Without a purpose beyond profit, people won’t work for you or buy your products
Most businesses have a deep and abiding love affair with profit. They measure it, report on it and build strategies to maximise it.
Consumers, on the other hand, aren’t motivated at all by how much money a company makes. True, they expect companies to make good stuff and deliver great service however what also matters is how companies treat their employees, choose their supply chain, how they protect the environment and whether they’re ethical and transparent about what they do and how they do it.
Brand purpose matters
Brand purpose is the reason, aside from making a profit, why a brand exists. It’s the difference you make, the actions you inspire, and the legacy you leave behind. Having a robust and meaningful brand purpose attracts like-minded customers and inspires employees. In a 2021 article, Deloitte argues that differentiators of the past, like price and quality, have become commodified. Instead, brand purpose has evolved into the key competitive differentiator. Customers buy from brands that share their values and contribute materially to their society. Research from Edelman found that 84% of respondents felt they needed to share values with a brand to buy from it. Brand purpose doesn’t just attract new customers, it retains and nurtures existing ones. In another global study by Deloitte, 57% of respondents indicated that they are more loyal to brands that commit to addressing social inequalities.
Happy at work
The world of work is changing too. Employees want to do work that gives them a sense of purpose. Data from McKinseysuggests that when employees find their work to be meaningful, performance improves by 33% and are 75% more committed to their company, and 49% less likely to leave. A clear brand purpose not only improves employee engagement and retention, but it also creates a positive culture in the workplace and improves the perception of a brand as an employer.
Being Responsible
If brand purpose is the reason a company exists beyond profit, corporate social and environmental responsibility (CSER) is the vehicle through which it’s expressed. It transforms your purpose from a mission statement into a set of tangible actions and policies. Without CSER, brand purpose can be flimsy and ineffectual. Brands that prioritise CSER build trust and brand loyalty, attract better talent, and create a clear differentiation within the market. It also allows companies to identify and mitigate social and environmental issues that pose a risk and enables brands to stay compliant with ever-changing regulations.
Doing it Right
Big brand / big heart – Patagonia
Founder Yvon Chouinard summarises the brand’s purpose succinctly in an interview with McKinsey: ‘Building the best product while causing the least harm is at the heart of what we do’.
In 2016 Patagonia donated 100% of its Black Friday sales to environmental charities
It created a Worn Wear program to encourage customers to buy used clothes and recycle what can no longer be used.
It has committed to being carbon neutral across its entire business by 2025.
To round off this example, in 2022, it was announced that Chouinard, having made enough money himself, would be transferring the entire ownership of Patagonia to a non-profit organisation dedicated to fighting the environmental crisis and defending nature.
Smaller brand / big heart - Tony’s Chocolonely
Unlike brands like Patagonia, whose mission has developed and expanded over time, Tony’s was created with their mission in mind. As such, the entire company is dedicated to eradicating modern slavery and child labour from the chocolate supply chain. In their own words, ‘Our mission is to realize 100% slave free chocolate. To achieve this, we must make the most amazing ethically produced chocolate to help cocoa farmers create a better future for themselves and inspire other chocolate makers to follow our example. In other words, we want to change the mainstream chocolate industry.’
Tony’s has full transparency in its supply chain – Tony’s works directly with cocoa farmers to ensure they receive fair prices and aren’t exploited - paying a premium on top of the minimum fair trade cost of cocoa beans to support a living wage for farmers.
Tony’s collaborates with other chocolate brands to push for systemic industry change and pledges to reduce its carbon footprint and offset emissions through climate investment and no deforestation.
Where to begin
A well-equipped and talented branding agency consults for the first part identifying:
Why a brand / company exists
What products and/or services the brand / company provides and how good they are.
What drives and inspires the brand / company.
What difference the brand / company makes.
What skills the brand / company has and how it can improve society.
Once this why is clear, ‘how’ it is used to shape the inner and outer voice of a business becomes the innovations platform for the rest of the work of a great branding agency. It is this ‘how’ that inspires action and triggers change. It is this ‘how’ that motivates the doing. And it’s this ‘how’ that will differentiates.
Whether your business is at the start of its journey and you’re searching for your ‘why’ and ‘how’, or whether you need a little help in finding your way back to purpose, we’d love to chat. Please get in touch.