Unilever dips 6% as rising commodity prices cut into margin outlook

FILE PHOTO: Unilever headquarters in Rotterdam, Netherlands August 21, 2018. REUTERS/Piroschka van de Wouw
  • Unilever slid as much as 6% on Thursday after the company downgraded its margin outlook for the year.
  • The stock was Thursday’s biggest loser among the FTSE 100.
  • The outlook adjustment comes as Unilever finds itself caught in a brewing political row over a decision by Ben & Jerry’s, its subsidiary, to cease operations in what it called the occupied Palestinian territory.
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Unilever slid as much as 6% on Thursday after the company downgraded its margin outlook for the year.

On a Thursday earnings call, Unilever announced that despite healthy sales growth, rising commodities prices had begun to eat away at its operating margins. The company has raised prices but not quickly enough to prevent margins from compressing. Unilever downgraded its margins outlook to “about flat.”

The stock fell on the news, dropping sharply as British markets opened and trending down slowly thereafter. The stock was Thursday’s biggest loser among the FTSE 100.

The outlook adjustment comes as Unilever finds itself caught in a brewing political row over a decision by Ben & Jerry’s to cease operations in what it called the occupied Palestinian territory. Ben & Jerry’s is owned by Unilever but is run by an independent board, signaling a potential conflict over control of the company.

On Thursday, a Texas official said the state’s pension fund was exploring divesting from Unilever under a 2017 law banning investments in any company that boycotts Israel. Earlier on Tuesday, Israeli Prime Minister Naftali Bennett said his country would “act aggressively” against Ben & Jerry’s and warned of “severe consequences.”

“Unilever remains fully committed to our business in Israel,” Unilever CEO Alan Jope said during the Thursday earnings call.

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3 steps to transform your business into a conscious brand consumers will want to support

Ben Cohen and Jerry Greenfield
Ben & Jerry’s cofounders Ben Cohen and Jerry Greenfield in Burlington, Vermont.

  • “Conscious brands” are companies that embody a higher purpose by embracing social responsibility.
  • Consumers are drawn to conscious brands – and they’re also willing to pay more for their product.
  • To become more conscious, be clear on what you stand for, take action, and cultivate partnerships.
  • See more stories on Insider’s business page.

Today, more consumers than ever are demanding that companies become transparent and take a hands-on approach to making the world a better place. They’re looking for what experts call “conscious brands,” companies that embody a higher purpose by having an intentional purpose or embracing social responsibility. Think: Tom’s Shoes or Jessica Alba‘s Honest Company.

According to a report by MWWPR, not only do 90% of consumers say they’re more likely to patronize companies that take a stand on social and public policy matters, 80% say they’ll even pay more for products from such brands.

But you don’t have to be a big name in order to transform your business into a conscious brand. Follow these three steps to make sure that your actions resonate with your ideal customers, helping you multiply your revenue and make a lasting impact.

1. Be clear about what you stand for

Ben & Jerry’s is an iconic conscious brand. Climate justice, LGBTQ equality, and Black Lives Matter are only a few of the socially responsible causes the company has advocated for over the years. And it only makes people love their brand even more.

As people become savvier, trust in marketing is growing more vital each day. It’s not enough to just offer a great product or excellent customer service. Customers want to do business with companies they like, trust and align with. Those brands that sit on the sidelines regarding important issues are coming under greater scrutiny. Meanwhile, those with the guts to take bold but strategically sound stands are being rewarded.

Follow B&J’s lead and include your views and values in your marketing. Share your beliefs, and ask your audience to take part alongside you in supporting the causes you believe in. By intentionally integrating social responsibility as part of your daily business routine, you can ensure you are doing your part in practicing social and environmental responsibility and be seen as a thought leader in your niche.

2. Take action

It’s one thing to talk about the causes you support, but it’s another thing entirely to actually do something about them. People are jaded by outdated marketing techniques, false advertising, and businesses and influencers who don’t walk the walk. While building and running a conscious business requires more intentional decision making and an uncompromising commitment to the mission for good, the reward is the creation of a movement that leads to unparalleled success and impact.

Patagonia is a noted leader in environmental and social responsibility. Their mission statement reflects this well: “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.” From supporting grassroots activists working to find solutions to the environmental crisis to suing the former president of the United States, Patagonia has taken action on the most pressing environmental issues facing our world.

There are countless ways you can become part of the change for good: collect donations, offer scholarships, take part in activism. Use the resources you have – your voice, your business, and your community – to take action. When you weave these actions into your company culture, and it’s embodied by employees and customers alike, you create a movement. By embracing ethical business practices while creating transparency and accountability, and providing immense value, your brand will rise up over the competition.

3. Cultivate partnerships based on values

Co-branding with another company is an effective way to double the awareness around an issue, increase the impact of an effort and, ultimately, expand the visibility of both organizations. Who you partner with has a direct impact on your reputation, your brand and your potential customer’s perception of your business.

