, the depicted men are considered resource dependent, because they, to some extent, rely on organisations like hummel to make the public aware of their situation to increase their chances of getting help. Moreover, it is most likely easier for the user of the website to relate to the CSR-communication on hummel’s website, due to discursive connectivity. This suggests that the reader “shares the discourse, ideas and concepts” with the depicted people (2009, p. 234). Even though the visitor of the website may be very different from the depicted people, they are still human beings, who also have a need for safety, and strive for better living conditions. If a little less fortunate, it could have been you and I, Rasmus Frost Hansen Page 24 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 who were born in Africa or Afghanistan and had to deal with suppression and war at close hand. Therefore, it is argued that hummel’s CSR-communication is relatively easy to relate to. Next, the bottom section of the karma page is used as a social section, where the consumer can upload pictures to express his/her relation to hummel and its products. This may be a way for hummel to appear social and thereby try and engage the consumer to interact with the company. Also, it can be interpreted to respond to the idea about giving consumers an opportunity to identify with the company by engaging with it through this social feed. However, it appears that the content in this social section is not only user-submitted. Above the images, tweets are found, and the ones to the sides are provided by hummelonlineshop.de and hummel UK, which are official hummel usernames on twitter14. The tweet in the middle is provided by a twitter-user, who used Instagram to take a photo of her cat lying on a hummel product15, and then linking to hummel via the various hashtags (#). Then, regarding the images, hummel’s products are presented to the viewer in different contexts. Some children are wearing hummel clothes, a snapshot of girls playing football, and two in-store photos are presented to the viewer. Here, it is not clear who posted the images. The two in-store photos are most likely posted by a retailer, who sells hummel products to the consumers, because the price tags are still on and the products are arranged as if they are to represent to assortment of a store’s range of hummel products. Also, it could be anyone’s children in hummel clothes, e.g. a retailer, an employee, or a consumer’s children. So, this social section on the karma page does not provide the visitor with any information about hummel’s CSR-initiatives. It merely promotes hummel’s 14 15 https://twitter.com/hummelcharacter http://instagram.com/p/WemD8itcgE/ Rasmus Frost Hansen Page 25 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 products to the consumer. Hence, the social feed section appears as an element that promotes hummel’s products instead of communicating CSR. hummel’s persuasive appeals Then, regarding hummel’s persuasive appeals, it can be argued that hummel appeals much to the reader’s emotions. When depicting people, who needed help from hummel to change their world (Afghan female football players and Karma United Strikers), hummel may arouse different emotions in the reader, which means that hummel uses pathos appeals to persuade the reader (Kies, 1995– based on Aristotle’s work). For example one may, on one side, feel sorry for the women in Afghanistan, because they have never had the opportunity to play football before, which may be considered a normal activity in the reader’s everyday life. On the other hand, the reader may also be happy learn that these women are given a chance to change that with hummel’s help. In addition, when/if the reader feels moved by hummel’s CSR-communication, it can be explained in terms of enargeia, which is means “in work” as if hummel’ energises and actualises something (Kies, 1995). This means that the reader is persuaded to take a positive stand towards hummel and its activities, because it helps those in need. The reader may therefore also feel that he can help by e.g. purchasing hummel’s karma products. Furthermore, Corbett and Connors (1999, p. 78) explain that, “It is the appeal to the understanding that produces conviction about the conduciveness of the means to the desired end; it is the appeal to the emotions that makes the end seem desirable”. Hence, when the persuasive appeals concern the reader’s emotions and reasoning, the persuasion process becomes more likely to succeed. This is found when hummel uses a logos appeal, which is the appeal to logic/reason (Kies, 1995). The logical elements of hummel’s CSR-communication are communicated in terms of change. If something needs change, it is perceived as to be for the better, which is communicated when saying “(…) we want to the change the world through sport”. Thus, it may seem reasonable for the reader to support hummel, because the world becomes a better place when hummel is able to carry out its CSR-activities. Karma structure Regarding the structure of the webpage, a hierarchy seems to be presented to the user of the website. In the top, the Karma United sun shines, and is interpreted to symbol a glorification of hummel and