David and Goliath – The battle for Authentic British Chocolate…

25 01 2010

You can also get an audio version of this blogpost here: – LISTEN

Cadburys Dairy Milk

US based Global Giant Kraft foods

The David Vs Goliath battle for ownership of British chocolate maker Cadbury now seems to have been won by powerful global brand Kraft Foods.

Employees of Cadbury, residents of Birmingham where its HQ is located, and the wider British public and press are generally up in arms about this planned take-over.

Their real concern seems to be about the Authentic legacy of the Cadbury brand, and fears that Global food giant Kraft will end the higher purpose and philanthropy that the British brand is famed for, particularly within the Bournville Village suburb where it was founded.

But is this fair? Kraft is recognised in USA as one of its most reputable companies, and Forbes Magazine recently ranked Kraft as number one USA company for sincerity i.e. doing what it says it will do; and number 3 for overall reputation. So why is the British public so concerned?

Recent economic events have created a great deal of scepticism regarding the blatant pursuit of profit – and much of the press reporting in this case has focused on how Kraft has borrowed heavilly to buy Cadbury at a time when the Dollar/Sterling exchange rate makes the purchase cheap. And traditional financial reporting has primarily focused on the profit motives of Kraft, and I have yet to see any journalist dig deeper into the values of the Kraft management team, and its social responsibility record or future strategies and policies. However, Kraft itself also seems to have failed to capitalise on its reputation, and its communication programme seems to have stumbled in todays world of word-of-mouth communication. Its management team has a duty to shareholders to pursue opportunities that meet its stated strategy – which this take-over is, but it has failed to engage the wider stakeholders and is now seen as a hostile enemy.

This leads me to conclude that Authentic businesses need to be GREAT at communicating their values and policies, to generate trust, and to make sure that what they do is aligned with what they say they will do. It also confirms a wider trend that I and my colleagues in Authenticis are finding – that people in general are more concerned about the greater purpose of brands and are shunning those who purely pursue short term profitability for economic gain. Kraft will need to beware of boycotts to both brands in the post-acquisition period.

What do you think? leave a comment below, or get in touch to hear how we can help your organisation in developing its Authenticity.

James Rock Cultivar Consulting

Member Authenticis Consulting Network

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