As reported in a recent Hubspot post by Sophia Bernazzani, “In 2015, Target partnered with UNICEF on a campaign called Kid Power, which committed Target to one of UNICEF’s sustainable development goals (SDGs). The retailer sold kid-friendly fitness trackers encouraging them to complete various fitness activities, which ultimately helped deliver food packets to underprivileged children around the world.”

To ensure that you’re making smart partnering decisions, choose partnerships that align with your values. If you have not yet determined your brand values, make it a top priority. The best way to do this is to follow my 3S Method. First: Source. Do a Google search of “brand value words.” Choose as many words as possible that you resonate with and feel are important. I like to put them on index cards (or you could use digital Kanban boards) to make step two easier. Second: Sort. Group the index cards with similar words. For instance, honesty, integrity, and truth would go in the same pile. Finally: Select. Choose your final words from the groups by what you feel best represents your deepest values.

Now, use these brand values as your North Star. Refer to them any time you are making decisions, such as who to partner with, who to hire, which clients to work with, and more. Doing so is sure to help you stand out amongst the noise online and attract raving fans with similar values.

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How Ben & Jerry’s makes nearly 1 million pints of ice cream a day

  • Ben & Jerry’s is the best-selling single ice cream brand in the world.
  • It’s gained a cult following thanks to classic flavors like Half Baked and Cherry Garcia and a mission to use ice cream to fight for equality.
  • We visited the plant in St. Albans, Vermont, to see how Ben & Jerry’s pumps out nearly 1 million pints a day.
  • It takes hundreds of workers, special machinery, and a 24/7 operation to package up these pints.
  • Visit Business Insider’s homepage for more stories.

Following is a transcription of the video.

Narrator: Scooped up across 38 countries and up to 75 flavors, Ben & Jerry’s is no pint-sized operation. Its two Vermont factories run 24/7, operated by hundreds of flavor makers. Together, they pump out nearly a million pints a day, from classic flavors like Cherry Garcia and Half Baked to flavors on a mission for criminal-justice reform and refugee rights. And all those flavors have to be delicious.

Sarah Fidler: Our minimum run size, once we get a flavor to the factory, is 80,000 pints. So not only do we have to love it, but 80,000 fans have to love it too.

Narrator: We visited the St. Albans plant in northern Vermont to see how these famous pints flip their way to our freezers. Ben Cohen and Jerry Greenfield started Ben & Jerry’s Homemade Ice Cream in 1978. From a renovated gas station in Burlington, Vermont, they launched a brand based on sustainable ice cream making and advocating for causes they believed in, and it worked. Today, Ben & Jerry’s is the best-selling single brand ice cream label in the US. To pump out its iconic flavors, first it starts with ingredients.

Ben & Jerry’s partners with 250 farms globally to source everything from vanilla bean to milk. Milk comes from the St. Albans Cooperative Creamery, just a mile and a half from the factory. Once the milk’s at the plant, it heads to one of these massive, 6,000-gallon silos.

But before it can be made into ice cream, everyone involved has to suit up, including us. Gowns, hairnets, caps, and boots.

To make the ice cream base, the milk heads to the blend tank. Cream, milk, and lots of sugar are churned together. The factory goes through 6,700 gallons of cream every single day. Every ice cream flavor starts with either a sweet cream base or a chocolate base.

Next, the Mix Master will pour in eggs, stabilizers, and cocoa powder if it’s a chocolate base. Then it’s piped into the pasteurizer. You can’t see it happening, but hot steel plates are heating up the mix to kill any harmful bacteria. The newly pasteurized milk is stored in a tank for four to eight hours, so the ingredients can really get to know each other.

After making the two bases, they’ll head to one of the 20 flavor vats to get a flavor boost.

Fidler: We’re always coming up with new flavors, hundreds of flavors a year, and we usually narrow it down to about three or four. We really love to bring our social mission values into our naming process. For example, Empower Mint to talk about voting rights.

Narrator: Before Ben & Jerry’s famous chunks can be added, the mix has to get to below-freezing temperatures. It’s pumped through this giant freezing barrel, and when it gets to the front, it’s finally ice cream. Along the way, it’s quality tested, meaning lucky factory floor workers get to taste the ice creams.

Then it goes into the first of two freezer visits. When it comes out, it’s 22 degrees and somewhere between the consistency of a milkshake and soft serve.

Now for the best part, the chunks. Founder Ben actually didn’t have a great sense of smell, which meant he couldn’t taste much either. So his big thing was texture. That’s why Ben & Jerry’s has some of the biggest chunks in the ice cream industry. These chunks end up in flavors like Half Baked, Chubby Hubby, or the one we’re making, Chocolate Therapy.

Workers dump in add-ins through the Chunk Feeder, from brownie bites and cookie dough globs to chocolate chunks, fruits, and nuts. They let us give it a try, but it’s not as easy as it looks. Then it’s finally time to pack those pints. Workers stack the empty containers into the automatic filler. The machine drops the pints into position and perfectly pumps in ice cream. It can fill up 270 pints a minute. The pints are pushed towards the lidder and sealed tight.

