5 minutes read
We’re truly living in unprecedented times. The perfect storm of Covid-19 and the Black Lives Matter Movement ushered in a new era. Whether it was a consequence of the dire threat of the virus itself, or the loss of loved ones, the economic and social uncertainty that came with it, the harsh reality is that the pandemic created hypersensitivity. People were feeling vulnerable, sensitive and scared. Businesses shut down. Families were brought back together. Our assumptions were changed. Our needs and wants were adjusted. And when George Floyd was so tragically murdered and we were forced to relive the tragedy while stuck at home, it was like gasoline was poured onto the fire.
Companies have had to shift business models in real time. On the heels of a 160 percent increase in eCommerce purchases from new or low-frequency users, brick and mortar retail brands scrambled to stay open while others transitioned to fully online. The lion’s share of companies have had no choice but to transform the way they conduct their businesses. And while re-acclimating to the new world at warp speed, companies have had to do some serious soul searching. Many have chosen to look more closely to their brand values and the role they play in their customers’ lives, communities and the world at large.
Where it was once enough to focus exclusively on generating profit, now a brand no longer has that luxury. Instead, it must define its purpose both internally and externally and ensure that on a day-to-day basis it’s living up to that promise. So, what exactly is purpose? Purpose is defining why a company exists in the world. It’s understanding its deeper raison d’etre. Purpose could be standing for diversity or demanding a healthier planet, but it has to be clear and it has to be about more than merely making money. The reality is that today a brand must lead with purpose. It must be embedded in its DNA, be inspiring to its people, and relevant to its customers.
And while companies that embrace and lead with purpose are not entirely new, we have seen a seismic rise in the number of Purpose Led Businesses and Brands. Take Ben & Jerry’s for example. On September 15th, they launched a podcast in partnership with Vox Media called, “Who We Are: A Chronicle of Racism in America.” The project takes a closer look at America’s lesser known “history of racial injustice” and “state sanctioned brutality continuing long after slavery ended.” Ben & Jerry’s doesn’t just talk the talk, but they walk the walk. The project is a paean to the black community and a clear affirmation of their commitment to “advancing the cause of black economic and social advancement.” Amour Vert, the emergent fashion brand, is another prime example. According to Advertising Week, “its purpose—sustainability—is the corner-stone of everything they do from planting a tree for every tee shirt purchased to using sustainable fabrics, to manufacturing in limited quantity to avoid excessive waste. Even its factory is California based to limit its carbon footprint when it comes to shipping.”
So how did we get here? The catalyst for the transformation appears to be the massive influx of millennials into the workforce and the significant role they have played in reshaping corporate culture. A strong purpose, is a necessary ingredient for an employee value proposition and with millennials entering the fold, savvy brands have taken notice. Open Sourced Workplace broke down the 25 most important things millennials want from an employer. The answers won’t surprise those who have been paying close attention. “A big paycheck is no longer enough to attract young workers these days.” In fact, what’s most important to a millennial is the “emphasis that a company places on social impact.” This includes everything from their stance on “climate change to their commitment to pursuing policies that are pro-diversity and gender equal.” Not surprisingly, millennials who work for purpose-led companies overwhelmingly report feeling more engaged than their friends who work at companies without a clear purpose. And as Gallup’s years of case studies have supported, those who are more engaged tend to perform far better than their counterparts who aren’t.
And this isn’t merely in terms of consumer spending habits, but it extends as well and perhaps to an even greater degree for B2B companies. For starters, more than half of B2B purchasers are now millennials, and if they sense that a potential vendor does not share the same commitment to causes that they themselves celebrate, the odds are that they won’t want to play ball. It’s more than just a byproduct of the employee experience but is now layered into the fabric of companies themselves. Their corporate governance dictates their commitment to pursuing equality and it’s written into the bylaws. As a result, there are certain expectations businesses now place on potential vendors in order to conduct business with them. If a potential client’s corporate culture does not align with their own and if gender and racial diversity isn’t a real commitment, the bylaws may prevent any sort of engagement.
It’s not just the turbulence of the past several months that have caused the upheaval. As a matter of fact, the steady rise in purpose-led branding was clear to anybody paying close attention. In 2018, Accenture Strategy conducted the 14th annual Global Consumer Pulse Research to gain an understanding of current global consumers’ preferences, beliefs and behaviors, surveying 29,530 consumers in 25 countries to get a better understanding of “how consumer expectations are evolving.” Their findings were startling. “Companies that don’t step up pay the price. More than half (53 percent) of consumers who are disappointed with a brand’s words or actions on a social issue complain about it. That’s not surprising. Customers have always complained. What’s different now is that 47 percent walk away in frustration, with 17 percent not coming back. Ever.” In the past, the prevailing viewpoint was that if you built it, they would come. Now they won’t.
And while it calls for a major adjustment, this new reality is anything but doom or gloom. It offers companies a unique opportunity to stand out, be bold and to ultimately capitalize on that boldness. At Unilever, where “nearly half of its top 40 brands focus on sustainability” they’ve noticed an obvious correlation. The purpose-led brands are far outpacing the rest. In fact, they are “growing 50 percent faster than the company’s other brands and delivering more than 60 percent of the company’s growth.”
So, given the changing landscape, what’s a brand to do?
What are the questions you need to be asking yourself?
Is your brand relevant? Is it set for the future?
Is it primed and properly postured for what comes next?
How can it avoid the pitfalls and ensure that it leverages the new opportunities that have arisen?
Purpose-led branding is the future, and it all starts with understanding and articulating purpose. Whether or not that purpose is for the greater good is something a brand needs to decide for itself, but they have no choice but to lay out their distinct point of view and adhere closely to it.