|
|
 |
|
|
|
|
|
|
|
|
|
 |
|
|
|
|
|
|
Education is marketing, and marketing is education. That's what Gary Hirshberg was thinking when he launched Stonyfield Farms. And that's why he uses tactics that mainstream marketers never would've considered.
|
 |
The true confession, actually, is that Gary and Stonyfield Farms co-founder Samuel Kaymen had no business being in business in the first place. Their only experience had been as educators, running non-profit organizations.
They had no knowledge of the yogurt industry, let alone consumer products, marketing, sales, or the supermarket industry.
They set out with a lot of naivete, chutzpa -- and a really good recipe for yogurt. Because they were educators by avocation and training, Gary and Samuel got their start giving lectures that doubled as sampling events. They put facts about the environment on their yogurt lids. They published their own "Moosletter," and built their own mailing lists.
In other words, they used all the educational techniques typical of non-profit organizations. They didn't draw any distinction between advocating for environmental causes and advocating for their organic yogurt.
Stonyfield's start-up years were 1983 to 1987 -- well before the era of organic awareness. They tapped right into the post-60s, post-70s, maturing baby boomer generation. "People were looking to take greater responsibility for their own health and also wanted to have their purchases count for something more than just a purchase," says Gary, the company's CEO and Prime Moover.  "They liked the idea that their grocery dollars could go to causes that they cared about." Ten percent of Stonyfield's profits are donated, primarily to environmental causes.
So even though Gary and Samuel didn't know much about the business, they believed that only business really had the power -- through the marketplace -- to reach large numbers of consumers with their message about protecting the environment and consuming organic foods.
"Deep down, philosophically, we believe that most problems in society -- most environmental problems -- exist because business hasn't made their solutions a priority," says Gary. "Our idea is that these problems will go away only if business makes finding solutions a priority."
Those solutions may not have materialized as yet, but Stonyfield Farms has been a resounding success by any measure. By the time Groupe Danone SA purchased a 40 percent stake in the company in October of 2001, Stonyfield was posting some $80 million in annual sales, and was America's No. 4 brand of yogurt. The company now tops $100 million and expects to rank No. 3 nationwide very soon.
Underneath it all, Gary says, is the constant creation of new strategies. "We never knew what was really going to work because there were no models for us," he explains. "We led with the only things we really knew -- our yogurt and our causes."
|
 |
Sampling has always been a central part of your marketing strategy.
Yes, that's right. The one thing I know works -- that I absolutely know works -- is sampling. But our idea of sampling was to drive our truck right into the middle of anti-nuke rallies. There we'd be, in a field with 4,000 protestors, handing out cups of yogurt.
People came away knowing that, not only that was this was great yogurt, but also that Stonyfield is a company that truly cares. We would drive to rallies and marches in Washington. We would take the product to school, college and Earth Day events. There was always an environmentalist edge to it.
Do you continue to stage "activist" sampling events like that?
Sure. More recently we came up with the idea of sampling people who ride mass transit, because they're doing something good for the environment. We were thanking them for riding public transit because, by avoiding the use of an automobile, they're saving the production of about 45 pounds of carbon dioxide and about 78 pounds in total of airborne particulates per year.
People riding trains and buses in the morning think they're going to work, but really they're practicing environmentalism in the purist and most powerful way. So we went to the Chicago Transit Authority and told them we'd like to stand on their train platforms, hand people cups of yogurt and thank them for riding the trains.
They said, excuse me? You want to do what? They had never before allowed food to be served on their platforms. But we reached 85,000 people in three days and bumped our market share three points.
Did you include a bounce-back coupon to drive consumers into the stores to buy your yogurt?
We handed out a yogurt, a spoon, and a little flyer that said, "we salute your commute." And then, yes, on the back of the brochure was a coupon.
 But, as a guerilla product, we have never been able to count on redemption. We know that other consumer product companies would look at coupon redemptions and conclude that if redemption is less than 2 or 3 percent, it's not worth doing. But we have never been able to get high velocity or frequency from coupons because we just don't have the shelf presence to create it.
But Stonyfield has always been very retailer-centric.
Well, we had one bucket to go out in the world with -- we didn't have barrels and barrels of resources. We had our little five-gallon pail of tools. One of the tools was the yogurt, another was our mission, another was just us -- our own vitality and energy. So when Samuel and I would finish milking and making yogurt we would drive to the five Stop & Shop supermarkets who had let us in.
The reality was the impulse buy. The final frontier was right there on the shelf -- that person grabbing for a Dannon, Columbo, or Stonyfield was going to make the difference. The best nights were when Samuel and I would go together to demo because I would talk to the consumer while he was sneaking products into her basket. So by the time she got to the front of the cash register and saw the extra cups of yogurt, she wasn't going to bring them all the way back. I'm barely kidding about that.
My point is that we really were stretched. We were making yogurt, milking cows, funding this business, and there were only so many things that we could do. So the retailer inevitably got the highest priority because we knew that that was where the decision was going to happen.
|
 |
Has your activist positioning ever adversely affected your relationship with retailers?
Oh sure. Yeah. I was on the board of Stop Handgun Violence, which in Boston is a fairly well known, non-profit group that advocated for gun safety. I have lost three friends to guns. I felt, as a businessperson, it was important to come forward. We were not telling people that they should or shouldn't use guns. We were saying that if you were using guns, please use them responsibly. Lock them up.
At that time, 15 children under the age of 19 were dying every day in America from guns. So we put on our lids that we supported our friends at Stop Handgun Violence, along with their phone number. Well, one retailer called me and said, "How dare you use my supermarket as your soapbox!" I first argued with him, but ultimately we changed the lids for him.
