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8/20/2009

News

The local lie
Big corporations try to hijack the 'local'

 

This new variation on corporate greenwashing — “local-washing” — is, like the Buy Local movement itself, most advanced in the context of food. Hellmann’s, the mayonnaise brand owned by the processed-food giant Unilever, is test-driving a new “Eat Real. Eat Local” initiative in Canada. The ad campaign aims to enhance the brand simply by associating Hellmann’s with local food. But it also makes the claim that Hellmann’s is local, because most of its ingredients come from North America. (A low bar, indeed.)

Frito-Lay’s new television commercials use farmers as pitchmen to position the company’s potato chips as local food – including some Florida farmers – while Foster Farms, one of the largest producers of poultry products in the country, is labeling packages of chicken and turkey “locally grown.”

Corporate local-washing is now spreading well beyond food. Barnes & Noble, the world’s top seller of books, has launched a video blog site under the banner “All bookselling is local.” The site, which features “local book news” and recommendations from employees of stores in such evocative-sounding locales as Surprise, Ariz., and Wauwatosa, Wisc., seeks to disguise what Barnes & Noble is – a highly centralized corporation where decisions about what books to stock and feature are made by a handful of buyers – and present the chain instead as a collection of independent-minded booksellers.

Across the country, scores of shopping malls, chambers of commerce and economic development agencies are also appropriating the phrase “buy local” to urge consumers to patronize nearby malls and big-box stores. In March, leaders of a new Buy Local campaign in Fresno, Calif., assembled in front of the Fashion Fair Mall for a kick-off press conference. Flanked by storefronts bearing brand names like Anthropologie and the Cheesecake Factory, officials from the Economic Development Corporation of Fresno County explained that choosing to “buy local” helps the region’s economy. For anyone confused by this display, the campaign and its media partners, including Comcast and the McClatchy-owned Fresno Bee, followed the press conference with more than $250,000 worth of radio, TV and print ads that spelled it out: “Just so you know, buying local means any store in your community: mom-and-pop stores, national chains, big-box stores – you name it.”

In one way, this corporate local-washing is good news for local economy advocates: It represents the best evidence yet that their grass-roots movement is having a measurable impact on the choices people make.

“Think of the millions of dollars these big companies spend on research and focus groups,” says Dan Cullen of the American Booksellers Association, a trade group that represents 1,700 indie bookstores. “They wouldn’t be doing this on a hunch.”

Signs that consumer preferences are trending local abound. Locally grown food has soared in popularity. The U.S. is now home to 4,385 active farmers markets, one out of every three of which started within the last decade. Food co-ops and neighborhood greengrocers are on the rise. Data from several metropolitan regions show that houses located within walking distance of small neighborhood stores have held value better than those isolated in the suburbs, where the nearest gallon of milk can be a five-mile drive to Target.

A growing number of independent businesses are trumpeting their local ownership and reporting a concomitant surge in customer traffic. In April, even as Virgin Megastores prepared to shutter its last U.S. outlet, independent music stores across the country were mobbed for the second annual Record Store Day. A celebration of local music retailers that features in-store concerts and exclusive releases, the event drew hundreds of thousands of music fans into stores, was one of the top search terms on Google and triggered a 16-point upswing in album sales, according to Nielsen SoundScan.

Across the country, local business alliances – like Stay Local in New Orleans, the Metro Independent Business Alliance in Minneapolis-St. Paul and Arizona Local First in Phoenix – have formed in over 130 cities, calling on people to choose independent businesses and local products and making the case that doing so is critical to rebuilding middle-class prosperity, averting environmental collapse and ensuring that our daily lives are not smothered by corporate uniformity.

Surveys and anecdotal reports from business owners suggest that these initiatives are changing spending patterns. A survey of 1,100 independent retailers conducted in January by the Institute for Local Self-Reliance – where I work – found that amid the worst economic downturn since the Depression, Buy Local sentiment is giving local businesses an edge over their chain competitors. While the U.S. Department of Commerce reported that overall retail sales plunged almost 10 percent over the holidays, the survey found that independent retailers in cities with Buy Local campaigns saw sales drop an average of just 3 percent from the previous year.

