The Coopera-ve Movement A global research study on percep8ons towards coopera8ves.

Transcription

1 The Coopera-ve Movement A global research study on percep8ons towards coopera8ves Ipsos and UQAM. All rights reserved. Contains Ipsos' and UQAM s confiden8al and proprietary informa8on and may not be disclosed or reproduced without the prior wrihen consent of Ipsos or UQAM. Date: June 11 th, 2012 Job Number:

2 Table of Contents Introduc-on 3 Summary of Methodology 4 Summary of Markets 5 Outline of the Discussion 11 Percep-ons Towards Coopera-ves 12 Future of Coopera-ves 39 Conclusions and Key Insights 44 2

3 Introduc-on In the context of the Interna8onal Year of Coopera8ves and the Interna8onal Summit of Coopera8ves, the Chair of public rela8ons and marke8ng communica8ons at l'université du Québec à Montréal organized a research study on communica8ons and coopera8ves. The summit will allow officers of coopera8ves from all over the world to share their opinions and concerns about the industry, and to gleam insights from a series of studies that were conducted on its behalf. As a result of a dona8on made by Desjardins, the Chair was able to mandate Ipsos with the task of uncovering the percep8ons that exist towards coopera8ves. More specifically, a qualita8ve research methodology was undertaken and ten focus groups were organized across five ci8es: Quebec, Manchester, Paris, Buenos Aires, and Tokyo. These ci8es were selected in order to gain a global picture, and to have a representa8on of individuals from nearly every con8nent on earth. In each city, one group was held among people who are currently members of a coopera8ve, while the other was held among non- members. Overall, 81 individuals took part in this study, and while certain conclusions were clearly unique to each city, there was also much convergence in the results, demonstra8ng that there are in fact universal percep8ons towards coopera8ves. The following pages highlight the results of this study, which was designed for UQAM and which will be presented in a forum this October. 3

4 Summary of Methodology Methodology Ci-es Selec-on criteria 10 focus groups (2 in each city) Quebec, Manchester, Paris, Buenos Aires, and Tokyo All par8cipants: Between 25 and 64 years old 50% men and 50% women Do not work in the marke8ng research or adver8sing industries Have lived in their city for at least 2 years Are able to name at least one coopera8ve in their city Have never par8cipated in a focus group about coopera8ves before Have not par8cipated in a focus group in the past 6 months Members Are currently members of at least one coopera8ve The fact that an enterprise was a coopera8ve must have played a posi8ve role in their decision to become a member Project management Non- Members Are not currently members of any coopera8ve The fact that an enterprise is a coopera8ve must have a nega8ve or neutral influence on their decision to do business with it Chris8ne Melançon, Vice- President, and Tom Rigby, Research Manager Discussion guides 4

5 Summary of Markets Markets Covered: Quebec City, Canada Manchester, England Paris, France Buenos Aires, Argen-na Tokyo, Japan 5

6 Summary of Markets Members Quebec City Popula-on: 765,706 (GQA) Date of groups: April 18 th, 2012 Best known coopera-ve: Desjardins (banking, insurance) Percep-ons at a glance: The par8cipants here felt that the coopera8ve industry in Quebec revolved around one main enterprise, Desjardins. Aside from this, it was generally believed that the other small, local coopera8ves were implicated in helping their communi8es, but were rarely discussed in the media. Most of the par8cipants had clear percep8ons about what the coopera8ve model entails and were proud of the principles it stands for. However, there was a strong percep8on that the younger genera8ons values were much more individualis8c and money- oriented than their own or their parents, and that as a result, the relevance of coopera8ves would diminish over 8me. In addi8on, there was some concern that as coopera8ves grew in size, they became less true to their original principles, and were more likely to resemble regular corpora8ons. Non- members 6

7 Summary of Markets Members Manchester Popula-on: (GMA) Date of groups: April 23rd, 2012 Best known coopera-ve: The Coopera8ve (food, banking, insurance, travel, etc) Percep-ons at a glance: There was a strong associa8on between coopera8ves in general and The Coopera8ve, which was thought to be the largest in the industry. The members here felt an ahachment towards coopera8ves, and considered them to be part of Manchester s historical landscape. However, they also felt that the younger genera8ons were not growing up with the same emphasis made on coopera8ves, and that these enterprises will become less relevant over 8me as a result. The non- members knew the basic principles of coopera8ves, but ques8oned whether they actually operated any differently than private companies. This was omen on account of the size that some coopera8ves had ahained. Non- members 7

