Japan Forum of Business and Society Annals, No.5, pp. 37-54, 201637

Social Business Models――A Comparative Case Study of the German Beverage Market

Tobias Bielenstein
Managing Partner, Branding-Institute CMR AG
Keywords：Social Business, Business Models, Social Business Models, Business Model Canvas,
Stakeholder, Beverage Industry, CSR【Abstract】
The paper examines the question of specifics of social business models in comparison to common
business models. Further the business model canvas of Osterwalder / Pigneur is applied as analytic
tool with the question whether the canvas has to be amended in order to analyze social business.
Based on Mohammed Yunus, et al. definition of social business a generic social business model
canvas is developed and compared to three small case studies of the German beverage market. The
case studies allow asserting the existence of many variations to the social business model defined by
Yunus, et al. The study concludes that Osterwalder / Pigneurs business model canvas originallydeveloped for common business can capture also social businesses with one extension: the value
proposition has to specifically consider different stakeholders and therefore could consist of different
parallel part-value propositions.

European countries. Many of them install

1.

Introduction“start-up” or “new economy” kind of corporate
cultures. This kind of business is referred e.g.

The term social business is well linked to Mo-

as “Social Business 2.0” or, like the title of ahamed Yunus and the projects he has

British award for such organizations, the “newbrought into life in Bangladesh and otherradicals”. Many of these companies claim tocountries. But social business is also a com-have found new, innovative ways of contribut-

mon feature of modern welfare states. Thereing to the social good and to generate social

it is not only part of the “third sector”. Instead

impact in new ways. The scope of these com-it has been a matter of innovative approaches

panies is very diverse. Some of them are ac-

especially in recent years. Inspired by organi-tive on an international scale e.g. in develop-

zations like Ashoka and other initiatives forment aid or fair trade, others are working insocietal engagement the establishment of new

the field of the public good within their own

social businesses has been fostered in many

countries of origin.

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招待論文 /Invited Articles

The purpose of this paper is to take a clos-This paper uses business models as theer look to business models and formal busi-

base of analysis. It will introduce briefly toness structures of social businesses. It is thethe business model concept and then takeintention to address the question of what kind

Mohammed Yunus’ definition of social busi-

the “new” of these new social businesses is.

ness as a starting point. Further the proposi-This is not only interesting for other socialtion of Yunus, et al. (2010) is taken into ac-

businesses. In an era when all companies

count that social businesses are based on

have to deal with the task of their Corporate

innovation. Yunus, et al. define five require-

Social Responsibility, in situations wherements that facilitate business model innova-

boundaries between social and ordinary busi-

tion in the context of social business. They

ness are fading, and in a time where innova-

are considered here. In order to keep the casetion is imperative to all businesses, it is ofstudies easy to handle and to allow a struc-high interest for any kind of business to see if

tured comparison the business model canvas

or what they could learn from social business-by Osterwalder / Pigneur is applied as a tooles.

to analyze the business models of each com-

The background of this paper is business-pany. This is the tool set to analyze the social

consulting practice. Its origin is at the inter-business models of the three companies andface of some consulting projects for social

compare them with each other. The researchbusinesses and a series of consulting projects

interest is twofold. One is to better under-

in the German beverage industry with special

stand the specifics of the respective social

consideration of Corporate Social Responsibili-

business models. The second is to test the

ty. The approach of this paper is located inbusiness model canvas approach as a research

the interface of business- consulting and sci-

tool and revise is if necessary for further re-entific research.

search.
The first chapter introduces to the researchSet-up of the Paper

concept and the methodology. The following

The set-up of this paper is a comparative casechapter presents the case studies. The paper

study of three social business companies incloses with a summary of findings and conclu-

the German beverage industry. The formal

sions.

corporate structure and the business models

2.

of these companies are analyzed. They arecompared to a generic business model of theBusiness Models, Social
Business; and Social Business
Modelsindustry and a generic social business model

Generally speaking a business model de-

before set in comparison to each other. By thescribes a business’ “structure of production,formal comparison of the three companies

services-, and information-processes and theagainst the theoretical models some conclu-

players involved” (Johnson, Scholes, et al., 2011

sions are drawn.

[translation by author]). In other words it is a

Social Business Models

39

description of the logic how a business oper-

received even 54 definitions of the term busi-

ates. Most business models are applied in con-ness model and clustered them according atext of strategy development. They serve “likethree level hierarchical order – pointing out

a blueprint for a strategy to be implemented

that neither any of them is advocated nor

through organizational structures, processes,that they are mutually exclusive:and systems” (Osterwalder and Pigneur, 2011,p.19).

As a model a business models represent a・Business model concepts as an abstract
overarching concept that can describe
all real world businesses.

simplified, focused view on the way a busi-・Descriptions of a number of different

ness operates and could serve different pur-abstract types of business models (i.e. aposes. “Specific business models function likeclassification scheme), each one describ-

recipes: as practical models of technology that

ing a set of businesses with common

are ready for copying, but also open for varia-

characteristics.

tion and innovation“ (Baden-Fuller and Morgan,

・Presentation of aspects of or a concep-

2010, p.157). Further as models they help totualization of a particular real world

compare businesses and their main logics ofbusiness model. (Osterwalder, Pigneur,operation in a concise manner.

et al., 2005, p.5).

