International candy company leaves bitter aftertaste

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Nestlé Takes a Beating on Social-Media Sites

Greenpeace Coordinates Protests Over Food Giant's Palm-Oil Purchases

By Emily Steel, The Wall Street Journal

For nearly two weeks, environmental activists have been using social media to wage war against Nestlé over its purchases of palm oil for use in KitKat candy bars and other products, catching the Swiss food giant off guard.

Protesters have posted a negative video on YouTube, deluged Nestlé's Facebook page and peppered Twitter with claims that Nestlé is contributing to destruction of Indonesia's rain forest, potentially exacerbating global warming and endangering orangutans. The allegations stem from Nestlé's purchases of palm-oil from an Indonesian company that Greenpeace International says has cleared rain forest to establish palm plantations.

Nestlé says it had already decided to stop dealing with the firm, which supplied just 1.25% of the palm oil Nestlé used last year. It says it bought only a tiny fraction of the firm's output, so any impact was negligible, and that it is working toward buying only environmentally sustainable palm oil. (Though Nestlé makes KitKats in other markets, Hershey, which isn't involved in the battle with Greenpeace, makes the brand in the U.S.)

"We, like Greenpeace and many others, abhor destruction of the rain forests, and will not source from companies where there is verifiable evidence of environmental damage," says Nestlé spokeswoman Nina Backes.

Greenpeace, which is coordinating the protest, says Nestlé hasn't done enough, and is continuing to buy the disputed firm's oil in blended batches sold by third-party suppliers.

Nestlé says it is pressuring its providers to scrutinize their supply chains to keep that from happening, but it has had trouble making itself heard above the din. The difficulty with social media, says Ms. Backes, is "to show that we are listening, which we obviously are, while not getting involved in a shouting match."

Activist groups have long used Web sites, grass-roots email campaigns and videos to publicize their causes. But the attack on Nestlé is part of a new wave of digitally savvy protests, marketing experts say.

"This is the place where major corporations are very vulnerable," says Daniel Kessler, press officer at Greenpeace.

Indeed, some companies have already seen their images tarnished by digital media. Last year, two employees of Domino's Pizza posted a Web video of themselves blowing their noses on pizzas. The company responded within 24 hours with a statement on its Web site telling consumers it knew about the video and had found the pranksters.

The next day, J. Patrick Doyle, then the company's president and now its chief executive, made a video to apologize and say the employees had been fired and were facing criminal charges.

"We were honest. We were honest in our anger; we were honest in our approach. And I think people could sense that," says Tim McIntyre, Domino's vice president for communications. Mr. McIntyre says the company is now more vigilant in monitoring how consumers talk about its brand on social media, tries to be quicker in its response and has instituted a social-media code of conduct for employees.

For Nestlé, the trouble began March 17 when Greenpeace released a report on the company's palm-oil use. On the report's cover was an altered version of the KitKat logo, with the brand's name changed to "Killer."

The same day, Greenpeace protested outside the company's corporate headquarters in Switzerland and posted a mock KitKat commercial on the Web showing an office worker opening the candy's wrapper and snacking on a bloody orangutan finger.

Thousands of protesters swarmed onto Facebook and Twitter and shared the video across the Web. Some Facebook users replaced their profile pictures with the "Killer" logo and posted negative comments about Nestlé on its Facebook fan page. The postings continue, with many of them encouraging a boycott of Nestlé products, but the number peaked last week, according to Nielsen Co.

In the protest's first days, Nestlé asked Google's YouTube video site to remove the mock commercial, citing copyright infringement, Ms. Backes says. YouTube pulled the video, but it continued to spread on the Web.

Nestlé also told Facebook users it would delete their comments from its Facebook page if they included the altered logo. Social-media experts say that only incited the protesters. Nestlé's fan base on Facebook, now mostly protesters, swelled to more than 95,000.

Late last week, Ms. Backes says, Nestlé resumed posting information on Facebook to tell consumers about its palm-oil sourcing practices. She says it is too soon to judge whether sales of KitKats or other Nestlé products have been affected by the protests.

"Like all companies, we are learning about how best to use social media, particularly with such complex issues," Ms. Backes says. "What we take out of this is that you have to engage."

Marketing experts are split as to whether the company should simply shut down its Facebook page. Jeremiah Owyang, an analyst at Altimeter Group, a digital-media consulting firm, says that would close off all lines of communication. Ian Schafer, CEO of digital-marketing firm Deep Focus, sees it differently. "The damage has been so done, it might not be a bad idea to shut down the page and start over," Mr. Schafer says. "It is tough to turn that negativity around."