By ALLISON BRUCE
Friday, November 17, 2006
In an unassuming building in Simi Valley, Calif., David Stearn can look out his office window at a street lined with mature trees and hills in the distance.
The natural skin care products company _ derma e _ crafts its products and corporate culture with a greater mission in mind. It has the feel of a neighborhood street, a fitting setting for an $8 million-a-year business that strives to be a good community citizen.
Items such as facial cleansers, moisturizers, makeup removers and exfoliants are made with natural, vegetarian ingredients. They are sold in health food stores and natural sections of mainstream stores.
The company operates in the health food industry and doesn't pitch its products to mass marketers, said Stearn, the president. The exception is when a store has a special section devoted to health food.
"It's real important to remember your base and not try to be all things to all people," Stearn said.
Stearn and Vice President Linda Miles worked together at another natural skin care products company before starting derma e in 1984. The name of the company comes from derma e's early focus on a vitamin E cream.
Today, the company has more than 90 products, yet remains family-owned and operated.
When derma e moved to Simi Valley more than three years ago, it brought along its corporate values.
"David and I feel very strongly about giving back," Miles said. "The more successful the company becomes, the more we want to give back."
Contributions include personal time, money and products, some which are donated for resale or to organizations such as orphanages in Haiti and domestic abuse shelters. The company makes regular donations to local, national and international agencies.
When it moved to Ventura County, derma e began making donations to the Ventura County Special Olympics.
Doing business in the environmentally conscious, or "green," marketplace has its benefits and challenges, as does operating as a socially responsible company.
A 2005 survey by RoperASW found that 19 percent of consumers are serious about the environment, with another 33 percent "on the fence," able to go either way on environmental issues.
Though the number of environmentally conscious consumers are "greener" than in the past, pragmatism still drives the majority of decisions, RoperASW determined. And pragmatism in this context means how much a product costs.
Many people who say they will buy green, fair trade or other "feel good" products often have a tendency to change their minds when looking at the price tags. That's one reason why there's still much debate on the bottom-line benefits of "corporate social responsibility."
In a study published in the Stanford Social Innovation review this fall, researchers found that people who were told about the social attributes of products _ such as products made without sweatshop labor _ made decisions similar to those who were not told.
Researchers also found that some consumers will pay more for products with positive social attributes, but only when those products meet their needs.
That drives home the point that a company with social and environmental objectives still has to have a solid product, said Jacquelyn Ottman of J. Ottman Consulting in New York. Ottman works with corporate clients on marketing their green products.
"Product performance is critical and foremost," Ottman said in an e-mail. "No one will buy a product just because of how the business operates ... However, if a (green) product performs really well, it will likely attract green as well as non-green consumers, too."
Sales for natural or organic personal care products could reach $6.6 billion by 2010, according to a 2005 report from market research company Packaged Facts.
"People are more conscious about what they put in their bodies and on their skin," Miles said.
Ottman sees green business as the way of the future. As more people become concerned about environmental issues such as global warming and what's in their food or personal care products, they will start asking tough questions of the companies selling those products, she said. And companies that can withstand customer scrutiny will benefit.