8 Summary of Markets Members Paris Popula-on: 12,089,098 (GPA) Date of groups: April 25th, 2012 Best known coopera-ve: Crédit Mutuel (banking, insurance) & Crédit Agricole (banking, insurance) Percep-ons at a glance: The coopera8ve industry in France was believed to be concentrated most in the financial and food sectors, and the two best known coopera8ves were Crédit Mutuel and Crédit Agricole. The members felt pride in doing business with a coopera8ve and agreed strongly that they do contribute to a beher world overall. However, both they and especially the non- members, felt that as coopera8ves gained in size, they ceased to be true coopera8ves. In effect, the larger they became, the more they were perceived as being like every other enterprise. In addi8on, the non- members considered coopera8ves to be per8nent in rural areas and in the agricultural sector, but less so in large ci8es or in finance. Overall, the Parisian par8cipants showed the most skep8cism about coopera8ves adhering to their principles. Non- members 8

9 Summary of Markets Members Buenos Aires Popula-on: 12,801,365 (GBAA) Date of groups: May 2nd, 2012 Best known coopera-ve: Banco Credicoop (banking, insurance) Percep-ons at a glance: There was a percep8on in Buenos Aires that coopera8ves are closely linked to the government, and that the laher plays a role in controlling how coopera8ves operate. In addi8on, some par8cipants thought that the organiza8on of coopera8ves had played an important role in preven8ng factory closures or home evic8ons during the na8onal crisis of As such, both members and non- members saw these as important organiza8ons, but thought they were more targeted to rural areas or lower income classes. Finally, similar to the other markets, the par8cipants omen felt that large, highly profitable coopera8ves were not really representa8ve of the coopera8ve model. Non- members 9

10 Summary of Markets Members Tokyo Popula-on: 35,676,000 (GTA) Date of groups: May 14th and 15th, 2012 Best known coopera-ve: COOP/コープ (food and groceries) Percep-ons at a glance: The Japanese par8cipants felt very posi8ve towards food- based coopera8ves specifically. They perceived these coopera8ves as having stricter standards, and thought they were more steadfast in their commitment to quality and safety. This hit home in Japan where the tsunami and earthquake affected nuclear plants and radioac8vity, threatening the safety of Japanese- grown food. However, large, urban- based coopera8ves were considered to be more disconnected from the original principles, which raised skep8cism. In addi8on, a few par8cipants men8oned stories of coopera8ves ac8vely recrui8ng over the phone, as do the fringe religious groups, which heightened concerns. Non- members 10

11 Outline of the Discussion Introduc-on â Percep-ons Towards Coopera-ves â Perspec-ves of Members â Perspec-ves of Non- Members â The Future of Coopera-ves â Conclusion 11

12 Members & Non- Members Percep-ons Towards Coopera-ves 12

13 First Words: Summary At the start of each group, the par8cipants were asked to write down the first words that come to mind when they think of Coopera8ves. This exercise allowed us to gain insights into the top- of- mind artudes that people have about coopera8ves, and to determine how informed they are about them. Throughout this exercise, the par8cipants (both members and non- members) were more likely to associate posi8ve terms with coopera8ves than nega8ve ones, sugges8ng that coopera8ves generally have a good reputa8on. The idea of the collec8ve or the group, and sharing or mutual ownership, were the first words that were heard most omen. In addi8on, coopera8ves were frequently associated with agriculture or agricultural loca8ons, and par8cipants saw these smaller, naturally close- knit communi8es as more relevant to the coopera8ve movement. When nega8ve words were men8oned, they typically revolved around a lack of trust or skep8cism. Comments of this nature were heard most in Paris and Buenos Aires, and stemmed from a percep8on that coopera8ves do not actually adhere to the principles they stand for. Quebec City Manchester Paris Buenos Aires Tokyo 13

14 First Words: Quebec City In Quebec City, both groups shared the percep8on that coopera8ves equal teamwork and community. Importantly, in the second group, the detail and depth of responses was less than in the first, and the non- members were more likely to associate coopera8ves with money or commerce, seeing them as just another type of corpora8on. While their artudes towards coopera8ves were not necessarily nega8ve, they did demonstrate a lack of understanding or familiarity. Quebec City: Members Teamwork/community Economical/savings Profit sharing Desjardins La Coop Fedérée Members Associa8on Democracy Quebec City: Non- members Solidarity/community/group Members Profit sharing Money/commerce 14

15 First Words: Manchester Although Quebecers focused most on the no8on of teamwork, par8cipants in Manchester were more preoccupied with the idea of mutual ownership and profit sharing (the financial element). Once again, the non- members proved to be less informed about coopera8ves, but did not appear to harbor any nega8ve percep8ons or feelings towards them. It should also be noted that when these non- members discussed shares or dividends, they were omen misinformed and under the impression that coopera8ves were similar to public companies and that one received dividends, vo8ng rights, or could earn capital gains based on the number of shares he or she purchases. Manchester: Members Owned by the members Dividends/profit sharing Coopera8on/teams Employers/work Community members Fair trade/ethical Manchester: Non- members Owned/run by members Shares in the organiza8on Provides dividends 15

