The power of purpose-driven brands
2020 has presented a multitude of challenges for businesses and consumers across the globe, yet the common thread that has emerged is the value of authentic brand purpose. In the face of economic uncertainty and growing impetus on global social change, a purpose-led philosophy has been the defining factor allowing brands to stand out and demonstrate their worth to their consumers in an already challenging business environment.
Brand purpose has never been in the spotlight to the same extent that it is today. The proliferation of social media against the economic and political backdrops of this year have led consumers to hold brands accountable, expecting them to have a say on the issues that consumers care most deeply about – from providing relief to front-line workers during the COVID-19 pandemic to tackling systemic racism.
The appeal of purpose
Brand purpose goes beyond the what, where and how you do business – it is the why that underpins your operation. Why do your team members get up and go to work every morning – what are you really trying to achieve? Customers want to build their relationships with brands that do more than just make money, and brand purpose creates a notable point of difference.
Purpose is a powerful attractor. Accenture’s brand purpose study revealed that 62% of customers want to engage with companies that take a stand on current and relevant issues including sustainability, transparency and fair employment practices. The impact of not speaking out is costly; brands that don’t do this face significant backlash with 47% of customers stating they would walk away from a brand in frustration and 17% indicating that they would never come back.
An Edelman study showed similar trends: 65% of belief-driven buyers said that they wouldn’t buy from a brand that stayed silent on an important issue. The bar is high, with 53% of consumers thinking that brands can do more to solve social issues than the government. Purpose clearly has a strong effect on a consumer’s perception of a brand, and we expect this to grow in the wake of this year’s turbulent environment.
Words vs actions
It’s clear that customers expect brands to be involved in social causes, yet it’s vital that a company’s actions must back up its words. Over the last two months we have seen businesses who spoke up against the Black Lives Matter movement but who didn’t already integrate diversity practices into their operations quickly ousted by consumers and employees.
Purpose should lie at the core of your business – it’s not a social trend or a marketing strategy. The actions of your brand must clearly and wholly underscore your purpose. Kantar’s Purpose 2020 report showed the positive benefits of what acting on your purpose can bring, with brands perceived to be purposeful significantly outperforming those brands who were only partially or not at all perceived to be purposeful. A high perceived positive impact led to brand value growth of 175% vs 86% for medium positive impact and low positive impact. Acting on your purpose will not only boost your credibility in the eyes of your customer – it may have a positive impact on your business performance, too.
It’s evident that many brands know their purpose, but don’t articulate it well. Kantar’s Purpose 2020 study uncovered that 76% of marketing leaders believe their business has a defined purpose but only 1 in 10 actually have a corporate purpose statement that is backed by a meaningful action plan.
It can be difficult for purpose to permeate all levels of a brand: according to Kantar, while two-thirds of marketing leaders believe that their brand purpose will deliver long-term business growth, only one-third believe purpose is regarded as a company-wide movement within their organization. Ensuring leadership and employee buy-in across all levels of your business internally will be vital to ensuring your purpose is clear and visible to your external stakeholders.
Purpose can be a strong driver to build customer loyalty and increase brand value; it is a metric that will underpin all your future communications and marketing campaigns. With consumer attitudes drastically shifting and a more considered mindset emerging, demonstrating your brand purpose will be vital to ensuring success and longevity of your brand going forward.
At Tag, we partner with brands and agencies worldwide to deliver creative marketing campaigns at speed and scale. We work closely with clients to create meaningful marketing communication campaigns that allow brands to connect with their consumers and future-proof their business in today’s rapidly changing environment.
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