The term “Business Model” has become
pretty popular in the past two decades. It is

Following Osterwalder and Pigneur’s (2005)

widely used not only in boardrooms, among

approach the level of analysis here is on spe-managers, and in business magazines – butcific aspects respectively particular real world

also among the interested public. One of thebusiness models. Before that the generic busi-

reasons is the quest for innovation. In this re-ness models introduced are representing a de-spect business model innovation has become ascription of a set of businesses. Further in ac-

third strategic approach next to product andcordance with Baden-Fuller and Morgan (2010)

process innovation. Among the public it has

the model function of business models has tobecome quite popular with the emergence of

be underlined here. I.e. a concise way to rep-

the internet-economy and the digitalization ofresent characteristics of a business embody-many established industries. This has helped

ing essential elements and the way how they

to develop completely new business models

work together. By this “business models pro-and forced established business models tovide managers and scholars a way to describe

come under scrutiny.

and distinguish the variety of types of busi-

A closer look to the term business model
reveals that it lacks of a consistent definition.

ness behavior we find in the world of firms“(ibid, p.166).

Already more than 10 years ago Loos, et al.

As it is not the purpose here to deconstruct(2003) identified 28 different definitions of thethe theoretical discussion about business mod-term. In an inquiry Osterwalder, at al. (2005)

els a rather pragmatic way has been taken to40

招待論文 /Invited Articles

choose an appropriate business model ap-

these nine elements four key areas of a busi-

proach as the base of analysis. The main cri-ness are covered: customers, offers (products

terion was to choose a business model ap-& services), infrastructure and financial results

proach that facilitates a comparative way of(ibid, p.19). Within the nine elements Oster-

analysis in a concise manner and an easy rep-

walder and Pigneur specify how the elements

resentation of findings. Therefore the ap-

could be shaped and what they could consist

proach of Osterwalder and Pigneur (2011) hasof.

been selected here as the appropriate tool.

A special feature of Osterwalder and Pig-

Osterwalder and Pigneur’s approach has

neur’s approach is the graphical representa-

been developed in an open stakeholder pro-tion of the business model – the so-called busi-

cess integrating perspectives and feedbacks

ness model canvas. It arranges the nineof more than 100 scholars and practitioners,

elements according to the four key areas.

e.g. managers and business consultants. It dis-

Both in the conception as well as in the

tinguishes nine key elements of a businessgraphical representation the value proposition

model – Value Proposition, Customer Seg-

rests in the center of a business model. Sur-ments, Channels, Customer Relationships,

rounding the value proposition are the eight

Revenue Streams, Key Resources, Key Activi-

other elements. Left of the value proposition

ties, Key Partnerships, Cost Structure. Withare elements to deliver the value proposition,

Fig.1

Business Model Canvas

Business Model Canvas according to Osterwalder/Pigneur
Key Partners

Key Resources

Value Propositions

・Some activities
are outsourced
and some
resources are
acquired outside
the enterprise.

・are the assets
required to offerand deliver thepreviously
described
elements...

・Customer
problems andsatisfy customer
needs with value
propositions.

Customer
Relationships
・Established andmaintained witheach Customer
Segment.

Key Activities

Channels... by performing a
number of Key
Activities.

・Delivery of Value
propositions tocustomers
throughcommunication,
distribution, andsales.

Customer Segments
・An organization
serves one orseveral Customer
Segments.

Cost Structure

Revenue Streams

・The business model elements result in the cost
structure.

・Revenue streams result from value propositions
successfully offered to customers.

Source: own graphic based on Osterwalder & Pigneur, 2011.

Social Business Models

41

right to the value proposition are the custom-

based suggesting deductive research paths.

ers – objects of the value proposition – specifi-

From the business-consulting and analyzing

cations of customers and the relationships topoint of view this is difficult to handle or eventhem. Osterwalder and Pigneur recommend

to implement in business operations. There-

to use the canvas in order to have structured

fore the approach here is exactly the otherdiscussions and workshops within businesses.

way round. The empirical study is based on a

While conducting this project the canvas also

simple business model canvas that is relative-

turned out to be helpful when interviewing

ly near to the one of Osterwalder / Pigneur.

management in social business about their re-

Additions are applied to that canvas and test-

spective business models. Further the canvas

ed empirically in the cases.

allows for a structured comparison of business models.

