Purpose or Perish: The Brand Imperative

If you know me or have read any of the past editions then you know that for me, when it comes to marketing, EVERYTHING starts with brand and everything that is brand starts with its purpose.

Picture this: You walk into a store?where every product meets your functional needs. A sea of sameness. Everything is parity. Everything delivers. How do you choose? Increasingly, the answer lies not in what a brand sells, but in what it stands for. This isn’t a new concept, but as consumers are being bombarded with more choices, where skepticism of companies at an all-time low, and where the line between business and social responsibility is increasingly blurred, brand purpose has emerged as a critical differentiator. It is no longer a mere afterthought or a feel-good addition to messaging. This shift is reshaping the very foundations of brand strategy and marketing, forcing us to ask deeper questions about our companies' roles in society and their impact on the world.

The rise of brand purpose isn't just a fleeting trend; it's a fundamental reimagining of the relationship between businesses and society. It's a recognition that in today's interconnected world, companies can no longer operate in isolation, focused solely on profit. As marketing leaders, we have a responsibility to be the guides to our brands in becoming active participants in addressing societal challenges, aligning company success with the greater good. Brand purpose has become the new battleground for consumer loyalty and business success.

Consumer Expectations: The New Generation's Demand for Meaningful Brands

The ascent of Millennials and Gen Z as dominant consumer groups has catalyzed a profound shift in brand expectations. These generations, having grown up in an era of unprecedented global challenges – from climate change to social inequality – are demanding more from the brands they support.

Back in 2021, Deloitte published a survey which revealed that 47% of Millennials and 48% of Gen Z have made choices over where to work based on personal ethics. This same principle extends to their purchasing decisions. They're not just buying products; they're buying into ideas, values, and visions for a better world.

We’re seeing this all over the place. Take Patagonia, for instance. When founder Yvon Chouinard announced that "Earth is now our only shareholder," transferring ownership to a trust dedicated to fighting the environmental crisis, it wasn't just a PR move. It was the culmination of decades of purpose-driven strategy that has resonated deeply with these value-conscious consumers.

This shift requires brands to reevaluate their role in society. It's no longer enough to simply not do harm; consumers expect brands to actively contribute to solutions. Whether it's sustainability, social justice, or community development, brands must demonstrate tangible commitments to causes that align with their core business and resonate with their target audience.

However, this heightened expectation comes with a caveat: authenticity is paramount. Consumers finely tuned BS detectors. They can spot purpose-washing a mile away, and the backlash against brands perceived as inauthentic can be swift and severe. The challenge for brand leaders is to ensure that purpose is deeply embedded in the company’s DNA, influencing everything from product development to customer service to advertising.

Differentiation: Purpose as the Ultimate Competitive Advantage

In markets saturated with similar products and services, brand purpose has emerged as a powerful differentiator. In a sea of sameness, where functional attributes and even price points are comparable, purpose becomes the tiebreaker.

Dove's "Real Beauty" campaign, focusing on body positivity and self-esteem, has set it apart in a crowded field of soap and beauty products. By aligning with a purpose that resonates deeply with its target audience, Dove has created an emotional connection that transcends the functional benefits of its products.

Similarly, Tesla's mission to "accelerate the world's transition to sustainable energy" has turned electric vehicles from a niche market to a global phenomenon. Tesla's purpose isn't just about selling cars; it's about revolutionizing transportation and energy consumption. This bigger vision has created a tribe of loyal customers who see their purchase as an investment in a better future.

The power of purpose as a differentiator lies in its ability to create emotional resonance. In a world where consumers are increasingly seeking meaning in their purchases, a clearly articulated and authentically lived purpose can be the factor that tips the scales in a brand's favor.

However, differentiation through purpose requires more than just clever marketing. It demands a holistic approach where purpose informs every aspect of the business, from product development to customer service to supply chain management. Only when purpose is fully integrated into the business model can it become a sustainable competitive advantage.

Long-term Value: The Financial Case for Purpose

While the moral argument for brand purpose is compelling, there's also a strong business case to be made. Numerous studies have shown that purpose-driven brands often demonstrate better long-term financial performance.

