Does your business have to be purpose-driven?
Don't confuse having a purpose or operating responsibly with being purpose-driven.
It might be controversial but our purpose at Twenty One Twelve is to help our clients grow and make more profit. In the process, we intend to create a profitable business ourselves.
Why’s that controversial?
Because people are increasingly concerned with the sustainability and provenance surrounding what they buy and who they buy it from. That’s supposedly more true for younger consumers, which makes complete sense. As consumers ourselves, the team here at Twenty One Twelve is careful in their choices.
“Consumers between the ages of 17 – 38 are almost twice as likely to consider ESG issues when making purchasing decisions than consumers over 38 years old.” (PWC)
This trend isn’t just important within the B2C space, increasingly B2B brands need to prove their ESG credentials:
- According to a 2020 study by Gartner, 75% of organisations are planning to include ESG criteria in their procurement process by 2024, up from less than 25% in 2020.
- A 2021 survey by EY found that 98% of institutional investors consider non-financial performance, including ESG factors, when evaluating investment opportunities in B2B companies.
- A 2019 global survey conducted by ING revealed that 61% of businesses said they would lose competitive advantage if they didn’t adopt sustainable practices, including ESG-related initiatives.
But let’s not confuse being a purpose-driven brand, like Patagonia, with being a good brand which follows solid and ethical practices and principles. The two aren’t the same.
And the idea that every business needs to be purpose-driven doesn’t quite sit right with us. Simply jumping on a bandwagon to make yourselves look virtuous doesn’t make sense. It feels disingenuous.
We’re big believers that if we’re profitable, it makes it easier for us to deliver wins for our clients, partners, suppliers, the Twenty One Twelve team and the charities we support.
For example, our team likes to get involved in a myriad of charity initiatives. From raising money by running half marathons to being a core part of the team behind Henley Lockdown Fest – a virtual festival during lockdown which raised over £25,000 for the NHS and the Henley-on-Thames based-charity, The Riverside Counselling Trust.
We also advise our clients in this regard. From a selfish point of view, it gives them the edge over their competitors – would you choose the brand that donates to charity or the one that pockets all the profits? It also makes our clients feel good about themselves but they don’t consider themselves purpose-driven.
Consumers don’t want purpose constantly shoved in their face. Too much virtue signalling, bandwagon jumping or high horsing, makes you look disingenuous. People mainly want to know the brand is well and sustainably operated and, if it gives back then that’s a bonus.
For Twenty One Twelve client FOMO mortgages, we added a philanthropic element to the brand to mirror the values of its founder and to endear it to consumers. If you remortgage through FOMO for example, a donation will be made to Ecologi to help offset your carbon footprint.
At this point, the ESG agenda and greenwashing are too well known to fool an informed audience. But, if you can be more authentic in your approach to your company’s purpose, a focus on ESG goals can still be a powerful tool.
Of course, the success of this tactic depends on your audience, which is worth considering when you’re thinking about designing a purpose around your brand.
If you do go down this route, stick to it rigidly and be prepared – this point of difference will cost you money.
“A true brand purpose doesn’t boost profit, it sacrifices it” – Mark Ritson
And that’s the truth of the matter, if you’re not prepared to sacrifice profit by staying true to your purpose, it’s not a purpose at all.
Get in touch with us if you’re scoping out your brand strategy.