Today, people are flooded by brand marketing. Start-ups, SMEs and scale-ups are challenging the dominance of large corporates, bombarding consumers with thousands of messages a day. In this cluttered market, people are selective about who they tune into – and who they tune out. And the ones that are most likely to cut through the noise, are the ones who speak to a higher purpose. The companies that care.
62% of customers today want companies to take a stand on current and relevant issues like sustainability, transparency and fair employment practices. Companies that stand for something meaningful and are genuine about it – in their actions, words and products or services – are better prepared to weather change, as strong values translate to a loyal brand following. Here’s why it pays to have purpose.
The rise of technology and in particular, social media, has stripped many companies of their corporate veneers. Social media provides a network for people to swap good and bad news stories, influence others and highlight policies and practices that might once have been swept under the carpet. Trust events are becoming more commonplace, and polished PR teams can’t save businesses for long.
Treading the fine line between business and ethics becomes even more treacherous during times of economic uncertainty and change. For example, companies that acted poorly during the Covid-19 pandemic are likely to see a reckoning when the market stabilises, as employees leave and finding replacements proves harder.
The good news is that for brands that find their purpose, the future is bright. Brands with a high sense of purpose have seen their brand valuation grow by 175% over the past 12 years. Meanwhile, investment in UK tech companies addressing UN Sustainable Development Goals has almost doubled in the last year, and has grown by over 9x since 2013.
Purpose-led businesses have stronger productivity, better growth rates and higher levels of innovation, as well as a more satisfied workforce who stay longer – with up to 40% better workforce retention than their competitors.
These brands stand the test of time by being authentic, transparent and consistent. By leading and being vocal on social issues aligned to their values, businesses can build ‘tribes’ of loyal followers that help them keep pace with change and stop them from being displaced by more active disruptors.
In fact, so tantamount to brand longevity is purpose, that in Deloitte’s Success Personified report business leaders ranked societal impact as the number one way to measure annual performance, ahead of financial performance and customer and employee satisfaction.
A strong brand-purpose penetrates far deeper than simply satisfying consumer expectations. It also influences the people you attract, and the people you retain.
Particularly when we look to the future, we see how the rise of the conscious-consumer is seeping into expectations for job hunters. Almost two-thirds of millennials and centennials – the economic engine of the future – prefer ‘brands that have a point of view and stand for something’. 70% of millennials expect their employers to focus on societal or mission-driven problems. And 86% of millennials would consider a pay cut in order to work for a company with a mission and values aligned to their own, compared to 9% of baby boomers.
Employees are also increasingly being seen as brand ambassadors. 65% of consumers are influenced to act based on the words, actions, values and beliefs of employees – not just the CEO or spokesperson. And 28% of consumers make decisions on a brand based on how the company treats its own employees. Platforms like Glassdoor and LinkedIn give employees a voice, and those companies that can’t walk-the-talk can be easily exposed.
This is particularly important when we consider how decisions are being increasingly moved to the edge (see Democracy and Transparency). As employees are empowered to make more decisions autonomously, ensuring cultural alignment to brand values becomes starkly important.
As a result, companies are placing greater emphasis on attracting candidates that are culturally aligned to the business from day one. Cultural assessment tools are gaining popularity as part of the recruitment process, with persona mapping and analysis of existing employees helping companies to pinpoint desirable and common behaviours and values, although care should be taken with this. The benefits of a united workforce should not mean stripping out the benefits of a diverse one.
Protection and projection
To build an authentic, purpose-led brand, companies need to step in time with their target market and listen to customer expectations. Here, technology plays a vital role. By collecting, analysing and synthesising different data points, companies can temperature check market sentiments across different platforms and audience types. Sophisticated, self-learning algorithms can also pick-up on mood shifts, with AI and ML helping companies to manage their corporate image in everything from product development to customer service. The Internet of Things (IoT) also contributes to this, helping companies to trace how consumers interact and engage with their brand.
In our 2019 whitepaper ‘A Brighter Future’, we discussed how AI could help companies to unpick knotty customer data in order to establish patterns and personalise the customer experience. But it can also do the opposite, helping companies to recognise broad trends and shades of opinion on their brand image. It can help them to discover their audience, their expectations and how to adjust as the market moves. In fact, 46% of businesses are turning to ecosystems of suppliers, partners and customers to test out new business models and understand market disruption before it happens.
By understanding how the audience sees and experiences the brand, businesses can be more strategic about how they bring their values to life.
And this too filters into technology, with digital marketing and customer experience (CX) playing a large part in vocalising company values and translating corporate messages. Understanding what makes consumers tick is half of the battle, but the other half is being able to communicate this in a clear, transparent, authentic and frankly, loud, enough way to be heard.
As businesses ask for more trust from their consumers in order to build an understanding of their audience, reducing the risk of a trust event is becoming increasingly important. For example, data breaches are becoming more common as companies look to streamline processes and hold onto valuable insight from customer data. Investing in a watertight cybersecurity strategy therefore needs to be an imperative for any company handling a large volume of customer data, especially as IoT and edge computing become more popular for managing consumer needs.
Be authentic, be audible
The key to a purpose-led brand is authenticity. Companies should not simply echo the values they hear in the market – this will soon ring hollow. Instead, they must establish a genuine, in-the-roots, purpose to their business, and then look for where this aligns to customer values, even as they evolve. Businesses must think, act and speak with this purpose – from the people they hire to the business decisions they make. Tech can take you part of the way – but genuinely caring is the key.
For years, business leaders have warned of the implications of living in a VUCA climate. The words we use to describe the market – high velocity, unpredictable, turbulent, disruptive – all hint at the need for regular adaptation and agility. The coronavirus pandemic is a real-life example of VUCA in action. And it won’t be the last. Change, both small and monumental, is an inevitability we must all be braced for. And technology is the trigger point for this transformation, the architect of its innovation. It is a catalyst and an accelerant.
In our Tech Through Adversity series, we explore how the world of work is changing under the pressure of a VUCA climate – and the role tech has to play. Contact us at firstname.lastname@example.org for more information.