its CSR-activities. Moreover, Kress and van Leeuwen (2006, p. 186-187) suggest top elements in visual representations as being the ideal, which means “it is presented as idealised or Rasmus Frost Hansen Page 26 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 generalised essence of the information, hence also as its, ostensibly, most salient part”. Then, the lower parts of the webpage are considered the real information (2005, p. 187). This means that hummel presents its CSR-activities as an actual representation of what hummel does in terms of CSR, whereas the Karma United sun in the top represents the ideal situation where all those, who need their world changed through sport, should have the opportunity to be embraced by hummel Karma United. In addition, it can be argued that an ideal situation for hummel would be if the world map is filled with pins to represent an improved position in the global market – both in terms of CSR, but also with regards to business activities in general. However, the real elements in the bottom of the page, which concern hummel’s Karma products, can be interpreted to symbol the way to achieve the ideal situation. Hence, if the consumer buys Karma products, and thereby supports hummel financially, the ideal is more likely to be achieved, because hummel is provided with more resources to carry out more CSR-activities around the world. Sub-conclusion: hummel Karma United hummel’s CSR-communication is considered rather interpersonal, where, especially the visual elements, seem to either demand the viewer’s attention or inviting him/her to support hummel in changing the world through sport. It is also found that hummel’s rhetoric primarily appeals to the reader’s emotions and to his/her reasoning in order to persuade the reader to take a positive stand towards the company. hummel communicates its CSR-initiatives quite consistent with the team oriented business strategy of the company. Moreover, hummel makes it easier for the visitor/user of the site to relate to the company’s CSR-initiatives, because of the rather high level of interpersonal communication. Also, the CSR-communication is integrated on a single website. The consumer can buy clothes, read about the company’s history, and discover relatively easily how responsible the company is. Hence, the easily accessible interpersonal CSR-communication on hummel’s website reveals that hummel communicates CSR to a fairly large extent, but in a marketing context, where promotion of products also takes place. This is interpreted to mean that hummel does not engage in CSR-activities for the sake of doing good, but uses it as a way to persuade the reader to take a positive stand towards the company, which is intended to improve future sales of e.g. Karma products. Rasmus Frost Hansen Page 27 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Conclusion The degree to which hummel communicates corporate social responsibility on its website is considered to be relatively high. The visitor/consumer is presented to hummel’s CSR via “hummel Karma United” through which hummel’s CSR-activities are presented in an interpersonal manner that appeal to both the emotions and reasoning of the consumer. In this way, hummel is interpreted to be able to differentiate itself from competitors, because the interpersonal approach and the communicated social responsibility will most likely form the basis of a positive attitude towards the company. This positive attitude is a way for hummel to persuade the fragmented postmodern consumer, because it may limit superficial consumption patterns and thereby create a stronger relation with the consumer. Supporting hummel is also considered a way for the consumer to reinforce his/her identity as a responsible consumer, which is argued to be favourable in terms of sign-value. Hence, hummel helps the consumer differentiate the company/brand from competitors through CSR-communication, because the interpersonal approach most likely increases the consumer’s identification with hummel instead of competitors. However, it is recognised that hummel does not merely engage CSR to be a good corporate citizen, but uses it to persuade the contemporary consumer as a way to increase hummel’s opportunities for a better position in the marketplace. Discussion The consumer’s ability to differentiate hummel from its competitors is found to be reinforced by hummel’s CSR-communication, but it can be argued that it will require the consumer to value interpersonal relationship communication to a certain degree. For instance, if global warming is more important to the consumer, compared to the issues in Africa, the consumer may not attend to the interpersonal CSR-communication on hummel’s website to the same degree. Some may prefer facts, when presented to CSR-communication, for example, how much energy is saved, how many schools are build in Africa etc. This may dilute the consumer’s identification with hummel, because emotional appeals are considered to be the most salient elements in hummel’s CSR-communication, even though they are supported with appeals to reasoning. Also, if the contemporary consumer is as Rasmus Frost Hansen Page 28 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 