Over the last decade, brand purpose has become key to business success. Not only does a strong brand purpose boost purchase intent–it also draws the best employees and the smartest investors. And despite a global pandemic, investment in brand purpose thrived in 2020.
In 2021 however, I believe a new term will come to define business outcomes just as much as brand purpose: impact proof.
Impact is the bedrock of your brand purpose, and without proof that you are having a positive impact – demonstrated and disclosed in a credible way – your brand purpose will become meaningless.
Not convinced? Here are five shifts your company will struggle to ignore this year.
1. Your Customer Is A Citizen First
Years ago, if you’d told me we’d see a teenage environmentalist on the cover of Vogue in 2019, and the climate emergency on the front page of The Sun in 2020, I might have raised an eyebrow. These moments represent a huge mind shift in the mainstream when it comes to sustainability.
The pandemic has changed us too. Whilst locked down in my London house, I really listened to the birds and connected with nature for what felt like the first time since I was a child. Yes we were anxious, worried and angry. But we were also more aware of the world and our relationship with it–of the climate, of our local communities and of those on the other side of the world.
A global BCG study in 2020 found that 70% of people are more aware now than before COVID-19 that human activity threatens the climate. Heightened awareness of sustainability is translating to our shopping habits–72% of Gen Z and Millennial consumers now ‘prefer to buy from brands that do good.’
The upshot is that brands must consider their customers as citizens, not just consumers. That means they’re going to care about your overall business impact just as much as the product they’re buying. In 2021, I think we’ll connect more as citizens to make collective demands for clear proof of impact.
2. Your Employees Are Speaking Up
Gone are the days when employees stayed silent on matters of brand integrity.
2020 was the year when Everlane employees called out the disconnect between the company’s public promises and internal culture. It was also the year when 6,000 people signed an open letter demanding an explanation from Google GOOG+1.4% after its dismissal of Timnit Gebru–the AI Researcher had co-written a paper covering structural bias against women and people belonging to ethnic minorities.
A number of my friends working in big tech told me of their plans to jump ship last year. Others shared plans to form internal groups to drive positive change, to bring reality in line with PR spin.
Whether you like it or not, we’re living in the age of the ‘glass box brand’, so your purpose story better be as true inside as it is outside.
For marketers, that means proof of impact will be a crucial part of your brand communications. If your brand purpose is going to have an iota of credibility, it needs to be evidenced.
3. Your Supply Chain Data Is Getting Smarter
Last year, Covid and Brexit threw supply chains into the spotlight for everyone. Supply chain nerds like me saw our niche interests hit the headlines, as people worried about toilet paper supplies, garment worker livelihoods and gridlocked ports. On many an Instagram thread, I saw shoppers asking big questions about the origins of products that they could no longer find in the U.K.
In my opinion, together with the climate crisis, Covid has made supply chain fragility and opacity impossible to ignore. This is especially the case given that supply chains are where 90% of the impact of products lies.
Supply chain data is getting smarter every day. I’m incredibly excited by the potential of new startups in this space, like Altana AI, which brings together billions of data points to create an AI model of the global supply chain. Equally exciting is how supply chain solutions are now helping us understand raw material impact. Unilever, for example, is today using a combination of advanced satellite imagery and geolocation data to check if suppliers have sourced crops from areas where deforestation has occurred.
The rise of the smart supply chain leaves little excuse for a disconnect between a brand and its operational reality. For brands with a clear purpose and integrity, this is a huge opportunity: by harnessing supply chain data, they can generate strong proof of impact.
4. Regulation Is Coming
A study by NYU Stern from 2013-18 found that products marketed as sustainable grew 5.6 times faster than those that were not. And according to Co-op, demand for ‘ethical’ goods and services in the U.K. rose to £41 billion in 2019.
In the knowledge that “green sells,” many marketers have doubled down on sustainability messaging. However, some claims have been based more on the truth than others, giving regulators reason to act. The U.K.’s Competition and Markets Authority (CMA) recently announced plans to vet businesses making claims about the sustainability or environmental impact of their products.
It’s not just oil companies that are being told off. The CMA will be looking at industries from textiles and fashion to FMCG. And a number of brands have already been pulled up by regulators. From Quorn’s carbon-mislabelling to Gousto’s misleading recyclability claims, the Advertising Standards Authority has already shown that it will call out brands making false claims – and not quietly either.
Regulation might be slow, but it’s powerful, and brands can’t ignore its potential to destroy their purpose-driven campaign.
5. Money Is Moving
Capital is gaining a conscience, and fast.
One of the few silver linings of 2020 was that fact that over $40 trillion was invested in ESG assets. And according to PwC, funds driven by environmental, social and governance data are expected to outnumber ‘conventional’ funds by 2025.
Seeing some of the biggest funds make meaningful moves to assess sustainability–and seeing Exxon being booted out of the DOW–gave even the most staunch of capitalists pause.
Elsewhere, a growing number of institutional investors see the industrial meat industry as the next oil and gas. Risks like deforestation have contributed to lower valuations, whilst Beyond Meat has transformed PepsiCo’s product portfolio, giving both stocks a boost. Even Blackrock is pushing companies to net zero and threatening to drop any laggards from active portfolios.
Back in 2000, the legendary business consultant and writer, Peter Drucker, boldly stated that “culture eats strategy for breakfast.”
Today, a core element of that culture is brand purpose – one simply can’t survive without the other. And without clear impact proof, your brand purpose will soon lose its value.
To find out how Provenance can help your brand communicate your brand purpose with proof, click here.