As marketers engage in the relentless search for the
tools and means to achieve brand supremacy, thousands of textbooks,
memoirs, and how-to books have offered insight and counsel on the
dark secrets of marketing success. Most evolve around the familiar
tenets of knowing one’s customer, insightfully plotting a
category’s competitive white space, and effectively delivering on a
consistently relevant and differentiating message to a well-defined
target. Tried, trite—and still fundamentally true.
The world’s best brands (however one measures them) understand
and practice these basics day in, day out, year upon year. Yet
today, as perhaps never before, there is a crisis of trust among
the world’s most prominent brands that has not only generated daily
headlines about the latest recall, scandal, or indictment, but is
now well quantified in a number of studies measuring consumer
attitudes around the globe.
The great irony here is that trust has traditionally
been considered a table stake in brand perceptions, a necessary
value (like quality) for any and all brands to own, but
hardly a unique or distinguishing attribute. Today, perhaps sadly,
trust stands out as a true differentiator and can be a critical and
often challenging element in building brand equity, especially in
the financial services, automotive, casual dining, hotels, and
insurance sectors.
Yet if the principles behind good marketing and business
practices have not changed, neither, one might argue, has our
propensity to fail to live up to them as practitioners. Human
nature being what it is, some companies, like some people, have
either deliberately or inadvertently made promises they can’t keep
since the dawn of organized commerce.
What is different, however, is the transparent world we
now live and work in and the unprecedented and relentless nature of
public exposure to any and all activities surrounding businesses,
products, and marketing. Today we all work in glass houses.
This new dynamic has begun to persuade even the most hardened
business leaders; driving success must now, as perhaps never
before, be tempered by moral accountability. Whether the headline
is about questionable manufacturing practices in China, bribery in
Mexico, phone hacking in the United Kingdom, or outrage on Wall
Street, even the most respected and powerful organizations can be
just a blog or tweet away from an instant—and very public—fall from
grace.
As a result, organizational leadership finds itself at a
communications crossroads. The lesson for some is that greater
caution is required in promoting the corporate persona, and they
are redoubling efforts to seal leaks and control social expression.
It means grudging acknowledgement of the new porosity of
information while girding to fight the inevitable public relations
brush fires with practiced containment strategies and techniques.
Not especially inspiring, but certainly practical.
The world’s best businesses, on the other hand, seem to be
taking a different perspective. They tend to view social
transparency and corporate responsibility not as a risk or cost of
doing business, but rather as an unprecedented new opportunity to
tell—and commit to—their brand story in a fresh and publicly
accountable way. These companies have decided to walk the talk by
infusing a promise into their brand that goes beyond traditional
platitudes of “building shareholder value” or ensuring “whiter
whites.” They have seized on the new transparency to actually
redefine who they are as an organization in terms that both
distinguish and motivate.
The power of purpose
The means to identify and implement a strong brand positioning
have, of course, become increasingly sophisticated since Jack Trout
and Al Ries first popularized the term back in the 1980s with their
book Positioning: The Battle for Your Mind, but the core
notion has remained essentially the same. It is “outside in” brand
definition, built on a perceived customer need and gap assessment
of where the most opportunistic space exists in a given market. In
this time-worn model, a product or company and, in particular, its
brand story, are crafted to fulfill a predetermined role, resulting
in a brand idea that often owes more to research than to any innate
value or vision organically and philosophically derived from the
brand itself.
For decades, this outside-in approach has worked exceedingly
well. Where it begins to fall apart, however, is when the great
blogging, tweeting, YouTubing world exposes a clever brand story
for being only that—an artfully spun yarn versus a fully embraced,
defining brand idea. As we advise our clients at Landor, “a brand
is as a brand does.” It means that what we actually do as
branded organizations is much more important than what we
say.
