Centrale Danone, a Moroccan subsidiary of the French multinational Danone, has reportedly lost 50% of its market share in the fresh milk sector since a consumer boycott targeting its products commenced in April, according to Reuters.
Boycotting High Prices
On 20 April, anonymous activists launched a consumer boycott campaign, via Facebook, protesting against high prices. Centrale Danone, along with Afriquia fuel stations and the Sidi Ali water brand, were targeted by the boycott.
"The goal of this boycott is to unite the Moroccan people and speak with one voice against expensive prices, poverty, unemployment, injustice, corruption and despotism," read one of the boycott pages, according to Reuters.
The boycott has significantly affected Centrale Danone's sales. The company expects a loss of 150 million dirhams in the six months ending 30 June, down from a profit of 56 million dirhams in the same period a year ago, according to Reuters.
The secretly-organised campaign is the first such mass online protest in Morocco.
Addressing The Fallout
“Centrale Danone will never leave Morocco,” Emmanuel Faber, the CEO of Danone, said during a visit to the country’s commercial hub of Casablanca. But it will take months to address the fallout from the boycott and regain consumers’ trust, he told reporters.
Last week, Centrale Danone said it would cut the amount of milk it collects from 120,000 farmers by 30% and lay off workers on short-term contracts, estimated by a government minister at 1,000 people, according to Reuters.
In an effort to regain the public’s trust, Centrale Danone said it was ready to sell milk at the cost of production without making a profit, as long as a new deal could be reached with farmers.
Protests Over Job Losses
The government has asked the campaigners to end their boycott out of fear of putting off any potential foreign investors. The government also asserts that the boycott undermines the domestic dairy sector, leading to the job losses.
About 2,000 people protested the boycott after job lay-offs, blaming the government for what they described as a degradation of the purchasing power of Moroccans. Centrale Danone has about 6,000 people on its payroll.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Padideh Aghanoury. Click subscribe to sign up to ESM: The European Supermarket Magazine