superficial as the theories of postmodernism imply, hummel may risk that its CSR-communication is overlooked, due to the fierce competition for the consumer’s attention16. Finally, further study of how hummel communicates its social responsibility in other media is encouraged, because it will give a more holistic impression of hummel’s CSR-communication. If the interpersonal communication style is consistent across several media platforms, hummel may persuade more consumers, which will improve hummel’s position in the market place. In addition, similar research of hummel’s competitors’ CSR-communication is also encouraged, because it can give an impression of where the companies differ with regards to CSR-communication. A reception analysis of the consumers’ attitudes towards hummel’s CSR-communication can also provide further insight to the communicative elements’ effect on the consumer attitude towards hummel, and thereby support the insight of whether or not hummel improves its position in the marketplace via CSR-communication. 16 Appendix: Market analysis Rasmus Frost Hansen Page 29 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Sources Aaker, D. A., & Shansby, G. J. (1982). Positioning Your Product. Business Horizons. Ansoff, I.H. (1957). 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Euromonitor International (Feb. 2013): Top consumer trends for 2013 - http://www.portal.euromonitor.com.ez.statsbiblioteket.dk:2048/Portal/Pages/Analysis/AnalysisPag e.aspx Euromonitor International: (Feb. 2013): Brand shares (by global brand name) in the apparel and sportswear industry - http://www.portal.euromonitor.com.ez.statsbiblioteket.dk:2048/Portal/Pages/Search/SearchResult sList.aspx Euromonitor International (Nov. 2008): Private label – Potential in a weakening economy - http://www.portal.euromonitor.com.ez.statsbiblioteket.dk:2048/Portal/Pages/Analysis/AnalysisPag e.aspx Firat, F. A. & Venkatesh, A. (1993) Postmodernity: The age of marketing. International Journal of Research in Marketing 10. Fowler, H., R, and Aaron, J. E, (2010) The Little Brown Handbook (11th ed). Pearson Education Galbreath, J., & Shum, P. (2012) Do Customer Satisfaction and reputation mediate the CSR-FP link? Evidence from Australia. Sage Publications Gurau, C. (2007). The Marketing Review. Vol. 7, No 4, pp. 369-383. Westburn Publishers Ltd. Rasmus Frost Hansen Page 30 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Holt, D., B, (1997). Poststructuralist Lifestyle Analysis: Conceptualizing the Social Patterning of Consumption in Postmodernity. Journal of Consumer Research, Inc. Vol. 23 Kapoor, S. & Sandhu, H., S. (2010) Does it Pay to be Socially Responsible? An Empirical Examination of Impact of Corporate Social Responsibility on Financial Performance. Global Business Review, 11:2 pp. 185-208 Kiess, D. (1995). Ethical Appeals: Ethos, Pathos, and Logos. The Hypertext Books. Retrieved from: - http://papyr.com/hypertextbooks/comp1/ethos.htm - http://papyr.com/hypertextbooks/comp1/pathos.htm - http://papyr.com/hypertextbooks/comp1/logos.htm Kress, G. & van Leeuwen, T, (2006) Reading images – The Grammar of Visual Design (2nd ed.) Kotler, P., Keller, K.L., Brady, M. Goodman, M. & Hansen, T. (2009). Marketing Management. European Edition. Pearson Education. Lewis, S. (2001). Measuring Corporate Reputation. MBC University Press Lii, Y., & Lee, M. (2011) Doing Right Leads to Doing Well: When the Type of CSR Reputation Interact to Affect Consumer Evaluations of the Firm. Springer Luo, X., & Bhattacharya, C., B. (2006). Corporate Social Responsibility, Customer Satisfaction, and Market Value. Journal of Marketing Vol. 70 pp. 1-18. Preble, J., F. (2005). Toward a Comprehensive Model of Stakeholder Management. Blackwell Publishing p. 407-431. Reed II, A., Forehand, M., Puntoni, S. & Warlop, Luk. (2012). Identity-based Consumer Behaviour. International Journal of Research in Marketing 29, 310-321. Pickton, D. & Broderick, A, (2005). Integrated Marketing Communications (2nd ed.) Pearson Education Simmons, G. (2008) Marketing to postmodern consumers: introducing the internet chameleon. European Journal of Marketing Vol. 42 No. ¾ Solomon, M. R., Barmossy, G., Askegaard, S. & Hogg, M. K. (2010). Consumer Behaviour – A European Perspetive. (4th ed.) Pearson Education. Rasmus Frost Hansen Page 31 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Stillar, G. F. (1998). Analysing everyday texts. Discourse, rhetoric and social perspectives. Sage Publications. 14-57; 58-89. Tench, R. & Yeomans, L. (2009). Exploring Public Relations. Pearson Education Limited. 2. McWilliams, A. , Siegel, D., S. & Wright, P., M. (2006) Corporate Social Responsibility: Strategic Implications. Journal of Management Studies 43:1 Upson, J. W., Ketchen Jr. D. J., Connelly, B. L. & Ranft, A. L. (2012). Competitor Analysis and Foothold Moves. Academy of Management Journal. 93-110 van Marrewijk, M. (2003). Concepts and Definitions of CSR and Corporate Sustainability: Between Agency and Communion. Journal of Business Ethics. 44. 