ICMR Case Collection

ICFAI Center for Management Research

This case was written by A. Mukund, ICFAI Center for Management Research (ICMR). It was compiled from
published sources, and is intended to be used as a basis for class discussion rather than to illustrate either
effective or ineffective handling of a management situation.










The Story of Benetton's Advertising Campaigns
MKTG 019
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This case was written by A. Mukund, ICFAI Center for Management Research (ICMR).
! 2002, ICFAI Center for Management Research. All rights reserved. No part of this publication may be reproduced, stored in a
retrieval system, used in a spreadsheet, or transmitted in any formor by any means electronic or mechanical, without
permission.

To order copies, call 0091-40-2343-0462/ 63 or write to ICFAI Center for Management Research, Plot # 49, Nagarjuna
Hills, Hyderabad 500 082, India or email icmr@icfai.org. Website: www.icmrindia.org



MKTG/019


THE STORY OF BENETTONS ADVERTISEMENT CAMPAIGNS

Benetton is used to unfavorable publicity.
- An article in The New Statesman, January 24, 2000.

A CAMPAIGN IN TROUBLE

In January 2000, the United Colors of Benetton (Benetton), Europes largest clothing
manufacturer, released its death-row advertisement campaign featuring prisoners who had been
sentenced to death. The campaign appeared on billboards and in major news publications in
Europe, America and Asia. Benetton had worked for two years on the campaign, for which a
special booklet and video were also released. Benetton claimed that leaving aside any social,
political, judicial or moral consideration, the campaign aimed at showing the public the reality and
futility of capital punishment.

The campaign resulted in widespread protests against the company from the customers as well as a
number of governments. The families of the victims (whom the death row inmates were convicted
of having killed) objected strongly to the campaign. The state of Missouri in the US decided to sue
Benetton, claiming that the company had deceived the state by using the death row inmates as part
of an advertising campaign. (Benetton was reported to have falsely told the state that the inmates
were being interviewed for a project sponsored by the National Association of Criminal Defense
Lawyers.) In an out of court settlement, Benetton had to write apology letters to the families of the
victims. Benetton was also ordered to pay $ 50,000 to the Missouri Crime Victims Fund.

Benetton expected the protests against this campaign to die down, as they had for its earlier
campaigns. However, public opposition in the US intensified further. The biggest setback for
Benetton came in the form of the cancellation of its deal with the US retailing major Sears,
Roebuck & Co. to open Benetton outlets in Sears stores across the US.

Benetton was counting heavily on the deal, signed in late 1999, to improve its miserable
performance in the US markets during the 1990s. (In the early 1980s, Benetton had over 700 stores
in US, the number had declined to 200 by 1999.) After the release of the death row campaign,
Sears stores across the US were picketed and numerous letters of protest were written by the
families of the victims. Alarmed by the protests over its association with Benetton, Sears opted out
of the deal in February 2000.

Sears was not the only store alarmed by the publics reaction to Benettons advertisement
campaign. Analysts commented that most of 500 stores in US were closed because of the
storeowners personal conflicts with the companys campaigns. Meanwhile, reports appearing in
CNN, Wall Street Journal, and Advertising Age, revealed that the campaign was not liked by a
majority of the US consumers.
The Story of Benettons Advertisement Campaigns

3
Benetton, however, stood by its campaign. The companys US director of communications said,
Once again, its very hard for people to see what were doing and understand that its not
advertising, that its a way to get people to think.

BACKGROUND NOTE

The Benetton story began in 1955, when the Benetton family, led by Luciano Benetton (Luciano)
started a small fashion company in Italy. The business expanded significantly in the 1960s and the
Benettons constructed a factory in Ponzano Veneto, Italy. In 1964, Luciano entered into a deal to
open a store for the exclusive marketing of the Benetton range of apparel, a concept hitherto
untried in Italy. The first store was opened in Belluno in 1969 and was an immediate success. The
same year, the company began its overseas business by establishing a store in Paris, France.

During the 1970s, the Benetton empire spread across the globe and established a strong brand
equity. The company was made a public limited company in 1978. In June 1986, Benetton
published its first annual report and secured a stock listing on the Milan Stock Exchange. Soon, the
stock was listed on five other exchanges world wide, including London, Frankfurt, New York,
Toronto, and Tokyo. In June 1989, Benetton made a public offering of American Depositary
Shares (ADS), listed on the New York Stock Exchange. By 1995, Benettons were reported to be
the wealthiest family in Italy.