Purpose-driven companies actually witness higher market share gains and grow three times faster on average than their competitors, all while achieving higher workforce and customer satisfaction.

Consider the case of Unilever again. Under Paul Polman's leadership, the company put purpose at the heart of its business model with the Sustainable Living Plan. During his tenure, Unilever delivered consistent top and bottom-line growth, with the Sustainable Living brands growing 69% faster than the rest of the business.

The reasons for this enhanced performance are multifaceted. Purpose-driven brands tend to build deeper, more resilient connections with customers, leading to increased loyalty and advocacy. They're also often more innovative, as their purpose drives them to constantly seek new solutions to societal challenges.

Moreover, purpose-driven brands tend to be more resilient during crises. During the 2008 financial crisis and the COVID-19 pandemic, companies with strong, authentic purposes were better able to navigate the turbulence, maintain stakeholder trust, and emerge stronger.

However, it's crucial to note that the link between purpose and profit isn't automatic. Purpose must be genuinely integrated into the business model and consistently acted upon to drive long-term value. It requires commitment, investment, and often, a willingness to make short-term sacrifices for long-term gains.

Trust Building: Purpose as an Antidote to Institutional Distrust

We're living in an era of declining trust in institutions. The 2021 Edelman Trust Barometer revealed a concerning "epidemic of misinformation and widespread mistrust of societal institutions and leaders around the world." In this context, a genuine brand purpose can be a powerful trust-builder.

When a brand consistently demonstrates commitment to a purpose beyond profit, it can cut through cynicism and build meaningful connections with consumers. Take Ben & Jerry's, for instance. Their long-standing commitment to social justice issues, from climate change to racial equity, has built a loyal customer base that sees the brand as more than just an ice cream maker, but as a force for positive change.

However, building trust through purpose is a delicate balancing act. Brands must be prepared to take stands on issues that align with their purpose, even when it might be controversial. At the same time, they must ensure that their actions consistently align with their stated purpose to maintain credibility.

The Path Forward: Embedding Purpose in Brand Strategy

As we look to the future, it's clear that brand purpose will only become more critical. The challenges our world faces are too big to be addressed by governments alone. Brands have a crucial role to play, and consumers, employees, and investors increasingly expect them to step up.

For marketing leaders, this presents both a challenge and an opportunity. The challenge lies in authentically defining and activating a brand purpose that aligns with the company's core business, resonates with key stakeholders, and drives positive impact. The opportunity is to create deeper, more meaningful connections with consumers, and drive long-term business success.

But HOW do we embed purpose in brand strategy? Here are a few things to consider…

1. Define your purpose authentically: Your brand purpose should arise from your company's core competencies and values. It should be something you're uniquely positioned to address.
2. Purpose must live across the entire organization: Purpose can't just be a marketing initiative. It must inform decision-making across all departments, from product development to HR to supply chain management. It must thrive in your culture, the way in which you do business, the products you develop, and how you approach your customers and society.
3. Measure and communicate impact: Develop clear metrics to measure the impact of your purpose-driven initiatives and communicate this impact transparently to stakeholders.
4. Be prepared to make tough choices: CFOs will crush me for this one, but living your purpose may sometimes mean making decisions that impact short-term profitability. Be prepared to stand by your purpose, even when it's challenging.
5. Continuously evolve: As societal needs change, be prepared to evolve your purpose and how you activate it. Regularly engage with stakeholders to ensure your purpose remains relevant and impactful.

Look, the power of brand purpose is undeniable. In a world hungry for meaning and positive change, purpose has become the new battleground for brand relevance and business success. As brand leaders, we have the opportunity – and the responsibility – to harness this power, creating brands that not only drive business success but also contribute to a better world.

The brands that will thrive in the future are those that see purpose not as a marketing tactic, but as the very reason for their existence. They are the brands that understand that in today's world, doing good and doing well are not mutually exclusive – they are inextricably linked. Afterall, isn’t that what purpose is all about?