None of this has slipped the notice of corporate executives and the consumer research firms that advise them. Several of these firms have begun tracking the trend. In its annual consumer survey, the New York-based branding firm BBMG found that the number of people reporting that it was “very important” to them whether a product was grown or produced locally jumped from 26 to 32 percent in the last year.

“Food is one of the biggest gateways, but we’re seeing this idea of ‘local’ spread across other categories and sectors,” says Michelle Barry, senior vice president of the Hartman Group, a consumer research firm. A report published by Hartman last year noted, “There is a belief that you can only be local if you are a small and authentic brand. This isn’t necessarily true; big brands can use the notion of local to their advantage as well.”

Barry explains: “Big companies have to be much more creative in how they articulate local. … It’s a different way of thinking about local that is not quite as literal.”

One way corporations can be “local” too is to stock a token amount of locally grown produce, as Wal-Mart has done in some of its “Supercenters.” The chain’s local food offerings are usually limited to a few of the main commodity crops of that particular state – peaches in Georgia or potatoes in Maine – and sit amid a sea of industrial food and other goods shipped from the far side of the planet. Yet this modest gesture has won Wal-Mart glowing coverage in numerous daily newspapers.

Wal-Mart, like other chains, has learned that with consumers increasingly motivated to support companies they perceive to be acting responsibility, tossing around the word “local” is a far less expensive way to convey civic virtue than displaying actual civic virtue.

“Local is one of the lower-hanging fruits in terms of sustainability,” Barry says. “It’s easier for companies to do than to improve how their employees are treated or adopt a specific sustainability practice around their carbon footprint, for example.”

Rather than making direct claims using the word “local,” some companies are pushing marketing messages that work by association. One example is a CVS television commercial that begins in a Main Street bookshop, following the owner around as she tends to her customers. The bookshop then transforms into a CVS. The bookshop owner is now the customer. The feel is still very much Main Street.

“Suddenly the kind of unique, enjoyable, grass-roots bookstore experience morphs into a CVS experience,” says Cullen, of the American Booksellers Association. “There’s a Potemkin facade that a lot of chains are trying to put up because consumers now want something other than a cookie-cutter experience.”

Still another corporate strategy is to redefine the term “local” to mean not locally owned or locally produced, but simply nearby. “With the term ‘local’ being so nebulous, it seems ripe for manipulation,” reports Mintel, another consumer research firm that counsels companies on how to “craft marketing messages that appeal to locally conscious consumers” and how to avoid “charges of ‘local-washing.’” The key, Mintel says, is for companies to decide what they mean by “local” and to disclose that clearly so as not to be accused of trying to misappropriate the term.

Corporate-oriented Buy Local campaigns that define “local” as the nearest Lowe’s or Gap are now being rolled out in cities nationwide. Some represent desperate bids by shopping malls to survive the recession and fend off online competition. Others are the work of chambers of commerce trying to remain relevant. Still others are the half-baked plans of municipal officials casting about for some way to stop the steep drop in sales tax revenue.

Chief among them: Orlando. When billboards proclaiming “Buy Local Orlando” first appeared, Julie Norris – a café owner who last year co-founded Ourlando, an initiative to support indie businesses – was excited to see the concept getting such visibility. But she soon realized that the city-funded program, which provides businesses who join with a “Buy Local” decal, seminars at the Disney Entrepreneur Center and a listing on the website, was open to any business in Orlando, including the big chains [see “Ourlando versus Orlando,” May 7]. “We sat down with the city and said, ‘What you guys are doing is a real disservice to the local business movement,’” Norris says. When Norris went public with her complaints, city officials accused Ourlando of being “exclusive” by not allowing chains.