The company had three production facilities in the industrial complex near Treviso, Italy, on a
190,000 square meter area. The complex was reported to be one of the most modern and advanced
in the world, with a capacity to manufacture around 100 million garments every year. One facility,
in operation since September 1993, manufactured outerwear, skirts and jeans, and the other two, in
operation since July 1995, manufactured cotton jackets and shirts. Benettons wool facility in
Castrette, Italy was operative since 1986. The company also had an automated distribution center
in Castrette (built in 1982), for handling warehousing, invoicing, payment and dispatch operations.

By 2001, Benetton had a presence in 120 countries around the world. The company, selling
apparel for women, men and children and sportswear and sports equipment through 7,000 retail
stores, was even referred to as the McDonalds of the fashion industry. Benetton directly
managed some of the retail outlets, but a majority were run on a franchise basis. Besides the
flagship United Colors of Benetton brand, Benettons other brands comprised Sisley, Playlife,
Nordica, Prince, Rollerblade and Killer Loop. Over the years, Benetton had diversified its product
line by licensing the manufacture of sunglasses, stationery, cosmetics, linens, lingerie, watches,
toys, steering wheels and knobs for automobile gearshifts, golf equipment, designer condoms,
luggage and designer pagers. Besides being Europes largest clothing manufacturer, Benetton was
also the worlds largest consumer of wool in the garment industry. Table I provides a summary of
the companys financial performance.

TABLE I
BENETTONS FINANCIAL PRFORMANCE
(in million Liras)
Year Revenue Net Profits
1994 2,787,672 210,220
1995 2,939,134 220,255
1996 2,871,108 245,642
1997 3,636,800 290,100
1998 3,833,900 293,200
1999 3,838,000 322,000
2000 3,908,000 471,000
Source: www.benetton.com
The Story of Benettons Advertisement Campaigns

4
BENETTONS ADVERTISING HISTORY

Benetton has been credited with pioneering a new era of advertising by removing its product from
its advertisements, and focusing only on colors and the selection and placement of items on the
copy. Analysts remarked that Benetton deliberately manipulated its advertisements over the years
to gain publicity and thus stimulate interest in its products.

Till the 1980s, Benetton advertisements focused on the products, with the logo - a stylized knot of
yarn with the word Benetton printed under it - contained within a dark green rectangle. In 1982,
Oliverio Toscani (Toscani), a prominent fashion and advertising photographer, joined the Benetton
group. On Toscanis recommendation, Luciano handed over Benettons advertising account to
Eldorado - a small advertising agency in Paris. The initial advertisements were conventional in
style, showing groups of young people wearing Benetton clothing. Toscani soon convinced
Luciano that Benettons campaigns should promote Benetton as a lifestyle accessory, rather than
a clothing brand.

In 1984, the All the Colors in the World campaign was launched, showing groups of teenagers
from many countries and ethnic groups dressed in Benetton clothing, with the company logo in the
corner. In 1985, Toscani created the immensely popular United Colors of Benetton theme, aimed
at presenting the message of racial unity. By now, Toscanis rebel streak had become rather
evident, and complaints had been made against the use of the United States flag in one of the
advertisements.

In 1989, Benetton terminated the contract with Eldorado, and began managing its advertisements
internally. This change was accompanied by a significant change in advertising philosophy as
well. The new campaigns neither showed the product, nor used any slogan. The Benetton knot
logo was replaced with the small green rectangle. By 1991, Toscanis photographs were reported
to have completely shifted from being slightly disturbing to socially and politically incorrect. The
companys campaigns appeared only on billboards, at art-shows and in select print media. Since
Benetton wanted its advertisements to appear exclusive and art-oriented, it did not use electronic
media like radio and television.

Throughout the early 1990s, Benettons advertisements featuring a war cemetery, many different
brightly colored condoms, a baby with the umbilical cord, a priest and a nun kissing invited
severe criticism. Though Benetton covered sensitive issues such as child labor, the death penalty,
poverty, the abuse of nature, violence, intimidation, AIDS and peace between the Arabs and
Israelis, their portrayal was almost always a subject of controversy. (Refer Table II).