The basic but fundamental assumption that
there are differences between ordinary andsocial business models is based on the litera-Social Business Models

ture underlining the role of innovation in so-

The next step is to take a closer look to social

cial business models. Yunus, et al. (2010) defini-business and respective social business mod-tion states: “Building social business requires

els and derive some general assumptions

building new business models” (ibid, p.312) .

about variances and differences that shape so-

Also in the analysis of German social businesscial business models compared to “ordinary”

the aspect of innovation is underlined:business models. The goal is to set up an easy

Scheuerle, et al. (2013) distinguish two types ofto handle social business canvas that servessocial business. According to this social busi-

as the guideline for empirical study.

ness in a narrow sense is defined as meeting

Some research has been carried out in thisthree criteria: Solving a social or environmen-

field. Next to general work on sustainable

tal problem, an innovative approach, and per-business models, e.g. Schaltegger, Lüdeke-

formance driven income. A social business inFreund, et al. (2012), there are also recent

a wider sense is defined by solving a social orworks that specifically deal with businessenvironmental problem and either having anmodel canvas. One example is the triple layer

innovative approach or a performance based

canvas separating economic, ecologic and so-

income (Scheuerle, Glänzel, et al., 2013, p.12). The

cial layers in a sustainable business model

crucial question for the following analysis is(Joyce, 2015). Furthermore the most recent edi-

whether innovation towards social businesstion of the journal Organization & Environ-models happens within the framework ofment is completely dedicated to the questioncommon business models which means itof business models for sustainability (Schalteg-

could be recorded with help of business model

ger, Hansen, et al., 2016).

canvas introduced above or whether the busi-

While the broad und most current works

ness model canvas needs an extension in or-

generate a solid base they are mostly theory

der to capture innovation of social business42

招待論文 /Invited Articles

models in comparison to common businesssented within the existing Osterwalder / Pig-

models.

neur business model canvas, or if the canvas

According to Yunus, et al. a social businessneeds an extension, or if a new kind of canvas

is a “no-loss, no-dividend, self-sustaining com-is needed. With regards to sustainable busi-

pany that sells goods or services and repays

ness models Joyce (2015) develops an ada-

investment to its owners, but whose primaryvanced model adding layers to the original

purpose is to serve society and improve theOsterwalder / Pigneur canvas. Following the

lot of the poor” (Yunus, Moingeon, et al., 2010,

triple bottom line approach he comes to thep.311) . They identify five major strategic

conclusion that a triple layered business mod-moves facilitating innovation towards social

el canvas is needed with two additional can-business models. While they locate three ofvases, one for the environmental bottom line

them – challenging conventional wisdom, set-and one regarding the social bottom line.

ting up appropriate partnerships, and under-

While the triple layer approach follows ataking experimentation – within the realm of

stringent argumentation it has a side effectcommon business model innovation, they de-especially in a comparative study: three lay-fine two of them as being specific for social

ers are accompanied by additional complexity.

business models: “the needs to involve social-

Instead of nine key elements there are 27 ele-ly-oriented shareholders and to state the in-ments / indicators to analyze. This moves

tended social profit explicitly” (ibid, p.310).

away from the initial model idea – a simplified

The question is whether these additional el-and concise way of analysis – and is especially

ements can be developed, captured and repre-

difficult to handle in a comparative study.

Fig.2

Social Business Model CanvasSocial Business Model Canvas following Yunus, et al.
(based on the Osterwalder/Pigneur Business Canvas)
Key Partners
・In difference toordinary businessinvolvement ofsocially oriented
shareholders/business partners
is specificallyaddressed

Key Resources

Value Propositions

・No differences

・Social value
proposition has tobe considered(Social business'“primary purpose... to serve society
and improve thelot of the poor”)

Key Activities
・No differences

Customer
Relationships
・No difference
Channels
・No difference

Cost Structure

Revenue Streams

・No difference・No difference

Remarks
・Social impact of the company-stated by the company or by stakeholders

Customer Segments
・“the poor”

Social Business Models

43

Also other approaches e.g. Upward’s flourish-marks and specifically asks about theing business model canvas (Upward and Jones,social impact of the business.

2016) provide additional complexity. But themain reason not to follow such approaches is3.

Case Studies

the different purpose followed here. Joyce’s
model is intended to provide a tool to analyze

The set of comparative case studies consists

and further develop business models towardsof the description of an “ordinary” businesssustainability. Here it is the purpose to ana-model of the German beverage industry andlyze social business models.

three case studies on different social business

Following Yunus, at al. (2010) definition a so-models within the German beverage industry.

cial business is basically an ordinary businesswith some additional elements. Therefore theoriginal Osterwalder / Pigneur business mod-3-1. Ordinary Business Models in the German beverage industry

el canvas serves as the basic analytical con-

The “ordinary” business model of the German

cept here extended by three elements:

beverage industry is a business model in the・As there should be a stated social pur-definition of Baden-Fuller and Morgen (2010),

pose of the business the value proposi-

i.e. a representation of essential elements andtion will be specifically considered incharacteristics of business or an industry re-the case studies with view to advance-

spectively. As the model introduced here de-ments, variations, and the addressees

scribes a whole industry it has to remain on aof the value proposition.

very generic level. In practice the industry

・T he element of key partners is en-

could be further structured – still on a gener-

hanced by the question of social orient-al level – according to the kind of drinks it

ed shareholders of the business.

produces (e.g. mineral water, beer, etc.) and to・An additional line added allows for reTable 1

the sales area (regional, national, international).