At this point, six pints every hour are pulled off the line for quality testing. Quality assurance personnel first cut pints open. They’re making sure the ingredients are symmetrical and there aren’t any big air bubbles.

Worker: There is a small gap, but that’s what we call a functional void. If we saw large voids, it would be concerning. It’s actually quite the workout, as you can tell.

Narrator: They also measure the weight and volume of pints to ensure that the right amount of ice cream makes it into each container.

Worker: So, we know the weight of the ice cream, and anything below 460 is not passable.

Narrator: Now back to the factory line. It’s now time for the pints to take a second spin in the freezer. The ice cream has to get even colder, down to minus 10 degrees. The pints travel along the Spiral Hardener, a corkscrew-shaped conveyor belt inside a freezer. With the wind chill, it can get up to minus 60 degrees in there.

After three hours, the pints are finally frozen and ready to be packaged. They’re flipped over and shrink wrapped into groups of eight. Together, they make a gallon. But you’ll never actually see a gallon tub of Ben & Jerry’s ice cream, because the company never wants its ice cream going bad sitting in the back of your fridge. Once the pints are packaged, they’re ready to be shipped across the globe.

Abby Narishkin: Hey, guys, my name’s Abby, and I’m one of the producers on this video. My favorite flavor is definitely Ben & Jerry’s Milk & Cookies, but let me know your favorites in the comments below and if you have any ideas for the next episode of “Big Business.” Don’t forget to hit the subscribe button so you don’t miss out.

EDITOR’S NOTE: This video was originally published in August 2020.

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Ben & Jerry’s partnered with Colin Kaepernick to unveil a vegan ice cream that ‘amplifies calls to defund and abolish the police’

Ben & Jerry's Colin Kaepernick Change the Whirled flavor
Ben & Jerry and Colin Kaepernick’s Change the Whirled flavor.

  • Ben & Jerry’s has teamed up with civil rights activist and athlete Colin Kaepernick to unveil a new vegan ice cream flavor that will be available next year.
  • The Change the Whirled flavor “celebrates Kaepernick’s courageous work to confront systematic oppression and to stop police violence against Black and Brown people,” according to the ice cream maker.
  • Ben & Jerry’s has a history of being vocal on racial, political, and social justice issues in the US.
  • Visit Business Insider’s homepage for more stories.

Ben & Jerry’s has teamed up with activist and athlete Colin Kaepernick to unveil a new ice cream flavor, Change the Whirled.

According to Ben & Jerry’s, the flavor “celebrates Kaepernick’s courageous work to confront systematic oppression and to stop police violence against Black and Brown people.”

Like Kaepernick, Change the Whirled is vegan, and has a caramel sunflower butter ice cream base with fudge bits and graham cracker and chocolate cookie swirls. The ice cream will be available early next year, and all of Kaepernick’s proceeds will go to the Know Your Rights Camp, a Kaepernick-founded organization with the goal of “advancing the liberation and well-being of Black and Brown communities,” according to its website.

Read more: Nike just blew past Wall Street’s expectations, and experts say it’s thanks to tech and taking risks like its Colin Kaepernick campaign

“Ben & Jerry’s commitment to challenging the anti-Black roots of policing in the United States demonstrates a material concern for the well-being of Black and Brown communities,”  Kaepernick said in a statement. “My hope is that this partnership will amplify calls to defund and abolish the police and to invest in futures that can make us safer, healthier, and truly free.”

The ice cream will be sold in the US and parts of Europe for between $4.99 to $5.49.

The ice cream giant’s history of championing causes

Justice Remix'd Ben & Jerry's
Cohen and Greenfield announce a new flavor, Justice Remix’d, during a press conference in 2019

This isn’t the first flavor Ben & Jerry’s has released with a cause. In 2019, the ice cream maker – which calls itself an “aspiring social justice company” – unveiled its Justice ReMix’d flavor with the goal of bringing attention to criminal justice reform and racial inequality in the US, according to Ben & Jerry’s website

Read more: How Ben & Jerry’s embrace of social issues set it apart from the competition, boosted its marketing, and helped it build a positive workplace culture

Ben & Jerry’s has also used other avenues besides themed ice cream flavors to express its views on social and racial issues across the country.

In September, the ice cream maker and Vox Media launched the “Who We Are: A Chronicle of Racism in America” podcast that takes a deeper look at racism and white supremacy throughout US history. And following the death of George Floyd, Ben & Jerry’s published a statement that was lauded by Twitter users for its length and details.

Last year, Ben & Jerry’s also publicly supported H.R. 40 which, if passed, could create the Commission to Study and Develop Reparation Proposals for African-Americans.

“Ben & Jerry’s is proud to diversify our flavor portfolio by honoring Kaepernick with a full-time flavor,” Ben & Jerry’s CEO Matthew McCarthy said in a statement. “We deeply respect how Colin uses his voice to protest racism, white supremacy, and police violence through the belief that ‘love is at the root of our resistance.'”

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