An idea that's hit the business world like a tsunami in recent years is "higher purpose."
In 2019, the Business Roundtable of 181 leading CEOs signed a declaration of "purpose over profits." That same year, a Harvard Business School study linking purpose with stock market performance was published, and the Association of National Advertisers even voted "brand purpose" as "Marketing Word of the Year."
However, most of the companies getting attention for their purpose-based efforts have been B2C companies. I say that because just prior to the pandemic in late 2019, my firm The Purpose Power Index that polled members of the US general public about which companies they saw as driven by higher purpose.
The not-so-great news: we learned that few companies were actually seen as purpose-driven, and many of them were smaller "social good" B2C brands such as 7th Generation, TOM's shoes, Method, etc.
The good news for B2B brands is that a major change, driven by the pandemic, seems to be underway in the world of brand purpose. Today, a broader range of companies is getting credit with the public for being purpose-driven, and among them are a significant number of B2B brands.
When we repeated the Purpose Power Index study in early 2021, we found that the landscape of the public's perception of which companies are purpose-driven had shifted dramatically. Normally in "top brands" studies—e.g., "World's Most Admired Companies" surveys—the leaders don't change often.
But in 2021, the higher-purpose brand landscape was upended. Nearly one-third of the top 100 purpose brands were new to the list, and over half of the top 20 were new. Perhaps most surprising of all, six of the top 25 purpose brands were B2B players, as were 11 of the top 50.
The Top 10 B2B companies were, in order:
So why is the public suddenly taking notice of purpose-driven B2B brands? Three important drivers come to mind.
1. Reaction to the Pandemic
The pandemic made a lightbulb go off in many people's minds about the role and importance of B2B companies in the world and in their lives. Brands in delivery services and supply chain management, for example, have suddenly gone from being considered "behind the scenes" players you never think about to essential services that keep the world working in a crisis.
Thus, when a B2B brand such as resource-planning giant SAP talks about its mission to "help the world run better and improve people's lives," everyday people from consumers to investors have a greater appreciation for why that matters to them and society at large.
2. Trust in Brands Over Government
The public increasingly understands the need for innovation around some of our biggest opportunities and challenges as a society—but doesn't trust the government to do it. That makes innovative B2B companies such as Intel, with its purpose of "creating world changing technology that improves the lives of every person on the planet," and Space-X, which seeks "to revolutionize space technology, with the ultimate goal of enabling people to live on other planets," seem more like societal R&D engines than obscure B2B companies.
3. Less Purpose-Washing
Major B2B companies have done a good job of focusing on actually doing something to live their higher purpose, and they are perhaps less guilty of "purpose-washing" than some of their B2C counterparts.
Many B2C companies, such as Pepsi and even Nike, have "purpose-driven" rhetoric that is viewed as mostly marketing by some people. Major B2B companies, on the other hand, seem to be focused more on activating their purpose rather than just talking about it. UPS and HP are two strong examples.
Brand With Purpose: UPS
Recently I spoke with UPS Chief Corporate Affairs Officer Laura Lane, first at StrawberryFrog's Purpose Power Summit last June, and again in August 2021 on the Planet Purpose podcast from Inc. magazine that I co-host with StrawberryFrog founder Scott Goodson. Laura spoke about how, under new CEO Carol Tomé, UPS has doubled-down on purpose and has articulated its higher role as "moving our world forward by delivering what matters."
One of the most important ways UPS activates its higher purpose, Lane told me, is through its employees: "We find lots of ways to learn about what they're passionate about, where they want to volunteer, where they want to lend their voice for political change, where they want to engage to help communities whose voices maybe have been suppressed or not as elevated as they could be, how we can help give them that megaphone to make those voices heard."
A thorny issue for many companies is how to deal with hot-button societal issues, and because of its large (500K) employee base, UPS is no stranger to the importance of such issues to its people. UPS has successfully navigated those waters, taking values-driven stands while generally avoiding backlash.
"I think why UPS has been successful in advocating for change, when I think about voter laws, when I think about changes in some of the healthcare mandates that are now coming out, we did it from that foundation of what really matters....By keeping politics out of it and acting based on our company values. We are neither red nor blue, we are brown."
Brand With Purpose: HP
I spoke with HP Chief Impact Officer and Head of Sustainable Impact Ellen Jackowski earlier this Fall on our Planet Purpose podcast, and I was fascinated to hear her talk about HP's higher mission of being "The Most Sustainable and Just Technology Company in the World."
"We're focused specifically where we at HP can make the biggest impact. And that's in three areas: climate action, human rights, and digital equity. So that represents both the environmental and the social side of these issues. And we recognize how interconnected these things are."
HP has set ambitious goals, such as its 75% circularity goal by 2030, and the company is being transparent in publicly measuring its performance on that goal. The "circularity commitment" means that 75% of the materials in HPs products and packaging will either be reused or recycled, or be renewable.
Today, the company admits it's at only 41% circularity. What's so interesting about HP's efforts and commitments is that it seems to be paying off financially. Jackowski explained that the company has started tracking its enterprise RFPs from large companies that buy suites of PCs or printers from them. "We've seen in the last two years over a billion dollars in new sales due to our actions on sustainable impact."
* * *
As the HP example demonstrates, when B2B companies activate their higher purpose in tangible ways, it can have impressive business payoffs.
Our Purpose Power Index research showed that being seen as purpose-driven offered tremendous additional benefits: People said they were significantly more likely to invest in those companies, to want to work for those companies, to buy from them, and to defend them if they were attacked publicly.
The key is actually doing something tangible with purpose, not just talking about it. When that happens, B2B companies can go from being an afterthought in the mind of the public to getting the credit they deserve for helping make life and the world work better.
More Resources on Brand Purpose
Continue reading "How B2B Brands Can Use Purpose to Win in the Marketplace" ... Read the full article
MarketingProfs provides thousands of marketing resources, entirely free!
Simply subscribe to our newsletter and get instant access to how-to articles, guides, webinars and more for nada, nothing, zip, zilch, on the house...delivered right to your inbox! MarketingProfs is the largest marketing community in the world, and we are here to help you be a better marketer.
Sign in with your preferred account, below.
You may like these other MarketingProfs articles related to Branding:
- The 10 Brands People Feel Most Intimately Connected to in 2022
- Be Positioned or Get Positioned: Do's and Don'ts for Transforming the Perception of Your Brand
- How a Unified Brand Multiplies ROI [Infographic]
- How to Authentically Brand Yourself in a Digital World: Eric Yaverbaum on Marketing Smarts [Podcast]
- Seven Pillars of B2B Brand Reputation Management
- The Most Commonly Tattooed Brands [Infographic]