Business Types in Beverage Industry

National & International

National

Regional

Breweries
Mineral water & Mineralwater-based soft drinks(Carbonized) Soft drinks
Fruit juices
Companies without own
production facilities(incl. “new” beverage start
ups)
Other beverage companies (e.g. vineries, liquor producers etc.) are not considered in this overview as they are not part ofthe study.

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Table 1 translates these two dimensions to a

・Health related benefits – are e.g. vita-

matrix. The table implicates the assumption

mins in beverages or no-calories propo-that the position of a company in one field ofsition of mineral water. The communi-

the matrix will be reflected in the businesscation of health related benefits hasmodel.

been reduced sharply after the intro-

The generic business model introduced

duction of the health claims directive ofhere has been developed as part of a busi-

the European Union regulating strictly

ness-consulting project in 2012 / 2013 and has

every claim communicating such bene-

been applied in projects with 8 middle scalefits.

companies of the German beverage industry

・Social benefits – value propositions insince then. It is a simplified and “ideal-type”

this cluster relate much to the brandmodel of how the beverage industry – brew-

commitments of a beverage. They caneries, mineral water companies and fruit juice

be divided in two different sub-clusters.

producers – work in Germany. Within the

One is closely interrelated to the propo-

consulting process it has been employed insition of enjoyment as it relates to situ-

order to identify and analyze elements whereations of beverage consumption (e.g.

beverage companies differ from peers in theenjoying with friends, delighting peers

industry. Most companies in the German bev-

by serving a specific beverage, etc.).

erage industry are small or middle scale en-

The other one relates to sustainability

terprises. Among breweries there are only

propositions of beverages, which could

some 50 national distributing companies out

range from simple“natural product”

of more than 1,300 breweries. In the mineralclaim of mineral water to the“organic

water industry it is some 10 national out of

proposition” several breweries and200 companies.

fruit juice companies offer.

Following is a brief description of the nine

It has to be underlined that the value prop-

key elements of the German beverage indus-

osition of a company or a product are derived

try based on the Osterwalder / Pigneur busi-

by analyzing brand proposition, the position-ness model canvas.

ing and respective communications respec-

Value Proposition

tively. Short term oriented advertisement andMost value propositions focus on the quality

other communications measures (e.g. PR) areof products and accompanying benefits. These

usually not taken into account as they are

benefits can be clustered around three main

more sales oriented and not reflecting thethemes:long term value proposition.

・Enjoyment and pleasure – most of the

Key Partners

value propositions in this cluster under-

Key partners of the beverage industry could

line the taste and high quality of the

be clustered in “up-stream” and “down-

products.

stream” related partners. The up-stream partSocial Business Models

45

mostly consists of suppliers of key ingredi-

Customer Relations

ents, packaging, and machinery for produc-

Most beverage companies identify wholesaletion. Down-stream partners consist mainly ofand retail as their customers. Traditionallyretail (food retail, beverage markets, catering)consumers were considered only as custom-and logistics. Within the German beverage

ers in secondary priority – even if brands

market whole sale plays a key role as thewere developed with consumers in mind. This

middle man between producers on one side

had consequences with respect to the value

and food retail, catering etc. on the other side.

proposition because brands and the value

Other key partners consist of associations andproposition they carry were seen as means toother business partners, e.g. banks etc.

sell the product with the main benefit to the

Key Activities

retail / whole sale as stakeholder. Such ap-

Key activities consist mostly of production,

proaches have changed in the past two dec-

sales and marketing including the respective

ades as beverage companies became moremanagement functions. Part of sales and mar-consumer oriented, brands more sophisticatedketing functions are conducted in co-operation

and better reflecting consumers’ expectations.

with wholesale.

Most companies try to maintain a close and

Key Resources

personal relationship to their customers in re-

Key resources are production facilities andtail. Important meetings are face-to-face be-

staff.

tween CEOs of the beverage companies and

Fig.3
Key Partners
・Upstream・Producers ofIngredients・Machineries
・Packaging
・Downstream
・Wholesale
・Retail

Cost Structure
・Staff・Production facilities
・Capital expenditure

Generic Beverage Industry Business Model Canvas

Key Resources
・Production
facilities
・Staff

Key Activities
・Production
・Sales・Marketing

Value Propositions
・Quality of
products

Customer
Relationships
・B2B: Personal
・B2C: Dependingon marketingstrategy

Customer Segments
・Wholesale
・Retail・Catering・Consumers

Channels・Delivery of Value
propositions tocustomers
throughcommunication,
distribution, andsales.
Revenue Streams
・Sales・Production/Services for other beverage companies

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招待論文 /Invited Articles

respective senior managers at wholesale andments. A graphical representation based onretail. But in addition e.g. by social media

the business model canvas summarizes eachchannels direct communication with custom-

chapter by representing the main discrepan-

ers has been established.

cies to the generic business model of the in-Channels

dustry and specific social business model ele-

Most important channels are wholesale andments.

retail. Catering is usually supplied throughwholesale.

