Creating Balance In An Imbalanced World
Solving the challenges businesses are facing today requires a new mindset
Business In The 20th Century Was All About Profits.
In 1970, the economist Milton Friedman said, businesses should think only about making profit, adding that any idea of social responsibility was a distraction and a disservice to shareholders. Now enter the 21st century, defined by the global economy, information technology and the Internet. Competition is fierce and consumers have more options than ever. The traditional supply/demand cycle is under attack by forces outside of our control. Making profits is still the motivator to run a successful business, but business models have changed.
The social fabric of our society is in danger with income inequality rising, while environmental issues, from climate change to overpopulation, are adding a global layer to an increasingly dire picture. The call for change gets louder, and we as a society as well as individuals need to respond. Tech companies aren’t left out here, and we see more and more business leaders leading by addressing social and environmental issues head on, with low carbon initiatives or employee incentives such as extended maternity leave or equal pay for men and women.
The Call For Balance Is a Call For Social Responsibility
At the World Economic Forum 2017 in Davos, Sergej Brin, founder and CEO of Google said in an interview, that a sense of social responsibility is common to many of the companies participating — something that has animated Google from its inception: “You can’t just think narrowly about your business… that you’re just going to maximize earnings and not be concerned about what’s going on around you. It seems to me that companies are taking these things seriously.”
For us as creatives, it’s where the conversation starts when we discuss a new project. It’s not just about goals and objectives anymore, but the larger context, too.
Millennials And The Quest For Meaning
Social responsibility is a common term that gets kicked around amongst business consultants and marketing professionals as a way to address those issues. But what does it have to do with tech branding? And what does it mean to your customers? A lot. Not only do we face new challenges, we also see the rise of a new group of consumers, the millennials. The 2015 Deloitte Millennial Mind the Gaps survey revealed, that in 2015 millennials for the first time made up nearly half of B2B purchase influencers and/or decision-makers, a percentage that is growing rapidly.
With that growth comes an increasing demand for more than just a good deal or a decent salary. More than any generation before, millennials also require a clear sense of mission, vision, and values that align with their own, and that is summed up in that one often misunderstood word: Purpose.
“Globally, more than seven in 10 (73 percent) Millennials believe businesses have a positive impact on wider society... When asked to identify the words or phrases that match their own ideals as to what business should try to achieve, Millennials highlight “job creation,” “profit generation,” and “improving society.” — Deloitte, Mind the Gaps
What Does Purpose Really Mean?
Purpose is the well where social responsibility feeds from. It’s the foundation. In a B2B context, purpose isn’t some fluffy woo-woo — it’s pragmatism, it’s something that adds to the bottom line. This is because a bonus or a corner office are not enough to move the growing millennial population. The iPhone-Generation is gravitating toward brands that provide meaning and purpose that extends beyond shareholder value — whether it’s focused on improving communities, revolutionizing an industry by introducing earth-friendly products, or simply creating a great place to work. And as research shows, companies that demonstrate a strong commitment to purpose enjoy better financial returns than those that don’t: Do good, do well.
That same Deloitte report also found that most business buyers do not perceive enough meaningful difference between competing brands to be willing to pay a premium for one over the other.
“In a world where authenticity increasingly is in focus, consumers are seeking more than brands who focuses on revenue — consumers want to support brands with a purpose — one that justifies an emotional engagement.” — Martin Lindstrom
In other words, while virtually any B2B brand can demonstrate business value, so too can its competitors. How, then, can B2B brands stand out among a sea of similar offerings, and what prompts today’s buyer to make a choice of one partner or provider over another? Purpose can be the needed differentiator.
Millennials do not distinguish their concerns between personal and business lives. The lines have blurred here. Countless studies indicate that the big-picture, emotional rewards millennials feel (and look for) when buying Patagonia clothes or Warby Parker glasses, are the same rewards they’re looking for as B2B buyers. Appealing to personal values with this new generation in B2B can make them up to twice as likely to do business with you, versus appealing only to standard business values such as price, performance or legacy.