95-103. Varner, I., & Beamer, L. (2011). Intercultural Communication in the Global Workplace (International ed.). McGraw-Hill Wisser, W. (2005). Revisiting Carroll’s CSR Pyramid – An African Perspective. URL-sources http://www.ldoceonline.com/ : 06-03-2013 http://www.hummel.net/en-DK/content/about/mission-statement/ : 13-03-2013 http://www.hummel.net/en-DK/content/about/heritage/ :13-03-2013 http://www.hummel.net/en-DK/karma/page/12/Copenhagen%20World%20Cup :17-03-2013 http://www.hummel.net/en-DK/karma/page/24/Flashmob?1365438134718 :17-03-2013 https://en.wikipedia.org/wiki/Blood_diamond :19-03-2013 http://www.businessdictionary.com/definition/private-label.html :21-03-2013 http://www.businessdictionary.com/definition/monopolistic-competition.html : 21-03-2013 http://www.ldoceonline.com/dictionary/global :21-03-2013 http://www.ldoceonline.com/dictionary/international_1 : 21-03-2013 http://www.imf.org/external/pubs/ft/reo/2012/afr/eng/sreo1012.pdf :28-03-2013 http://instagram.com/p/WemD8itcgE/:04-04-2013 https://twitter.com/hummelcharacter :04-04-2013 http://www.thornico.com/Company-Karma.2247.aspx :06-04-2013 http://www.hummel.net/en-DK/karma/page/4/Sierra%20Leone%20Amputee%20Team:25-03-2013 Rasmus Frost Hansen Page 32 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Appendix Market analysis In order to understand hummel’s context in terms of marketing opportunities, it is useful to look into the sportswear industry and the competitive forces takes place in it. Here, Michael E. Porter’s five forces are used as a point of departure, because they can provide one with an overview of the competitive environment in an industry. The five forces are: Industry competition, potential entrants, substitutes, buyers, and suppliers (Kotler et al. 2009, p. 304). First of all, regarding the global sportswear industry, there are many competitors. Nike, Adidas and Puma are the dominating individual players, according to Euromonitor International (2013)17. However, it should be noted that in the statistics provided by Euromonitor International (2013), “others” have a large market share (62,8%), which may refer to many smaller brands within in the global sportswear industry, of which private label18 products is interpreted to make up a very large part. Private labels are those brands hold by a retailer like Stadium, Sportmaster, Dansk Supermarked or Walmart, who orders their goods under their own name(s). Hence, the large market share of the “others” may be due to the fact that private labels in general have become considered as of almost equal value as the big brands like Nike, Adidas and Puma in the sportswear industry (Euromonitor, 2008)19. This is also seen as a reaction to the economic crisis that is believed to have made the consumers more priceconcerned (Euromonitor International, Feb. 2013, p. 2). So, when consumers are more price sensitive in times of economic crisis, and when private labels are considered to deliver products with high functional quality, it is argued that the consumer prefer value for money. This puts an increased pressure on the big brands, and hummel, to deliver value, which the consumer is willing to pay for. Hence, the largest market share in the global sportswear industry lies with the many different private labels, but there are still a few individual entities (Nike, Adidas and Puma) that play an important role in this industry. However, it should be noted that hummel is not on Euromonitor International’s list of the brands with the largest market shares, which means that hummel should be considered a part of the “others” group. 17 Attached statistics provided by Euromonitor International: Brand shares by global brand name Private label: Brand owned not by a manufacturer or producer, but by retailer or supplier, who gets its goods made by a contract manufacturer under its own label. Also called private brand: http://www.businessdictionary.com/definition/private-label.html 19 Euromonitor International 2008: private label 18 Rasmus Frost Hansen Page 33 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Furthermore, when considering the status of the industry, it is argued to be an industry where monopolistic competition20, takes place. Even though Nike, Adidas and Puma are big players in, the sportswear industry there are still many others with a significant market share, and there also exists certain consumer preferences in the sportswear industry. Hence, monopolistic competition takes place. With regards to consumer preferences, these may either be based on horizontal or vertical product differentiation. Vertical product differentiation occurs when consumers prefer one product to another, due to a perceived difference in quality - for example some prefer organic milk over regular milk or a hybrid car over a standard car (McWilliams, Siegel, and Wright, 2006, p. 4-5). This also helps explain why some consumers are willing to pay more for certain products. On the other hand, horizontal product differentiation is based on people’s individual tastes instead of quality, where some prefer a black car over a white, or Coca-Cola over Pepsi Cola. Furthermore, the growth in the industry seems to be sensitive, because during the last couple of years there have been both significant increases and decreases in consumer expenditure of clothing and footwear in the global marketplace, which are key components of hummel, Nike, Adidas and Puma’s businesses. Then, regarding the