Has it ever happened to you that you encountered a product that supports a purpose, and you felt an urge to purchase it? You thought it would make a difference; you felt good knowing that you will have even a small part to play in that impact?
If yes, let us tell you that you are not the only one who has experienced this. Research suggests that 80% of consumers prefer buying from purpose-driven brands because they believe they are doing some part in making a positive impact.(1) The competitiveness is hardly limited for new purchases either. For example, in the USA, 66% of people tend to shift from a product they regularly buy to the one which is purpose-driven even if it’s new.(2) So, customers may appear faithful to a brand, but you may rely on such betrayals in your favour if you have a purpose-driven brand. This reminds us of what Richard Branson said:
“The brands that will thrive in the coming years are the ones that have a purpose beyond profit.”
What is a purpose-driven brand strategy?
For new businesses, a purpose-driven strategy is a long-term trend that connects the customers based on shared values. And it must be at the heart of the overall brand strategy, not just marketing or one-off campaigns. Not to mention, all the brands have some goals, but very few are purpose-driven. The difference is that a purpose-driven brand is stimulated and inspired by a central core mission that goes beyond core services or products. A purpose-driven brand aims to solve problems in society and make the world a better place for everybody. You might think it’s like an NGO, but the fact is that a larger-purpose can drive any business – and increasingly, more large corporations.
What are examples of purpose-driven brands?
To illustrate the power of purpose-driven strategy, we share with you examples of brands that have opted for this strategy and follow through on their commitments, including Tesla, Microsoft, Savers, and Maanch.
- Tesla exists to ‘accelerate the world’s transition to sustainable energy’. As an innovator to break records in sustainable transport, technology, and more, it made its reputation. Tesla often invests in specific aspects of its strategy, which are vital to both its long-term growth and its higher goal.
- Microsoft aims to ’empower people to achieve more’. This is another excellent example of a corporation that has gone through a low-level organizational structure from the 21st century: encouraging and trusting staff with a specific aim, mission and priorities.
- Savers is a large thrift store chain with a store in the US., Canada, and Australia. They buy all their products from NGOs who have received the items as donations. Then, they sell these items at affordable rates. The things that are not sold are then recycled. In this way, Savers support NGOs and give them money and help the environment by recycling products that are not sold.
- Maanch is a unique purpose-driven business – a platform for philanthropy, aimed at impacting investors and corporates. Their core mission is to ‘deliver more impact per investment towards achieving the UN Sustainable Development Goals and manage impact data with more insight, immediacy and efficient’.
So how it has been working out for purpose-driven brands?
The ability of a brand to sustain its profit is intrinsically related to a greater purpose. The ‘strength of purpose’ research among 8,000 global consumers and 75 companies and brands by New York-based Zeno Group (3) reveals that if a brand has a purpose, consumers are:
- four times more likely to purchase;
- six times more likely to protect that brand in challenging circumstances; four times more likely to recommend; and
- four times more likely to trust.
In the same way, two out of three consumers could spend extra for brand products and services that work for positive social impact.(4) According to IBM Research and the National Retail Federation, 70% of socially aware consumers pay a 35% higher premium for sustainable goods.(5) This suggests that brands with a clear purpose outperform and lead to higher growth.
Why should you opt for a purpose-driven brand strategy?
All the data above indicate why it’s not enough to focus just on product or profit. Now more than ever, companies are expected to be purpose-driven. No matter what products and services you offer – they need to work towards a purpose. Research indicates that 79% of people believe brands should address social justice issues, whether that be climate change, women’s rights, immigration, LGBTQ+ rights, or other important causes. (6) However, it’s easy for some brands to state they have a purpose-driven brand, but it’s quite rare that they mean it though. No doubt, we need money to live, but beyond that, we need a reason to live. It takes us forward together. We end up creating more value for everyone. The leaders of brands should start with a ‘why’ and make a difference with their corporations.
Many of us wish we build a business where we can do meaningful work. But how can we do that? If you too have not figured the purpose of your business out yet, we are here to assist you.
At CHORDIUS, we help our clients to build the businesses around the purposeand connect you with opportunities, employees, and customers. Through our services, including business coaching, strategy review, strategic communication, and marketing, you’ll be able to build your vision and communication strategy around something that matters to you and your company. This way, you’ll have the potential to reach millions of people and drive tremendous change.
As Simon Sinek said in his 2009 TED Talk:
“Profit is a result of purpose, not the other way around.”
Book a complimentary session with us today to discuss your brand strategy and communication approach.