Thomas is a contributor to AdWeek where he recently shared some of his thoughts on brands and purpose. Click here to read the original article.

In a branding sense, purpose has become like Pokémon. Everybody is searching for it, but nobody really knows why. Much like the obsession with lifestyle we saw from brands in the ‘90s, brands today are firmly on the social issues bandwagon like bees around a honeypot. Brands are desperately playing a game of catch-up by shouting, “We care,” but often this comes across as a lighthearted after-thought. This is all very well, but for purpose to really work, it should be built into the business model because otherwise people can easily smell the difference.

Don’t just stand for something—fight for it

The purposes that inspire me most are by their very nature anti-establishment. They’re picking a fight with business-as-usual and are far from nice. It’s business with a vengeance. I call these incumbent brands “purpose underdogs,” and their growth is often stellar, as they’re not just built on good aspirations but are aiming for better.

As half the Fortune 500 companies are struggling with failing profits or revenues, paying lip service to purpose without really committing will not help. It’s about true business transformation. This is something these purpose underdogs understand implicitly. Incumbent brands are able to punch above their weight. Research from the Boston Consulting Group has shown this, documenting how smaller brands in the U.S. are 65 percent more likely than large brands to outgrow their category.

For purpose to really work, it should be built into the business model because otherwise people can easily smell the difference.

Hate something, change something  

The underdogs are social and economic entrepreneurs driven by a hatred of all the ills and wrongdoings of our current system. Take Jukka Peltola, the co-founder of Goodio, a fast-growing Finnish chocolate company. Horrified by a sickening food system with bad ingredients and de facto social inequality, he set out to create chocolate that’s truly good for you (and those who make it) and succeeded. It is hand-crafted, high-quality, vegan chocolate with foraged Nordic ingredients like sea buckthorn, with beautiful packaging and a taste like nothing I’ve ever had before (read: real chocolate with no added sugar).

These underdogs don’t need glossy purpose statements or extensive CSR-reports to show they care. The love for what they do comes naturally; their businesses answer a real problem they have identified. It’s essential to act fast in the marketplace and have your ears to the ground if you’re not going to be outrun as a brand by more agile players.

Make better business models like Warren Buffett on speed

What if you can’t stand the fact that tourism is one of the most polluting industries in the world and you hate the commotion and cheap sales tricks of industry giants like Hotels.com or Booking.com? Christian Møller Holst, the co-founder of travel booking platform Goodwings, set out to make a real difference by turning each hotel stay into lasting impact. Rather than relying on heavy marketing budgets, he partnered with non-profits to use their extensive network with brands to create a truly collaborative model. It’s brothers in arms fighting to make a difference, and travelers can feel and see the tangible impact Goodwings and its many partners are making. It’s not a charitable add-on—it’s a better business model. If we want to evolve as an industry, stories are not enough. As an industry, we need to scrutinize products and services and aim for better.  David Ogilvy put this cunningly: Marketing only makes a bad product fail faster.

Everything you can do, we can do better  

Starbucks used to be a textbook example of a purposeful company, but today their model is being challenged. Consider Wheelys Cafe, a chain of organic bicycle cafes, enabling people (all people) to start their own coffee businesses.

Wheelys is run by (in their own words) “a person with a heart and dreams,” and surely its customers can feel that passion, as it’s now present in 45 countries. But what Wheelys is fighting for is even more interesting: “to break the hegemony of the industrial fast food chains and create an organic revolution.” The rules of purposeful brands are being rewritten and are becoming by people, for people. For a generation of young people who love to be the boss of their own life, this is a purpose they can understand. Wheelys is enabling them to live out their dreams rather than being a feel-good statement on a red takeaway cup.

Most brands have asked themselves the question: What do my customers want? Few organizations make it possible for people to follow through on those wants and enable better lives by asking when. As the market is shifting toward a democratic, empowered, social place, we don’t buy what you make or why you make it but what you can make me become. It is people’s “why” that matters. Big brands howling about purpose is one thing, but smaller incumbent brands are nipping at market shares with a steadfast challenger mindset and loud rallying cry: Big brands, everything you can do, we can do way better.

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Thomas Kolster © 2017
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