One of the great transformations of the 21st century is that brands are occupying an increasingly relevant and transcendent role in the world. Brands have occupied a central space of modern society, partly on their own merit, partly because consumers have raised them there. In this new context, brands have an influence and power with which, well used, they could help build a social proposal better than the current one. In recent years I had taken for granted that companies had internalized the transcendent role of their brand’s purpose; but I was wrong. At present, many companies are unaware of the role of purpose in building their brand.
While the world talks about digitalization, the purpose is back on the table because customers demand it.
In a world in which consumers can quickly discover whether a brand is fulfilling its promise, or not, it is crucial that brands are transparent, create connections, enhance commitment and have a strong relevance to their consumers.
People are looking for a purpose they can believe in. The more inspired the employees are, the better the work they will do and the more convinced the customers are, the more they will choose and recommend it.
A great brand is a great promise fulfilled.
A brand with a strong purpose not only helps the general good of society, but also helps employees and customers know what they represent. The purpose must be approached with sincerity and honesty and not with the opportunism of saying it, without believing it, without feeling it and without doing it. Today’s customer can detect the falsehood at a kilometer away. In this era of radical transparency, it is necessary to reiterate it, consumers can quickly detect whether companies are keeping their promises or not.
Many brands have understood the need to fill the gaps of the human being of the digital age. Offering an expectation of fulfilling your wishes. Each satisfied desire gives way to a new one, since that is the function of desire: desire. Although the underlying unease increases while the real need is not met. Simultaneously the existence of the illusion, in this market of perceptions, accepts mobile payments and virtual currencies. In a world where the need to fill in gaps has become an exercise of first necessity, the brand-consumer relationship cycle has entered an unpublished territory. Many people no longer follow certain brands, but joins them. When I talk about them, I talk about those that do not play with customers’ expectations, from manipulation and deception, but from those that consistently align their vision, their feelings, their sayings with their doing behind an honest purpose.
As companies with purpose mature, they become more strategic and increasingly impact society. Leading companies push towards a new territory in their search for differentiation and impact.
Is it the essential purpose for business success?
A brand is born to solve a problem or satisfy a need. Its purpose is the reason why there is a brand. It is the underlying essence that makes a brand relevant and necessary for people. The purpose sits firmly at the center of a brand’s culture and affects every decision. How well you do it, and how well you believe loyalty, affinity, commitment and connections with your customers will determine if you join the group of relevant or irrelevant brands.
Ecoalf, Western Islands Company, Auara, Establecimiento de Café, El Noble, The Body Shop, Lego, Patagonia, Nike, Lululemon and Dove are examples of brands that fulfill their purpose. This has allowed them to occupy a significant place in the minds of their clients and support their growth.
In the report, The Business Case for Purpose, from a Harvard Business Review Analytics team can read “a new vanguard: those companies capable of harnessing the power of purpose to boost performance and profitability enjoy a clear competitive advantage.”
The survey defined the organizational purpose as “a rationale for being that inspires and provides a call to action for an organization and its partners and stakeholders, and provides benefit to local and global society.” And although 90% of executives surveyed said their company understands the importance of the purpose. This survey suggests that the purpose is a powerful tool although, surprisingly, little used:
* Most executives believe the purpose is important.
* 89% of executives surveyed said that a strong sense of collective purpose drives employee satisfaction.
* 84% said it can affect an organization’s ability to transform.
* 80% said it helps increase customer loyalty.
But only a minority said their company currently operates purpose-oriented.
* 46% said their company has a strong sense of purpose.
* 44% said their company is trying to develop one.
All successful companies were founded with a central purpose, but many have neglected their origins on the trip. Successful brands, aimed at a purpose, see their customers as more than just consumers. Their clients are active parties that invest their time, money and attention in the brands they love.
Customers of this new era, can, and indeed do, act as powerful advocates for brands in which they believe and value authenticity, consistency and transparency. That is why smart and sensitive brands are committed to the beliefs of their customers, which are also theirs.
Targeted brands with a purpose prioritize the cultivation of deep relationships, with less focus on the like and more attention on love. Increasingly, people are putting their money where their hearts are. Millennials are those that drive the demand for brands with more purposes. Younger adults are the most willing to pay a little more for sustainable goods. And as employees, millennials are also rewarding businesses with higher purposes for their loyalty, notoriously volatile. Of the attributes of the companies given by the millennials to whom they consider being faithful, one of the most frequently cited is “a strong sense of purpose beyond financial success.” The nuance is important: beyond, not instead of.
To be fair to some companies, building a purpose on established brands is a very difficult task. Born in an era of product-based differentiation putting the purpose in the center is no simple task. This is why for many companies the construction of the purpose must be updated, since it was not such a strategic aspect at that time. The truth is that not all companies have known or been able to identify a suitable cause, and then build around it.
The digital age brands that have not yet been born do not suffer such a limitation and, therefore, may have a built-in purpose. If they do not, it would be a mistake, as customers are increasingly betting on relationships with brands that arise from a meaning greater than a mere transaction.
Today’s purpose goes beyond corporate social responsibility. The purpose cannot be seen as a department or a timely initiative. It must be the blood and oxygen that branches, soaks and nourishes the entire company. Today it is possible to create economic and social value together. The purpose is a source of competitive advantage that allows to align and energize the organization inward and connect and establish deeper ties with the world (customers, suppliers, shareholders, etc.) outwards.
If your company already has a strong sense of purpose, see where you can integrate it more deeply into the way you make daily decisions. Also see how you can start measuring your progress toward fulfilling that purpose.
Corporate social responsibility (CSR) does not disappear, it evolves. Companies are spinning on purpose and CSR can be part of it. Public, private, mixed and cooperative companies can occupy a more prominent place in modern society. Having a social purpose approach is not a minor task: a purpose or social mission as the reason for the company’s existence is increasingly transcendent.
This reveals a trend in companies that develop and integrate a social purpose in their business models and in everything the company does. The social purpose is a more holistic approach to the business, in which the business model is infused with its social intention and is not treated separately.
The social purpose is linked to the mission and the declaration of value; everything is aligned. Everything is consistent.
The main changes include a transition from approaches, from transactional to those that are strategic, holistic, social and transformative; the integration of the purpose into the business model (or vice versa).
When Michael Porter and Mark Kramer shared the concept of “shared value” – the idea that the purpose of a company is to achieve both the benefit of the shareholders and the social purpose – was novel, so much that some even encouraged affirm that this new vision would reinvent capitalism.
The meeting of benefits and purpose is a means and an end. And having a purpose is not enough. What makes the difference is to live it, feel it and have it active, alive, beating in each employee, each client, each action. The brands that understood it are rewriting history.