As more consumers in the US become socially conscious in their spending decisions, business models must take into account the principle of purpose.
Consumers want to align with brands that share their most deeply held convictions and values and to avoid supporting those that do not. To demonstrate their purpose, brands might donate to specific charities, fund environmental research, or organize charitable events that consumers can rally behind, but they have to do something more than just dishing up empty lip service. They take a stance on issues that their customers care about and then they put their money where their mouth is to prove their value.
The millennial generation is 83 million people strong, and heavily value-driven when it comes to where they want to work and where they spend their money. Businesses that have a clearly communicated purpose and values attract millennials as both employees and customers. Many people see CEOs as people in power who also possess adequate money to influence positive change in society.
Money and power come with responsibility, and the wealthy are expected to have a positive impact on their communities. If they don’t use their wealth for good, they’re seen as greedy and selfish. No one likes a Scrooge.
Resilience for Companies
Businesses face many ongoing challenges and it can take years for a company to turn a profit. A company can create resilience by focusing on their purpose instead of profits. Profit minded businesses often fail when problems arise.
A purpose minded business is grounded in a long term plan in spite of incidents that may occur along the way. Aside from simply feeling good about what you’re doing, leading a purpose-driven business properly and demonstrating that purpose well, can lead to increases in share price, sales boosts, increased productivity, low employee turnover, and positive market reputation.
Sharing a collective purpose across an entire company can be challenging to achieve, but the benefits are worth the effort it takes to build something truly positive. Most people want a sense of meaning in their workday.
Great workers will gravitate to companies with clearly communicated purposes that they align with and the pursuit of that purpose makes the “daily grind” feel more like time spent making a real difference.
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Conversely, it’s very easy for great workers to become dissatisfied in a job where they feel as though they have no greater impact than serving the company and being paid a fraction of the revenue they generate. A purpose beyond the paycheck staves off job dissatisfaction and other negative feelings toward the company as long as employees feel connected with the company’s purpose and see a progression in its pursuit over the course of their careers.
Employees are much more likely to stick around a long time at purpose-driven workplaces because there’s always something to work for and look forward to. Business owners should do all they can to encourage this sense of belonging as retention is important for smooth daily operation and the business’s bottom line.
High turnover can lead to feelings of insecurity among staff and are often seen as a red flag by quality applicants, but whenever an opening arises at a business with low turnover, it’s like finding the Holy Grail and prospects will compete for that coveted position.
Businesses face ongoing challenges every day and can often take years to become profitable. Having a purpose beyond profit can help a company become resilient early on, especially if the company is staffed with like-minded people also focused on the company’s core purpose. It helps to keep everyone on the right track and maintain a positive outlook in the early stages before profit is realistically attainable.
Businesses with a core purpose solely of profit often fail when problems arise. When there is no greater purpose to pursue, losses and stagnant earnings are nails in a corporate coffin.
Purpose-driven companies are representing more than the entity, product or service, or the people working there. They approach problems and goals with a mindset always focused on the way everything supports and advances their core purpose, and their standard of quality is the concrete evidence of these efforts that consumers will evaluate.
For instance, an environmentally conscious brand focused on reducing its carbon footprint and helping its customers do the same will ensure any manufacturing facilities they contract with are maintaining exceptional environmental standards in their materials, processes, and finished products.
A purpose is not just for internal benefits and a sense of direction, as it also helps appeal to and helps retain loyal customers. Simon Sinek wisely states in his book Start With Why:
“People don’t buy what you do, they buy why you do it.”— Simon Sinek
A company with a clearly communicated and widely supported purpose can amass fiercely loyal customers who will not be lured away with the promise of a lower price elsewhere. If a company is having a positive impact in their community, society, and the world, their customers want to help maintain that momentum and will stick with the company as long as it continues to pursue that purpose.
Businesses should also be very aware that there are influential consumer-detectives out there so they’d better not be trying to lie about how good they are. It’s a terrible look when they’re found out.
Similarly, a shallow veneer of purpose used superficially as a marketing tactic can be just as bad for a company’s reputation. A fake purpose is worse than no purpose at all, so don’t even bother if you’re just trying to put on a good face to attract some socially conscious customers. You’ll never secure the loyal ones with that kind of strategy.
We know what it’s like when the idea of business takes form. It can be an erratic rush to get it off the drawing board and into reality. If it wasn’t part of the overall business goals at the beginning, defining a purpose for your business may not have even been a consideration.
Discovering your business’s purpose could be the fundamental element to ignite long term success for your brand. Even if you didn’t start with one, it is still possible to reframe a business around a newly defined purpose that will bolster resilience, ensure and motivate high-quality standards, and support healthy long term relationships with employees and customers.
We can’t tell you what your business’s purpose should be, but a brainstorming session with the Jexans is a great place to start looking! Reach out to us for guidance and striking up a conversation.