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TVNZ-NZ Marketing Awards 2017

TVNZ-NZ Marketing Awards 2017: Karma Cola puts money where mouths are

Ethics may not be something traditionally associated with the soda industry, but for Karma Cola, creating good looking, great tasting, do-gooding drinks is at the heart of what they do and so far, that devotion to purpose is paying off.

By StopPress Team | October 17, 2017 | features

"Karma,” says ethical drink manufacturer Karma Cola, “is our purpose and our business model”. “It’s our hero product, it’s the name of our company and it’s the foundation we’ve established to uphold and implement the values that underpin our company.” Those values are something it wears conspicuously on its sleeve and so far, it’s walking the talk admirably.

For a start, Karma Cola buys its cola directly from farmers in Sierra Leone. Not only that, it pays another five cents from every bottle sold back into the Karma Cola Foundation, a fund created to help communities trade their way out of poverty and protect the rainforest the cola comes from. It’s currently the only cola company to give back to cola growers in this fashion, which they dub, the ‘virtuous circle’.

It’s a noble sentiment to be sure, but one that requires a degree of skill – not to mention transparency – to pull off.

“We show all the ingredients that go into our sodas,” says Karma Cola. “All of them organically grown and ethically sourced, and the impact of the money generated by the sale of them. We have no secret recipe and nothing to hide.”

“We saw this as an opportunity to turn a small part of a massive industry into an opportunity to do some good. People in Sierra Leone are still recovering from a 10-year civil war and need a way to lift themselves out of poverty. We saw this as a small way of helping them determine their own futures.”

Running an ethical company has its unique challenges of course. After all, Karma Cola sources its cola nuts from the border of Sierra Leone and Liberia, sugar from India and vanilla from the highlands of Sri Lanka. It then brews it in Tauranga, the UK and Austria before distributing it to over 3,000 cafes in 20 countries. That requires some logistical heavy lifting.

“Out of ten [in terms of difficulty], getting cola from the south-west of Sierra Leone to New Zealand, and establishing a relationship with the people who harvest it, is an eleven,” says the company.

“Fortunately, we have strong relationships with Fairtrade, ethical trade and organics movements through our other company All Good Bananas and previous endeavours.” 

Those relationships enable it to connect with people on the ground in Sierra Leone, establish a supply chain and ultimately, create the story that differentiates Karma Cola.

With a goal to provide economic independence to the farmers and communities it sources from – and to become the most popular ethical soda in the world in the process – the company has worked hard to create messaging that reflects the unique values of the brand as well as give the consumer insight into the process.

By having a clear, unambiguous purpose and communicating that directly to stakeholders of all varieties, Karma Cola has managed to secure both goodwill and buy-in from point-of-origin suppliers all the way through to end consumer.

“Demonstrating the direct relationships and transparency of our supply chain helps us engage with external partners, especially accounts and distributors selling our drinks, and justifies the premium positioning and price,” says the company.

That purpose—so unequivocally expressed—is the glue that holds together the organisation and strengthens its relationships with suppliers, partners and other stakeholders.

‘Think globally, act locally’ the saying goes, and that’s exactly how Karma Cola has approached its big plans for a better soda business.

“We had the goal to provide a route to economic independence to the first village we worked with in Sierra Leone and we’ve done that through our cola nut trading. We’re now working with over eight villages and extending the scope of the Karma Cola Foundation into other grower communities and other countries, including Sri Lanka and India.”

Another, less humble goal? To be the most popular ethical soda in the world.

“We’re on our way. Our growth has been dramatic – we launched just over four years ago and we’ve sold over 10,000,000 bottles and cans so far.”

“Although we haven’t actively tried to go beyond the UK and Austria, we’re now in 20 countries, simply because people have demanded [it]. So you can nd us in great cafes in Iceland, Malta, Denmark, Hong Kong, Japan, France and beyond. So our story and our marketing has brought us great customers, but it has also brought us investment.”

For Karma Cola, the bottom line is, and has always been, making a positive impact on the communities it works with. And that’s where the greatest wins so far have been.

The impact of The Karma Cola Foundation in the Boma and Tiwai regions of Sierra Leone includes: 

● The building of a road bridge ensuring the safe transportation of people and supplies
● Sending 74 children to school annually
● Paying the salaries for teachers in two community-run schools
● Building two rice-processing centres to provide food security
● Supporting an educational HIV/AIDS theatre group
● Erecting a meeting-house and guest house to rent out to support eco-tourism
● Funding medical supplies and awareness training during the Ebola epidemic
● Rehabilitating 12 cola forest farms and developing a seed bank for future seasons
● Helping four women start up their own trade business
● Setting up an adult literacy programme 

“We’ve also learnt that we’re not a charity. We don’t tell the people benefiting from the Karma Cola Foundation what to do, as they know what they need more than we do. Village elders and chiefs of Sierra Leone democratically decide what to do with the funds.

“We’re making a product in a category that isn’t known for its ethics and we’re turning that paradigm around,” the company says.

“We believe something as frivolous as a fizzy drink can actually be a great experience and a force for good.” 

Category
Best Corporate Social Responsibility
Sponsor
Marketing Initiative
The Karma Cola Foundation
Company Name
Karma Cola
Judge’s comment
“In reviewing the entries for CSR, Karma Cola was the standout entry for the judges. In our view, Karma Cola embodies the category it’s entered in – its proposition is all about social responsibility – part of its DNA. Karma Cola’s strategy is also commercially savvy in that it helps them stand out in an incredibly cluttered category. It’s a smart way to be a challenger brand going up against global giants. The judges were also very impressed with the accelerating performance of this young and growing company. It’s not only delivering positive results for the people it’s giving back to, but also building another offshore success story for New Zealand.”
Marketing Partners
Special Group
Finalists
AA New Zealand, Air New Zealand, ANZ 
  • This story will also appear in the Awards issue of NZ Marketing. 
  • To read more on the TVNZ-NZ Marketing Awards 2017, click here.

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