16 First Words: Paris The Parisian par8cipants, like the Quebecers, associated coopera8ves most omen with groups, teams, and unity. The par8cipants here also saw coopera8ves as prominent in the agriculture sector (and usually less applicable in urban regions). The level of skep8cism surrounding coopera8ves was higher in Paris and manifested itself in different ways. There was distrust of coopera8ves managers, who according to some par8cipants have been accused of mishandling their enterprises finances, but also distrust of the coopera8ve industry as a whole, which some saw as standing for principles that they did not adhere to. Paris: Members Group/team/unity Sharing Mutual Agriculture Associa8on Paris: Non- members Group/together Agriculture Common interests Associa8on Unclear No image Distrust 16

17 First Words: Buenos Aires Both the members and non- members in Buenos Aires saw coopera8ves as represen8ng solidarity or coopera8on, and they ahributed many posi8ve terms to these enterprises. Unlike the other markets, however, members here had a strong percep8on that coopera8ves were affiliated with the government. In addi8on, mul8ple members were convinced that all coopera8ves func8on as non- profit organiza8ons, similar to chari8es. A few of the non- members had the same reserva8ons about coopera8ves as those in Paris did, and were concerned that these enterprises did not actually put principles ahead of profits. Buenos Aires: Members Unity/solidarity Community ac8on/coopera8on Commitment Non- profit Personalized service Government/poli8cal Efficient Buenos Aires: Non- members Mutual aid/coopera-on Having a specific goal or objec8ve Friendly Associa8on Distrust 17

18 First Words: Tokyo Both groups of par8cipants in Tokyo used similar terms to describe coopera8ves, and perceived these enterprises to be non- profit oriented and commihed to mutual aid and common interests. These par8cipants also felt that coopera8ves were generally more firng and appropriate in agricultural regions. In both groups, the specific Consumer COOP was omen men8oned as it was popular for its grocery delivery service. Tokyo: Members Non- profit Helping each other Agricultural coop Consumer coop Run by members Common interests Tokyo: Non- members Consumer COOP Agricultural coop Membership system Non- profit Common interests Strong recrui8ng/persuasion 18

19 Coopera-ves Known Quebec City Manchester Paris Desjardins Mountain Equipment Coop Coop quincallerie Coop d habita8on La Coop Fédérée Coop funéraire CoopZone The Coopera-ve Credit Union John Lewis Crédit Mutuel Crédit Agricole Coop d assurances Banque Populaire Coop Leclerc Caisse Épargne MAAF MACIF CAMIF 19

20 Coopera-ves Known Buenos Aires Banco Credicoop Telephone Coop Ceramics Coop Housing Coop Taxi Coop Tokyo Consumer COOP Re8rement home Coop Agricultural Coop Housing Coop Fishery Coop Trust Coop 20

21 Coopera-ves vs. Tradi-onal Enterprises In most markets, the par8cipants did not see any difference in the quality of products and services between coopera8ves and tradi8onal enterprises. However, the case was different in Japan where there was a higher concern for tainted food products (radioac8ve problems following the earthquake and tsunami), and these par8cipants (par8cularly the members) thought that coopera8ves were more commihed to ensuring the quality of their food. Most people felt that coopera8ves did not exist solely to earn profits, and that because they were required to redistribute the profits that they do earn, less money remained for marke8ng and R&D ini8a8ves. As such, coopera8ves were omen seen as less popular (less of an adver8sing presence) and less innova8ve or up- to- date in terms of the technology they employ. On the posi8ve side, coopera8ves were consistently thought to be more commihed to providing excellent customer service. In fact, many felt that while tradi8onal enterprises put profits above all else, for coopera8ves, excellent customer service was the ul8mate bohom line. (con8nued on page 22 ) Quebec City Manchester Paris Buenos Aires Tokyo Quality of products/services No difference between coopera8ves and tradi8onal enterprises Coopera8ves have higher quality Research and development Customer service Popularity Coopera8ves were perceived as inferior to tradi8onal enterprises Coopera8ves were perceived as superior to tradi8onal enterprises Coopera8ves were perceived as less well known, and thus less popular 21

