Purpose has been a buzzword for the last couple of years in marketing and communications, but now - amidst a pandemic, civil unrest around racial discrimination and political uncertainty – the term holds more weight than ever.
Zeno Group explores this concept in its new 2020 The Strength of Purpose study, which includes insights from more than 8,000 individuals across eight markets (United States, Canada, United Kingdom, France, China, India, Singapore, Malaysia) about their perceptions of 75-plus brands and the role of corporate purpose.
One insights from the study reveals that consumer are four to six times more likely to purchase from, trust, protect and champion companies they believe have a strong purpose, but cancel culture is just as strong. More than three out of four (78 percent) of respondents say they have taken action in response to a brand doing something they disagree with, whether no longer buying from that brand, switching to a competitor or dissuading others from purchasing or supporting that brand.
"We define Purpose as an organization’s unique role and value in society that allows it to both grow the business and positively impact the world," said Alison DaSilva, managing director of Purpose + Impact at Zeno Group. "A clear purpose becomes the filter for decision-making: how to behave, what issues to advance and how engage all stakeholders."
DaSilva added that the power of purpose transcends age, meaning that a brand’s strength of purpose and the likelihood to take positive action is notable across all generations, with the strongest being among Gen Zers. Rather surprisingly, people 74 years old and up are more likely than any other generation to be motivated to purchase from brands with stronger purpose, according to Zeno’s research.
Something marketers should keep in mind, DaSilva said, is that while the majority of consumers believe brands should have a strong purpose, only 37 percent think most companies have a clear or strong purpose, which means businesses are "leaving equity on the table."
See below for other top takeaways from the study.
The Purpose Paradox: Although most consumers agree companies should have a strong purpose, only 37 percent believe companies actually do.
Consumers have raised the bar and are looking to companies to advance progress on important issues within and outside of their operational footprint. They have high expectations for brands to have a more meaningful reason for being, with 94 percent of consumers globally saying it is important that the companies they engage with have a strong Purpose and 83 percent of consumers saying companies should only earn a profit if they deliver that positive impact. However, an interesting paradox ensues: the majority of consumers do not believe companies today have a clear and strong Purpose.
Strong Purpose drives incremental reputation and business benefits: After rating more than 75 brands on their perceived strength of Purpose, we asked consumers to indicate their likelihood to take a positive action towards these brands. A correlation and regression analysis of the data demonstrated that when a brand has a strong Purpose, consumers were:
- Four times (4x) more likely to purchase from the brand;
- Six times (6x) more likely to defend that brand in a challenging moment;
- Four and a half times (4.5x) more likely to recommend (champion) the brand to friends and family;
- Four point one times (4.1x) more likely to trust the brand.
Benefits of Purpose hold across regions and generations: 82 percent of consumers state they took action to support a company or brand when they believed in its Purpose, sharing positive opinions of that brand with others, encouraging others to support or buy it, or starting to buy from the brand themselves. And 9 out of 10 consumers (90 percent) agreed that "if a brand or company truly lives by a clear and strong brand purpose" they would be more likely to support them, even in the event the company or brand had a "misstep," or received "public criticism," showing the significance of a well understood purpose to a company or brand’s reputation.
Consumers are holding brands accountable: The study also found the so-called "cancel culture" expressed in respondents’ replies, as nearly eight-in-ten (76 percent) global consumers indicated they will act against brands whose Purpose, values or behaviors they disagree with, by no longer buying from the brand, switching to a competitor, or discouraging others from buying or supporting it.