The city did agree to remove from its press materials and website a reference to a study that found that, for every $100 spent locally, $45 stays in the community. The problem was that the study, conducted by Civic Economics, found that result to be true only if the money was spent at a locally owned business. Shop at a chain store, the analysis found, and only $13 of that $100 spent stays in the community.

Many of these AstroTurf campaigns are modeled directly on grass-roots initiatives. “They copy our language and tactics,” says Michelle Long, executive director of Sustainable Connections, a seven-year-old coalition of 600 independent businesses in northwest Washington state that runs a successful “local first” program. “I get calls from chambers and other groups who say, ‘We want to do what you are doing.’ It took me awhile to realize that what they had in mind was not what we do. Once I realized, I started asking them, ‘What do you mean by local?’”

Other examples abound. In northern California, the Arcata Chamber of Commerce is producing “Shop Local” ads that look similar to the Humboldt County Independent Business Alliance’s “Go Local” ads, except they feature both independents and chains. Spokane, Wash.’s Buy Local program, started by the local chamber of commerce, is open to any business in town, including big-box stores. Log on to the Buy Local website created by the chamber in Chapel Hill, N.C., and you will find Wal-Mart among the listings.

The Economic Development Corporation of Fresno County also appropriated the $45-stays-local statistic when it kicked off its Buy Local campaign at the Fashion Fair Mall. The figure was regurgitated on the TV news without any sort of critical analysis. Like Orlando’s, the Fresno campaign aims to boost sales tax revenue by deterring online and out-of-town shopping. It goes out of its way in every radio and TV spot to make sure people know that “local” means national chains and big-box stores. “Buy Local” stickers and posters are now visible on malls and chains throughout the Central Valley.

“For someone to say you are not local if you are a big box, I say baloney. They invested here,” says Steve Geil, CEO of the county’s EDC.

These sales-tax-driven campaigns may well be doing more harm to local economies than good, according to Jeff Milchen, co-founder of the American Independent Business Alliance, a national organization that helps communities grow local business alliances (on whose board I serve). “If you encourage people to shop at a big-box store that takes sales away from an independent business, you’re just funneling more dollars out of town, because unlike chains, local businesses buy lots of goods and services, like accounting and printing, from other local businesses.”

The irony of trying to solve declining city revenue by trying to get people to shop at the local mall is that the mall itself may be the problem. While many California cities are facing drastic budget cuts and even bankruptcy, Berkeley has managed to post a small increase in revenue. Part of the reason, according to city officials, is that Berkeley has more or less said no to shopping malls and big chain stores and is instead a city of locally owned businesses that primarily serve local residents. That creates a much more stable revenue base. Berkeley hasn’t benefited from the temporary boom that a new regional mall might create, but neither has it gone bust.

Can corporations succeed in co-opting “local” – or at least in so muddling the term that it no longer has meaning? The Hartman Group’s Barry thinks that’s possible. “For many consumers, these things are not being called into question much. They say, ‘Hey, it’s my local Wal-Mart’ or ‘my local Frito-Lay truck.’ It depends where you are on the continuum and how you define local, which is a term that is really up for grabs.”

Milchen is less concerned about the faux-local campaigns in cities where there is already a strong local business organization. “It’s more of an educational opportunity than a problem, so long as they respond to it,” he says. But in places where local enterprises are not organized, he fears these corporate campaigns may succeed in permanently defining “local” for their own benefit.

Local-washing has prompted local business advocates to reconsider their language. Many are now using the word “independent” more than “local.” Clearly, language is critical to framing the debate.

Local business advocates hope that industries’ faux-local campaigns will ultimately backfire. “I think the fact that the chains are trying to play the local card in a way makes it easier for us,” says the American Booksellers Association’s Cullen. “I think people are going to recognize that these aren’t authentic, and that’s going to make the real thing all the more powerful.”

Stacy Mitchell is a researcher with the New Rules Project (www.newrules.org) and author of Big-Box Swindle: The True Cost of Mega-Retailers and the Fight for America’s Independent Businesses (Beacon, 2006).

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