threat of new entrants, there seems to be rather low entry barriers, due to the high amount of competitors in various sizes. In addition, it is generally known that there are low production costs in the Asian/Southeast Asian region, which is considered to be the main reason why apparel corporations tend to outsource production to that region of the world. Moreover, the demand for apparel in especially the regions of Latin America, the Middle East and Africa, Eastern Europe, and Asia Pacific is growing, whereas more developed markets as North America, Western Europe and Australasia lie under the global average growth21. This means that some new entrants may see opportunities in entering the market of sportswear and apparel, because of the growing 20 Many competitors and consumer preferences: http://www.businessdictionary.com/definition/monopolisticcompetition.html 21 Euromonitor International: New apparel research Rasmus Frost Hansen Page 34 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 demand in relatively new and growing blue ocean markets – markets where the major competitors are still not as dominating as they are in their home markets (Kotler et al. 2009, p. 307). On the other hand, since the competition in general appears to be strong in the global marketplace, it may cause some new entrants to look for alternative industries to do business. Furthermore, online shops have entered the apparel and sportswear industry by offering consumers the opportunity to buy clothes and sportswear without leaving their homes. The technological development has made shopping much easier for the consumers, and also for the industry. A 100% online shop without any physical shops and sales force has a competitive advantage, because of reduced costs related to salaries and rent. With lower costs, online shops can offer more or less the same goods at reduced prices. This gives them a competitive advantage in the market place. However, the technological development also benefits established corporations in the marketplace such as hummel, Nike, and private label brands, because they also have the opportunity to sell their products online. So, when new online based companies enters the marketplace, they increase the level of competition for established corporations, but the established corporations also have the opportunity to make use of the opportunities, which technology offers, and thereby respond to the threat of new entrants (Kotler, 2009, p. 123). Next, substitute products make up a major threat to hummel. This is because the consumers have so many alternatives to choose from in terms of clothing. First of all, the sportswear industry’s many players all fight for the consumers’ attention and money, and so do the apparel industry in general. Fashion changes from season to season, which most likely leads to changes in consumer preferences, also. Then, since the financial crisis began in 2008, consumers, especially in the European markets, tend to save more money than they used to (Euromonitor International, Feb. 2013). This tendency is considered to be a sign of low levels of consumer trust. There is still a lot of uncertainty in the marketplace, because it is hard to tell when the recession is over, and whether or not one may lose his/her job due to corporate cutbacks. This may be one of the reasons why people save money in case of bad times instead of spending it on goods and services. Thus, people may be more likely to spend their money on necessities like food and their mortgages to a higher degree compared to e.g. new sportswear. Then, the bargaining power of suppliers in the apparel industry seems to be rather low, because there are many to choose from. Since many corporations have outsourced their production to suppliers in the Asian region and Eastern Europe due to the lower costs of labour, there are more Rasmus Frost Hansen Page 35 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 suppliers to choose from. All things being equal, it is attractive for the suppliers to be in the apparel industry, because the global demand seems to increase steadily as shown above. This means that it can be considered a “safe” business to enter the industry as a supplier, because many will buy the products. However, the bargaining power does not seem to lie with the suppliers, because corporations like, Nike, Adidas, Puma, and also hummel, can easily change supplier to where they may find the most satisfying conditions in terms of price and quality. The final element in Porter’s 5 forces is the bargaining power of buyers. Buyers’ bargaining power can on one side be considered to be low, because there are many potential buyers of hummel’s products. People need clothes, because, according to Maslow, it fulfils one of the fundamental human needs by protecting against the weather, (Kotler et al. 2009). However, since the financial crisis may have made consumers more sensitive to price, hummel may have lost some of its bargaining power, because consumers may, to a higher degree, look for the best deal in terms of value for money. Hence, the bargaining power of buyers is increased due to the many competitors and substitute products that are available in the marketplace. Also, it does not