Every company enters the market with a purpose. Usually, this purpose is to offer a product or service that solves a problem or fulfills a need. However, the definition of purpose has evolved over time.
Simply providing good quality at a fair price is no longer sufficient. For many consumers today, it’s about buying from companies with a strong sense of purpose that aligns with their values and beliefs. Seventy percent of consumers think brands should take a public stand on social and political issues, with Millennials (80%) and Gen Z (75%) being the largest groups supporting this.
Many brands are responding quickly, and consumers have noticed: 67% of them observed that brands have been raising public awareness about important issues. Another 62% even said that brands have educated them on significant topics. If you want to win the hearts (and wallets) of consumers, focus on something bigger than just the products and services you offer. Otherwise, you risk losing market share, which is especially true today.
Consider how the pandemic has affected brand loyalty. Among the 75% of U.S. consumers who changed their shopping habits due to the pandemic, about 40% switched brands during this time, doubling the rate from 2019. While convenience and value remain key reasons, the desire to support brands with similar values is also becoming more important. With consumers four to six times more likely to buy from, protect, trust, and advocate for purpose-driven brands, it is more crucial than ever to position your business’s values front and center.
Shifting from Individual to Collective Concerns
While staying true to your brand, when selecting a cause or purpose, there are a few values that seem to influence consumer choices more than others. Here are some that often stand out:
1. Sustainability
Sustainability is a major selling point. Partly due to the pandemic, people have had more time to reflect on issues that matter to them, with one study finding that a third of U.S. consumers now spend more time thinking about climate-related concerns than before. Many of these consumers are choosing to spend their money on companies that prioritize environmentalism, sustainability, and energy efficiency. Nearly three-quarters of professionals believe that sustainability efforts will be critical to their business success in the future.
2. Social Justice
Supporting causes like social justice and reform can be challenging for many brands. While consumers generally believe that businesses should not shy away from fighting for racial, political, economic, and gender equality, it can be problematic if a company is seen as opportunistic rather than authentic. If your business decides to support a social cause, consider what other companies are doing. For example, some companies support the 15 Percent Pledge, dedicating 15% of shelf space to Black-owned businesses, while others like FutureLearn offer free courses on community building and LGBTQ+ allyship, or like Cathay Bank, which recently donated $1 million to organizations promoting diverse communities and combating anti-Asian hate crimes and xenophobia.
3. Employee and Customer Safety
The pandemic has highlighted the importance of employee and customer safety in business practices. Consumers have gravitated towards businesses that offer contactless shopping options, social distancing policies, curbside delivery, and sanitation stations. These practices have become almost essential in physical stores and are likely to remain. As people become more accustomed to wearing masks, regular handwashing, and other safety precautions, it may be wise to adopt these practices if you haven’t already.
4. Empathy
Empathy is good for business. It is important to understand the needs of your customers and show how your product or service fits into their lives. Empathy also influences how companies communicate and interact with the public. It humanizes a brand and enhances customer experience, making the company more relatable. This can strengthen brand loyalty and increase sales. One study found that companies offering more humanized experiences are twice as likely to outperform their competition in revenue growth.
5. Shopping Locally
The pandemic has changed consumer shopping habits in many ways, with one of the most significant shifts being the preference to shop locally. One survey found that 65% of consumers have adjusted their shopping habits to support local businesses, with Millennials and Gen Z particularly favoring local and small brands. This trend seems to have staying power, as 55% of Millennials and 60% of Gen Z intend to continue shopping locally even after the pandemic, along with half of Gen Xers. Younger shoppers appreciate the sense of community that comes with shopping locally, and keeping money in the local economy also supports the local workforce, from architects and contractors to accountants and marketers, many of whom are employed by local businesses.
Expressing your purpose in business has now become a key part of brand identity, and some might argue that it is essential for brand success.