22 Coopera-ves vs. Tradi-onal Enterprises Percep8ons of coopera8ves pricing changed between markets. Those who perceived coopera8ves to have higher prices (Paris and Tokyo) typically inferred that the principles of coopera8ves would encourage them to purchase locally manufactured products, or to employ local labour. As a result of these more expensive prac8ces, it was believed that coopera8ves would have to charge premium prices. On the other hand, in Quebec, Manchester and Buenos Aires, the par8cipants thought that because coopera8ves put other variables ahead of profits, they would be more inclined to charge prices that benefit society rather than earn high margins. Furthermore, these par8cipants felt that coopera8ves were kept in business primarily through their membership fees, and therefore, did not require the same types of margins on the products or services that they sell. Quebec City Manchester Paris Buenos Aires Tokyo Pricing Coops are usually cheaper, but not always Coops are usually cheaper, but not always Coops are priced the same or higher Coops are cheaper Coop prices are more stable, but usually higher 22

23 SWOT Analysis: Summary Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services W Less money for R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 23

24 SWOT Analysis: Strengths When examining the specific strengths that were men8oned, it is important to note that the majority were intangible in nature. For example, aside from customer service, most of these strengths related to the feeling that one gets when shopping at a coopera8ve or the moral principles of these enterprises. This resulted in many current members sta8ng that the coopera8ve model is good for humanity and that these enterprises are less likely to suffer from the type of scandals that have been in the news recently (CEO compensa8on, subprime mortgage crisis, etc). However, what this also demonstrates is that there is a need to more strongly communicate the specific, tangible advantages of coopera8ves, as these moral appeals do not resonate with everyone, especially during tough economic 8mes. Saving jobs or coming to the rescue was a percep8on that was heard exclusively in Buenos Aires. The par8cipants here were under the impression that when Argen8na was experiencing financial collapse, coopera8ves helped prevent factory closings and the loss of homes. Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 24

25 SWOT Analysis: Strengths We re not just a number in a coopera3ve. - Member, Quebec At companies you are just a number, in a coopera3ve the aim is to know everyone by name. - Non- member, BA Coops have more values. You are just a number at a regular mul3na3onal. - Members, BA The objec3ve of a coop is not to make money, it s to have great service. - Member, Quebec I feel good when I go in a coop store. I am glad I shop there. - Member, Manchester Because I feel that (shopping there) is the good thing to do. - Member, Manchester Coops, rather than pursuing profits, their goal is to improve the quality of life of all members. - Member, Tokyo I feel safer with the food at Coops. - Member, Tokyo Some people will never have access to a house except through a coopera3ve. - Member, BA When you are drowning and you desperately need help, then you organize a coopera3ve. - Non- member, BA Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 25

26 SWOT Analysis: Weaknesses In contrast to the strengths, many of the perceived weaknesses of coopera8ves were tangible in nature, and had a direct and no8ceable impact on the products or services received. For instance, many par8cipants felt that by not being purely profit- driven, coopera8ves products and services were more expensive (locally produced), and less innova8ve (insufficient profits to invest in R&D or curng edge technology). Furthermore, most par8cipants inferred that the reason why they do not hear about coopera8ves as much as tradi8onal enterprises was because of a lack of investment in marke8ng or awareness campaigns. Some par8cipants felt that another weakness of coopera8ves was not always including the word coopera8ve in their 8tle (John Lewis was cited as an example). This, combined with less of an adver8sing presence, made it more difficult for non- members to remember that coopera8ves are an alterna8ve, and to know which enterprises are coopera8ves and which are not. Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 26

27 SWOT Analysis: Weaknesses The prices are more expensive for what they are offering. The systems they use are not as modern. They re just not as geared up as other companies. Private companies can spend money on R&D. Coops have limited budgets, can t spend on research. I don t find the marke3ng is strong with coopera3ves. Capitalist (companies) have a stronger marke3ng presence. They need to promote more clearly the advantages that coopera3ves offer to consumers, say why we would go there more than to the others (non- coopera3ves). They can only get money from their members (their members are their pie ). Private companies can go outside membership base for sales. People need to know more who is a coopera3ve and who isn t. Not all coops make it known that they are coops so some people are not running to them. - Non- member, Paris - Member, Manchester - Non- member, Tokyo - Member, BA - Non- member, Paris - Member, Tokyo - Non- member, BA - Member, Manchester Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 27

28 SWOT Analysis: Opportuni-es The par8cipants in the groups were omen at odds about which direc8on they thought society s moral compass was taking. For example, those in the groups who were more op8mis8c felt that sustainable development, buying local, and buying and living green were becoming more common and that socie8es were becoming more aware of the importance of these ini8a8ves. Furthermore, these par8cipants thought that recent scandals (CEO compensa8on, subprime mortgage crisis, etc) would actually benefit society in that they would demonstrate the need to adopt new, less capitalis8c and materialis8c artudes. As a result, these par8cipants thought that the coopera8ve model would benefit. In addi8on, these same par8cipants thought that as the cost of living con8nued to increase, coopera8ves would present a more ahrac8ve alterna8ve. Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 28