Leading By Example
A company that has embraced a purpose from the very beginning is TOMS Shoes, a company that would match every pair of shoes purchased with a new pair of shoes for a child in need.
Blake Mycoskie, the founder of TOMS, developed a business strategy that rocked the boat in the corporate world. The brand was built around the concept of social responsibility. While traveling in Argentina in 2006, TOMS Founder Blake Mycoskie witnessed the hardships faced by children growing up without shoes. The One for One® concept was born. The idea has been extremely successful, considering the brand has given away over 60 million shoes since its launch in 2006.
Purpose Motivates Employees
Of course, millennials don’t just represent today’s buyers. As the human manifestation of a company’s brand promise, employees can make or break customer relationships. They have the power to influence customer loyalty and product quality. And they have the ability to impact productivity and profitability. Every CEO we have worked with has struggled with how to engage and mobilize employees to perform at the highest levels and achieve company goals. In advising them, I like to quote Start With Why author, Simon Sinek,
Purpose has the power to inspire the millennial employee. It can unify, engage and motivate a workforce, creating an environment in which employees see the personal value in helping create long-lasting business value for your organization. In fact, two-thirds of employees working for companies with a strong, stated and demonstrated purpose, report being willing to go the extra mile to work, versus less than half at other companies.
Purpose can make a crucial difference in your recruitment efforts as well. Overwhelmingly, millennials say they’d prefer to work for an organization with a clear, meaningful mission and an impact beyond producing profits.
Time And Again, Purpose Has Proven Itself To Create A Competitive Advantage In B2B
Research can indicate attitudes and hint at trends, but marketplace performance is the real proving ground for purpose — and it is easy to see it drive transformation, growth, and profits.
Purpose has always had power in B2B organizations, not simply in this emerging millennial era. To stay ahead of the curve, emerging tech companies need to anticipate the millennial needs and impact, but also acknowledge two simple human truths: First, that people recognize, respect and are drawn to other people who are dedicated to something bigger than themselves, and who work and live with meaning. And second, that every employee, from the mailroom to the corner office, wants to find fulfillment in the work they do. Seth Godin, the business coach describes this as The Tribe effect. People want to identify with a tribe, and purpose is the glue that holds the community together:
“A tribe is a group of people connected to one another, connected to a leader, and connected to an idea. For millions of years, human beings have been part of one tribe or another. A group needs only two things to be a tribe: a shared interest and a way to communicate.” — Seth Godin, Tribes: We Need You To Lead Us
If you are looking to integrate social responsibility into your brand and your organization, here are some tips to help you get started:
1. Find a cause that people can relate to
It’s important to find a cause that is important to you, that is meaningful to your business and comes organically from the inside and is not applied. When people feel passionate about a cause, they are far more likely to respond and participate.
2. Make sure you and all parties involved are being ethical
The key to is to not only follow through with best practices but also make sure the brand message touches on all media levels. Make sure that all aspects of your organization reflect your brand message. If your brand is advocating for being clean & green, and meanwhile your company’s primary manufacturer is posing threats to the environment or conducting animal testing, you might be in for some trouble.
3. Be honest
Consumers are eager to help a good cause, but they will also be quick to chastise a company that has set its foundation on false premises. If you are considering increasing your brand’s commitment to social responsibility with the sole purpose of generating more revenue, you may want to reconsider doing it at all. Consumers can see through smoke and mirrors and want to support brands that genuinely care about their cause.
So, what’s your company’s purpose?
Marc Posch Design, Inc., Brand Consulting and Design, made in downtown Los Angeles. As a team of creatives, thinkers and developers we are known for helping emerging tech and manufacturing companies to disrupt, stand out and grow. With our experience, deep industry expertise and all the collaborators to make it happen, we inspire success.
To find out more about what we can do for your business call 213.341.1642. Or visit marcposchdesign.com. Thank you.