Why Hershey’s treatment of Cadbury doesn’t look so sweet.

 How strongly should companies protect themselves from competition?

Can they over-step the mark at the cost of their profile and good public relations?

Does the behaviour of a giant like Hershey’s damage its own brand equity, despite being legally justifiable?

This week, BlackLab’s blog is going to get passionate. That’s because I’m talking about chocolate. Aside from my wife and my dog, the black lab himself, there’s nothing else I love more. I’m also a proud British ex-pat, and this is about British brands. So don’t expect my usual even-handedness. This post is biased. I make no apologies for it.

Over the last few days, news has emerged from the USA that confectionery giant Hershey’s has struck a legal settlement with Let’s Buy British Exports (LBB) to stop importing all Cadbury’s chocolate made overseas. It has also agreed to stop importing some UK Nestlé brands such as KitKat bars, Yorkie bars, Toffee Crisp, and also Maltesers, manufactured by Mars confectionery.

This has caused outrage amongst ex-pat Brits who will miss their favourite treats. Some of you might consider this to be nothing more than a storm in a Creme Egg-cup, but it has made enough waves to reach TimeMagazine. Furthermore, it speaks volumes about Hershey’s, and in my opinion, this could be a gaffe that the company might live to regret, when considered in PR and branding terms.

Uncle Sam and John Bull are slugging it out over . . . chocolate . . . kind of . . .

The case for the defence

I’ll keep this brief, because frankly, I’m not impressed by it.

According to the NewYork Times, a Hershey’s representative explained that these products had been imported when they were not intended for sale in the USA, and that this was infringing on its trademark and trade licencing. Hershey’s does indeed have a licencing agreement to make Cadbury’s chocolate in the USA, with similar packaging but with a different recipe. Plus, as the NYT notes, the ban on Toffee Crisps is owing to its packaging, which too closely resembles Reese’s Peanut Butter Cups, and Yorkie bars infringe on the York peppermint patty, apparently.

So, Hershey’s is protecting the brands for which it is responsible in its market, from products that seem identical but aren’t. The NYT quoted Jeff Beckman of Hershey’s, who wrote in an email:

“It is important for Hershey to protect its trademark rights and to prevent consumers from being confused or misled when they see a product name or product package that is confusingly similar to a Hershey name or trade dress.”

Why Hershey’s recipe for brand-protection leaves a sour taste?

Thanks so much for that clarification, Mr. Beckman. Now let’s examine it.

As regards the licencing, strictly speaking and from a legal standpoint, Hershey’s is correct. It would be foolish to argue with it.

However, this seems to me to be one hell of a heavy-handed, some would say bullying move on Hershey’s part to . . . wait for it . . . stop the import of products that consumers like more.

Yes, the recipe for the licenced US Cadbury products has more sugar, less milk and different emulsifiers than the UK originals, giving it a different taste, texture and a longer shelf-life. Did I say different taste? Sorry, I meant a WORSE taste.

There, I’ve said it, and lovers of the real stuff feel the same way, judging by the media reports. So what we have here is a corporate giant stamping its heavy boots on the importing of a relatively small number of rival products, which are, frankly, better than its own, in my humble opinion.

British chocolate. Yum! Delicious, according to discerning ex-pat Brits

To put it in non-technical terms, the recipe of American chocolate is crap. Some years ago, I was lucky enough to watch the food scientists and sensory analysts at work in one of Nestlé’s European confectionery R&D centres. What I learned from my visit was that chocolate can be given a kind of geographical profile, depending on its flavour and viscosity.

These factors are based on the recipe. So a darker, purer, more bitter chocolate, with a higher proportion of cocoa solid and lower milk and sugar, levels, is more suited to the continental European market. Europeans have a very sophisticated palate when it comes to chocolate. A more milky, sugary variety is preferred by the Brits, but compared to American chocolate, it’s nearly as pure as the driven snow, because their stuff is packed to the brim with crappy sugars and ingredients that give it a sickly sweetness. It’s literally kids’ stuff compared to the others, designed for an infantile and unsophisticated palate.