29 SWOT Analysis: Opportuni-es I think there will be a point when people put more emphasis on buying local. - Member, Quebec (Because of the financial crisis) it will be a good impact, there will be more need for coopera3ve value- oriented companies. - Member, BA Coopera3ves are a good solu3on if you have a crisis. With a higher cost of living, maybe the coop will be more important in the future. To create more ideas that will help you save. - Non- member, BA - Non- member, Quebec Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 29

30 SWOT Analysis: Threats The less op8mis8c par8cipants had a wholly different view on society s changing artudes, and felt that the recent scandals in the news proved that society was becoming less community- oriented, and more individualis8c and greedy. As such, these par8cipants thought that the coopera8ve model would become less relevant for future genera8ons. Aside from society s artudes, other perceived threats included cheap foreign labour, which can reduce the compe88veness of enterprises who support domes8cally produced products and services. One percep8on that was consistently raised was that coopera8ves have become larger in size over 8me, and that as a result, they no longer represent true coopera8ves. If this con8nues to happen, it was believed that the principles and promises of democracy would be phased out. Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 30

31 SWOT Analysis: Threats Coops seem to have been more popular a while ago, people are becoming more individual oriented, don t have 3me to take care of others, I will work for me and my family. The younger genera3on don t know anything about coops, they don t know why they should go. I don't think that talking about helping the community is the main message, it is the product and the offer these days that maxers most. Globaliza3on. Other developing countries offer much cheaper salaries, harder to compete with. I can clearly see that they are trying to get bigger so they are becoming more like a private company. When it is too big it doesn't work anymore and it loses its values. - Non- member, Quebec - Member, Manchester - Non- member, Quebec - Member, Quebec - Member, Tokyo - Non- member, Paris Beber service, more aben-on to customers S Willing to sacrifice profits to do what is right Honorable and respectable business model Customers are more proud to shop there Business model benefits society Can save jobs, come to the rescue (BA) O Trend of buying local Greener ajtudes Higher costs of living More expensive products/services Less money for W R&D, less innova-ve Do not promote or adver-se as much Difficult to generate sufficient financing Not always clear who is a coopera-ve Community -es are becoming weaker T Greedier, more capitalis-c society More individualis-c society Cheap foreign labour Growing size of coops 31

32 Reasons For Membership Five segments of members were observed within the groups, each of which had a different primary mo8va8on for joining a coopera8ve. The Moralists formed the largest segment, and the driving force behind their membership was a belief in the coopera8ve model and the principles that coopera8ves espouse. The Lifers were found exclusively in Manchester, and were individuals who had learned about coopera8ves as school children, who had grown up going to coopera8ves with their parents, and who perceived them to be part of Manchester s history. For the most part, they never ques8oned joining a coopera8ve. The Service/product seekers were those who placed a premium on great customer service or higher quality products. For most, coopera8ves delivered the best on customer service, and for those in Tokyo, they also represented superior product quality. Deal seekers Service/ product seekers Moralists The Deal seekers were not part of coopera8ves for any moral reason. They simply joined because it was with their specific coopera8ve that they received the lowest price or the highest price/quality ra8o. This segment would be the most easily lured away from a coopera8ve to a tradi8onal enterprise by superior promo8ons or offers. Lifers 32

33 Reasons For Non- Membership Four segments of non- members were observed, each of which had at least one main reason for having not joined a coopera8ve. The Deal Seekers formed the largest segment and were comprised of individuals who were only concerned with gerng the best deal. These par8cipants appreciate the principles of coopera8ves, and all else being equal would be open to becoming a member, but their ul8mate decision rests solely on who makes the best offer, and they do not think that coopera8ves are compe88ve enough. The Unaware were interested in the idea of coopera8ves but lacked sufficient knowledge or educa8on on who is a coopera8ve and who is not. The Unfamiliar were encouraged by what they heard about coopera8ves during the group, but for most, this was the first 8me they had really learned the details of them. They require knowledge and familiarity about what the coopera8ve model is all about, and exactly how it differs from tradi8onal enterprises (and what tangible advantages it offers). The Skep-cs were mostly found in Paris and Buenos Aires, and were leery of the promises made by coopera8ves, ques8oning whether in reality they were any different from most companies. Skep-cs Unfamiliar Unaware Deal seekers 33