3-3. Josef Brauerei

Customer Segments

Josefs Brauerei (Josefs Brewery) was founded

Most beverage companies cluster their cus-in 2000. It was set up as a non-profit limited

tomer according to their function (wholesale,(gGmbH = Gemeinnützige Gesellschaft mit be-retail, catering) and sometimes according to re-schränkter Haftung, English translation: non-profit

gion if distribution is nation-wide or interna-or charitable limited). The non – profit limited

tional. More and more companies cluster also

is a special business structure for social busi-

their consumers according to establishedness in Germany. A gGmbH is entitled tomodels.

claim tax exceptions, e.g. it pays no corporate

Revenue Streams

income tax, no local business tax, and could

Revenues result mostly from sales. There areapply for lower VAT of 7% instead of 19 %.

hardly any additional services that could be

Especially the latter tax exception could re-monetized. Some companies offer production

sult in advantages to competing companies

and bottling services to other beverage com-without this status. Further a gGmbH is enti-

panies.

tled to issue donation receipts which make

Cost Structure

donations tax deductible. Then again all re-

Cost structures consist of equipment, packag-

turns of the company have to be devoted toing, staff and logistics. Marketing spendings

the social purpose: they may not flow back to

are in most companies below one percent ofowners and / or investors. All profits have toturnover.

stay in the company to serve the social purpose and all capital is tied to the social pur-

3-2. Case Studies

pose – even in the case that the company is

The following three case studies are all based

liquidated.

on interviews with the respective companies.

The owner of the company is a ChristianWebsites and other materials provided by thesociety (Josefsgesellschaft), which was founded

companies were reviewed. Additional informa-in 1904 with the goal to support and foster

tion was consulted if available. The structure

disabled persons especially by offering educa-of the following chapters is the same for alltion, training and work. Technically Josef

three cases. An introduction is followed by an

Brauerei is held by another gGmbH. Accord-

analysis based on the nine business model ele-

ingly the officially stated business goal in theSocial Business Models

47

trade register is “to employ disabled persons

staff members are treated as ordinary staff

and educate, train disabled persons in profes-

members except for the consideration of theirsional and personal realms to bring them into

disability. Therefore disabled staff has no sep-

the job market”. According to its own state-arate positioning in the key resources field ofment the company is the first and only brew-

the business model canvas. Further they ar-ery in Germany offering full jobs to disabled.

gue it would be the core element of the social

Josefs Brauerei has a workforce of 16. Halfbusiness model to bring disabled person intoof the staff are disabled but all employees arejobs that are subject of full social insurance

subject to full social insurance contribution.

contribution. The background of this issue isAs a business the company is positioned as athat disabled people were usually disabled

regional brewery offering different beers and“twice”. First they had no access to jobs andnon-alcoholic soft drinks.

second because of that they remained subject

The business model of Josef Brauerei is inof social welfare until pension age because

most elements similar to a comparable ordi-

they never contributed to social security. In

nary regional brewery in the fields of key

this way the social business model of bringing

partners, activities and resources as well as indisabled persons in full jobs not only helps

the fields of customer relationships, segments

them to work and by this to gain self-confi-

and channels. Management underlines that itdence as well as economic self-reliance. It also

is at core of the business model that disableddisencumbers the social security system –Fig.4

Business Model Canvas of Josef Brauerei

Business Model Canvas of Josef Brauerei gGmbH
Key Partners
・No significant
differences toordinarybusinesses

Key Resources
・No significant
differences toordinarybusinesses
Key Activities
・No significant
differences toordinarybusinesses

Value Propositions
・Quality of
products
・Social: Quality of
doing good bypurchasing/consuming the
product
・Social: Bringing
disabled into full
employment

Cost Structure
・Same as in industry
・Additional costs for disabled workforce, in part
covered by subsidies

Customer
Relationships
・No significant
differences toordinarybusinesses

Customer Segments
・No significant
differences toordinarybusinesses

Channels
・No significant
differences toordinarybusinesses

Revenue Streams
・Sales・Subsidies/Tax exceptions
・Donations

Remarks
・Social Value materializes partly not to consumers but to staff (disabled persons in full jobs)

48

招待論文 /Invited Articles

with the constraint that it relies on direct andsite and printed materials as being “change

indirect (tax reduction) subsidies. It should be

the world by drinking”.

added that the business model of Josefs Brau-

The company has a workforce of some 40

erei is also found in many other industries in

employees including the two founders. This

Germany even if it is an exception in the bev-

team consists of management, sales and busi-

erage industry.

ness service functions. The company has no

Regarding the value proposition Josefs

own production facilities. Instead a beverage

Brauerei offers two values to consumers. First

company in South Germany serves as produc-

it is the value proposition of a comparable or-tion facility. This model of outsourced produc-

dinary regional brewery with quality prod-tion is a quite common model for start-up

ucts. Secondly it is the benefit of consuming

beverage companies in Germany in order toproducts of a social business. This double val-

avoid high and risky investments and capitalue proposition is also in the positioning of thecosts right after the company is founded.

brewery e.g. reflected in the brand tagline

LemonAid has two products, each product“drinking good” (German: “Trink Gutes”) andoffered in several different tastes. Both prod-

the double headline in the image brochureucts are soft drinks, one called LemonAid, a“the good purpose” (German: “die gute Sache”)

range of fruit based lemonades, and the otherand “the good beer” (German: “das gute Bier”).