This is, in effect, “inside out” branding—starting from the
organic center of a company and peeling away the fluff and selling
language to arrive at relevant, credible, higher ground. It is
about brand actions, not positioning. And if these actions include
meaningful contributions to the greater social good that are
consistent with the DNA of a company and its products or services,
we believe the result is a true, distinguishing brand purpose.
Does it matter? A new consumer perception study, the
Global Corporate Reputation Index, first presented at the World
Economic Forum in Davos earlier this year, concluded that “Many top
companies outperform their industry averages on citizenship
[perceptions] by a more significant margin than performance,
indicating the importance of citizenship in standing out from the
competition.” In other words, in a world where brand
differentiation has become a game of inches, being known as
corporately responsible can significantly elevate an organization’s
overall leadership perceptions.
Former Procter & Gamble global marketing officer Jim
Stengel, author of Grow: How Ideals Power Growth and Profit at
the World’s Greatest Companies, and with Millward Brown the
architect of the “Stengel Study of Business Growth,” puts further
meat on these bones in his assessment of “The Stengel 50.” This
list of the 50 most successful brands across 28 categories—as
empirically defined by their exceptional growth over the past
decade versus competition—all shared common attributes, the first
of which was that each could be characterized as an ideals-led
business.
Stengel’s first rule for sustainable business success? “Brand
ideals drive the performance of the highest growth businesses.” He
goes on to posit that these brand ideals are derived from
“fundamental human values [and] the highest growth businesses are
run by business artists, leaders whose primary medium is brand
ideals.”
Pretty heady stuff from someone who led marketing for nearly a
decade at one of the biggest and, arguably, most competitive and
successful innovators in the consumer branding universe. In fact,
P&G itself takes this concept of ideals—or purpose-led
business—so seriously that it commissioned a select team of WPP
agencies, including Landor, Grey, and Hill+Knowlton, to personally
interview C-suite leadership at some of the most socially proactive
corporations in the world to ask them what they considered
were best practices in the realm of purpose-led branding.
After speaking one-on-one with leaders at a dozen major
corporations, including American Express, Dell, Ford, General
Mills, HP, IBM, McDonald’s, Microsoft, Nike, Nokia, Target, and
others, we were able to draw some clear conclusions about the
building blocks for a successful, purpose-driven brand
organization, as outlined in “Dispatch from a new
business horizon.” None should come as a major surprise, but
all require serious and total commitment to effect measurable and
lasting impact. Here’s what we learned:
How to build a successful purpose-led business
Principle 1: View social responsibility through a
business lens
Corporate social responsibility (CSR) should not be treated as
an afterthought or an independent function separate from the core
endeavors of an organization. Rather, it should be central to the
ongoing alignment of corporate social actions and business
objectives.
IBM has successfully integrated the creation of
social good with its business strategy by starting at the top. Its
CEO works directly with the VP of corporate citizenship and
corporate affairs to initiate programs that both do good and
benefit business. One example is the Corporate Service Corps, a
hands-on, in-country opportunity for rising IBM leaders to conduct
community-driven economic development projects in Africa, Asia,
Eastern Europe, and Latin America. About its benefits to IBM, a
company representative stated: “We invested 180 million dollars in
corporate citizenship globally, and we produced three times as much
in return.”
Principle 2: Make a difference from your position of
strength
However one chooses to define an overarching brand purpose, it
should capitalize on what one does best from a business
perspective, as well as be meaningful to target audiences
(especially employees) and differentiated from the
competition.
Nike believes that a planet with more active,
healthy people will make a better world as well as better
customers. Dave Cobban, consumer mobilization director at Nike’s
Sustainable Business and Innovation department, says, “Every $1
spent on sport saves $3 in health care in the United States. We’re
doing a lot of research to show that the future of humanity depends
on physical movement.” With this attitude, Nike has identified the
domains that its products contribute to—sports and health—and
focuses on things it can do in these realms. It has built stadiums
and playing fields, organized inner-city tournaments, provided
sports equipment and training, and established foundations. It’s a
perspective that benefits our world—and Nike’s business.