34 Awareness of Principles: Members During the groups, each par8cipant was provided with a print- out of the seven principles that coopera8ves adhere to. They were then asked to indicate which principles they were aware of, and whether any came as a surprise. In turn, it became apparent that each principle could be classified into one of three categories: those that par8cipants were aware of and that they had observed in coopera8ves, those that they were aware of but were skep8cal about, and finally, those that they did not know were part of the coopera8ve model. Aware of, and observe Members par8cipate economically Membership is on a voluntary basis and available to everyone The organiza8on is autonomous and independent Democra8c power is exerted by members Coopera8ves are commihed to their communi8es Overall, the members were familiar with the majority of the principles, and agreed that they omen observed them in the way coopera8ves operate. However, two principles came as a surprise to the members, and some even ques8oned whether they were actually part of the coopera8ve model. Aware of, but are skep-cal about Unaware of Coopera8ves cooperate amongst each other Educa8on, training and informa8on are provided The first of these was the coopera8on between different coopera8ves. Most par8cipants typically felt that although coopera8ves were part of the same model, they did not work together in unison. The second was the educa8on and informa8on provided. Many members felt that coopera8ves were rarely heard about or adver8sed to the general public. 34

35 Awareness of Principles: Non- Members Aware of, and observe Members par8cipate economically Membership is on a voluntary basis and available to everyone The organiza8on is autonomous and independent Aware of, but are skep-cal about Democra8c power is exerted by members Coopera8ves are commihed to their communi8es Unaware of Coopera8ves cooperate amongst each other Educa8on, training and informa8on are provided The non- members shared the same opinions as the members about most of the principles, but were surprised to learn that community commitment and democra8c power were officially part of the coopera8ve mantra. To this point, the non- members ques8oned exactly how large, mul8billion dollar coopera8ves could deliver on these promises. More specifically, the non- members were skep8cal that with thousands of members and upper levels of management, decisions could truly be made democra8cally. In addi8on, these non- members ques8oned what specifically has been done to benefit communi8es (where is the proof) because they had not heard of about ini8a8ves in this regard (except in Buenos Aires). 35

36 Awareness of Principles Prices are not cheaper and they are not pursuing profits so where is the money going? Lots of aspects that you can t see. Non- member, Tokyo The last one (educa3on principle)...it is surprising because I didn t think that they did that. Non- member, Manchester For a coopera3ve to be successful you need to know the specific needs of the people who are part of it, you can t do that in big ci3es, there are too many people. Member, Buenos Aires When it started it was to help people develop, but today they are just regular businesses. - Non- Member, Paris I see the advantages but I don t see any ac3on in them. It sounds good, but (in the end) it doesn t make a difference. Non- member, Quebec. 36

37 Industry Appropriateness Industry Perceived relevance Reasons given Agriculture High Close- knit communi8es, more interdependence between residents. Food High Dependant on farmers as suppliers, coopera8ves naturally invest in locally grown products which is most appropriate for the food sector. Housing High Apartment complexes allow for a small group of individuals to come to unanimous, democra8c decisions. Banking/finance Moderate Much history in this sector and customer service is cri8cal, but advanced technology, larger companies, and large profits reduce the percep8on of being a true coopera8ve. Insurance Moderate Idem as banking. Technology- based Low Lack of R&D investment is considered to be a main drawback for coopera8ves, so technology based companies do not seem appropriate for the coopera8ve model. 37

38 Past Experience With Coopera-ves Members Non- Members Most of the members were very sa8sfied with their coopera8ve experience, and were unlikely to change to tradi8onal enterprises. They appear to be loyal members and are not at risk of abandoning their membership posi8ons any 8me soon. The Deal seekers would be the most at risk group, but provided that prices and quality remain the same, they will likely stay with coopera8ves. Most non- members did not have any experience with coopera8ves in the past, and had not considered them closely before. However, some were made interested in the coopera8ve model during the groups, and if provided proof of their adherence to the principles, their interest would increase. 38

39 Future of Coopera-ves 39

40 2012: Year of the Coopera-ve Members Non- Members In total, 8 of the 80 par8cipants knew that 2012 was considered as the year of the coopera8ve: Two in Quebec City (both members) Three in Manchester (all members) One in Paris (not a member) Two in Buenos Aires (both members) Those who were aware had learned about it via work (worked for a coopera8ve), university, or by browsing online about coopera8ve- related content. Most agreed with the idea of sponsoring a specific year in order to promote awareness of coopera8ves but in their opinion, this promo8on has not been communicated frequently or loudly enough. 40

