Building a Wider
Horizon With Labour
JustTea Project — “Building a Business Case for Corporate Social Responsibility in the Indian Tea Industry” has been implemented by three organisations namely, Centre for Education and Communication, New Delhi, FAKT GmbH, Germany, and Traidcraft plc, UK. The main objective of the project was to ‘promote the sustainability of tea trade through improved social standards, fair trade practices and new market opportunities’. The development of a Code of Conduct, the promotion of tea trade in EU and consumer research and campaign were sub-objectives. To achieve these objectives, we followed ‘universal’ (targeting the whole Indian tea industry), ‘multi-stakeholder’ (all stakeholders in tea industry), ‘dialogical’ (consultative process), and ‘CSR from bottom-up’ approaches. The project conducted a consumer research on whether there is a business case for socially and environmentally responsible tea among educated Indian middle-class consumers whose incomes allow to choose quality products. The pilot consumer campaign in selected cities also assessed if and how these consumers can be convinced to buy tea that has been produced observing social, economical and environmental standards. Furthermore, the aim of the campaign was to look into the possibility of consumers’ willingness to pay a price premium for socially and environmentally friendly tea. More than 80 per cent of Indian tea is sold in the domestic market. In 2005, India consumed around 750 million kg of tea. To create a business case for tea which has been produced observing social and environmental standards, Indian consumers need to show an interest in buying such tea at a fair price. The potential request of those 115 million Indian consumers, who dispose of a monthly income above 270 Euro, has not been adequately explored yet for this type of product. The JustTea project wanted to generate relevant data about what importance Indian consumers attach to social and environmental standards in making their purchasing decisions, what premium they would be prepared to pay for such tea, and what would be the cues for marketing socially and environmentally friendly tea. Research was conducted between February and July 2006 in the four metros of Delhi, Kolkata, Mumbai and Bangalore among educated middle-class consumers in four stages: qualitative focus group discussions (Stage 1); structured quantitative questionnaire administered to 1007 customers of Fabindia stores in the respective metros, followed by distribution of leaflets (Stage 2); events with tea quiz and lucky draw in Fabindia stores (Stage 3), and quasi-qualitative interviews with 303 of the earlier respondents to track changes of perception after they have received more information (Stage 4). The survey revealed a growing concern of Indian consumers regarding environmental pollution and the use of pesticides in food production. This concern mainly comes from a worry about personal health, which is affected by unsafe or contaminated food. Social issues, on the other hand, are given less attention in the daily lives. Here child labour was the most mentioned issue and it evoked the greatest concern. Most respondents recalled a few steps that are necessary in tea production, but hardly anybody knew how exactly tea is produced. When it came to the economic importance of the Indian tea industry, surprisingly hardly any of the respondents was able to estimate the number of workforce employed: Only 2 per cent of the respondents said that more of 6,000 people are working in tea (as per a real figure of 1.2 million workers in permanent employment). When presented with a concept of tea that is produced observing social and environmental standards, the overall reaction of the consumers was positive and even enthusiastic. The information was provided in a leaflet, and there was repeated exposure over several stages of the research cum campaign. These inputs increased their awareness about social issues in general and the conditions of workers in the tea industry in particular, and enhanced their positive attitude to the concept and the product. The novel concept, which was introduced to and discussed with the public, persuaded the consumers across the centres to try socially and environmentally friendly tea. For a majority of them, a premium of Rs 20–25 per kg or a 10 per cent addition to their monthly expenses for tea was an acceptable price. The study recommends that before the marketing of the social and environmental benefits of a tea brand, consumers need to be assured of basic product quality (taste, flavour and aroma), which should not be any worse than in their previous choices of tea. All elements of the new product need to translate into direct benefits for the consumer, for example, environmentally friendly production into personal health, and social responsibility into the self-gratification of being a responsible citizen. Some reassurance as to the credibility of the social and environmental claims needs to be given on the package (for example, ISO certificate) or through a website. The JustTea team acknowledges 141 India — a division of Bates India Pvt Ltd — which conducted the research cum consumer promotion in Bangalore, Delhi, Kolkata and Mumbai, and Fabindia, which graciously allowed us to use their shoppers as the universe for this research. We also acknowledge all the respondents who provided us with valuable information. We are publishing this report believing that the findings of the consumer research cum campaign would be important for the marketing of and campaigning for tea in general, and specifically tea which is produced observing social and environmental standards. New Delhi September 2006 JustTea Team