CharyTea, a range of ice tea products. The

Further the brewery offers a social value propo-

products are sold – according to the company

sition i.e. offering full employment to disabled– in unique and specially designed refillable

person.

bottles throughout Germany.
LemonAid states that it is not only a soft

3-4. LemonAid

drink company but that it was founded in or-

LemonAid was founded in 2009 in Hamburg.

der to actively contribute to social change.

It is set up as a limited (Gesellschaft mit be-This goal is pursued by producing all prod-

schränkter Haftung – GmbH) which is a com-ucts with organic and fair traded ingredients

mon corporate structure in Germany. The

and by contributing 5 Eurocents from eachcompany was founded and is managed bybottle sold to the LemonAid & ChariTea e.V.,

two social entrepreneurs. One is a former em-a registered non-profit society. The LemonAid

ployee of the German governmental develop-& ChariTea e.V. actively supports develop-

ment aid agency, the other one is a former

ment projects of different kinds in developing

employee of one of Germany’s most renowned

countries. It states in its statutes that the two

advertising agencies. The business goal is ac-

managing partners of LemonAid GmbH are

cording to the trade register “to develop, sale

lifetime-presidents of the non-profit society.

and produce beverages and food”. The social

According to the company all projects aregoal of the company is not stated in the tradepersonally selected by the managing partners

register entry but communicated on its web-which corresponds to the founding story ofSocial Business Models

49

the for-profit LemonAid GmbH. According tomarketing soft drinks with fair traded, organ-

this story one founding partner, Paul Bethke,

ic ingredients, sold in refillable bottles thatleft the official German development agency

are produced by other beverage companies.

GIZ because he was dissatisfied with official

Three differences are relevant here comparedprojects and decided to found a business byto those other beverage companies:

which he could fund his own development aid

・L emonaid extended its distribution

projects (Täubner, 2015). LemonAid states thatchannel to be listed in food stores andit has collected one million Euro since therestaurants specialized on organic

founding of the company (LemonAid, 2016).

foods.

The business model of LemonAid as a bev-

・I ts products are sold nation-wide inerage company is comparable to other bever-Germany.

age start-ups in Germany. The German Asso-・Its model of donating 5 Eurocents of

ciation “Independent Drinks”, an association ofeach bottle sold. The main difference tosmall beverage start-ups, lists more than 50

cause related marketing here is thatcompanies many of them having the same

LemonAid has its own non-profit arm

business model (Drinks, 2016) which consists of

to facilitate projects while usual cause

Fig.5

Social Business Model Canvas LemonAid GmbHBusiness Model Canvas of LemonAid GmbHKey Partners
・Fair trade scheme
supports strategic
ties to suppliers

Key Resources
・No significant
differences toordinarybusinesses

Key Activities
・No significant
differences toordinarybusinesses

Cost Structure
・Same as in industry

Value Propositions
・Quality of
products
・Fair Trade
Ingredients・Quality of doing
good bypurchasing/consuming the
product
・Social:
Beneficiaries ofprojects
・Social: partners infair trade schemes

Customer
Relationships
・Involvement ofcustomers
through aid
projects

Customer Segments
・Buyers of organic
food

Channels
・Extension toorganic foodstores

Revenue Streams
・Sales (pricing is clearly above average beverage
prices, also above prices for organic food)

Remarks
・Social value materializes to consumers threefold: quality of products, fair trade products and donation.
・Social value to other stakeholder materializes to fair trade scheme partners and beneficiaries of projects.

50

招待論文 /Invited Articles

related marketing model are based on

set up as a limited (Gesellschaft mit beschränk-

co-operation between companies andter Haftung – GmbH), which is a common cor-

NGOs (Hessekiel, Kotler, et al., 2012).

