Case Study 1 Ethique: Balancing planet and profit

115.116 Introduction to Marketing Case Study 1 Ethique Due: Sunday 22 nd August, 11.55pm (NZ time) Please read the case study that follows , then download the Case Study 1 Ethique Answer Sheet, answer the questions , and then submit the answer sheet into the Case Study 1 dropbox in the Assessments section of the 115116 Stream site before the due date. Case study Ethique: Balancing planet and profit classic myth of the entrepreneur who discovers gold while tinkering at home. While studying her biology and chemistry degree, West became aware of the phenomenal amount of plastic generated through the bottles for beauty products. West experimented in he r Christchurch kitchen with taking the water out of beauty products, instead producing them in bars. As a poor business, so she used the living costs from her student l oan to buy ingredients (Nadkarndi, - waste beauty brand. Ethique was founded in 2012 with the goal of saving one million plastic bottles from landfill by 2020 (West, 2021). So far, she has managed to save 12 m illion bottles by tapping into consumer concerns over the amount of plastic in our environment (Ethique, n.d.). In the last 50 years, the growth in the use of plastics has become a large - scale problem that threatens the fragile ecology of our earth. Plas tic replaced natural products like wood and steel, or paper and glass in packaging. However, plastic was not without its problems, and the majority of plastic was produced for single use. The United Nations estimates that around 8.3 billion tonnes of pla stics have been produced since the early 1950s, and that around 60% of this plastic has ended up in landfills or the natural environment (UNEP, 2018). The amount of discarded plastic is becoming a significant problem due to the time it takes to decompose, with some plastics taking up to 400 years to break down (WWF, 2018). This means that nearly all of the plastic produced over the time period we have been making it is still in existence in one form or another. This plastic is contaminating our oceans an d forests, polluting the environment for animals, and in the process disrupting the food chains that humans are dependent on. A study from Australian researchers found that the problem is so bad that the average person now consumes the equivalent of a cre dit card in plastic per week through tiny particles in their water and food (Rorlich, 2019). West says, That just seemed wrong, because not only do you need to package that in plastic, but you also need to ship all of the extra weight. Then the end consumer uses the product in a room full of water . (Kiwibank, n.d.). products are plastic free, using biodegradable ingredients and compostable packaging so that they have less impact on the environment (Ethique, n.d.). The products are vegan and are cruelty free, s o all ingredients are tested on humans rather than animals. At first, growing the business was not easy. But West struck it lucky when she entered into a university competition for entrepreneurs where part of the prize included investment and business me ntorship (West, 2021). Her mentor then helped her launch a campaign for investors in 2015 on the crowdfunding campaign platform PledgeMe. The campaign sold equity (shares) in her business, and within 10 days, she had raised $200,000 to grow Ethique (West , 2021). This investment helped West move her business into an office and grow her team to four. Public relations fueled the rise of Ethique, and following a mention in Forbes, the company was profiled by Huffington Post. This post was then shared by A shton Kutcher and Britney adding further momentum to the brand awareness. Following this attention, West decided to expand to the United States and funding this expansion again through crowdfunding. This time she raised half a million within half an hour. Ethique is now available through retailers in 22 countries, and sends products to 50 countries through its online e - commerce store. Deals with companies like W oolworths in Australia (which owns 950 stores across Australia) and Boots Chemist in the United Kingdom have increased their market penetration. They have extended their range to include pet shampoo and household cleaners. They also have a strong social media following, with over 126,000 followers on Facebook and 118,000 on Instagram. West. "While I always saw Ethique being a D2C [direct to consumer] business online through the Ethique World website , it is really important for people to be able to touch and feel and have a look at the product physically so we need to be in retail stores, an d with our launch into grocery in New Zealand through Countdown we found that very successful, so moving into Woolworths we expect very much the same," she says (Shaw, 2021). just under 1000% (Deloitte, 2019). West aims to continue this growth, with a goal of gaining a market capitalization of $1 billion (Kiwibank, n.d.). The secret to building a market leading company, says West, is in telling the story of your value propos People buy or invest in people, not ideas, so they need to know you, the passion you have, and what your story is . Include pictures and t will look like, and again, people. Photos and videos create empathy and Ethique is a certified B - Corporation (BCorp) , a type of business that is legally required to consider the impact of their decisions on society and the env ironment. However, the company operates like a B Co rp on steroids: 20% of all profits go back into charities that support nature, including Australia Zoo Wildlife Warriors, HUHA (Helping You Help Animals), Project Blue, Virunga National Park, Offset Earth, Oxfam and the City Mission in Auckland. Furthermore, in July of this year Ethique was judged to be in the Top 5% of all BCorps globally. They aim to have direct trade partnerships where possible, and source their coconut oil from Women in Business Devel opment in Samoa, moringa oil from Rwanda, cocoa butter from farming cooperatives in Ecuador and the Dominican Republic and babassu and cupuacu oils from South America. Ethique also funds local initiatives and have worked with over 170 organisations to fun d school groups, tree planting and beach clean an amount calculated at $22.75 an hour which covers the basic costs of living in New Zealand and is higher than the mi nimum wage of $20 (Ethique, n.d; TVNZ, 2021; Employment New Cutting out the plastic reduces their carbon imprint, but they also plant a tree for every order through a partn ership with the non - governmental organization Ecologi (Ethique, n.d.). To date they have planted more than 200,000 trees in Madagascar and are aiming for 400,000 by the end of 2021 (Ethique, n.d.). The New Zealand offices are run on renewable energy, and (Ethique, n.d). Freight continues to be one of the ongoing challenges for the business, with disruption to supply chains from Covid - 19 causing issues (Shaw, 2021). The business is headquartered in Christchurch, with offices in New York and Britain, but the factory produces the bars in Auckland. In October 2018, Brianne went to the market for investors interes ted in helping solve some of these supply chain issues, securing a small number of international backers for an amount that remains undisclosed. desires for more sus tainable products, but also acknowledge their budget. While research indicates 73% of consumers would change their consumption habits to reduce their environmental impact, another study shows that 60% of consumers are unwilling to pay more money to do so (Mortimer, 2020). Ethique shampoos retail at around NZ$22, but they are the equivalent of three bottles of shampoo (Ethique, n.d.). And, in April this year, coinciding with Earth Day, Ethique expanded its range to include lip balms , with completely compostable plastic - free tubes and 100% naturally derived sustainable ingredients. With a strong social media buzz, and a growth in key markets abroad, Ethique demonstrates that it is possible to do good for the plan et and profit at the same time. Also see: https://www.tvnz.co.nz/one - news/new - zealand/kiwi - zero - waste - beauty - brand - ethique - scores - major - international - investment - deal