Organisations that are clear about their purpose generally have lower staff turnover, produce a better financial performance and are more likely to connect with up-and-coming millennial consumers, according to research.
It is nearly a decade since Simon Sinek’s simple but powerful 2009 TED talk — Start with Why: How great leaders inspire everyone to take action — featuring his “What, How, Why” golden circles. The video has clocked up more than 38 million views and still inspires organisations to clarify and rethink their purpose.
Now, designing brands for consumer market purpose has become an important emerging marketing trend. A recent South by Southwest (SXSW) forum in March heard that designing brands with purpose is the key to successfully targeting millennial consumers. Todd Kaplan, vice-president of marketing at PepsiCo, and AJ Hassan, executive creative director at R/GA Chicago, who helped spearhead the purpose-driven Always #LikeAGirl campaign (90 million YouTube views/shares) told the forum that purpose-driven brands will be a major trend over the next 10 to 15 years.
The 2017 Edelman Earned Brand Study found that 60 per cent of millennials are belief-driven buyers. They want and value transparency. They want to change the world and they want to participate with their brands. Brands that lead with purpose show a 46 per cent increase in wallet share.
“Having a nice CSR (corporate social responsibility) program doesn’t make you a purpose-driven brand,” says Hassan. “Responding to a moment in time doesn’t make you a purpose-driven brand. When you are purpose-driven, you have to flow it through everything you do.”
There are three different approaches — designing for a cause, a cultural moment or having purpose at the core.
In the US, Whirlpool’s Care Counts program provided washing machines to 17 schools after discovering that high absentee rates were linked to students not having clean clothes and that teachers had stretched to taking their students’ clothes home to wash. Providing washing machines to the schools helped lift the attendance rates of the participating students to 91 per cent. Whirlpool subsequently partnered with Teach for America in 60 schools in cities including New York, Chicago, Atlanta and Los Angeles.
A lot of brands are jumping into cultural conversations... where they can take a position... to make their brand more relevant.
“There are a lot of brands who are jumping into ‘cultural conversations’ — an issue-based story — where they can take a position that allows the brand to make their brand more relevant,” says Hassan. One example is beer manufacturer Budweiser, which produced and distributed cans of drinking water to victims of Hurricane Harvey in August 2017.
Purpose-driven brands “live their purpose through and through, 365 days a year, and are built on that belief system,” says Hassan. “It’s embedded in the organisation’s DNA.”
One example is Method, which up-ended the home products cleaning market by making sustainability and environmental awareness stylish. However, it’s not just about brands that trumpet sustainability or saving the whales, says Kaplan, citing the approach of other successful brands such as Clorox — which developed a more human-centric, purpose-driven focus.
Another example is Dick’s Sporting Goods in the US, which took a leap towards attracting a different sort of consumer with its decision not to stock assault-style rifles following the recent school shooting in Parkland, Florida.
“Think of it as understanding — like a self-awareness of your brand,” says Kaplan. “When there’s a crisis, you will know how to respond because you will also know your set of values as a brand — as opposed to it being just the perspective of the CEO or a leader taking a stand.”
Authenticity is everything
Be it: Be grounded. Earn the right to have the conversation in what you do or produce.
Do it: Back it up with action.
Say it: Share what you believe and communicate what you stand for.