IGNITING PURPOSE-LED GROWTH - Kantar

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PURPOSE 2020IGNITINGPURPOSE-LEDGROWTH1

THE POWEROF BUSINESSPURPOSE IS ONEOF THE MOSTMISUNDERSTOOD ANDMISUSED BUSINESSBUZZWORDS TODAY.Purpose-led companies canmake a tremendous differencein the world. Businesses havethe size, reach and trust ittakes, and people expectcompanies to use this powerfor a good purpose. Purposecan drive growth, yet all toooften this doesn’t happen.Purpose is one of the mostmisunderstood and misusedbusiness buzzwords today.Where do companies gowrong with purpose? Why ispurpose so criticized and soundervalued? In particular,what does it actually mean tobe purpose-led? What is theprocess for putting purpose towork? Kantar has helped manycompanies find the answersto these questions. Purpose isa core practice area of Kantarand a focal point of thoughtleadership. This white paperoutlines the multi-step journeyit takes for a company tobecome truly purpose-led—aproven framework to unlockthe potential of purpose togenerate growth and improvesociety.Purpose is what people arelooking for in brands, and thispreference will only intensify asthe next generation comes of age.Purpose-led brands enjoy strongergrowth and a deeper connectionwith consumers. Purpose iscentral to success in the future ofconsumption.Companies have always donemore than just sell products andservices. But with the network ofcustomers, suppliers and employeesthat companies around the worldcommand today, the power ofbusiness to shape culture and societyhas never been greater, or morecritical.The size of companies rivals that ofentire countries. For example, theroughly 300 billion (USD) in 2017topline revenue earned by Royal DutchShell that it uses to run its companyis more than the 2017 revenue ofroughly 270 billion (USD) collectedby the Mexican federal government torun its country. Shell’s 2017 revenueis an amount on par with the 2017nominal GDPs of top 40 countries likeSingapore, Colombia and Malaysia.Similarly, Walmart, the world’s largestcompany by topline revenue, earned 485 billion (USD) in 2017, which isabout the same amount as the 2017nominal GDP of Belgium, the 25thlargest national economy in the world.The relative reach of companies iseven more impressive. PresidentTrump has perhaps the mostscrutinized Twitter account ever, with50 million followers and growing,but Nike has 75 million followers onInstagram.In the 2018 Edelman Trust Barometer,business and nonprofits were theinstitutions with the highest percentageof people saying they trusted them—at252 and 53 percent, respectively. Thepercentage of people saying they trustgovernment was just 43 percent, thesame percentage as embattled media.The difference was even bigger amongthe informed public sub-sample, as itwas called, of college-educated, heavymedia consumers, with 64 percenttrusting business versus 53 percenttrusting government.In short, companies have more thanenough size, reach and trust to makea positive impact on the world. Withthis power come expectations. In theKantar Global MONITOR trackingof values and attitudes worldwide,over 60 percent of consumers under30 prefer brands that “have a pointof view and stand for something,”compared to less than half ofconsumers past middle-age.Almost all consumers in GlobalMONITOR agree that improvements totheir wider communities are importantin their personal lives, so it is necessaryfor companies to have a tangibleimpact, not just to take a stand. This isconfirmed by other Edelman researchin which 80 percent of those surveyedexpect businesses to take the lead insolving social problems.The desire to make a difference isespecially true of younger consumers.In Global MONITOR, about two-thirdsof people under 30 believe they canmake a difference through theirown actions. Similarly, nine in tenof Millennials surveyed by Deloittewant to use their skills for good, yetonly a little over one-quarter feelthe companies they work for puttheir skills to full use and about thesame percentage are skeptical thatcompanies are focused on improvingsociety. Despite having the powerneeded for making purpose matter,many companies come up short.

