Modern consumers care about social responsibility to the point where they’re willing to swap brands if it means the company they buy from is helping others.
Dora Nikols, director of Social Mission, a social purpose agency that specialises in corporate responsibility, says this societal change is forcing businesses to reevaluate what they stand for to remain relevant.
“Consumers are now looking for meaning in their life, they’re looking for authenticity, they’re looking for purpose,” she said at a Academy Xi talk in Sydney.
This shift from the digital revolution to a purpose revolution is a result of consumers being fed disinformation and fake news.
“We have so much information that people have put their filters on. They choosing to support brands that have meaning to them,” she said.
“The digital revolution has created a lot of transparency. A lot of consumers have become “keyboard warriors,” if they see something they don’t like, they will talk about it, and from a PR perspective that does a lot of damage to your brand.”
Nikols said consumers are now looking for corporate leaders to stand up and represent both their company and interests.
“If you’re a founder or CEO it’s really important that you start talking about what you believe in because there’s a lot of trust.”
As an example, she referenced Qantas CEO Alan Joyce’s support for the yes campaign for marriage equality earlier this year.
“I do believe businesses should be out there talking about social issues. We’re part of the community, we’re in a democracy,” Joyce said at the time.
“Business reputation has taken a bit of a hit because people look like they’re only focused on profitability. You have to have a passion for something and actually a bigger cause.”
She also suggests the modern consumer is looking to be inspired.
Nikols cites a Cone Communications CSR (Corporate Social Responsibility) study from last year which found 89% of consumers would switch brands to one that supports a good cause. The Edelman Trust Barometer 2017 found 58% Australian are more likely to be loyal to a brand that supports a good cause.
Nikols assessed the issues facing the core four Australian business models:
For profit is the traditional model, which she says is “all about making money… above all else, which today is a big risk.”
Corporate Social Responsibility (CSR) means “business as usual, but you’re supporting a charity on the side”. But Nikols says it’s an outdated model because “the way you run your business is not aligned with what you believe in”.
She believes a key way forward today is to be a social purpose business.
“This means you actually doing good, you’re meeting your values within your business, and you’re also supporting what you believe,” she said
This type of organisation that does not earn profits for its owners, rather the money earned or donated is used purely to meet its objectives and keep the business running.
To be a successful today, Nikols says businesses need seriously consider their social purpose.
Here are the steps she suggests executives make for a business to stand out by standing for something.
“The first thing you need assess is what you care about,” she says.
“If you’re looking to stand for something, think about what makes you angry, think about what legacy you want to leave behind, and how you want to make the world a better place.”
However she also emphasises the need for the cause to make business sense.
“Once you have worked out what you care about, what your customers and community cares about, it’s time to find the ideal cause partner.”
“Once you do that, it’s time to amplify,” she says.
“But before you go that it’s important that you take an inside out approach. It’s really important to let your internal staff know, and your stakeholders, before you start promoting it otherwise it will seem like a PR exercise”.
“And then you analyse… not only in terms of how well the brand is doing, how well sales are doing but also your social impact — what impact have you had on the charity or the cause you believe in?
“That’s important for you story-telling and PR to gain that authenticity, and so that you’re making a real difference in the community.”
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