Purpose recession, Lego, Ikea, Apple, Timebanking

1. Moving forward in a Purpose Recession

While it may sound counter-intuitive, the idea that companies should keep advertising during a recession is well established. Over a century’s worth of studies show that brands which maintain or grow their advertising budget during a downturn increase sales and market share, both during the downturn and following it.

Now, while we’re not currently in an economic recession, we think we are in a purpose recession. Gone are the days when it was hard to move for purpose-related marketing, as companies and brands jostled to show consumers their contribution to society. Instead, we have reticence and the desire to keep a low profile. Businesses have been spooked by high-profile backfires (think Bud Light), the growing crusade against ‘wokeness’ and the politicisation of ESG. Many now fear they will get as much outrage as praise for activity which positions them firmly on one side of the cultural dividing line.

In the face of this purpose recession, we think the lessons of advertising through economic recessions should be kept front of mind. Companies with a purpose, which believe in the power of business to make a difference, which have invested deeply in their approach to sustainability and understand the existential threat the climate crisis poses to their future, should not stand by and keep quiet. Not only should they keep taking action, they should also find ways to show people what they’re doing. This doesn’t mean doing what you might have done before. It’s not the time for a brand to talk in broad brush strokes about its vision for the world or make a splash about a target set for a decade in the future.?Instead, marketing in the purpose recession needs to focus on real, tangible action that happens now, with messaging that has a point beyond telling people about what you’re doing in the hope of a pat on the back.

The purpose recession gives you an opportunity to demonstrate what you can do for people in a way that will cut through and showcase the strength of your commitment. For more of our thinking on the story behind this and what to do next, click here, or even better get in touch.

2. Reduce, reuse, replay

Do you have box upon box of old Lego taking up valuable storage space? Lego is seeking to provide a solution with a new UK take-back program, which encourages customers to return their bricks to be recycled into new items for donation. Sounds good right? Well yes, up to a point. But to us, this scheme seemingly overlooks the thriving second hand market for Lego which allow these colourful, durable bricks to continue to be played with for years to come without the need for repurposing or recycling.?

The Lego Replay scheme, conducted in collaboration with charity partners, has been extremely successful in North America. Since its inception in 2019, over 230 million bricks have been donated, benefiting 300,000 children in need through recycling into new items that support learning in school, such as storage boxes, while preventing unnecessary waste. This program is a key component of the brand's broader circular strategy, enabling innovation with a reduced environmental impact. This comes after Lego’s recent environmental strategy U-turn as they ditched efforts to transition from oil-based plastics to recycled polyethylene terephthalate (PET).?

However, Lego found that most people in the UK already have a plan for their unwanted Lego bricks, with 94% of families passing them on to friends, families, local schools, or selling them.? This local circularity is highly efficient and minimizes the environmental footprint associated with shipping the bricks back to Lego for transformation into new products. Tim Brooks, Lego's Environmental Sustainability President, emphasizes the durability and safety of Lego bricks, designed to be handed down through generations for continuous play and creativity - so why not reuse them in their current state rather than repurposing them into something new? While recycling initiatives often hit the headlines, reusing can take a back seat.??

One brand championing reuse is Bundlee , a children’s clothing rental service that helps parents save money and reduce waste, allowing users to swap out clothing as their child grows. Thrift+ is also encouraging reuse, helping customers send in their unwanted clothes with a pre-paid bag and label for Thrift+ to resell and recirculate as users earn Thrift+ points to shop on the platform.??

While Lego’s goal to increase their circularity is a noble one, we wonder whether a buy-back scheme could be more effective, incentivizing families to send back their unwanted Lego for it to be sorted, cleaned and resold as it is at a discounted price or donated, rather than recycled into something new. Even still, with many individuals already participating in local donation and resale of Lego, there may be opportunities for Lego to support and enhance existing organic circular practices rather than diverting attention away from them.

3. Decoupling profit and carbon growth

Complete systems transformation aside, decoupling carbon and growth is pretty much the holy grail of sustainable economic activity. Which makes Ikea’s news – they have done it! - particularly exciting. Ikea’s total carbon footprints (including scope 1, 2 and 3 before you ask) decreased 24.3% from FY16 alongside a growth in profits of 30.9%.??

How did they make this happen? Well first they increased energy efficiency, switched to renewable electricity and adopted electric vehicles within their operations. They are also working towards a reduction in the climate footprint of products and food by promoting those with lower carbon footprints. And they are providing renewable energy to IKEA suppliers. While their current target is to reduce by 15%, they are now strengthening commitments to align with the Science Based Target initiative (SBTi) Corporate Net Zero standard and are looking to reduce by 50% vs a 2016 base.??

While you could argue that switching to renewable energy, while commendable, is a relatively easy win which is hard to sustain (once it’s done it’s done), and that the real proof will be in whether this decoupling can continue through the years to come, we think that would be a little curmudgeonly. Instead, we think it should be celebrated, and poses a brilliant challenge to others. What can you do to accelerate economic growth which reduces carbon, rather than the opposite? And how can you make sure it doesn’t stop with you, but goes all the way through your value chain as well??

4. DEI bearing fruit at Apple

Numerous Diversity, Equity, and Inclusion (DEI) initiatives are dedicated to fostering internal diversity and equity within businesses for all employees. Those engaged in these efforts are well aware that this process often unfolds gradually and can present challenges. Therefore, it was heartening to witness a major brand like Apple reach a significant and impactful milestone by becoming the first major tech company to achieve a board of directors with equal representation of men and women.??

?This milestone is a stark contrast to its industry peers, who continue to face immense challenges in addressing board diversity. The broader tech landscape is marred by a glaring lack of diversity at the decision-making level. Research consistently underscores the positive impact of diverse boards, emphasizing that inclusivity leads to better decision-making and enhanced corporate performance. In an industry where innovation is paramount, Apple's move sends a powerful message about the imperative of breaking traditional moulds. At a time when DEI efforts are under threat, particularly in the US given the changing legal context, it’s particularly important to celebrate progress and lead by example. In this case Apple seems to be doing just that.??

5. The Goods: what goes around, comes around

When we think about what a bank does, we think about savings, loans, mortgages, investments, and so on – the different ways in which we store and borrow financial capital. But this isn’t the only currency we have at our disposal.?

‘Timebanking’ is a concept that reflects an earlier type of economy where the exchange is based on an alternative currency: time. The essence is simple: for every hour you give to your community, you receive an hour credit, and the bank stores and trades your credits. This could include gardening, IT support, home repairs or errands. These are tasks that aren’t always traded in the formal monetary economy but are very useful nonetheless.?

By trading services, people can benefit from skills they don’t have or when they’re most valuable, such as in older age, or even ‘cashing in’ on time when it’s needed most, such as during parenthood. And time-banking’s position in the middle ground between voluntary reciprocal support networks and monetary economy brings powerful benefits, including building relationships and trust in communities, as well as enabling people with low incomes to access services that might otherwise be unaffordable – particularly valuable during times of high inflation.?

Although this may appear to step on the toes of altruistic volunteering, it can be an effective way to encourage people who would not normally get involved in traditional volunteering. And through being able to donate credits via the bank, it can provide a structured and accessible way to volunteer help for members of your community.?

If this sounds like a good deal to you, you can get involved in time-banking as an individual or organisation in the UK here or globally here.?