 

American chocolate. Yeuch! Rubbish, according to those same discerning consumers

Doubtless Hershey’s knows this, and I suspect it feels that increasingly, US consumers know this too. And they want something different . . . better. So it saw a threat to its core product range, the traditional American favourites like Hershey’s Kisses and Reese’s Pieces. But rather than improve their recipes, which, Heaven forbid, would involve the risk of expensive time, effort and investment, the company unleashed its legal eagles and let them crap their litigious guano all over consumers’ choice.

Do I sound mad about this? Good. Because I am. There’s a number of things wrong with this decision on a variety of levels. Here’s the list:

1.     It’s a disproportionate response that makes Hershey’s look like a bully, in my opinion.

2.   It will be perceived by some to be a blunt and brutal restriction of trade, ironically in the country that is the cradle of the free market. Whether this is a fair and accurate reading of the situation is irrelevant. That’s how it looks, and in PR and branding terms, perception is everything.

3.   It’s driven by the lawyers and the corporate “suits”, with little thought to the impact on brand reputation.

4.     It ‘s poorly thought-through, with little consideration for how consumers feel. That’s always a bad idea.

5.  It actually sheds light on what else is available and why it’s better than Hershey’s own products. Ooops! Surely the company really didn’t want to publicise that?

6.  It patronises consumers, the very people who buy these products. Just take a look at Mr.Beckman’s comment, above. Apparently the good people at Hershey’s are deeply concerned that poor Joe and Joanne Public won’t be able to distinguish one product from another when they look similar. Really? I imagine that the vast majority of these consumers can read and think, all without help from the paternalistic people at Hershey. I’m sure their heads won’t burst into flames. Leave them to make their own decisions. After all, using this rationale, Skodas shouldn’t be sold in the same markets as VWs because they come from the same ‘stable’ and it could confuse people. Oh no. That doesn’t happen, does it?

In short, give it up, Hershey’s

By applying the letter of contract, trademark and licencing law, Hershey’s has violated the sanctity of consumer choice, has patronised customers, bullied competitors, and implied that the quality of its own products could be called into question. Well done Hershey’s. What a potentially massive own-goal. This is a blunder that you may well rue. I will watch with interest.

What can baby lotion, nappies and yeast extract teach us about brand advocacy? Maybe, baby, Mum knows best.

It has been a while since I’ve blogged, owing to the happy distractions of organizing a wedding, going on honeymoon, and my wife and I preparing for the arrival of our first baby. We have a couple of months to go but already there has been a lot to learn and plenty to do, not least completely re-organizing our home, and starting to get stocked up with baby-related products.

Yes, this blog entry is all about baby stuff. It’s what’s dominating our waking thoughts at BlackLab Towers. The process of stocking up with baby products has revived my thinking about branding, reputation and public relations. In particular it has got me thinking about the importance of advocacy in the marketing and PR mix.

I realize that I’m about to address the Holy Grail of marketing and PR, namely spreading good word of mouth. It’s elusive, difficult to get, and even harder to maintain. Its value is often tough to quantify but it’s incredibly valuable. My experience alone, albeit as an unscientific sample, testifies to this value.

Consumer choice and PPB syndrome

Now, I’ll be the first to admit that when it comes to baby stuff, I’m a complete ignoramus. This must be the typical status of many first-time dads and mums to be. In fact it’s so typical that it leads to a high incidence of PPB amongst this demographic group. What’s PPB? It’s pre-parental bewilderment and it can be quite overwhelming.

For instance, before the birth of their first child, a friend of mine, and his wife went to a large Mothercare store in suburban London to scope out prams, cots and other supplies. His wife was freaked out by the variety and choice of products. Many she didn’t previously know existed, and many she wasn’t sure she even needed, but felt as though she should buy items, just in case. She was so overcome that she ran out of the store in tears.

