Traditionally, brands have been focused on the business of generating profits. Consumers, on the other hand, have been focused on getting the best deals and buying through the most convenient sales channels. For the most part the relationship between them was based on economics and convenience. The underlying values and practices of the brand and leadership teams were until recently, of little consideration or concern. That is quickly changing.
The Harvard Business Review reports, “In a recent survey of consumers, 65% said they want to buy purpose-driven brands that advocate sustainability.” Being purpose-driven is a new variable in the equation for winning today.
What is motivating consumers to be more purpose-driven? In a world where there is high-speed internet, mobile wireless networks, 24-hour news cycles and social media, a swarming effect amongst consumers can form in minutes. All it takes is for one key online influencer to expose a harmful action, unfair, or unjust practice to instantly create a swarm of calls for boycotts that can bring down an organization or leadership team. Likewise, having an influencer reveal and amplify the values and purpose-driven practices of a brand can also have a positive impact on sales and the brand value. The swarming effect works both ways. When we are all connected to the same online networks, we easily swarm.
The key to winning in a network of swarming consumers is to strategically be swarmed for good reasons. It’s about being recognized for the societal good your organization is doing as demonstrated by purpose-driven advocacy and practiced values.
For many older business leaders being purpose-driven is unfamiliar and uncomfortable territory not taught in business schools. Remaining as neutral as possible on most societal issues was not only long-established dinner etiquette, but a reliable corporate strategy to maximize demographic appeal. Today, however, staying neutral is not the safest bet. That is why I am suggesting that now is the right time for companies to add the position of Chief Values Officer (CVO).
My argument for the CVO role is backed in part by the following research by NYU Stern’s Center for Sustainable Business that found products marketed as sustainable grew 5.6 times faster than those that were not between the years 2013 and 2018. In more than 90% of the CPG (consumer packaged goods) categories, sustainability-marketed products grew faster than their conventional counterparts. That represents a significant consumer buying trend based on values and beliefs. The Harvard Business Review summoned up these findings with the concise statement, “Consumers are voting with their dollars — against unsustainable brands.”
A Nielsen report also supports this view, “Consumers are looking for companies to step up as partners in their quest to do good…This passion for corporate social responsibility is shared across gender lines and generations. Millennials, Gen Z and Gen X are the most supportive, but their older counterparts aren’t far behind.” In another Nielsen research report consumers said they are also willing to pay more. Among the 66% willing to pay more, 56% said they were willing to pay more for products from companies that are known for their commitment to social values.
The Chief Values Officer’s role would be to identify the values that inspire people both inside and outside the company to do good, and then to ensure they are an essential part of the brands’ DNA and purpose. Without being purposeful about purpose, a brand is at the mercy of the swarm.
Partner | Futurist | Leadership Strategies at TCS
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***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.