Dannon Case Study

Topics: Marketing, Corporate social responsibility, Marketing strategy Pages: 7 (2170 words) Published: October 27, 2013


Steven Wallace
Case Study #3: The Dannon Company
Southern New Hamphire University
Due May 19, 2013

Introduction
Danone, Dannon’s parent company, was one of the largest health-focused food companies in the world. Danone traced its heritage back to 1919 in Barcelona, Spain, when Isaac Carasso wanted to create yogurt with inherent health benefits. Through the years and different lines of succession, Danone continued to grow, but never lost its core vision of providing better health to people through their products. When this case was written, Danone’s global business focus was on fresh dairy (Activia yogurt), bottled water (Evian), medical nutrition, and baby nutrition. Danone viewed the United States as an emerging market for yogurt, thus Dannon’s marketing efforts needed to focus on growing U.S. yogurt consumption and expanding the category, while also growing its brand. (Marquis, p.1) Dannon entered the US market in 1941 and by 2010 was poised to become the leader in America’s domestic yogurt sector. This was a major accomplishment for the simple fact that America’s yogurt market was practically non-existent at the time! A new product, called “Fruit at the Bottom” changed that and became an instant success. In 2007, even though Dannon had success, U.S. yogurt consumption was only 11.8 lbs versus 62.4 lbs in Switzerland and 42 lbs in France (Marquis, Exhibit 2) The implication of the latter statistics to Dannon was the U.S. was a high potential market for the next 5 to 10 years. (Marquis, p. 5) Dannon had maintained a strong commitment to CSR and was integrated into the company’s overall mission of “bringing health through food to as many people as possible.” Their CSR mission, however, was very internally focused and few customers knew about its activities. (Marquis, p.1) Dannon’s CSR activities fell under the Regulatory and Corporate Affairs Department and focused around three key themes: nutrition and health, nature, and people. The case identified notable accomplishments in each of these areas, to include the U.S. Dannon Institute (nonprofit foundation dedicated to promoting excellence in the field of nutrition) with its many noteworthy educational programs. The question behind this case, as proposed by its senior director of public relations, was how Dannon’s long-standing, deeply ingrained corporate social responsibility (CSR) efforts could play a role in achieving Danone’s and Dannon’s overall marketing strategy. Discussion with Key Dannon Leaders brought out the following pro’s and con’s concerning the proposed idea of communicating Dannon’s CSR efforts to its consumers: Pro

Con
Possible increase in marketing of Dannon’s social mission
Hard to measure ROI and benefits would be mostly intangible
Possible increase in marketing individual products
Limited, short-term sales impact
Consumption of products might increase
Impact of consumption might not be immediate
Potential tax incentive or government assistance to promote health programs Competitors could take advantage of hallo effect
Opportunity to communicate what Dannon stands for at the product level Change in overall budget priorities and expenditures for new program Opportunity to use Danone global brand
Critics could say CSR efforts were only for publicity
Brand campaign would have halo effects down to Dannon’s individual products Customers could perceive effort as disingenuous.
Dannon employees would feel better about the company they worked for People don’t buy products just because they like the company’s CSR stance Would help build social interests
May not support business interests

Message might be too complex

(Pro and Con information taken from case study, pages 9 -14) To Communicate or Not to Communicate?
Dannon seems to be very focused on its Return on Investment (ROI) for marketing and communication dollars spent. While the question of whether or not to...

References: Etile, F. & Tyessier, S. (2011). Corporate Social Responsibility and the Economics of Consumer Social Responsibility. Paris School of Economics. August 2011. Retrieved May 18, 2013 from http://ageconsearch.umn.edu/bitstream/120399/2/Etile_Fabrice_359.pdf
Lester, B. (2010). Corporate social responsibility branding survey. Penn Schoen Berland. Retrieved May 18, 2013 from http://www.psbresearch.com/files/CSR%20Branding%20Survey%202010%20EXTERNAL%20FINAL.pdf
Marquis, C., Shah, P., Tolleson, A., & Thomason, B. (2011). The dannon company: marketing and corporate social responsibility (A). The Harvard Business School. Revised September 28, 2011. File number 9-410-121
The Economist. (2001, September 6). The case for brands. Economist.com. Retrieved May 18, 2013 from http://www.economist.com/node/771049
The Economist. (2001, September 6). Who’s wearing the trousers? Economist.com. Retrieved May 18, 2013 from http://www.economist.com/node/770992
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