Want to Be Different from Your Competitors? Consider Purpose-Driven Marketing
While businesses must be profitable to exist, shareholders are not the only stakeholders.
While business leaders generally understand the value of sharing and upholding their mission and vision with their stakeholders, there is a third component that is often overlooked and necessary for the success of a business: purpose. Kim Keating, CEO and Founder of GIVE Marketing, LLC has made “purpose” the cornerstone of her business and helps clients with strategic planning, social impact and marketing activities that are not only sustainable but create value for stakeholders involved with the business, both from the inside and out.
Q. Can you describe purpose-driven marketing and give us a real-life example?
A. Purpose differs from mission. Purpose transcends the question of what a company does. It asks why an organization truly exists above making a profit. It means standing for, and taking action, around something bigger than the product or service.
For example, the purpose of New Jersey-based TerraCycle, a waste management company, is to “eliminate the idea of waste” by “recycling the non-recyclable.” Anything is game for recycling, and this perspective enables TerraCycle to be highly innovative in its problem-solving and design. One project they are working on is tackling Philadelphia’s cigarette butt problem by turning them into park benches that beautify the city. TerraCycle Australia is working with Procter & Gamble to create a recycling program that transforms its brands of empty dish and air care products into sustainable raw materials.
Once you hear about TerraCycle and its unique, no-holds-barred approach to recycling, it is hard to recall any other waste management provider by name. By focusing on a higher purpose (preserving the environment), TerraCycle leaves a lasting impression with stakeholders, amplifying its brand.
Q. Can you define "stakeholders" for us?
A. In addition to purpose, there is one key difference between conventional and purpose-driven strategy: stakeholders. Conventional business strategies are usually constructed to meet the needs of one particular stakeholder: shareholders. The goal of a business is to increase profitability and return financial value to investors above all else.
While businesses must be profitable to exist, shareholders are not the only stakeholders. There are multiple stakeholders who touch and are touched by a business, and there is interdependency between them. Stakeholders may include customers, team members, vendors, distributors, suppliers, investors, citizens, community, media, academia, government and the environment, among others.
When a business adopts purpose-driven strategy, it thinks in terms of creating value for all stakeholders. Its perspective shifts from being product-oriented to stakeholder-oriented. The stakeholder relationship extends far beyond the transactional role between buyer and seller, which often diminishes at the point of purchase.
Q. What are some real-life examples of how purpose drives value to a company?
A. For TerraCycle, purpose pays. This last year has been the most successful in TerraCycle’s 15-year history. It has increased staff by 50% and was qualified by the U.S. Securities and Exchange Commission (SEC) to issue stock.
Newark-based Zago Manufacturing produces high tech clean-sealing fasteners and components used in industries from medical devices and electronics to renewable energy, robotics and drones. The product shields toxins from leaking in or out of the surroundings and is sustainable by design.
Zago Manufacturing has embraced sustainability as part of its business strategy. The company has met the standards of the NJ Sustainable Business Registry by producing an environmentally friendly product, installing solar panels at its facility and implementing programs such as Zago Sustainability 360, which addresses environment and social justice issues like filling the manufacturing skills gap.
By upholding its vision and higher purpose of being a socially responsible manufacturing company that accelerates innovation while creating value for all stakeholders, Zago has experienced year-over-year sales growth and sustained meaningful relationships with clients, community and employees alike.
Q. How does purpose-driven marketing give companies a competitive advantage?
A. When a company embraces its purpose, that purpose can be integrated into the heart of its business strategy, positively impacting creativity, innovation, decision-making, long-term value and, yes—sales. Embracing purpose is especially good for companies that create products or provide services in industries that are perceived as “transactional” or not especially known for their “customer-focused” abilities (i.e. industrial suppliers, contractors, etc.).
Here, adopting a stakeholder perspective can serve as a key differentiator in and of itself, as stakeholders naturally gravitate to companies that are mindful of their needs while doing good in the communities they serve. The audiences of stakeholder companies often generate more positive word of mouth and referrals, as these companies leave strong, lasting impressions. This type of publicity is the best publicity—it is authentic, reliable and free.
Q. Do you have any advice for a company on how to get started with a purpose-driven business strategy?
A. Becoming a purpose-driven company, like anything else, takes commitment, focus and time, but the rewards are plentiful and sustainable over the long term. Start by surveying your stakeholders—find out what is important to them, why they come to work every day, why they invest in your company, buy your goods or services, or work with you—and you will be well on your way to finding your answer. It doesn’t require a huge investment, just a different way of implementing or viewing business processes and what the stakeholder needs.
Q. What was your favorite breakfast cereal as a kid?
A. Applejacks because I loved the jingle “A is for Apple…” and the cinnamon taste.