porate structure in Germany. The Viva con

Regarding the social business model ofAgua GmbH (abbr. VcA GmbH) was founded

LemonAid there are almost no relevant differ-2010 in Hamburg / Germany coined by theences in comparison to the generic businessNGO as “social business 2.0”. The ownership-model of the beverage industry. The changes

and corporate - structure of the VcA GmbH is

described above remain within the businesspretty interlaced. 40 % of the company be-model. The fact that LemonAid managed tolongs to a Viva con Agua Beteiligungs GmbHextend its channels and address a specific& Co KG (limited partnership with limited liabili-

consumer segment (organic products) remains

ty company as general partner). This company

within the beverage company business model

again is owned by the Viva con Agua Verwal-

and is not significant to the social businesstungs GmbH (VcA management limited) thatmodel. On the key partner side the businessbelongs to the six investors responsible formodel is extended because of the fair trade

the initial investment to the company. 20 %supply chain that includes close strategic ties

belongs to Viva con Agua e.V., the NGO

to suppliers. The value proposition of Lem-

which is held in governance structure of aonAid receives an extension regarding bothregistered association. The remaining 40 %the ingredients (organic and fair) and regarding

belong to the Viva con Agua Foundation,

the social benefit by donation a small amountwhich is the donation body of Viva con Aguaof money when consuming the product. This

e.V. This complicated and non-transparent

is reflected in the main brand tagline of Lem-

structure generated criticism especially fromonAid which reads “Drinking helps” (while theother NGOs (Syndikalismus, 2010). VcA GmbH’s

cited version is the official version presented bymanagement justifies this structure for two

LemonAid a translation of the German tagline

reasons: one is to allow repayment of the ini-

“Trinkend die Welt verändern” would readtial funding to the investors, which would be“Changing the world by drinking”). Additionallyimpossible if VcA would be e.g. a gGmbH.

the social value proposition could be extended

Secondly – and more important according toto a generic target group of beneficiaries ofthe management – it was the plan to keep

the development aid groups and the partners

any economic risk away from the NGO andwithin the fair trade schemes.

the Foundation as the endeavor was considered an experiment.

3-5. Viva con Agua

The Viva con Agua NGO was initiated by aViva con Agua GmbH considers itself not as a

football player of the German football club FC

beverage company but as a unit of the Viva

St. Pauli in Hamburg. This football club has acon Agua NGO in order to generate funds by

reputation of having an “alternative” fan baseproduct sales. The Viva con Agua company is“built around left-leaning politics, social activ-

Social Business Models

51

ism and the event and party atmosphere of

In the first years profits of the VcA GmbHthe club’s matches” (Wikipedia St. Pauli, 2016).

were partly used to fund projects of the VcA

The goal of the NGO is “to establish access to

NGO and partly to repay the investors. In theclean drinking water and basic sanitation formeantime all invests are repaid according to

all humans worldwide” (VivaconAgua.org, 2016).

the management.

It has members and supporters throughout

The product sold under the VcA brand isGermany and in the meanwhile also branches

mineral water only. It is sold in two variationsin Switzerland, Austria and the Netherlands.

of high and low carbonized mineral water.

The NGO works mainly with means of PR to

There are no other products offered and ac-raise awareness to the problem of access tocording to management there are no plans toclean drinking water in developing countries

extend the product range in the water busi-

and runs education projects, e.g. in co-opera-

ness. In this sense VcA sells a commodity dif-tion with schools. It runs no own projects inferent from other bottled waters only by thethird world countries. Instead “it acts as a do-social cause. The management explains that it

nation broker and income generator” (Gebauer,

could sell also any other product of commodi-

2014, p.159). Funds for projects are donatedty character in order to raise funds. In fact

through the Viva con Agua Foundation to

VcA started to sell toilet paper in spring 2016

Welthungerhilfe, a well-established German

based in the same business model in coopera-

NGO in the field of development aid.

tion with a producer of toilet paper and a

The business goal of VcA GmbH is accord-

drug store chain in Hamburg.

ing to the trade register “marketing and sales

The social business model of VcA GmbHof water products”. It has a workforce of 6 re-looks very different from other social businesssponsible for management and sales only.

models due to the fact that VcA is only licens-

VcA GmbH has no own production facilities.

ing its brand while most part of the opera-

Instead it has a partnership with a mineraltional business is outsourced to the mineralwater bottler in Northern Germany who holds

water bottler. The input area is basically re-a license to sell its products labeled with the

duced to key partners i.e. investors and theViva con Agua brand. A second mineral wa-

bottlers. The company has no need to financeter bottler in South Germany acquired a li-

its capital. The value proposition focuses en-cense in 2015. Sales are in part assigned totirely on the social cause – the purchase of athe mineral water bottler and in part withwater bottle becomes a donation for a good

VcA GmbH. All other business activities, e.g.

cause. Customer relations play a very big rolelogistics and distribution are with the mineral

at VcA. The company manages to acquire ad-water bottlers. The bottlers pay a license fee

ditional donations from consumers as well as

between 5 and 11 Eurocent per bottle sold.

from wholesale and retail. The latter are enti-

This leaves also space for the bottling compa-

tled to present them selves as “Viva con

nies itself to have profits from this business.

Agua” – supporters if they make a donation.

