The modern business landscape is changing. Companies are no longer just looking to make a profit, but instead want to balance the needs of shareholders, employees, customers and the planet. According to the consulting agency Deloitte, “purpose-driven companies witness higher market share gains and grow three times faster on average than their competitors, all while achieving higher workforce and customer satisfaction.”
It’s what Deloitte calls a “purpose premium,” those special attributes of a purpose-driven company that drive customer loyalty, employee satisfaction and better overall products, which in turn creates a competitive advantage.
With so much emphasis on purpose these days it leaves many asking the question…how do you define “purpose-driven”? Does it have to mean the same thing to everyone? In this post, we’ll attempt to answer these two essential questions and provide a few tips on how to implement purpose-driven initiatives at your company.
What is a “purpose-driven” company?
A purpose-driven company believes that businesses should be about more than just making money; they should strive to make a positive difference in the world. Companies that operate with a purpose-driven mindset are focused on creating not only financial value but also social value, which might mean supporting environmental sustainability initiatives or providing employees with better working conditions and opportunities for professional development.
It is part of a larger movement within the corporate world to move away from traditional models of business, where profits are put above all else, towards a more holistic approach to doing business–one that takes into account not only financial goals but also the impact on people and planet.
Purpose-driven companies recognize their responsibility to their stakeholders (employees, customers, community) and strive to make decisions based on what’s best for all parties involved. This includes:
- Understanding how their activities affect the environment.
- Working to reduce their carbon footprint.
- Taking into consideration ethical issues such as human rights.
- Prioritizing long-term sustainability over short-term gains.
- Focusing on building strong relationships with stakeholders rather than maximizing profits.
By focusing on the “why” behind their operations instead of just the “how,” companies can create value for all stakeholders while making sure they are staying true to their core values and beliefs.
Benefits of being a purpose-driven company
If growing three times faster isn’t enough of a benefit, here are some other amazing advantages to being a purpose-driven company:
Better customer relationships
Customers are more likely to choose a brand that they believe in and one that aligns with their values. When a company embraces a purpose-driven model, people believe its products and services have more meaning, which fosters customer loyalty. This loyalty brings repeat purchases, higher reviews, and long-term relationships with customers.
Improved employee satisfaction
Today’s workforce landscape is more competitive than ever. Adopting a purpose-driven approach is an important step toward employee retention. In the study mentioned above, Deloitte found 49% higher levels of workforce retention among purpose-driven companies.
Meet ESG and CSR goals
Many companies, especially larger corporations, have environmental, social and governance (ESG) initiatives and corporate social responsibility (CSR) initiatives in place. Companies usually adopt a purpose-driven mindset to meet these goals. Otherwise these programs feel more like greenwashing to both customers and employees.
Defining what purpose-driven means to your company
To achieve a goal, you first must define it. Figuring out what purpose-driven is to you is a key first step in any company’s journey toward this model.
- Begin with the company’s core purpose and values. Not just the what you do, but also the why.
- Define how the company can create a lasting impact through its products and services. Make asking questions important, such as “will this make us more sustainable?” or “How does this improve the lives of our customers?”
- Identify specific goals that align with the company’s purpose and values, such as adopting more sustainable practices or developing new products or services that better serve the needs of customers.
- Define what success means, whether that’s meeting metrics, retaining workers, or simply improving the company’s public image.
How to become that purpose-driven company
Defining purpose-driven is one thing, but you’re probably here to learn how to take concepts into action. Here are some steps to get you started:
- Focus on customers – What’s going to create value and improve the lives of your customers. Is there an accessibility need not being met? Is there a better packaging option that’s more sustainable? Purpose-driven companies want what’s beneficial to the people you serve and the planet.
- Look for unmet needs – Is there something you can provide that better serves the special needs community? Are your customers looking for products with reduced plastic? Tap your best customers to examine unmet needs.
- Make it personal – If you want employees to buy-in to the purpose driven model, you’ve got to genuinely believe in your company’s mission and be ready to live the purpose, both in and out of the office.
- Unite the team – Find out what motivates them and the causes they feel passionate about. If climate is something the team can get behind, work together toward that goal.
Working with a purpose-driven marketing agency
Once companies become comfortable with their role as a purpose-driven company, they often look for ways to incorporate it into sales and marketing materials, whether that’s a new pitch deck, rebranding or different language on the website.
At MAYO, we’re a purpose-driven company that works hand-in-hand with other purpose-driven companies to achieve their marketing goals. We’ve found companies want to talk about the changes they’re making and good work they’ve done, but don’t know how to do it without sounding too salesy. That’s where having an agency grounded in authenticity and experienced in working with purpose-driven companies can help you get the right messages to the right audience.