cost the consumer anything to shift from one brand to another. However, some consumers may fear the loss of face if they change from the most fashionable clothes and sportswear to less branded products which, to some, appear to be of discount value (Varner and Beamer, 2011). Moreover, since hummel is not a strong global player compared to Nike, Adidas and Puma, hummel may have a lower bargaining power towards the individual consumer compared to the bargaining power of the dominating players in the market place. In sum, when Porter’s 5 forces are applied to the apparel and sportswear industry, it is found that there is quite fierce competition in the marketplace, due to the many competitors and substitute products. New entrants may use the technological development to create a competitive advantage, but hummel also have the opportunity to make use of this, and thereby improve its ability to compete effectively. The bargaining power of suppliers is considered low, because there are many suppliers to choose from. And finally, the bargaining power of buyers appears to be high, even though there are many potential consumers. The fierce competition in the marketplace makes it easier for consumers to easily swap between brands based on personal preferences and tastes. Rasmus Frost Hansen Page 36 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 Competition and marketing strategies In terms of competitive strategy, it is argued that hummel function as a market niche. This is due to its relative small size on the global market, since hummel is not explicitly represented on the Euromonitor International’s list of the brands with the highest market share. However, if looking at hummel’s Company Karma website one can see that it is carrying out a lot of activities in Europe, and especially in Eastern Europe. Based on this, one can argue that hummel use the European market to be a geographic specialist – especially in the Eastern European market (Kotler et al. 2009, p. 326). Furthermore, it is assumed that hummel is relatively strong in the Northern European countries because these are closer to the company’s home market(s), Denmark and Germany. In elaboration, it is questioned whether hummel is actually a global player in the sportswear industry. According to Longman’s Dictionary of Contemporary English22, global is something that affects the whole world, whereas international23 means only to involve more than one country. And based on the activities that are depicted on the map on hummel’s karma page, it is found that hummel only have a very few activities outside Europe and some parts of Africa. Asia, North- and South America, and Australia are markets where hummel appears to have very few, if any, activities. Moreover, even though hummel is a relatively small player in the global sportswear/apparel industry, it is able to compete in markets where Nike, Adidas and Puma may not be as strong competitive forces compared to North America and Western Europe. Especially in the Eastern European, the Middle East and even in some African regions (according to the interactive map on hummel’s karma page), hummel seems to be aiming for the future consumer potential in developing countries. This may be due to the blue ocean potential in markets like the Sub-Saharan regions of Africa, where, according to the International Monetary Fund, economic steady growth takes place, even though the regions may be troubled with political instability and drought24. Then, hummel may be able to gain a competitive advantage in the developing markets by the means of the company’s CSR-initiatives, e.g. the sponsoring of Sierra Leone Amputee Team from Free Town25 and the Afghanistan-NATO women’s football match, because the CSR-activities may be interpreted as both strong functional and emotional benefits for the consumer with regards to hummel’s value proposition (communicating the value of hummel) (Aaker, 1996, p. 79). 22 http://www.ldoceonline.com/dictionary/global http://www.ldoceonline.com/dictionary/international_1 24 http://www.imf.org/external/pubs/ft/reo/2012/afr/eng/sreo1012.pdf 25 http://www.hummel.net/en-DK/karma/page/4/Sierra%20Leone%20Amputee%20Team 23 Rasmus Frost Hansen Page 37 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 The functional benefits of hummel’s CSR-activities are the products they provide for the women in e.g. Afghanistan. Also, it can be argued that the mediation of the issues, like poverty or armed conflict, also serve a functional benefit, because more people are made aware of these issues and may therefore be more likely to help those in need. Then, the emotional benefits may be the happiness these people are assumed to have when playing football, as one of the female Afghan soccer players says, “The match is important to us, because it shows the world that there are Afghans who are against war and in favour of peace and happiness”26. In addition, it can be argued that hummel provides those affected by its CSR-activities with self-expressive benefits, because the company helps them overcome the issues they face via mediation of their troubles and by giving them an opportunity to improve their lives through sport. Hence, hummel may increase the opportunity for a satisfied