GETTINGPURPOSE RIGHTBeing a purpose-led business is nolonger an option. Research andexperience show that purpose isrequired to sustain an enduringcompetitive edge in consumerpreference, talent acquisitionand business growth. In theMarketing 2020 work completedby Kantar, and first published inthe Harvard Business Review in2014, interviews with 600 CMOsand 15,000 consumers worldwideidentified a “purposeful positioning”as a key driver of marketingsuccess, behind only “big insights”and “total experience.” The WPP/Kantar Millward Brown BrandZTMtracking of brand value finds thatbrands perceived as having ahigh positive impact on people’slives have grown brand value 2.5times more than brands with lowperceived impact.Notwithstanding such strongevidence, purpose is often criticized.Not because it is unimportantor irrelevant, but because it ismisunderstood. Purpose is confusedwith corporate social responsibility(CSR) activities to protect theworld rather than recognized to beinitiatives that positively impact theworld. Or it is thought to be somesort of doubletalk like greenwashing.It is easy for companies to fall intothese confusions, though, so it is vitalto follow a proven path in order toget purpose right.The Kantar Purpose 2020 frameworkdraws from the groundbreaking workcompleted for Marketing 2020 and isenriched with an array of additionalwork including over 100 companydeep-dives on purpose, a survey ofAmerican Marketing Associationcorporate professionals and thesuccessful learning from more than200 projects on purpose worldwidefor clients like Shell, Ferrero, ING andAkzoNobel. From this work, a clearjourney to becoming purpose-ledhas been identified, specified andquantified.3

BECOMINGPURPOSE-LEDPurpose moves from a starting point to “matter more” toan end-point to “impact more.” That is to say that purposebegins as an isolated tactic that, properly shepherded,grows into a promise, then a strategy, and only thenbecomes a business-led movement.AMPLIFICATIONINFUSIONARTICULATIONPURPOSE ASAN ISOLATEDTACTICPURPOSE ASAN ALIGNEDCOMPANY WIDESTRATEGYPURPOSE ASA SOCIETALBRANDPROMISEMATTER MOREPURPOSE ASA BUSINESS-LEDMOVEMENTIMPACT MORE01.ISOLATED TACTICBrands and companies begin at different stages in thisjourney. Some, like Patagonia, are born out of purpose.Others, such as Lego, are halfway down the path, whileothers, such as Nestlé, are just starting out.This initial sort of limited purpose is always a short-terminitiative led by a marketing team or a departmentdedicated to CSR. It is executed as a one-off activity.Becoming purpose-led is not easy. It’s hard to getcomfortable with purpose-driven tactics in today’scontentious and transparent market environment. Very fewbrands have been able to get to purpose as a movement.02.SOCIETAL BRAND PROMISEThe next phase of purpose is a longer-term commitmentthat cuts across marketing functions. The functional andemotional benefits of a brand are elevated to a societalpromise that enhances a brand’s reputation, therebybuilding its equity.Once begun, there are three big steps in the journey.Articulation carries a brand from tactics to promise.Infusion then moves a brand from promise to strategy.And finally, amplification gets a brand from strategyto movement. These are very specific tasks that can bebenchmarked and assessed against a set of identifiable,quantitative criteria. These steps and the criteria for eachconstitute the Kantar Purpose 2020 framework.03.COMPANY-WIDE STRATEGYOnce established as a valuable brand element, purposemust then move beyond the marketing team. It becomes aguiding growth principle for the entire organization.04.PURPOSE AS A MOVEMENTA business becomes purpose-led when purpose movesbeyond the company to become a social movement.Piloted by business, purpose drives growth with positivesocial impact.4

STEP 1ARTICULATION—TAKE A STAND!Purpose is not vision or mission.Purpose is the reason a brandexists—it is the positive impact abrand makes in people’s lives andthe world they live in.Where a company is headedand what it does to get thereare essential for guiding anorganization in the right direction.Purpose articulates what thatdirection is all about. This is morethan what a company sells, andthus purpose is a challenging task.Five criteria definehow to articulatepurpose to move fromtactics to promiseMEANINGFULPurpose must have a strong,relevant meaning if it is to resonate.It does so by tapping into asocietal tension that is biggerthan functional and emotionalbenefits. Many brand leadersworry that their categories are toofunctional for purpose to resonate.But a company like Dulux provesotherwise. It went from selling cansof paint to selling cans of optimismthrough its purpose of addingcolor to people’s lives. Through itsinvolvement in local communities,it proved it could leverage colors toinfluence the ways in which peoplefeel about and engage with theircommunities.TRUEPurpose must be true to a brand’scharacter by moving only intoterritories where a brand hasthe credibility to do so. This canbe treacherous if a brand is notcareful. Many brands have failed bytrivializing serious issues or by overcommercializing social problems.UNIQUEPurpose must be connected tosomething that is distinctiveabout a brand in its category.Different brands can leveragethis in unique ways. For example,the preponderance of women asconsumers of laundry detergentsenables Ariel to take on genderequality as its purpose even asOMO focuses on child developmentas its purpose.COHERENTPurpose must be aligned notonly with the brand but with thecompany as a whole. Practicallyspeaking, this means that purposeaffords a company the ability tobring it to life through all elementsincluding communications, productor even external suppliers.BUSINESS PROOFPurpose must be integrated withbusiness goals, not ancillary tothe core commercial focus of abrand or a company. For Unilever,this sort of integration has beenarticulated as doubling the businesswhile decreasing its environmentalfootprint. This has worked well,with over half of Unilever’s growthaccounted for by purposeful brands.5

