Earlier this year, Larry Fink, CEO of Blackstone, caused a stir in the business world when he published a letter highlighting the positive relationship with purpose and profits, suggesting that CEOs should rethink their business model to deliberately link purpose with profit.
“Unnerved by fundamental economic changes and the failure of government to provide lasting solutions,” Fink wrote, “society is increasingly looking to companies, both public and private, to address pressing social and economic issues. These issues range from protecting the environment, to retirement, to gender and racial inequality, among others. Fueled in part by social media, the public pressure is on corporations to build faster and reach further than ever before. In addition to these pressures, companies must navigate the complexities of a late-cycle financial environment—including increased volatility—which can create incentives to maximize short-term returns at the expense of long-term growth.”
Jane Horan says that Fink’s letter is a call to arms. The well sought-after consultant, who has worked with brands like Kraft, Disney and GE, says that purpose has moved into the mainstream, with a slate of recent research connecting purpose and performance. For example, when management consulting firm Bain & Company examined workforce productivity and performance, it found inspired employees deliver more discretionary energy and were 125% more productive than satisfied employees.
“This inspiration comes from leaders removing barriers and connecting the firm’s purpose to the individual’s purpose,” says Horan, founder of The Horan Group and author of several books, including “Now It’s Clear: The Career You Own.”
Horan believes that connecting employees to their personal purpose drives key performance outcomes and higher levels of fulfillment. Connecting them with organizational purpose has a knock-on effect. “Uncovering organizational purpose does not require years of navel gazing, in all probability; it already exists embedded within the values of the brand,” Horan says. “Peel back the brand to uncover values, personality, promise and ultimately, purpose.”
Ron Tite, founder and CEO of content marketing firm Church+State, says that today’s corporations are morally obligated to stand for something that transcends their shareholder constituency. “Purpose is the reason—beyond superficial profits—that you’re in business.”
An award-winning brander, Tite has helped craft the messages for brands like Air France, Evian, Fidelity, Hershey, Johnson & Johnson, Kraft, Intel, Microsoft, Volvo, and others. His philosophy on purposeful marketing falls into three areas:
1. THE MORAL FACTOR
Brands have to put purpose before profit because consumers want to do business with organizations that share their values. Recently, The Business Roundtable, a group of 181 CEOs representing 35% of the total market cap in the U.S., voted to define the corporation with five stakeholders in mind: Customers, Employees, Suppliers, Shareholders and the Community.
2. THE DIVERSIFICATION FACTOR
When a brand believes in something beyond its products and price points, it is easier to diversify its portfolio, pivot to complementary services and generate growth. With the production of the ARIV, GM is moving into the bike market. “If it exclusively defined itself by cars, it wouldn’t be able to grow beyond cars, especially at a time when fewer people are buying cars,” Tite says.
3. THE PITCH FACTOR
Consumers are tired of getting pitch slapped. Everyone has a special promo, price point or sale to offer. These days, that kind of messaging is not cutting it anymore. “People used to vote with their wallet; now they vote with their time,” Tite says. “If you can’t win the battle for time, you’ll never win the wallet. Elevating the conversation to other things is refreshing for consumers and has a much better chance of cutting through.”
Every brand needs a story (or stories) to tell, which makes purposeful marketing a great feel-good story. It resonates with your customers. It increases engagement. And it creates a lasting connection.
“Aligning the brand’s purpose with its employees, interests and concerns is equally as important as allying it with their customers,” Hebets says. “They need to feel that it serves the company’s higher purpose, vision and mission. It starts by bringing your employees into the discussion and sharing your customer behaviors, attitudes and interests.”
This article appears in the January/February 2020 issue of Connect magazine published by NextPage, which can be found online here. If you would like a free print subscription to Connect, please click here.