Principle 3: Create “thick value”
A brand purpose must be a sustainable idea that transcends
market and competitive trends. It should not be based on a fad or
the latest marketing buzz; rather, it should reflect the way an
organization chooses to conduct business, day in and day out.
Nokia has developed a service called Nokia Data
Gathering that is only tangentially related to its core business.
It allows health workers to collect health data in the field, and
upload it automatically with geo-positioning information. Rather
than waiting five weeks for processing, as it did under the
previous system, an organization such as the World Health
Organization can track in real time how things are progressing from
house to house or town to town after a tsunami or other disaster,
and respond much more quickly and effectively. Nokia provides this
service free of charge to the WHO and other health and social
services organizations, but the same system could be sold
commercially to others. By creating a service for the benefit of
others, Nokia concurrently created a long-term business opportunity
for itself.
Principle 4: Walk, then talk
It is far better to first inculcate brand purpose behavior
within the organization so it becomes how the company truly acts
and sees (rather than just talks about) itself—before going public.
If it isn’t real, it will not take long for constituents to
know—and they will not be quiet about it! Authenticity matters most
of all.
Dell set a good example of this principle in
action by waiting to go public until its YouthConnect program was
up and running. This initiative, which teaches problem solving and
technological skills to underserved children worldwide, began
around 2000 as an unbranded foundation. Initially serving U.S.
children and their educational needs, the program later expanded to
other countries following Dell’s global business growth. In 2009 it
was branded and formalized, and only at that point did Dell begin
to speak publicly about it.
Principle 5: Focus internally and the rest will
follow
If how a company acts is more important than what it says, make
sure all employees understand and personally embrace the brand
purpose and all it implies. They are the brand, and
if employees don’t buy it, neither will the customer.
Hewlett-Packard takes pains to ensure that
every employee understands his or her role in making a positive
impact in the community. As one of the largest technology companies
in the world, HP sees itself in a unique position to use its global
reach and scale to serve billions. And it has found that when its
employees engage with their communities, they are much more likely
to stay at HP. So HP encourages its people to volunteer in roles
that use their expertise and passion. HP itself offers skills-based
and pro bono programs for employees to learn new skills, partner
across departments, get out of their comfort zone, and grow—and
then sends these brand ambassadors out into the world. It’s an
approach that benefits employees, their community, and the
company.
Principle 6: Partner generously
Seek opportunities to partner with other brands and causes that
relate to and build upon an organization’s values. There is a
multiplier effect in focused and consistently applied effort that
leads to measurably better results when practiced in concert with a
good partner.
General Mills (GMI) originally designed the Box
Tops for Education program as a way to give money to America’s
public schools while selling more General Mills products. But GMI
soon opened the program to a number of partners to increase its
fundraising ability. What GMI may have lost in ownership, it has
more than made up for in reach and relevance. Almost half of
redemptions today come from non-GMI products, and Box Tops for
Education has raised some $450 million for schools since 1996.
People have noticed: In the first quarter of 2012, Forbes
ranked General Mills as its No.1 “Most reputable company in
America.”
Principle 7: It is a journey, not a
destination
Being a purpose-led brand is not an end in itself but rather a
well-defined path for success over the long term; it should be
equally as vibrant and relevant 10 years into the future as it is
today. Aim high, work patiently, and keep a clear eye on the
target.
Sound easy? It isn’t. Not every company is capable of both the
honest self-appraisal that precedes discovery of a compelling brand
purpose, followed by the hard, long-term effort required to deliver
against it consistently across all brand actions. But those who
embark upon this journey in earnest will find it leads to rich
rewards in every sense.
And make no mistake: The world’s most successful brands are in
business to win. The best of them, however, have recognized that
doing good is, indeed, good business.
This article was first published in the Hub
(July/August 2012).
hubmagazine.com
© 2012 Landor Associates. All rights reserved.