NEW RULES OF SUSTAINABILITY MARKETING: Why purpose is replacing profit and the Triple Top Line is replacing the Triple Bottom Line.

From the series NEW THINKING FOR THE NEW NORMAL.

THE TRIPLE BOTTOM LINE, People, Planet, Profit, was coined by CSR specialist John Elkington in 1994. The original concept was applied to accountancy and economics, not marketing. It's been a cornerstone of CSR ever since.

But in today's world of brands using marketing communications to promote their ethics, the P for Profit seems less relevant to both a conscientious business strategy and a marketing strategy.

26 years on the pandemic has created a paradigm shift in consumer values and the meaning of sustainability, forcing brands to rethink their purpose proposition.

In the 'new normal', the well established Triple Bottom Line has now been replaced by a more consumer centric model:

The Triple Top Line: Purpose, People, Planet.

It should also bridges the gap between CSR and Marketing (I know from a recent consultation we did for a major retailer, there can be a big gap between the two).

After all, profit comes from the business acting good, doing good, and supplying good stuff. Both Unilever and P&G have seen their 'good' brands outperform others. But profit is not consumer centric, in fact the more profitable you appear the most suspicious consumers are about how you made it.

71% of consumers say that putting profit before people will lose trust in that brand forever. [KPMG]

"It's not HOW much you made but HOW you made it that matters to consumers."

[Read my article on why Doing Good is Good For Business.]

"Ask yourself the why question. Why do you do what you do?" [Simon Sinek]

Devising a communications strategy starts with the ethos - the corporate purpose. The core values, the WHY you do WHAT you do. It can take some interrogation and focusing (I spend a good percentage of my time just on this when helping devise a new strategy, yet too often this is overlooked). [I recommend you read David Hieatt's book Do Purpose: Why brands with a purpose do better and matter more.]

This then drives the brand towards a people or planet strategy (though usually a combination of both). Note, every brand will have a different balance.

Think of it as part of the ‘new normal’ and new thinking in marketing ethics.

Another reason 'profit' has been replaced by 'purpose' is that it isn’t relevant to consumers. After all, Elkington designed the original Triple Bottom Line as an accountancy model, not a consumer model. So as far as customers are concerned, it’s not about bottom lines but top lines - you can hear them say,

"What are your values, do they align with mine and my community?"

Purpose drives the ethics of the business, it’s the WHY they do what they do and the benefit it brings to us all. Good companies have a good core ethos, bad ones just set out to make money, which inevitably has a negative impact. (Banks please note.)

So replacing the ‘Profit’ element with ‘Purpose’ makes more sense.

A company’s purpose, combined with its customers needs and the marketplace, will dictate the balance between People and Planet and what key ethical values they should champion.

In my book Ethical Marketing & The New Consumer I identified over 50 Key Ethical Values (KEVs p159) brands need to consider, and the importance of identify those that are most relevant to your consumer - primary, secondary and supportive. (Something some brands get very wrong because they are driven by PR and spin not consumer insights.)

Getting the balance right, especially between people and planet is not easy. Especially now there's been a paradigm shift in consumer values.

Many companies that focus on sustainability for example with a bias on key environment issues because they think that is key to good PR should be more focused on people – especially community. And a few, the other way around.

In a recent retail survey by CONNECT2 just 16% of consumers see 'sustainability' as just environmentalism. 16% see it as as companies doing good while 56% see it as equally about people & planet, with a bias of 60:40.

https://www.connect2-uk.com/insights/

The research may surprise some marketers and CSR consultants and challenge conventional wisdom, but we have seen a massive surge in people values recently from community cohesion to the recent George Floyd killing creating a global backlash.

76% of consumers say they are more inclined to buy from a brand that genuinely supports local community than ones that do nothing. (Which is more than if you tout sustainability.)

In a recent joint presentation we did with KPMG, we came across these facts:

? 40% of consumers want to see more support for local communities from major retailers.

? 41% of consumers are concerned about how companies treat their staff (and suppliers).

https://www.connect2-uk.com/insights/

Why brands, especially retailers, need to engage local communities.

Community is something that is now being seen as more important than targeting individuals, especially as we are influenced more by our communities than self. [Read my insights piece on individuals vs community group think.]

? 92% of consumers define community as local first. 71% see it as important or vital to their lives.

"During this COVID-19 pandemic crisis we have seen our sense of human value amplified. Now consumers want to know what brands are doing related to people and community first."

[Read my article: MARKETING ETHICS: INSIGHTS INTO ENGAGING CONSUMERS AFTER COVID-19.]

You can hear the shopper think:

"Do I care about your sustainability claims on toilet paper when people are dying?"

Issues like exploitation of workers along supply chains, that got no coverage a year ago, are now getting both press and social media traction, plus public condemnation.

Just look at the Leicester sweatshop scandal and how Boohoo shares lost nearly half of their share value between 30 June and 15 July, and lost key contracts. The public outrage cost them a lot of customers too.