Another time, less politically, we were talking about the live and active cultures in our yogut. Our lids said, "Multiple Organisms Guaranteed." A woman in the Bible Belt, who owned a chain down there, was horrified by this and she demanded that our yogurt come off her shelves.
Do you consider what you do to be cause-related marketing?
Yes, but I've never liked that term because our cause is not just limited to our marketing. We're more accurately a cause-related company and our marketing is just a reflection of that.
The problem is, when you're engaged in cause-related marketing and you're not fundamentally committed as a corporation to living it, you generate more cynicism than success. When we talk about reducing carbon emissions, we're actually doing it. When we talk about organics and saving family farmers, we're actually doing it. When we talk about donating to environmental causes, we're actually doing it.
A lot of companies have gotten into hot water by often having what I call a high talk:do ratio. They are saying one thing but not necessarily fulfilling that promise on the delivery side.
How is your brand of social activism different from Paul Newman's or Ben & Jerry's, for example?
The difference between Stonyfield Farms and Paul Newman is that we set out with about five hundred dollars in our pockets, Samuel and I. We were  closer to what most businesses have to start with. You beg, borrow, and steal from family, friends, and angels, and you have to get a return on investment.
Newman’s Own doesn't have to do that. They're able to send 100 percent of their profits to charities, which is phenomenal. Were the world full of Newman's Owns, we'd have a hell of a lot fewer problems than we have as a society. So, we are among their biggest fans and we partner with them on all kinds of things. I bow to Paul Newman every day. But I think that what we have proven is you don't have to be Paul Newman to do this.
With Ben & Jerry’s, you have a different situation. Our whole mission is healthy people, healthy planet, healthy food and healthy company. We have benefited from the fact that our basic product stands for health. Our product stands for making you healthier inside. Ben & Jerry’s clearly has not been in the business of selling health, so to some extent their mission and their products are not really linked.
It's been said that Stonyfield is more an ethic than a brand.
That was Frank Riboud, the chairman and CEO of Groupe Danone, who said that. He said it during a Wall Street Journal interview on the day that we were closing our deal with Groupe Danone. This reporter from the Journal was asking all kinds of questions about the balance sheet impact of this acquisition and the return on assets that we were expected to generate for Groupe Danone, and so on.
Frank interrupted him and said: Look, if you want to look at Stonyfield as a financial play, I assure you that their numbers will hold up to any scrutiny. But, he said, Stonyfield is much more than just a balance sheet -- Stonyfield represents an ethic and it's an ethic that we at Groupe Danone have to adopt if we're going to be successful in the twenty-first century.
So would you agree that Stonyfield is more an ethic than a brand?
I think we represent an ethic, but I wouldn't say that we have authorship of that ethic. It's an ethic that most consumers have, which is that if you can get a great tasting
|
 |
product and do good for the planet by voting at the supermarkets -- then why not? It's sort of a societal ethic, but I think we are representative of it.
One of the fascinating trends in my world is that we are now moving into the Wal-Marts and the Costcos. So, here we are, getting shelf space with the mainstream, huge, super retailers. They are now becoming the biggest sellers of organic, nationally. I think it's because consumers have figured out that they can have it all.
Does that trend also explain why you're now investing more heavily in print, radio, and TV advertising than in the past?
Not exactly. The main reason we're doing that is that we're no longer this "little engine that could." We're now the No. 4 brand nationally and the No. 3 brand in the Northeast. We'll soon be the No. 3 brand nationally. And, of course, once you're up there, everybody's taking shots at you. Also, there are fewer brands out there now, and also fewer retailers and fewer distributors, because of the whole acquisition mania that we've experienced.
And so the net of that is that you used to have six months minimum -- and usually one to two years -- before you were evaluated. Now you have 30 to 60 days. If you're not cutting it, there are plenty of other brands trying to fight for those limited number of spaces and are dangling huge dollars in front of the retailer.
We needed to ensure greater pull-through, particularly as we move out of the Northeast, where we're obviously better known. So that has really driven our recognition that we can't depend on just word of mouth alone, particularly when we enter a new market.
Why did you decide to appear in the commercials yourself?
Well, that's a good question. We had a lot of people pitch us a lot of different ideas. We decided that what people really want is the assurance and a bond of trust.
So what better to lead with, we concluded, than just the real thing and just to be ourselves. Did it work? I don't know. But we do know that people saw it and heard it, and we've gotten a heck of a lot of positive feedback from it.
How important is your personality to the success of the brand?
In the early days it was incredibly important because it was all guerilla, one-on-one, word-of-mouth. I think aspects of my personality, the sort of tendency to constantly reinvent, to question norms, to think out of the box, are important.
 But the company, at $100 million now, has become too big for me to manage and influence everything. So, what I depend on is really great people around me. Gary Hirshberg per se is not making or breaking Stonyfield Farms anymore. I've gotten the ball rolling, but a heck of a lot of other people are now driving it.
Does your strategy change at all as you expand out across the country?
Not really. Fundamentally, our strategy is selling high quality, leading with our mission, selling health and so on. As we take our advertising out there, I’ll probably have to do a Spanish-speaking version of our advertising. But I think our message will play in Peoria.
And now that you've got a European connection via Groupe Danone, does that mean that you have plans to go global as well?
We don't have any plans, but I think they may be having thoughts along those lines. We’re pretty focused on our domestic challenge here.
Would your message change if you were to go overseas?
I don't think it would change very much. The reality is that much of what we stand for --- organic, pro-biotic, anti-GMOs, fighting global warming -- are things that are really better understood in Europe than they are here. We'd take the same general approach, which is to cut through the noise by demonstrating that we're a brand that is made by real people, not just some anonymous corporation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
©2002 reveries.com |
|
