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March 22, 2022

Can your business be a force for good (and still be profitable?)

Impact-minded entrepreneurs face many difficult decisions when balancing the need to run a profitable business and the realities of markets that seem to push us towards business decisions that often conflict with our own strongly held personal ethics.

It's easy to feel like doing good business and doing good are mutually exclusive. However, as the negative impacts of commerce become more top-of-mind for consumers, there are more and more examples of brands taking a do-no-harm approach with how they operate, proving that business can be a force for good and that—as study after study continue to show us—doing good is also surprisingly good for business.

Emerging: the altruistic brand

Many of the successful brands we know and love walk this line between doing good business and doing good everyday. Established brands like Patagonia and TOMS have long, celebrated track records of blending profitable business practices with impactful actions that create undeniable good in the world. They are among the best at tapping into evergreen global social movements like sustainability and equality with a genuine spirit of activism.

Above: 1% for the Planet, Patagonia’s network of participating brands who give 1% of proceeds back to sustainability initiatives.

Increasingly, early stage startups are basing their brands on more focused niche causes like Misfits Market's drive to combat food waste with their ugly produce delivery service or data transfer company WeTransfer's efforts at fostering creativity in new economy sectors. The scope and implications of the good work these brands are doing vary greatly, but they all achieve it the same way: their brand strategies feature a clearly defined Brand Purpose—and they back it up with action.

Above: Misfits Market fights food waste by selling ugly fruit that might
otherwise end up in the landfill.

Starting with purpose

A brand purpose isn't just a mantra or messaging tool. It's a mission that guides all business decision-making from marketing to operations and defines your relationship with your customer. When your brand purpose aligns with the values of your audience, it adds tangible value to your product or service, transforming the business-customer relationship from transactional to deeply meaningful. That meaning puts a different spin on the importance of competing on price and the inevitable race to the bottom that particular practice triggers. No longer is ‘best price’ a primary purchase driver. A customer invested in a shared cause doesn't mind paying more for a product that is ethically sourced or locally manufactured. The supply chain and the added cost that comes with it, are an inseparable part of the product and what actually matters is the good that is being done.

Key takeaway: Doing good is in the eye of the beholder

Simon Sinek's influential book, Start with Why, frames the problem of finding your brand purpose with a series of questions, the most powerful of which is 'What good are you doing in the eyes of your customer?" This is a key consideration when developing your brand purpose because what is good to one person may be irrelevant or even bad to another. It may be as obvious and globally significant as the existential threat from climate change or as personal and relatively insignificant as mindfulness. Consumer trends and emerging social movements give us a window into what is considered 'good' and help to validate our assumptions around who our audience is, what they value and how that relates to our businesses.

94% of consumers say purpose is important

In the 2020 Zeno Strength of Purpose Study, 94% of respondents from 8 major global markets in the East and the West said it was important for brands they support to have a strong purpose. In a telling twist, only 37% of respondents in the study believed that today's brands have clear and strong purposes, meaning this is a demand not currently being met by the market. Founders looking for stronger connections to their audience should take note.

So yes, your business can be a force for good. In fact, as Gen Z becomes the dominant economic generation in the US and the rest of the world, it is increasingly the case that your business must be a force for good.

Adam Maclean

Co-founder PurposeLed

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