I sympathize. The other day, while out shopping, my wife was looking at a device that clears a baby’s nose when they get a cold. I don’t recall having or needing one of these when I was a baby, and I survived. However, we both stood staring blankly at each other, wondering if the item was essential and whether we’d be bad parents if we didn’t buy this over-priced piece of plastic that clears away baby snot.

Voila. Two cases of debilitating PPB, brought on when customers enter a world of which they previously hadn’t been a part, in which they had taken no interest and which they know next to nothing about.

The cure for PPB: Brand advocacy

So what’s the antidote for PPB? Quite simply, we unleash the power of brand and product advocacy.

Obviously, there’ll be those posh papas and mamas who’ll be emulating the glitterati in their buying decisions. Those with the spending power will no doubt be keeping an eye on what the Duchess of Cambridge is choosing for young Prince George, and will be doing the same. Celebrity product advocacy starts at the youngest age, it seems. For those that can, what a nice and easy decision-making process.

However, for most of us mere mortals, a more organic process of advocacy is what influences us. Mrs.BlackLab has been speaking to friends with children to find out what their recommendations are, plus she’s been online on numerous mum and baby forums, in order to gather opinions. Add to this the views of the couples in our birthing classes, and she’s being bombarded with information. Some of it is good and some of it borders on collective hysteria, and it is challenging to separate the wheat from the chaff.

It’s enough to make anyone’s head burst into flames, quite frankly, so the obvious place to turn to clarify the situation is to call upon your own experience (however limited) and to seek advice from your nearest and dearest, especially your own mum and dad.

When this happens, an interesting dynamic occurs. Your memory and your parents’ advice inevitably recall familiar brands and products. You find yourself gravitating towards them even though others may be just as good or better. You simply have no idea. Nevertheless, many of you might understand the wave of relief I feel when, for example, I see the comforting Johnson & Johnson logo on the familiar pink baby lotion bottle, the golden baby shampoo  (no more tears, aaaah) and the white baby powder shaker. In their presence, all the other brands blur into the background, and the tension and unease created by the packed rows of unfamiliar product names just melts away.

This is the power of brand heritage and that relief I feel is a deep-seated feeling of trust. Trust in these products, these brands, what they stand for and for shared heritage, that of the brand itself and my own personal history. After all, these are the products that Mum liked. You can’t argue with that. It’s marketing and PR gold. When it comes to bringing up baby, Mother knows best, right? At least to a complete parenting novice like me. It’s why I love Marmite, because Mum fed it to me when I was an infant. For decades it was advertised as “The growing-up spread you never grow out of.” As far as I’m concerned, never a truer word has been spoken.

So what does this mean for marketing and PR?

Clearly, what we see here in my anecdotal way is how effective advocacy is and how important it is for brands, products and services. Furthermore, I think we can identify a hierarchy of advocacy.

Firstly, there’s celebrity advocacy. Great for the advertisers and us PR bods to get the products on the telly and in the papers.

Then there’s group advocacy. It’s always taken place, but social media is instrumental in helping it to flourish. When Mrs.BlackLab gets recommendations and advice from her groups on Facebook or elsewhere, she taps into a community that shares her experience and interests. It’s a great place to canvass opinion, even though the majority of the members of the group are not personally familiar to you. It’s online word of mouth and it’s very valuable.

But the most valuable advocacy remains real good old-fashioned word of mouth, from those you trust the most: friends, family, colleagues and close contemporaries. Like the group advocacy, these guys of share your experience, but more than that, they actually know you, what you like, what you want and what you need. When they make a recommendation, you really listen.

When a brand has a heritage with these advocates, when you can trust it as much as the people who are recommending it to you, then you are on to a marketing and PR winner.

I’d love to write more about this, but now I must go to the baby supplies shop to peruse the prams, cots and breast pumps. Wish me luck!

What marketing, PR or advertising techniques have had most impact on you as a consumer or customer?

What companies and brands do you trust and why?

What influences you most in your choice of brand or company?

What would turn you from simply a loyal customer to an active advocate of a brand or company?