Why having a purpose is your best defense in today’s competitive landscape

The world needs purpose-driven businesses. It needs a lot of them, and more than ever, it needs them now.

The Third Ingredient for Success

When we think of some of the most successful businessmen in the world they all have one common motive: the first one being passion and the second one being the obvious profit. For as long as we can remember, the narrative for entrepreneurial success has been making money by doing what you’re good at. But in this era, at this specific moment in history, there’s now a third ingredient being added to the recipe for entrepreneurial success: purpose. Purpose has become the third reason and will soon be the third imperative for why people should be starting businesses. It’s time to shift the narrative from making money by doing what you’re good at to doing good with what you’re best at.

Changing Consumer Behavior

The world certainly doesn’t need more general marketers, agencies, or branding folks—there’s plenty of that out there. However, having a purpose could significantly impact brands and businesses, helping them reach people in a deeper and more meaningful way.

Gone are the days when consumers would buy a product solely based on features or benefits. People are now smarter and more thoughtful in deciding which brand to choose, influenced by the story behind it, the founder, and what the brand truly stands for. This is why this moment is the best time for entrepreneurship and marketing. The battle is no longer about features and benefits; it’s about meaning.

For example, Patagonia strives to use its outdoor clothing business to solve some of society’s greatest environmental problems. Ben & Jerry’s sees itself as a social justice company that serves ice cream because the founders believe that purpose shouldn’t be an accessory to running a business.

Defining Purpose

What is the purpose of a company? Bill Hewlett from Hewlett Packard said, “Any business exists because people come together to do something they can’t do by themselves; they push to solve a problem and meet a need.” Making money is important, but it’s not the reason for having a business; it’s just one outcome of doing that really well.

The Necessity of Purpose

In this day and age, no one should be starting a business without, in addition to a viable economic value proposition, an equally important proposition to move our society forward.

We are at an interesting time in our culture and society. Conscious consumers are leading the charge, defining and demanding that brands and businesses step up for something more than just selling a product. Being purpose-driven is now a strategic advantage; purpose is positioning. It is no longer a nicety but a necessity in business.

How do you stand out from the sea of sameness? It’s about standing up for what you believe in and the values of your organization. Consumers are increasingly likely to buy from, work for, and invest in purpose-driven organizations that align with their values. They want something deeper.

The Urgency for Purpose

Since 2000, 50% of the Fortune 500 companies have disappeared. In the next 10 years, another 40% will become extinct. So what do we do? The answer is purpose. Beyond cutting prices while still maintaining product quality, purpose may well be the only remaining competitive advantage available to business leaders looking to find themselves on the winning side of this disruption.

Three Main Reasons Purpose Matters

• Purpose-led brands are more successful in acquiring and retaining customers. Behavioral science tells us that people buy things that make them feel good about themselves and do business with brands they trust.
• Purpose helps businesses engage the best employees. There is a growing expectation that the workplace becomes a place of fulfillment, satisfaction, and personal meaning, beyond just providing a good living.
• Businesses that integrate purpose are growing faster than the competition, and investors are taking notice. To ensure prosperity, every company must not only deliver financial performance but also show how it makes a positive contribution to society. For example, Unilever has brands like Dove and Ben & Jerry’s that are growing 30% faster than the rest of its brands, demonstrating that financial performance and social impact are intrinsically linked.

The Importance of Clarity

We often see companies—big and small—racing for immediate gratification. They ask, “How do we generate more leads? How do we get more likes on social media? How do we sell more products?” While we can certainly reach those goals, the road will be much harder if you’re not clear about your story and identity. If you’re not, it won’t be clear for your audience or customers either.

What’s fascinating about purpose is its power; it’s the most potent tool we have to elicit emotion, excitement, activation, and ultimately, change behavior. Whichever tactic or strategy you’re employing, it must begin with a story. It needs a clear foundational understanding of who you are, why you exist in the world, and what you aim to achieve for your stakeholders and customers.

The Win-Win of Purpose

When we engage in branding and marketing, it’s essential to remember that we want to help businesses succeed. But if you can also do good in the process, that’s a win-win. If you can profit with purpose, everyone wins. This doesn’t mean you have to solve climate change or social injustice; it can be as simple as improving the quality of life for your team members, your community, or giving back in meaningful ways—something that exists beyond the bottom line.