During the late 1990s, Benetton seemed to have become even bolder, increasingly featuring nudity
in its advertisements. Even Luciano posed naked for a campaign. In 1998, Luciano said, Its our
prerogative to photograph a new collection in unusual places: were more interested in discovering
people than in selling them dreams. So here is the search for real people and real stories, here is the
discovery of beauty without stereotypes; here is diversity highlighted by uniqueness. However,
there were few buyers for this explanation.

Over the years, many newspapers in countries around the world refused to print Benettons
advertisements. The company was accused by some of making money out of the blood of war
victims. Reacting to this, Toscani said, Provocation is a good word. It takes somebody and
(makes them) see something from another perspective.

In 1995, government authorities in Germany banned Benetton advertisements featuring child
laborers, the human body stamped HIV-positive, and a waterfowl stuck in an oil slick. A German
appeals court claimed that these advertisements were unacceptable as they exploited suffering. The
newborn baby advertisement had to be withdrawn after a public outcry in Italy, France, and the
U.K.
The Story of Benettons Advertisement Campaigns

5
However, Benetton seemed to have had the last laugh in many of these cases, as it was able to
project itself as a martyr to censorship. Though many experts agreed that Benettons
advertisements used exploitation solely for financial profit, such bans just created more notoriety
for the company.

TABLE II
SOME OF BENETTONS CONTROVERSIAL ADVERTISEMENTS
THE ADVERTISEMENTS AND THE CRITICISM
A line up of lots of test tubes. Was seen as Benettons support for the controversial subject of
cloning.
A nun and a priest kissing. Offended religious sentiments.
A semi-naked couple based on
the Adam & Eve theme.
Offended religious sentiments by mocking a biblical event.
A black mans hand handcuffed
to a white mans hand.
A black and a white baby sitting
opposite to each other.
A black woman nursing a white
baby.
- Uncalled trivialization of the racial tensions around the world.

- The ad was displayed on the worlds largest billboard opposite the
Milan city (Italy) cathedral, inviting severe criticism.
- Attempting to remind the US/UK black people of the era of slavery
when black women used to feed white babies; Rejected by many US
magazines. The ad did not appear in the US and UK, but was used it
in 77 other countries.
Prisoners sentenced to death, war
cemeteries, clothes from a dead
Croatian soldier.
Resorting to unnecessary sensationalism.
A newborn baby still covered in
blood and with the umbilical cord
attached.
The innocent birth of a baby being exploited.
AIDS victims with HIV positive
stamped on their bodies.
Resorting to unnecessary sensationalism and ignoring the seriousness
of the AIDS problem.
Featured very young models in a
provocative manner.
Exploitation of children.
Source: ICMR

All along, Benetton maintained that these advertisements were designed to prompt debate on
serious social issues and draw the publics attention to the victims of these issues. Bitterly
attacked by some and internationally acclaimed by others, Benettons campaigns have managed to
tear down the wall of indifference, contributing at raising the awareness of universal problems
among worlds citizens. At the same time, they have paved the way for innovative modes of
corporate communication, Benetton sources said.

The notoriety that Benettons campaigns attracted ensured that the company was in the news all
over the world. Thousands of articles were written on the companys campaigns. This free-
publicity helped the companys brand become globally popular.

While for some people Benettons advertisements seemed offensive and tasteless, to others they
were a crusading effort to promote social values. Benetton worked hard to promote itself as a
socially responsible business by supporting social organizations and discussing moral issues in its
print campaigns throughout the world. The fact that Toscanis photographs won awards and were
displayed in art galleries around the world strengthened the companys claim regarding the artistic
value of its campaigns. In this context, it was difficult to label the death-row campaign as
offensive. According to the company, the advertisement was intended to highlight the human
aspects of the murderers and express its opposition to capital punishment.
The Story of Benettons Advertisement Campaigns

6
BENETTON DECIDES ITS ENOUGH!

The bitter experience of the death-row campaign seemed to have made Benetton realize the
damage its advertising strategy was causing. The fact that many people had decided not to shop at
Benetton as a result of its campaigns could no longer be denied.

Benetton sources admitted that the main problem with the companys current and past advertising
campaigns was the repeated use of controversial subjects. The sources also admitted that the
advertisements were not targeted towards the actual customers of Benetton. The presence of
controversial issues, combined with the lack of a television campaign and appropriate, informative
subject matter, were identified as weaknesses that had to be eliminated in order to reach the target
clientele more effectively.

