Campaign UK

There’s more to life than profit


Kraft Heinz’s £115bn aborted at­tempt at a merger with Unilever is surely the most su­perb ex­am­ple of cor­po­rate ob­tuse­ness in a long while.

In pre­par­ing their as­sault, Kraft and its pri­vate-eq­uity backer, 3G Cap­i­tal, must have taken the view that Unilever’s sus­tain­abil­ity agenda and so­cial val­ues are sim­ply mar­ket­ing siz­zle and that Unilever’s board, share­hold­ers and cus­tomers would ditch them for the right price.

You can see why they might think that; even a few years ago, it would have seemed acutely naïve to be­lieve that prin­ci­ples would be al­lowed to get in the way of wealth. Take Kraft’s takeover of the once fiercely prin­ci­pled Cad­bury in 2010 and its sub­se­quent aban­don­ment of prom­ises to sus­tain the Somerdale fac­tory: morally and so­cially of­fen­sive, but ac­cepted busi­ness prac­tice.

So most com­men­ta­tors have taken the view that what an­a­lysts call “the 3G way” would have cost Unilever fac­to­ries, jobs and its cor­po­rate cul­ture. Even so, few dis­pute the crude busi­ness case: in the short term at least, the merger would have driven cost ef­fi­cien­cies and prof­itabil­ity. That’s good busi­ness. For Unilever, though, good busi­ness is nu­anced: prof­itabil­ity har­nessed to and driven by so­cial pur­pose, not at the ex­pense of it.

If you read last week’s bril­liant anal­y­sis by Adam & Eve/ DDB’S David Gold­ing of the “cul­ture ver­sus col­lat­eral” di­vide, you’ll know that in­creas­ingly there are two ap­proaches to ef­fec­tive mar­ket­ing com­mu­ni­ca­tions: one that de­ploys data and pro­gram­matic tar­get­ing and low-cost, fast, flexible copy to nudge con­sumers along the pur­chase path; and one that de­ploys cre­ativ­ity to cre­ate cul­tural mo­ments that in­spire con­sumer pas­sion for a brand and, ev­i­dence shows, drives prof­its for the brand own­ers.

Both ap­proaches can work, though the lat­ter has higher risk but po­ten­tially greater fi­nan­cial re­ward. If you’ve got fire in your belly and pas­sion in your breast, you can’t have read Gold­ing’s piece and dreamed of cre­at­ing that low-cost, fast and flexible copy.

Ex­tend­ing Gold­ing’s ar­gu­ment into a wider con­text, busi­nesses are in­creas­ingly di­vid­ing into two types: those that pur­sue profit with­out any deep so­cial and en­vi­ron­men­tal con­cerns and those that pur­sue profit through a com­mit­ment to sus­tain­abil­ity and so­cial re­spon­si­bil­ity. Both work, though the lat­ter re­quires a longer-term view and an en­gi­neer­ing of the com­pany around its prin­ci­ples. But if you’ve got fire in your belly and pas­sion in your breast, you want to work for the com­pany that’s do­ing the right thing. In­creas­ingly, con­sumers are mak­ing the same choice too. Bravo, Unilever.

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