When one gets to a certain age it is not uncommon to find oneself asking rather more existential, important questions such as “why do I exist?” or “what is my reason for being?”
The answers can have a significant influence over what you do next and how you behave. In my case, they guide such thinking as how can I give back to a society that has given me so much? Ultimately, they are answers that help us all define our purpose.
But it is not just you and I who have been embarking on this kind of soul searching. It is something more and more businesses have been involved with in recent years. What we have here is a trend that is not only gathering pace, but also making a difference.
In today’s connected world, why you exist is as important as what you do - brands need a purpose that sits above what they do for customers.
With this in mind, I dig a little deeper into brand purpose and why it’s so important...
Inspiring people with brand purpose
Purpose orientated companies (ones that have more than just the profit motive) often outperform those that are purely focused on short term financial gains.
Something that can - and will - inspire businesses and their people to do amazing things.
All brands can compete on features through innovative R&D or digital disruption. However, this becomes more difficult when up against a competitor that delivers a truly meaningful purpose whilst interacting with its customers...
Dove believe real beauty comes in all ages, shapes and sizes, and are committed to broadening the definition of beauty for women.
Southwest Airlines want to connect people to what’s important in their lives through friendly, reliable and low-cost air travel.
Both are great instances of brand purpose really delivering. They are clear, based on a fundamental reason, and inspirational for the people of the business, its customers, and its stakeholders.
In fact, in the customer empowered world we live in, many of us would argue that the combination of authentic and meaningful purpose aligned to customer experience is the only way to build genuine sustainable returns for a business.
"In the modern firm, the most important assets are intangible, such as corporate culture, brand strength, and innovation. Only purposeful companies, freed from the exclusive focus on short-term profit maximisation, will make the long-term investments required to succeed in today's economy. In the long-run, there is no trade-off between purpose and profit.”
- Alex Edmans, Professor of Finance, London Business School.
Of course, some may seek to dismiss this approach on the basis that it isn’t easy to do and it is “all a bit fluffy”. At times I would agree with them. As everyone jumps on the bandwagon, this approach resembles the CSR reports of years gone by.
Purpose can also drive the wrong behaviour and erode value
Another approach brands take to define their purpose is to use what we would describe as the ‘hygiene factor’, or ‘no brainer’. These brands don’t found their purpose on a particular reason to exist within society, but rather the need to maximise a return for shareholders...
...Appealing to paymasters and not the people who buy their goods or services.
Let’s consider VW - a great example of how a brand with an internally focused purpose fell short on value recently and cost shareholders dearly.
To become the biggest car manufacturer in the world - knocking Toyota off its perch in the process - might get people clapping at AGMs, but it also led to some incredible decision making.
By defining its brand purpose based on internal factors, the brand not only faced serious financial issues, but also ruined their entire customer experience. As well as having to deal with third party distributors, who had been passed the burden of sorting it out, VW’s customers had to give up their own time to have the problem fixed.
So, how can having a meaningful purpose actually help your business?
In a recent EY and Harvard Business Review survey ‘The Business Case for Purpose’, executives spoke of the impact of a strong sense of purpose:
89% said it drives employee satisfaction
84% said it impacts on the company’s ability to transform
80% said it helps increase customer loyalty
Yet in the same survey, only 46% said their company has a strong sense of purpose whilst 44% said they were trying to develop one. So yes, there is work to be done to maximise the return on the potential of purpose. And I’m not just talking about words...
Doing what you say you’ll do - the purpose dividend and customer experience
It’s one thing to say you’ll do something, and another to put actions in place to actually do it.
“You are what you do, not what you say you'll do.” - C.G. Jung
With that in mind, here are 4 observations about how you can deliver what you promised:
1. Defining your core purpose by listening and reflecting
It is something that will often require the skills of the archaeologist and anthropologist as much as the businessman or strategist.
Finding the right sources of insight is essential, and asking the right questions of your audiences and being brave about who you talk to is key. You need to understand the views of the people who love the business, as well as those who do not.
Reflect upon what made it famous. Listen to how people talk about it inside and out. Map how it has evolved. And make note of how the society it serves has changed.
When you have the evidence, articulate a clear and inspired distillation of who you are and why you exist. Then get feedback.
2. Source feedback from trusted influencers inside and outside the business
Share your thinking with people you trust and those who will give you objective and meaningful opinions about the authenticity of your purpose. This will improve how you articulate what you think you are.
Whether it’s the elders of the business, valued customers, or industry and social commentators - they are your ‘purpose sounding boards’.
Remember, real value will come from those who will give you honest and objective views of what your purpose really means. This is about what it means to them and the people you seek to inspire.
3. Your business will be built by your people
Once you’re clear, start using your brand purpose to inspire your people and transform the way your brand interacts and listens to its customers.
I often refer back to the old saying “the insides of an organisation will always leak out”. In other words, it is impossible to stop the truth from revealing itself - be it positive or negative.
I reference VW again as a classic example.
With an inspiring and informing purpose, you’ll want the insides to leak out as they will be building the business and the brand.
4. Build a purpose led customer experience model
Putting the purpose into action and defining the emotional connections that can be created at key touchpoints will ensure everyone within the business is on the same path. It will help them visualise the connection between what they do and the outcomes delivered.
Building the model using teams from throughout the business brings the theory to life - helping prioritise the activity and allocate the often over stretched resources of the business.
With a sustainable brand purpose led model, you will be able to effectively inspire your people, customers and ultimately your stakeholder.
Drive the right passions and experiences for your audience
If you can’t see the positive impact on the long term financial fortunes of the business, then it’s unlikely that your brand purpose is driving the right customer experience.
Start with your senior team. After all, they will have defined your brand purpose. If it doesn’t inspire them, or if they can’t see how it directly influences things like decision making, then why - or how - would your employees, customers or stakeholders?
Nobody said it was going to be easy. Things worth doing rarely are. But in the long term, sustainable results will make it worthwhile in the end.