41 Building a Beber World The theme of this year, Co- opera:ve Enterprises Build A Be>er World demonstrated the UN s understanding that co- opera3ves are also powerful forces for posi3ve social and environmental change. - Montreal GazeXe, 05/15/2012 If companies put less emphasis on profits and more on caring for people and communi:es, the world would be be>er. Members Most of the members agreed that the principles of the coopera8ve model are very posi8ve, and that if they were to spread to the private sector, companies would be less profit driven and more likely to take the welfare of their communi8es into account. In turn, the impact on society could be a fundamental one. Non- Members Prove it. Is a coop going to reduce crime, reduce pollu:on? No. It s just a marke:ng message. Non- members typically found this statement to be an exaggera8on of the impact of coopera8ves, and some felt it implied that without coopera8ves, the world would be a bad one. The non- members generally agreed that coopera8ves might be able to have an impact in a small town, rural, or agricultural area, but less so in a sprawling, urban, metropolis. Ul8mately, the non- members were skep8cal about this statement and wanted proof as to exactly how coopera8ves had benefihed communi8es in the past, or to hear tes8monials from individuals who had seen the benefits first- hand. 41

42 Coopera-ves As Employers During the groups, the par8cipants were asked for their impressions of what it would be like to work at a coopera8ve. This ques8on presented both posi8ve and nega8ve answers. In most groups, 1 or 2 par8cipants had worked for a coopera8ve in the past, and thus the responses included both percep8ons and experience- based reality. Generally, those who were already members spoke of the advantages while the non- members omen focused on the perceived disadvantages of working for a coopera8ve. Posi-ve Beber work environment: You would probably be protected, you will have more job security. - Member in Tokyo. Most members felt that in a coopera8ve there would be less pressure to perform as the importance of profits was lower than in a tradi8onal enterprise. This would translate into less stress and consequently, a more comfortable work environment. By the same account, the decreased profit- focus would result in greater job security and would make for an environment where it is much harder to be fired. Moral benefits: (There s) lots of investment of themselves. You are more engaged, more helping the community. - Member in Quebec City. In addi8on, the members thought that working at a coopera8ve would give the employees a greater sense of pride in knowing that their efforts are directly contribu8ng to the beherment of society. This was an advantage that was not omen afforded by tradi8onal enterprises. Lible hierarchy/your opinion counts more: Coops value you as a person. You are asked your opinion as an employee as much as customers are asked. You are listened to which is not the case in (other) companies. - Member in Manchester. Due to the principles of democracy and equality at coopera8ves, par8cipants assumed that there would be lihle or no hierarchy there. In addi8on, it was also thought that each employee s ideas would be listened to more closely, and that everyone would be more implicated and play a stronger role in the direc8on of the enterprise. 42

43 Coopera-ves As Employers Nega-ve Lower salaries : It s cheap labour at a coop. You work for a small salary, harder to nego3ate a higher salary. Member in Quebec City. Many par8cipants felt that coopera8ves would not pay compe88ve salaries, both on principle and because the profits are earmarked to be returned to the members and/or the community. Furthermore, even if one did perform well in a coopera8ve, it was believed that it would be difficult to nego8ate higher salaries along the way. Less organiza-on: There are no bosses, no hierarchy. - Non- member in Buenos Aires. It s very hard for everyone to agree on one thing (in general), imagine in a coop. - Non- member in Buenos Aires. The perceived flipside of working in a democra8c organiza8on was that it would be difficult to come to a consensus and that decision making would be a slow and laborious process. As such, some par8cipants thought that it could be frustra8ng to work in a coopera8ve and to have to make every decision as a collec8ve unit. Not for the career driven: Who would aim for that? You go to college to get a degree, why would you aim to work at a place like that, other than for stability? - Non- member in Japan. Finally, because the salaries were perceived to be lower, nego8a8ons were harder, and progression through the company would be a longer process, some par8cipants felt that coopera8ves were not well suited to those who were career- driven and who wanted to ascend the corporate ladder quickly. 43

44 Conclusions and Key Insights 44

45 Conclusions and Key Insights Growth is a double- edged sword for coopera-ves. The most consistent percep8on across all markets was that coopera8ves exist for a higher purpose than simply maximizing profits. As a result, it is very difficult for people to conceptualize or even to believe, that a company can stand for democracy, community involvement, and sharing of profits, and yet s8ll manage to become a mul8- billion dollar organiza8on with thousands of members. From the non- members point of view, if a coopera8ve has achieved this level of success, it must have sacrificed its supposed principles in the pursuit of profit. In other words, an organiza8on cannot do the right thing and s8ll have enough money lem over to become as successful as those who only focused on profits from the beginning. This too- good- to- be- true percep8on affects the level of credibility that large, profitable coopera8ves have, and opens them up to skep8cism and cri8cism about no longer being true coopera8ves. Compounding this percep8on is the fact that many par8cipants feel as though they do not hear about coopera8ves (either in the media or in their social circles), which they assume they would do if the coopera8ves were in fact making all of these improvements in communi8es. As such, to not hear about coopera8ves community ini8a8ves leads many to assume that there are none. While regular corpora8ons unapologe8cally exist to maximize profits, coopera8ves have set a higher expecta8on, and as such, their community involvement needs to be communicated very strongly. 45