A Benetton official commented, Our world is a very diverse place, one where people have many
different opinions. Consumers from all different parts of the world see our advertisements. By
stating our opinions on controversial issues, we are setting ourselves up for destruction. The
company decided that in order to make the advertising campaigns more effective, they should be
made more informative and should reach a larger audience. The company thus began considering
the use of magazines and television.

A document posted on the Benetton website revealed that the company also felt that the
advertisement campaign needed to be changed. The document stated, We need to have models
wearing clothes by UCB in our advertisements. We need to show consumers that we are an actual
clothing line, and not a political or governmental company. By picturing our stylish clothes, we
will attract more business. Consumers want to buy our clothes because they are attractive and have
a high quality reputation. People who respect our clothing line are the only ones that actually buy
it, despite the political issues that we represent. If we can undo the damage that we have already
caused in the minds of many consumers by ceasing to offend them, our sales will greatly increase.
Lets show the world that we make great clothing, not that we have controversial opinions on
various subjects.

Though Benetton had always been a supporter of a variety of causes, such as the fight against
racial discrimination, whale hunting, ozone layer depletion, land mines, and North Korean girls
being sold into marriage etc., it stepped up its involvement in these non-controversial social issues.
Benetton took special efforts to project itself as a responsible company by sponsoring sport events
and focusing on racial integration (through its magazine Colors). Benetton also organized AIDS
benefits and educational programs around the world. With this new-found focus on moral and
ethical self-policing, Benetton seemed to be working hard towards non-controversial advertising.

QUESTIONS FOR DISCUSSION:

1. Critically comment on the controversies associated with Benettons campaigns, with special
reference to the death-row campaign. Do you think it was a wise move on the companys
part to eliminate the product from their advertisements?

2. Do you think Benettons advertising strategy was aimed only at creating scandals and
controversies? Can this strategy be justified by the fact that it resulted in free publicity for the
company? Support your answer with reasons.

The Story of Benettons Advertisement Campaigns

7
EXHIBIT I

BENETTONS ADVERTISEMENTS OVER THE YEARS

TEENAGERS - 1984 HANDCUFFS 1989 BLACK NANNY - 1989

ADAM & EVE 1991 NEWBORN BABY 1991 PRIEST/NUN KISS 1991

CONDOMS 1991 CEMETERY - 1991 HANDS - 1991

EST TUBES - 1991 CHILD LABOR 1992 HIV STAMPED BODY 1993

RICE 1997 BLOOD 1999 DEATH ROW 2000

Source: complied from various sources







The Story of Benettons Advertisement Campaigns

8
ADDITIONAL READINGS & REFERENCES:

1. Spaeth Anthony/Pratap Anita, Banned in Bombay, www.time.com, September 25, 1995.
2. Johnson Rachel & Gallegos Aaron, Between the Lines-True Colors, www.sojo.net,
September 1995.
3. Pinson Christian & Tibrewala Vikas, United Colors of Benetton, Fontainebleau, France:
INSEAD-CEDEP, 1996.
4. Foley P. John, Ethics in advertising, www.vatican.va, February 22, 1997.
5. Marshall Heather, The United Colors of Benetton, www.lclark.edu, April 30, 1998.
6. Improving the Advertising Campaign of United Colors of Benetton, www.benetton.com,
March 26, 2000.
7. Sushma clamps down on that close-up kiss, Times of India, February 24, 2001.
8. Sen Shunu, A&M, February 28, 2001.
9. Chadha Kumkum, I never said Ill ban FTV, The Hindustan Times, March 6, 2001.
10. Sridhara A, Policing the culture-An unhealthy trend, Deccan Herald, April 28, 2001.
11. Janellin Gina, Show Me Your True Colors, www.ultimateitalian.com, August, 10, 2001.
12. Madhu Sapre to face obscenity trial, www.apunkachoice.com, August 18, 2001.
13. Of blood, sweaters and Sears, www.bbc.co.uk, October 6, 2001.
14. Mandal Kohinoor, Taj Mahal tea ad brews storm, Business Line, October 15, 2001.
15. Lake Veronica, The Benetton Group, www.yahoo.com.
16. Case Study - Benetton , www.corex.net
17. www.unge-forskere.no
18. www.benetton.com