Profit is my Purpose

Purpose as a guiding principle

We use many concepts in brand marketing that are rather confusing for the uninitiated. And on top of that, many terms overlap significantly in meaning.

In recent years, a number of fine new terms have further enriched our profession. I'm referring specifically to the development of organisations increasingly paying attention to their positive social role.

Think of concepts like 'Purpose', 'Why' (from Simon Sinek's Golden Circle), 'High Ideals' (from Jim Stengel) or Unilever's Social Mission.

For convenience, I'll group all these words in this article under the term 'Purpose', by which I mean the social reason for being of an organisation.

More and more companies are trying to distinguish themselves through their Purpose.

In a project we recently carried out for Natuurmonumenten, we discovered that their Purpose is fundamentally about enabling all Dutch people, each in their own way, to enjoy nature. That matters — because when you enjoy nature, you start to value and protect it.

Or for GVB, Amsterdam's public transport company, where the Purpose is about making the lives of all people in Amsterdam more enjoyable. Everyone should be able to move quickly and affordably through the city. That's essential for the liveability of the city.

Another example that comes to mind is Tenzing Travel (formerly Kuoni), a specialist in long-haul travel, where the Purpose is about enriching people's lives with extraordinary experiences and memories.

Or Triodos Bank, whose Purpose is to use money to create positive social, environmental and cultural change.

What strikes me is that most Purpose statements are highly emotional and concerned with something fundamental that you want to offer your customers, rooted in a vision that you hold as an organisation.

Purpose operates on a different level from traditional 'positioning', which primarily sought something relevant that a brand could use to differentiate itself from competing brands.

When searching for and articulating Purpose, 'differentiation' is less relevant — it's much more about a higher mission to change something in society.

It's often about how you add value to people's lives, or a problem you want to solve.

For service providers like GVB or Natuurmonumenten, Purpose is closely tied to the organisation's reason for existing. But for product brands, the challenge of finding Purpose is usually far greater.

Yet even there, many compelling examples can be found.

For instance, at the end of the last millennium I worked at the Iams Petfood Company (then P&G, now part of Mars), and back then it was already about 'saving the world's dog and cat population' — because animals that eat ordinary, cheap industrial food get sick more often and live shorter lives.

Interesting too is that the rise of Purpose runs parallel to the growth of CSR (Corporate Social Responsibility), also known as sustainable business. The OECD has established guidelines that companies are expected to meet.

The definition of sustainable business is: "Sustainable business means pursuing higher business returns in all business decisions, while also seizing opportunities for a better environment and greater wellbeing for employees and society. It involves activities that go beyond what the law requires, driven by social engagement and a forward-looking vision."

As sustainable business has gained prominence over the past decade, consumers and employees have come to recognise its importance and developed a preference for organisations with a clear CSR policy.

International authors such as Roy Spence (It's not what you sell, it's what you stand for) and Simon Mainwaring (We First: The future of profit is purpose) make this connection very clearly.

The transparent world we live in reinforces this enormously. Organisations with a clear Purpose and a commitment to sustainable business are the ones with a future.

Just think of the spectacular growth and brand preference for Tesla.

Or Starbucks, where Howard Schultz publicly advocates for equal rights for all races and orientations.

The great advantage of embodying and acting on a Purpose that makes people happy is that it yields very real returns. Various studies have shown that companies with a clear Purpose are significantly more profitable.

Researchers such as Raj Sisodia et al. have studied this. Companies that pursue a 'share of heart' strategy rather than a 'share of wallet' strategy — and thereby build warm, emotional relationships with happy customers — consistently perform better financially.

It's remarkable that scientific research is needed to demonstrate this, because you'd think it reasonable to assume that companies focused on extracting money from customers would not be preferred. And that companies seeking to help customers and society, and to add value, would be.

But because we live in a capitalist system where making money is the ultimate goal, it apparently needs to be proven that 'doing good' is a better strategy than 'doing bad.' Even in financial terms.

In summary, I think we should be very glad about the rise of Purpose thinking within our profession.

After all, if we only deploy our creativity and knowledge to help our clients sell more, we are contributing to — and partly responsible for — the further deterioration of commerce and the erosion of society.

A world in which everyone is driven by the pursuit of more money is decidedly not a beautiful or happy world.

I think of the anger across society that flared up again this week following the ridiculous pay rises for the leaders of ING and ABN AMRO.

I wonder what their Purpose is. I suspect it's Profit.