52

招待論文 /Invited Articles

In the same time VcA breaks with many oth-on the cause. Actually the quality of the prod-er B2B marketing rules established in the

uct is barely mentioned. Additional stakehold-beverage industry. It pays no so-called listing

er addressed is the VcA NGO. Beneficiaries offees, no advertisement grants etc. VcA is re-

the projects are only addressed implicitly.

markably successful in selling its products es-

4.

pecially at caterings of cultural events, universities and other businesses with social

Comparison of Findings &Conclusion

conscious stakeholders. While VcA manage-

The three case studies above draw a very dif-ment is aware that is has a unique positioning

ferent picture of social business compared toin the beverage market with a brand andthe definition of Mohamed Yunus. Josef Brau-

marketing communication out of reach forerei directly addresses “the lot of the poor” inother beverage companies it admits that it

the sense that it brings disabled persons into

considers itself not really being part of the in-full jobs. But this case is different compared

dustry. “In fact our bottles and the labels on it

to Yunus, et al. case studies. The benefit lies

are a leaflet drawing attention to our cause.

within access to the job market, not within

The difference is that a consumer pays and inaccess to some (necessary) products. Lemon-

the same time donates when reading it”, says

Aid provides a mixture of social business

managing director Andre Lau. Regarding themodel and fund raising. It provides direct im-value proposition VcA puts the focus entirely

pact by applying a fair trade scheme when

Fig.6
Key Partners
・Investors
・Mineral Water
company as
license purchasing
entitySocial Business Model Canvas of Viva con Agua GmbHKey Resources

Value Propositions

・Only man power
・Small team of 6・Network aroundfootball club andevent scene in St.
Pauli・No communicatedproduct value
proposition

Key Activities
・Campaigning・Value Propositionis only about
doing good bypurchasing/consuming the
product
・Social: Indirectly
to VcA NGO

Cost Structure
・Only staff of 6

Customer
Relationships
・High Involvementof customers
through aid
projects
・Even retail makes
donations
Channels
No significant
differences toordinary businesses

Revenue Streams
・License fees
・Donations

Remarks
・Social value materializes through purchase of products.

Customer Segments
・Even those who
criticize bottled
water buy
products

Social Business Models

53

importing ingredients from developing coun-

The non-profit arm of both companies is out-

tries and by using organic ingredients only. In

sourced in separate organizations.

the same time it generates funds by which

Regarding the social business model canvas

LemonAid carries out its own development

as an analyzing tool it was possible to assess

projects through the non-profit arm of the

all relevant elements with help of the canvas

company. The third example, Viva con Agua,with one exception. While it was possible tois in fact a fund raising organization applying

capture variations on the left (key input) asa brand licensing scheme to the beveragewell as on the right (customers and channels)

market. Social impact is provided only indi-side of the canvas it turned out to be difficult

rectly through the funds given to other spe-to assess value propositions without ancialized development aid organizations.

amendment. In fact the three case studies

With regard to the social business model

suggest an adaption of the definition of value

the three case studies span a space of differ-proposition. The original business model can-ent approaches. Josef Brauerei stays prettyvas of Osterwalder / Pigneur puts focus on

close to the business model of the beveragecustomers regarding the value proposition.

industry. It has additional revenues and costs

While customers are also subject of the value

due to the fact that it employs disabled per-proposition of the cases presented by Yunus,

sons. Also Josef Brauerei is the only company

et al. (2010) this changes significantly in thethat has applied for the status of a gGmbH.

case studies presented here. The value propo-

LemonAid changes several elements of thesition of Josef Brauerei addresses at least two

business model e.g. on the upstream side of

stakeholder groups. One is the consumer, thekey partners i.e. the suppliers. Other ele-

other one are disabled employees. The samements, e.g. purchasing of organic ingredientsis the case for LemonAid and VcA. In bothand sales in organic stores could also becases value is proposed for consumers as wellachieved by companies in the organic busi-

as for other stakeholders, e.g. groups that areness and is not specific to a social business –addressed by development projects funded

unless the provision of organic food would notby purchasing LemonAid or VcA products.

be considered as social itself. Viva con Agua

Further the value is not realized by facilitat-on the other hand applies a completely differ-ing access to a product. Rather social value

ent model. It has outsourced almost all opera-

for consumers i.e. “doing good” is achieved

tional parts of the beverage industry focusing

just by purchasing the product. With otheron its core business purpose i.e. fundraisingwords: social business in the case studies in-for the Viva con Agua NGO. Both latter com-troduced creates also values beyond immedi-

panies have a corporate structure that is com-ate consumer needs and to additional stake-mon for ordinary business in Germany. Bothholders than consumers only. In order tocompanies explain that this gives them more

understand these value propositions the social

freedom to act without limiting regulation.

business canvas should be enhanced conse-

54

招待論文 /Invited Articles

quently asking for each relevant stakeholder
groups’ value propositons. This would be alsoin accordance with Mohamed Yunus definition of social business as being stakeholder
oriented: its purpose is to serve society.

els: Origins, Present, and Future of the Concept’,Communications of the Association for Information Systems, Vol. 16, pp.1-25.
―― and Y. Pigneur (2011) Business Model Generation,
Frankfurt/New York: NY, Campus Verlag.
Pauli, W.-S. (2016) Available at: https://en.wikipedia.
org/wiki/FC_St._Pauli, Accessed May 1st 2016.

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