consumer base in the future, because when delivering the value proposition of the company, it can be argued that people will judge hummel positively (Spence, 2002, in Galbreath and Shum, 2012, p. 214). This means that hummel’s reputation is affected positively, which may lead to increased sales in the regions where the CSR-activities take place, because the people there are aware of what hummel stands for, and may therefore be more likely to choose hummel over its competitors. On the other hand, hummel’s online CSR-communication (not its CSR-activities) is targeted at the contemporary consumer in developed countries, because they have the resources to engage in sports and spend several hundred kr. on apparel and sportswear. hummel may therefore create a competitive advantage in already established markets, because their CSR-activities are assumed to have a positive effect on people’s judgment on the company as proposed by Spence (2002) (ctd. in Galbreath and Shum, 2012, p. 214), and because CSR is often interpreted to improve the quality of 26 http://www.hummel.net/en-DK/karma/page/6/The%20NATO%20-%20Afghanistan%20match?1366014830458 Rasmus Frost Hansen Page 38 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 a company’s products (McWilliams et al. 2001, p. 6). The functional benefits for the target group of the CSR-communication is also considered to be the products hummel offers, but the emotional and self-expressive benefits are most likely different. With regards to the emotional appeals found in hummel’s communication style (pathos), it can be argued that the emotional benefits are based on the the positive feeling of purchasing hummel’s products (including Karma products), because it is communicated that one helps change the world through sport by supporting hummel – in this case via purchasing its products. Hence, the consumer is assumed to feel good about him/herself when making a purchase, because he/she thereby ensure that hummel can keep carrying out its CSRactivities in developing countries. This can also be a self-expressive benefit, because when the consumer feels good about changing the world through sport, he/she may view him/herself as someone who makes a positive difference for others in Afghanistan and Sierra Leone. Then, in order to position itself in the eyes of the consumer, hummel’s value proposition helps creating points-of difference (PODs) and points of parity (POPs) (Kotler et al. 2009, p. 363). The PODs that hummel communicates are identified to be the emotional and interpersonal appeals targeted at the consumer, because this is what hummel emphasises in its CSR-communication – as something unique. Then, in terms of POPs, it is argued that this refers to hummel’s product offerings (sportswear, lifestyle and fashion clothes). This ensures that hummel becomes a part of the consumer’s evoked – and then consideration set, which is to increase the chances of he/she purchases hummel’s products (Solomon, et al. 2009, p. 334). The consumer’s evoked set is the set of brands which he/she knows of, and then the consideration set is the group of brands the consumer will take into consideration when about to purchase e.g. sportswear. Thus, the emotional and functional benefits of the value proposition that are communicated in relation to Company Karma/Karma United, hummel intends to develop points of difference that help the company appear unique, which eventually may increase sales, due to both increased awareness and consideration of hummel’s products in the eyes of the consumer. Furthermore, it is argued that hummel uses a market development growth strategy, because the existing products of the company is marketed in new markets, where e.g. the Afghan women play soccer in hummel’s clothes (Ansoff, 1957, p. 114). This can also be explained in terms of a foothold, which is “a small position that a firm intentionally establishes within a market in which it does not yet compete” (Upson, Ketchen Jr., Connelly, & Ranft, 2012, p. 93). This means that hummel has used a foothold strategy to gain a competitive advantage, because they have entered a market where the competitors may pay less attention, since larger and more traditional markets like Rasmus Frost Hansen Page 39 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 the North American and Western Europe may take up much of e.g. Nike, Adidas, and Puma’s attention. Then, regarding generic strategy, it is found that hummel uses a differentiation strategy, because it appears to be using CSR-communication as a way to stand out in a large market, in large in the eyes of the consumer, instead focusing on narrow market segments or cost-leadership (Porter, 1980, ctd. in Kotler et al. 2009, p. 106). However, the Porter’s generic strategies have been criticised for being too general and to not fit today’s more fragmented markets (especially regarding consumers) (Gurau, 2007, p. 373). Hence, the theories of growth and generic strategy provide one with a general overview, but should not stand alone. Rasmus Frost Hansen Page 40 of 42 BA in Marketing and Management Communication Aarhus University – Business and Social Sciences 06-05-2013 CSR-review By McWilliams et al., (2006), Rasmus Frost Hansen Page 41 of 42