46 Conclusions and Key Insights Promote the coopera-ve model with pride. When discussing coopera8ves, Stéphane Bertrand, execu8ve director of the 2012 Interna8onal Summit of Coopera8ves, stated the following: Compared to tradi8onal businesses, no one is really talking about co- opera-ves, even though the movement as a whole represents a big and powerful segment of the global economy. And it s growing. The focus groups corroborated this feeling, and many par8cipants felt that coopera8ves have been 8mid about marke8ng themselves as coopera3ves. They agree that the model is one with strong appeal, but stated that they have not heard enough about how it works or even, which organiza8ons are coopera8ves. They want to hear more communica8on and more specifics on how these coopera8ves ensure that the way they operate is dis8nct from tradi8onal enterprises so that the true benefit of the model becomes clear to all. 46

47 Conclusions and Key Insights Percep-ons of coopera-ves have not modernized. Individuals around the world have an an8quated view of what a true coopera8ve is, and s8ll assume that it is a small, rural- based organiza8on with few members. In order for large coopera8ves to gain appeal, they must first gain trust, and doing so will require that they explain how they have ahained their size without sacrificing their principles. More specifically, how they con8nue to be community- oriented and democra8cally run, while also earning billions of dollars and having thousands of members. The principles of the coopera8ve model are indeed appealing to many, but if individuals do not believe that a coopera8ve actually adheres to these principles (and they do not for the large coopera8ves) then they are lem to make a purchase decision based on the price quality ra8o, which in most instances, is believed to be higher at private corpora8ons. 47

48 Conclusions and Key Insights Coopera-ves must move beyond the intangibles. Aside from service, and higher quality in Japan, many of the perceived strengths of coopera8ves were intangibles (pride, doing the right thing, suppor8ng the community, etc). However, the weaknesses were omen tangible, such as less investment in marke8ng or R&D, the laher of which made the products or services less compe88ve. As a result, many people believe that they will have to make sacrifices in order do business with a coopera8ve and only those who are truly commihed to sustainable business will be en8ced by them. Those who only care about the best deal, or who are on the fence, will likely be lured away by a percep8on that they will be able to receive more for their money in other enterprises that are not burdened by a need to redistribute the profits or to invest them in the community. The other problem with only being perceived as having intangible advantages is that they become easily copied. Inves8ng in the community is an honourable ini8a8ve, but one that is becoming more and more popular in the business world. As one non- member in Quebec put it, (involvement in the community) is not limited to coopera3ves. Look, even Walmart does it now. If consumers begin to feel that they are equally contribu8ng to society whether they do business with coopera8ves or with private enterprises, it is likely that many will switch or stay with regular corpora8ons. Under this circumstance, private companies would offer the best of both worlds, beher deals and a feeling of sa8sfac8on that shopping there helps the community. Coopera8ves need to demonstrate that they can be compe88ve, that they can help the community and s8ll provide great deals. To begin with, coopera8ves can capitalize on a strong percep8on that customer service is superior in their organiza8ons. This percep8on was considered quite important, and one that many people would be willing to pay a slight premium for. 48

49 Conclusions and Key Insights Summary of Percep-ons Coopera8ves do not exist to maximize profits. Coopera8ves are a good alterna8ve for those who want their dollars to benefit their socie8es and communi8es. Coopera8ves that earn substan8al profits must be sacrificing their principles/are not true coopera8ves. Coopera8ves place a high importance on democracy and members opinions. Coopera8ves profits must be redistributed, cannot be invested in R&D. Coopera8ves rely on membership fees to remain in business. Coopera8ves must support locally made products or local labour forces. True coopera8ves are small, so they are best suited to rural areas. Coopera8ves rely on less innova8ve technology, and have less up- to- date offerings. Coopera8ves put more emphasis on ensuring great service or more personalized service for their members. Great service is their bohom line. Coopera8ves prices are omen more expensive. 49

50 Bernard Motulsky Chairholder Chair in Public Rela8ons and Marke8ng Communica8on UQAM Tom Rigby Research Manager Ipsos Marke8ng Chris-ne Melançon Vice- President Ipsos Marke8ng Nadège Broustau Professor Department of Social and Public Communica8on UQAM ext Ipsos and UQAM. All rights reserved. Contains Ipsos' and UQAM s confiden8al and proprietary informa8on and may not be disclosed or reproduced without the prior wrihen consent of Ipsos or UQAM. 50