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| Amy Terpeluk |
When companies stumble on product quality, commit messaging mishaps, or have ethical shortcomings laid bare, the news media is never far from the controversy. Many of these stories are about disparities and discrimination that cause community pain—pitting customers against companies. Often, the drumbeat of news reporting is so loud that it cannot be ignored—day after day leading the news cycle. It can feel endless and all-consuming.
The importance of these stories isn’t lost on consumers, who increasingly see corporate social responsibility and brand purpose as front-of-mind purchase considerations. Consequently, it has become critical for companies to ascertain the consumer’s pulse and understand the public expectations of how iconic brands take on the challenges of our time.
“Catchy” is a poor substitute for championing a cause. Not all pressing issues require a corporate voice! Brand stewards must consider what issues are essential for their companies to engage on. Before leaping to the clarion call, they must ask why and when their brands should engage, or if they need to engage on a particular issue at all. To answer these questions, brand managers must carefully consider if an issue aligns with their products and purpose and how closely the issues at hand impact their consumers.
Sometimes corporate response to emerging issues is reflexive. But creating social impact isn’t about jumping into a headline-grabbing topic unadvisedly. Corporate action is a statement of commitment and is translated as an ongoing pledge to remain in the trenches long-term. Speaking out on trending issues that do not relate to the brand’s identity can offend, causing consumers to view the company’s executives as opportunists or disloyal to brand values.
We have seen how ill-informed public commentary and campaigns have dire consequences—a tipping point to customer, employee and stakeholder backlash. We have also seen the ire brands face when they neglect to take a stance on issues they have long claimed to champion.
Creating enduring social impact that cements customer ties to a brand requires a deeper understanding of how issues intersect with the company's mission and values. The FINN Purpose Alignment Study underscores the importance of research in gauging the relationship between brand, customer and cause. This study offers a metric enabling brand stewards to navigate the evolving landscape of brand purpose and how organizations can align communications priorities to social impact.
The importance of pricing and performance
There is no surprise that consumer purchasing decisions are driven by price and product performance. It stands to reason that in a highly competitive market—and at times of economic uncertainty—consumers prioritize product purchases around affordable quality.
It is in the company’s best interest to establish pricing strategies that are market-competitive, transparent and consistent. Consumers appreciate brands prioritizing fair pricing practices, fostering trust and long-term loyalty. But there is more to brand sustainability.
What happens when price and performance are comparable between two brands? How then, does a consumer choose between what are seemingly equals? This is when companies cannot overlook purpose-related factors.
The rise of social impact factors
Beyond immediate benefits, price, performance and product attributes, consumers now value the societal value of their purchase. This is an expansive shift in consumer consciousness toward more holistic considerations when making a purpose.
The FINN Purpose Alignment Study highlighted six social impact factors that ranked among the top 20 brand purpose sub-factors most important to consumers. These factors indicate a growing consumer demand for brands to actively contribute to society and the environment. By aligning themselves with social and environmental causes, brands secure an opportunity to connect with consumers who prioritize sustainability and corporate social responsibility as buying factors.
The study identified that in an era of heightened scrutiny on ESG (Environmental, Social and Governance) reporting practices and the return on business bottom line, social impact aspects are crucial consumer inflection points. Companies that integrate sustainable practices, authentically support aligned social causes and exhibit ethical business conduct have a competitive advantage in capturing the attention and loyalty of socially conscious consumers. Among the social impact ranking factors, keeping customer data private and secure, and operating in a trustworthy way rank higher than new features and product innovation.
Consumers want to associate themselves with brands that have a positive public image and are seen as trustworthy and reliable. They see where they spend their money as a reflection of their personal values.
New Paradigm in Marketing Strategy
The study's findings may have significant implications for companies' marketing strategies. Brands must carefully craft messaging and campaigns to reflect the evolving consumer priorities in brand purpose. It is essential to highlight the economic benefits and value offered by products while simultaneously showcasing brand commitment to social impact and sustainability in equal measure.
The goal for brand stewards must be to connect with consumers on a deeper, emotional level. Sharing stories and initiatives related to environmental conservation, community engagement and ethical sourcing can enhance consumers’ perception of a brand and foster a sense of purpose among consumers. When consumers and brands are aligned in purpose, they share the understanding that by working together to address pressing societal concerns, they are in harmony.
Embracing brand purpose and telling that story can be a competitive advantage in fostering consumer loyalty, enhancing reputation, and contributing to a more sustainable and socially responsible future.
It’s beyond debate; purpose is good business.
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Amy Terpeluk is Managing Partner at Finn Partners.
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