STEP 2INFUSION—INVOLVE EVERYONE!Infusing purpose means inspiringeveryone and everything, everytime and everywhere. It is not onefunction like marketing, but allfunctions, all propositions andall decisions. In Marketing 2020,80 percent of over-performingcompanies said they linkedeverything they did to purpose,compared to only 32 percent ofunder-performing companies.By infusing everything, purposebecomes more than just a clevermarketing campaign. It becomes adriving force with consumers.Organizations infused withpurpose can be recognizedby four characteristics thatfacilitate the transitionfrom promise to strategyLEADERSHIP-DRIVENSenior leadership must embracepurpose and commit to it in a veryexplicit way. Again, Marketing 2020finds this distinguishes successfrom failure, with 85 percentof over-performing companiesreporting that purpose is drivenby the C-suite versus 58 percentof under-performing companies.Senior leaders must make purposepersonal.CULTURE- ANDSTRATEGY-LEDThis is to say that purpose shouldengage both the heart and themind. Nearly all—91 percent—ofover-performing companies inMarketing 2020 said purpose wasshared throughout the organization,versus just 61 percent of underperforming companies. There is noone way to get everyone living thepurpose. Nike started with cultureto translate purpose into valueswhile Shell started with a systematicstrategy to build in purpose as aKPI.360-EXECUTEDPurpose must be brought to life ineverything that a company does. Allof the elements of communication,product, service and retail shouldcombine in an integrated way tocreate a total experience consistentwith purpose. For example, Whiskas’promise of nurturing a cat’s truenature meant delivering a productconsistent with its catchy, awardwinning ads, so the product waschanged to take out vegetablesbecause in nature cats don’t eatthem.IMPACT-MEASUREDThe impact of purpose must bemeasured, both to show that abrand or company is serious aboutit and to have definitive feedbackfor continuous learning. This meansgoing beyond traditional KPIsto include societal KPIs such asmeasures of impact on attitudes,values and behaviors. A brandmust be able to assess whether it ispositively shaping culture.6

STEP 3AMPLIFICATION—SPARK A MOVEMENT!Once purpose is articulated andinfused, it must be advancedbeyond the company itself. Thismeans sparking a movement andstimulating others to join thecause.There are three key waysto move from strategy andcreate a movementROLE-MODELINGThis means inspiring others throughactions and decisions. A companymust set the bar high and thenlive up to the standards it has setfor others to follow. Decades ago,Volvo acted as a role model whenit invented the three-point safetybelt. It could have patented this andkept it for itself as a competitiveadvantage. Instead, Volvo allowedcompetitors to use it because itspurpose was safety and it actedaccordingly.COLLABORATIONThis means working with othersto accomplish a purpose. Tony’sChocolonely invites everyone to joinin the fight for slave-free cocoa.Tony’s is willing to work with anyonein the supply chain, even directcompetitors, in a collaborative wayto make this purpose happen.CULTURAL CONVERSATIONThis means keeping the movementalive by constantly refueling andrevitalizing the conversation abouta company’s purpose. One of thebest-known ad campaigns of recentvintage is Dove’s “Real Beauty”campaign. First launched in 2004,Dove has kept it fresh by findingnew ways to talk about it andbring it into the broader culturalconversation.7

DRIVINGPURPOSE-LEDGROWTHThe path to purpose is one of aiming high to find a meaningbeyond the category while navigating the terrain at groundlevel without stumbling. It entails finding a long-term societaltension that is relevant but un