The C.A.F.E. program, however, has not always lived up to the hype. In the November 2007 edition of the Sacramento Bee, an article titled "Investigative report Promises and Poverty: Starbucks calls its coffee worker-friendly—but in Ethiopia, a day’s pay is a dollar" criticizes the chain’s ethical boasts in brochures and advertisements, especially when factoring in its impact on farmers in East Africa.
“Behind the lofty phrases on the back label are coffee workers who make less than a dollar a day,” the report noted.
Indeed, if there’s a lesson for marketers eager to use certification labels to bolster credibility regarding claims of environmental conscientiousness, it is this: Ethical boasts must match the facts on the ground.
Committed green consumers do. Eco-aware consumers are inclined to do the research, often using database driven websites that offer an assessment of labels and certifications, and not just for coffee. Consumer Reports, for instance, has an Eco-Labels center online at www.greenerchoices.org.
In response to the question "How meaningful is the label?" the Consumer Reports site reports that Fair Trade Certified, Organic, Rainforest Alliance and Smithsonian Bird-Friendly coffee were all awarded a designation of "Highly." Despite the parity of the assessment on Consumer Reports, however, the varying certification programs in the coffee industry are not all alike. This disparity in approach and accountability is a regulation trend that haunts many eco-friendly branding efforts.
Fair Trade Certified coffee, for example, focuses on the viability and economic health of small-scale farmers, as well as environmental practices. Its mission is to “guarantee farmers a set minimum price for their coffee,” cut out the middlemen and create “conditions for long-term sustainability.”
In exchange, roasters and importers agree to pay a licensing fee (about 10 cents a pound for coffee) to use the black-and-white logo. Fair Trade began certifying coffee in 1999 and expanded to certify other products as well, from tea and fresh fruit to honey, sugar and rice. Total retail sales topped US$ 1 billion in 2007.
Fair Trade's coffee certification program continues to grow and it is the fastest-growing segment of the specialty coffee industry, according to its 2006 annual report. In 2006, it certified 64 million pounds, a jump of 45 percent from 2005. The growth of other labels, most notably Rainforest Alliance, though, clearly threatens the once unrivaled supremacy of the Fair Trade label.
For example, in the so-called “bean wars” in 2005, a spat played out in the media over the launch of a coffee line by Kraft Foods certified by Rainforest Alliance destined for European markets. To this day, Fair Trade goes to great lengths to draw distinctions between its model and those of other labels and certifications, especially Rainforest Alliance. On its website, Fair Trade describes its method as “the only certification system that provides an economic benefit to producers in the form of a guaranteed minimum price."
Does quibbling render consumers cynical?
Yes. And not just because Rainforest Alliance and Fair Trade are parsing words. The Amsterdam-based Utz Certified system, created in 1997, focuses on environmental issues rather than worker wages. On its website, the group calls Fair Trade “a poverty reduction program,” that demands a “premium price” from consumers.
Utz explains, in defense of its policy of not requiring a minimum price-per pound: “Market statistics show that the majority of consumers and companies are not willing to make this active contribution.”
Even so, it promotes its system as a “credible tool for brands” to convey trust and credibility regarding their concern for the environment.
The tension among the various certification systems raises a basic question for marketers: How much do consumers care? Is it worth the hit to profits? Despite being first on the scene, Fair Trade Certified coffee isn’t on top when it comes to brand awareness, according to a recent survey by the National Coffee Association and its National Coffee-Drinking Trends consumer survey.
More than 51 percent of the consumers surveyed recognized the Organic Certified label compared to 27 percent recognition of the Fair Trade Certified label. Despite lower awareness levels, the Fair Trade Certified label matters where it really counts—the cash register.
Only 36 percent of consumers aware of Organic Certification in coffee bought it, compared to 55 percent of consumers aware of the Fair Trade Certified label.
Despite consumer cynicism and the squabbling among certification systems, the coffee industry has paved a progressive path, if not the perfect model for other industries to follow.
“It’s now the cost of entry,” noted Dennis Lombardi, an expert on food and restaurant marketing at WD Partners, a Columbus-based retail design firm. “Who's going to say they buy black market coffee for the lowest possible price? Without a certification, it’s like trying to sell a car without cup holders or anti-lock brakes… What’s an option in the mind of the consumer this year becomes a requirement the next year.”