Most businesses worth working for have a purpose beyond profit. Unless, that is, the business is about making money. Hedge funds could be forgiven for making their purpose about making money; clearly you should be turned on by making money if you want to work for a hedge fund!
But even then, a business might feel it has a higher purpose.
And why does this matter?
There are two reasons:
1. People work better when they have a clear, motivating purpose particularly if it fulfil their own needs. If you really want motivated employees give them a meaningful purpose.
2. People buy more and pay more for products from companies they respect. And one very powerful way of gaining respect is for people to relate to the purpose and values of the business.
These two things alone justify the need for businesses and brands to have a clearly communicated purpose.
Purpose can be simple and generic:
For example: we exist to help people look good or to help people succeed or to help people perform or to make people feel good. You could insert most lifestyle brands here.
This is better than existing just to make profit but because they are generic, they are a bit bland, and they fail to provide any differentiation.
Ideally, a purpose should be brand distinctive. This could be because it stands-out in its category: “we exist to help people feel good” might be differentiating in financial services but not so much in beauty. Or stands-out because it is distinctive. Purpose becomes so much more interesting if it feels like a genuine ‘movement’: democratise fashion, get the nation moving, make a happier home, bring families together, speed up life, free society, make life fairer…
For all the talk about purpose, the advocates and critics will continue to debate how important it is. Yet, successful brands have always had purpose. It is more recently that brands have embraced more social purpose and this has allowed the detractors to paint it as a fad rather than a key component of branding.
In our connected, social media driven world, managing a brand, or more particularly, controlling perceptions of your brand has become increasingly difficult. The people now have more control over brand perception than brand managers. But if brands have genuine purpose, a reason to exist, a mission that they are on and a workforce behind that purpose there is a good chance the people will reward it with positive perception and the profits will follow.
Purpose is a good thing but it needs to be meaningful, distinctive and most importantly deliverable. If the business does not live and breathe its purpose, then it is just marketing words in an annual report, at best meaningless puffery and at worst a downright lie.