Brand Purpose is a hot topic of conversation these days, but what is it exactly and why is it important to a successful brand strategy?
A powerful brand purpose is the guiding star for how a company intends to change the world for the better. It justifies a company’s existence beyond acting purely as a generator of revenue for shareholders. Purpose unites customers in the pursuit of a meaningful intention, and provides a vehicle for them to broadcast their beliefs and values to those around them. While brands and corporations have been integrating purpose into their business strategies for some time now, recent economic, environmental and political uncertainties have given consumers increased motivation to affect change by every means possible, and this includes putting their full support behind brands that have a purpose aligned with their own.
Larry Fink, Chairman and CEO of BlackRock, Inc., recently stated, “The public expectations of your company have never been greater…Every company must not only deliver financial performance, but it must also show how it makes a positive contribution to society. Without a sense of purpose, no company, either public or private, can achieve its full potential.”
In fact, Accenture Strategy’s 2018 global survey of nearly 30,000 consumers found that 62% of customers want companies to take a stand on current and broadly relevant issues like sustainability, transparency or fair employment practices.
Purpose contributes to the brand ecosystem in an intangible but meaningful and impactful manner. Traditional components of the ecosystem, like product, quality and service are all essential parts of building a relationship with the consumer. However, when brand purpose is added to the equation, you see a transition from mere customer to loyal advocate. This shift from a transactional to an emotional relationship is what creates brand champions that actively engage their sphere of influence with the brands they support and ultimately leads to sales.
By adding the human element of purpose to a brand also serves as a unique point of differentiation in an increasingly crowded marketplace. For example, nearly half of Unilever’s top 40 brands focus on sustainable living as their purpose. These brands, which include Seventh Generation, Ben & Jerry’s, Lipton and Dove, have been growing at a rate of 50% faster than the company’s other brands, and generate more than 60% of the company’s growth.
A word of caution should also be included here; Authenticity must be the foundation for the development of any brand purpose. Consumers are savvy and can identify an insincere attempt to appeal to their value set, making the gap between what a company says and what it does obvious and capable of eliciting swift reaction. A good case in point: during the 2018 FIFA World Cup, Mastercard stated that it would donate 10,000 meals to those in need in developing countries for every goal scored by Messi or Neymar during the series. Reaction to the initiative was crushingly negative and led to a social outcry for the billion-dollar company to donate the meals regards of who scores, which was the eventual result after the public shaming. While well intended, this campaign proves just how quickly an inauthentic sense of purpose can damage brand reputation.
In the end, however, the positive impact of defining a purpose is something that every brand must now consider. It demonstrates that your company stands for something more than its product. It creates a deeper customer relationship. It sets brands apart from their competitors. But most importantly, purpose provides a sense of being a true stakeholder and investment in the success, not only of your company, but also of your shared vision of a better world.