These are questions that executives and marketers are discussing in boardrooms and coffee shops each day.
Your purpose is the “why?” of an organization, the reason it exists—beyond making a profit. It is the foundation that many transformational businesses are built on. With the rise of conscious consumerism, there has been a growing number of startups built with a social cause embedded in their brands, and even their business models. Some might say purpose-driven brands are a trend, a passing fad, but the impact that having a purpose has on organizations—both financially and culturally—proves that it’s worth serious consideration for growing businesses. According to the Burson-Marsteller/IMD Power of Purpose Study, an authentic and well-communicated purpose can contribute to the results and success of a mission; and the results of Deloittle’s 2016 Millennial Survey show that 88% of millennials are likely to stay at a purpose-driven company for five years if they’re satisfied with that company’s mission.
However, brands need to do more than pay lip service to a cause. In order fulfill that purpose and ensure business growth, purpose-driven startups should do the following:
The world is full of challenges, and people are looking for businesses to play a part in solving them. Startups have a unique opportunity to respond to this desire when forming their businesses. This has helped startups differentiate themselves from traditional competitors, and sometimes even disrupt an entire industry.
Putting purpose at the heart of the business helps guide your decisions, ensuring authenticity. You can see the success of this strategy in Warby Parker, the eyewear company with the mission of increasing access to glasses for those in need. Similarly, Hungry Harvest is disrupting the way that consumers view natural produce while reducing food waste—they save and redistribute produce that is typically thrown away due to aesthetic imperfections or logistical inefficiencies.
People are the most important part of any business—and for startups with small teams, the support of employees is especially crucial. Purpose motivates employees and makes them feel like part of the brand.
An increasing number of job-seekers are looking to work for companies with a purpose. According to Nielsen’s insights, 62% of people say they prefer to work for a company that gives back to society and makes them feel like they are working to make a positive difference in the world. That is why purpose-driven startups attract smart and passionate people: A Morgan Stanely poll found that millennials are three times more likely to seek employment with a company because of its social/environmental stance. A unifying purpose tends to engender greater employee dedication, retention, and quality of work.
When a purpose is at the heart of the business, customers are able to engage with that core idea and create social impact at any touchpoint. By inviting people into your story, you empower them to play a role in fulfilling your cause, which can convert people from one-time users to loyal customers.
There are many different ways that purpose-driven startups are drawing individuals into their stories. For example, KIND is causing a movement with #kindawesome, Zady is engaging customers with stories about where its products come from, and Cotopaxi hosts Questivals—huge events that band adventure seekers and boost the brand’s mission.
When wielded in these key ways, a purpose can lead to business value and profitability—proving it is a key element in the recipe for startup success.
During the month of July, Interbrand will work with purpose-driven startups and non-profits to solve challenges they are facing, during a series of one-day, pro-bono engagements.
All photos from last year’s Month of Service Workshops.