The word ‘purpose’ has gained significant currency nowadays. We hear about brands striving to build ‘purpose’ into their organisation. At the same time, some question the viability of ‘purpose’ when commercial success is the goal of business.
There are many definitions of purpose in the context of business. A widely accepted definition considers purpose to be the essence that makes brands relevant in the market, ecosystem and communities. Purpose represents how brands create value for stakeholders at every touchpoint – be it customers, employees, business, governments and communities where they operate. It also represents the eventual impact of the business on the planet.
It is the ‘why’ of brands – why do they exist. Every brand exists to either solve a problem or meet a demand. Purpose is the test of how well they do it. Generally, every company started with a purpose but very few can keep it as the pressure to scale grows.
As Simon Sinek put it in Start with Why: How Great Leaders Inspire Everyone to Take Action:
“All organisations start with WHY, but only the great ones keep their WHY clear year after year.”
Can Purpose deliver Profits
Building purpose into business is the only way to thrive today and progress into the future. In 2019, Unilever announced that its purpose-led, Sustainable Living Brands were growing 69% faster than the rest of the business and delivering 75% of the company’s growth.
‘Purpose’ needs to be rescued from the narrow associations with ‘CSR’ and ‘Going Green’. It includes all that and more. Purpose is about creating profitable business models and products that can solve humanity’s challenges today and tomorrow. In fact, The Deloitte Global Millennial Survey, 2019, found that millennials (future consumers) have high expectations from brands. 87% think that business success should be measured by more than financial performance. Another 64% believe current companies are focused on their own agenda rather than making a contribution to the society.
As the Unilever announcement show, it is possible to create meaning in the marketplace.
Nike is another brand that shows how purpose does indeed mean a lot more and be seamlessly integrated into its business model. The company articulates it well when it states,
“Our purpose is to unite the world through sport to create a healthy planet, active communities and an equal playing field for all”
Not only does purpose build trust but it is also makes customers active stakeholders. It deepens relationships with the company. In the process, brands become involved with communities creating long-term business viability.
Why are we talking about Purpose
As populations surge and demand grow, are we equipped to meet the challenge of resource crunch and provide for everyone? There is an urgent need to reinvent our business models, manufacturing processes. We also have to look at our consumption patterns and make conscious choices.
It is in this context, that United Nations have declared the current decade as the ‘Decade of Action’ and have called on all sectors of society to mobilise on three levels to create a sustainable future for all:
“global action to secure greater leadership, more resources and smarter solutions for the Sustainable Development Goals;
local action embedding the needed transitions in the policies, budgets, institutions and regulatory frameworks of governments, cities and local authorities;
and people action, including by youth, civil society, the media, the private sector, unions, academia and other stakeholders, to generate an unstoppable movement pushing for the required transformations.”
It’s time for businesses to respond create ‘meaning’ in the marketplace. It’s time to understand purpose and become purpose driven.
What can we do
As professionals engaged in Marketing, Communications or brand management there is a lot to do in building a purpose driven business. This is an opportunity to mobilise the ecosystem. It is also the time to build and scale partnerships. Sharing know how on successful innovations and meaningful action is also important.
At the World Sustainable Development Summit in 2018, India’s Prime Minister Narendra Modi said,
“We need to follow the six Rs that stand for reduce, reuse, recycle, recover, redesign and remanufacture; this will lead us to the point where we can rejoice.”
In India, the ‘why’ is understood very well, we have to bridge the ‘how’ gap. ‘How to’ drive innovation in business models, process, products to achieve the ‘why’ to be able to follow the ‘six Rs’. It’s beginning to happen and it’s time it becomes a mainstream conversation in India.
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