Concerns about how communities are struggling with no wages in South Asia, Africa, South America and other poor areas of the global are starting to impact upon the supply chain. Fears of a total collapse could have a global impact. When communities have more to fear from starvation than COVID-19, there will be a total breakdown in social structure and order.

Black Lives Matter

The recent explosion of protests around the murder of George Floyd has also added to the People agenda, bringing to the forefront aspects of racisms, diversity, equal opportunity, slavery and a growing awareness that all is not good. As big companies rush to their crisis PR management teams to pump out statements that they support better people ethics, most fear that if they come under the microscope they will be exposed. "The profit motive hides many skeletons."

People, Planet – the top line for the less familiar

The word 'SUSTAINABILITY' is thrown about a lot but how many of us know what it really means? Many brands and the press suffer from what is known as 'green bias' and see it largely as environmentalism, but it's true meaning in the original TBL was both People and Planet.

This can be confusing when a piece of research or data suggests people want to live a more sustainable lifestyle" - Google say they have seen a massive peak in April of people searching for 'sustainable lifestyles'. If you suffer from green bias then you believe it's all about the planet and consumers are becoming more green. Partly true but it dismisses the importance of humanitarian issues.

Consumers see sustainability as about both People and Planet. Which mean many brands have got their balance wrong and need to rethink their corporate purpose strategy to be relevant to consumer values.

? 44% of consumers believe it is important that a brand’s values match theirs. [KPMG]

Planet is all about the environment, avoiding exploitation of natural resources, reducing pollution, waste and reducing your carbon footprint. On a positive side, helping to improve the environment too.

Environmentalism has been a popular issue this last year with single-use plastics, the devastation of the rainforests, pollution and the impact of farming on the environment. But the agenda has changed with COVID-19. Now it’s back to people.

People is all about a business’s social impact (good and bad). It covers society, communities and people. From not exploiting people (we’ve read a lot about modern day slavery and sweat shops) to supporting individuals and communities. From welfare, health and education to cultivating positive living. 

As an employer: paying fair wages, providing safe working conditions, respecting human rights, cultivating equality and diversity.

As a supplier/retailer: respecting customers, being honest and respecting their wellbeing.

As a buyer of services/products/produce: respecting suppliers’ rights, paying reasonable rates within reasonable times.

The latter has been in the news recently with a large number of retailers not paying their bills to garment manufacturers in Bangladesh. (Read my piece on the Fast Fashion Crisis and its affect upon workers in S Asia and follow the link to Traidcraft Exchange. [Also great article by Marc Bain in Quartz.]

People vs Planet – devising a new strategy

When this is all over, we shall be entering what is being called the ‘new normal.’ Experts from all sectors agree that no one knows what that will really be like, but they do agree that we will need to revise our thinking, change much of what we did before and re-evaluate. That means some rethinking on company ethics, not to mention communication strategies.

So the next time you sit down to discuss the future approach of your business and ethics, before you jump on the latest PR bandwagon stop and think. Take the time to map out your Triple Top Line instead. It could make your actions and communications far more relevant to your customers as well as help your bottom line.

"It's not HOW much you make but HOW you make it."

As for profit – it isn’t bad if it funds good things, but the consumer doesn't have this on their radar. When one supermarket announced big profits all the stories became focused on ow badly paid their shop workers were and how screwed the suppliers were.

One of the campaigns I created that I am most proud of was the WHO PAYS? campaign for ActionAid that forced supermarkets to stop exploiting farmers in the developing world.

"Navigating the minefield of ethics, consumer opinions and devising a strategy is complicated. Get it wrong and the backlash can undermine trust in your brand. Get it right and you'll never look back."

If you want to get it right, give us a call, and our team of specialists will help you get it right first time.

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*Redefining 'sustainability' In a recent retail survey by CONNECT2 just 16% of consumers see 'sustainability' as just environmentalism. 16% see it as as companies doing good while 56% see it as equally about people & planet.

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Chris Arnold is a Dr of Business and co-founder of CONNECT 2 (the UK’s leading business to community engagement marketing agency) and a specialist in communal economics. 

He is also founder of ethical brand marketing agency, Creative Orchestra and the business innovation consultancy (that employs neurodiverse thinkers), The Garage Innovation Lab.

He is author of Ethical Marketing & The New Consumer (published by Wileys), Why Women Shop on Venus and Men Shop on Mars, and FLIP - Unthink Everything You Know (pub late 2020).

He has written the Brand Republic blog on ethics for over a decade as well writing for Third Sector magazine, FT, Marketing, Campaign, Adage, Brand Strategy, Creative Review, Impact and numerous publications. He is also a contributor to TV's Food Unwrapped.

Chris is founder of the UK's biggest community arts festival, a director of London Community Arts CIC, and is involved with numerous community groups and projects.

To feedback email: [email protected] m: 07778 056686 (no sales calls)

Websites: https://www.connect2-uk.com/

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