The mainstreaming of Fair Trade: a macromarketing perspective

Abstract

Following a brief review of the development and underlying purposes of the Fair Trade movement, the paper introduces perhaps the key issue for the UK Fair Trade movement currently: the mainstreaming of Fair Trade food products. The macromarketing literature, with its focus on sustainable consumption, ecocentrism and a consequent need to change the dominant social paradigm, is used as a framework for analysing the findings of an empirical study of this mainstreaming process involving interviews with and case study material from both Fair Trade organisations and the major supermarkets which have engaged with Fair Trade. The key question that the paper addresses is whether Fair Trade, particularly as it enters mainstream markets, provides an exemplar, from within the existing dominant social paradigm, of the kinds of actions that the macromarketing literature suggests are necessary to enable sustainable consumption. Implications for both the Fair Trade movement and for macromarketing are drawn out.

Keywords:

• Fair Trade
• mainstreaming
• macromarketing
• sustainable consumption
• ecocentrism
• dominant social paradigm

ACKNOWLEDGEMENTS

The authors would like to place on record their thanks to those who were interviewed as part of this research. Without their willingness and candour the findings would be of considerably less value. The presentation of their views and the opinions expressed in the paper are, of course, the responsibility of the authors. The authors would also like to thank two anonymous reviewers and the editors of this special issue for their comments on earlier versions of the paper.

Notes

1. ‘Alternative’ is frequently used instead of ‘Fair’. The origins of this are in the use of the term ‘Alternative Trading Organisations’ (ATOs) a name stemming from the early days of Fair Trade where ‘fair’ seemed too weak a description of the common and radical vision that forged these organisations into a movement.

2. FLO currently sets standards for the following products: cocoa, coffee, flowers, fresh fruit, honey, juices, rice, sugar, tea, wine and sports balls, with standards for more tropical fruit and other tropical products under development. See www.fairtrade.net.

3. FINE is an informal network that involves the Fairtrade Labelling Organizations International (FLO), the International Federation for Alternative Trade (IFAT), the Network of European Shops (NEWS!) and the European Fair Trade Association (EFTA).

4. One of the issues in any analysis of Fair Trade is the lack of comprehensive data across the full Fair Trade product range. The Market Intelligence Section of Leatherhead Food International has produced the most recent international report, which also makes some projections, but even this analyses only Fair Trade food products.

5. A rough estimate gives a ratio of 27, suggesting that the value of coffee sales is around 12 times that of bananas.

6. Traidcraft internal papers.

7. The discussion derives from these interviews which were conducted as follows, all dates being 2004: Fairtrade Foundation (19 April); Traidcraft (23 April); Cafédirect (20 May); Co‐op (25 August); Waitrose (22 September); Tesco (23 September); Sainsbury's (23 September); and Day Chocolate (14 October). In order to preserve the anonymity of the interviewees and protect the organisations, general points are not attributed.

8. The Co‐operative has, however, retailed own‐label ‘Fair Trade’ wines without the Fairtrade Mark but with Traidcraft's name to provide reassurance and prior to the FairTrade Mark being awarded—see further below. Similarly, Tesco retails Traidcraft's tinned pineapple, which has yet to receive the Fairtrade Mark. This, however, is not an own‐label product.

9. De‐listings occur when a supermarket decides that a product is no longer worth the shelf‐space it occupies and would be better employed stocking another product. These are a regular feature of supermarket activity so that the lack of significant de‐listings could be regarded as a positive sign of Fair Trade's ability to hold its own with other highly competitive products.

10. The Ethical Trading Initiative was established in January 1998 with the support of the UK Government's Department for International Development (DfID) to help develop and encourage the use of widely endorsed standards, embodied in codes of conduct, monitoring and auditing methods, to improve labour conditions around the world. Membership consists of firms (including most of the Supermarkets), Non‐Governmental Organisations like Christian Aid, and Trades Unions. See www.ethicaltrade.org.

11. Lancaster's seminal paper within the economics literature introduced the idea that a good is purchased not for itself but for the bundle of characteristics that the good represents. Since different characteristics may be obtained, often in differing amounts, from competing goods, consumers are faced with choosing both which characteristics they prefer and how to make an efficient choice—how to maximise the bundle of chosen characteristics for the minimum price. Marketing theory, of course, uses much the same idea with the concept of ‘benefit segmentation’ capable of being traced back to a similar time as Lancaster's article (Haley, 1968). More recently, Kotler's presentation of product levels (core, basic, expected, augmented and potential—Kotler, 2000, pp. 394–396) together with the associated concept of product attributes (see, for example, Crittenden et al., 2002), provide legitimacy to Lancaster's original conception.

12. The categories accord approximately with the FLO categories (see note 2 above) and are: chocolate/cocoa; coffee; fruit juice; fresh fruit; honey; nuts and snacks, preserves and spreads; sugar; tea; wine/beer; sportsballs; and roses. In the more detailed list of separate products 22 different categories/sub‐categories are recorded (Fairtrade Foundation, 2005d).

13. Nestlé ‘is believed to be planning to test a premium “fair trade” coffee brand carrying the Nescafé name in the UK, with a global rollout to follow’ (Laurel, 2004) and Marks & Spencer's 198 Café Revives have switched all coffee to be Fairtrade Mark certified (Fairtrade Foundation, 2004). Kraft is also apparently considering launching an ethically aware brand, likely to be called ‘Kenco Sustainable Development’, but based on a Rainforest Alliance certification rather than Fair Trade, and with a considerably lower price being paid for green coffee beans (Guardian, 2004a, 2004b).

14. The websites are: www.asda.co.uk; www.booths‐supermarkets.co.uk; www.budgens.com; www.co‐op.co.uk; www.iceland.co.uk; www.morereasons.com; www.safeway.co.uk; www.sainsburys.co.uk; www.somerfield.co.uk; www.spar.co.uk; www.tesco.com; www.waitrose.com. They were accessed between 8 March and 28 August 2004.

15. The original data have been updated here to the latest version and contain 22 categories (see note 12 above). Note that all supermarkets with the exception of Iceland and Spar offer one or more varieties of fresh fruit. Morrisons and Safeway are still shown separately despite the takeover.

16. Sainsbury's followed Tesco in retailing Fair Trade flowers, but the original concern arose over Tesco's introduction of these products.

17. E‐mail correspondence 16–18 November 2004.

18. These figures were given verbally at the interview and are not necessarily current.

19. Bird and Hughes (1997) and Nicholls (2002) both use published consumer data to analyse the ‘ethical consumer’ and while AB socio‐demographic groups predominated in earlier studies there is evidence of a broadening of this to other socio‐demographic groups. Tesco's and the Co‐operative's engagement with Fair Trade is clearly a factor here.