‘Brand purpose is more important than ever’: Greg Nugent

Marketers must begin to tell more engaging corporate stories, as the way brands go about their business and contribute to the economy now has a significant impact on consumer attitudes, writes Greg Nugent.

The Profitability Of Purpose

It might be something to do with approaching the age of 40, but there is now a significant cohort of people I know in the industry who want to "give it all up" and go off to work on "something that really matters". Maybe it’s the daily grind, or the fact that they are ready for a new challenge. Maybe there is something in the air? Maybe purpose is on the wane.

The decline of purpose?

If you had asked me that question a few years ago, the answer I would have given would have been an unequivocal "No." Businesses leaders get purpose. They understand that they have to do much more than just pay a dividend. In fact, I would have argued that the opposite was true – that purpose was actually on the rise – and I would have pointed to the values behind our new-found concern about climate change as proof that corporate Britain gets it.

But then, suddenly, the plates shifted. Just when we thought it was safe to assume that corporate social responsibility was here to stay, the new masters of the universe declared that not paying their taxes was within not just the letter, but the spirit, of the law. Suddenly, business seemed quite au fait when it comes to not playing its part. And then, suddenly, this stopped being business news on page 19 and became a front-page story.

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The unintended consequence

Downturns tend to be relatively predictable. They have form – but the shape of this one is untypical and, so far, unpredictable. The recovery is slower than expected, our national debt is still going up and we have years to wait until strong growth returns. The squeeze on the public finances is having all sorts of unintended consequences. One of them, which I think we should be fascinated by, is the rise and rise in the scrutiny of "the corporation".

Do we care more now or less?

On one hand, the new masters of the universe seem not to be worrying too much about what we think. I do not imagine for a second that Google searches declined in the UK when it was announced that it bills from Ireland, not London. Or that iPhone sales dropped when Apple disclosed that it pays 2% tax, and not in this country. On the other hand, I do imagine that sales of Starbucks’ decaf skinny lattes went down during the week we found out that it had paid no corporation tax in the UK since 2009 (I’ve stopped buying them). Or that sales at Costa Coffee (which did pay tax here) went up as people crossed the road to buy their daily fix. Or that sales in Waitrose and John Lewis go up every time we hear that it’s their staff who get the bonuses, not "the City".

YOUGOV helps us find out what we really think

A not-to-be-ignored 27% of UK adults claim to be happy boycotting brands and businesses if they consider that they are not paying their taxes – this is a 7% increase compared with the same poll in June. Within this number, a third of UK men are willing to change what they purchase, along with 35% of those over 60 years old. Underneath all these figures, we can see a potentially potent swing in the factors that people consider when making their purchases. From price to purpose, we care more now than ever before.

Purpose makes profit

The recovery will take years and strong growth is a long way off. Until that point, our interest in the corporate story will continue to rise – perhaps rapidly. The way in which a business operates – and plays its part in the broader recovery – will determine the way we perceive it. That is going to require a shift in the way that we, as a creative industry, think.

We need to tell much more engaging corporate stories. Businesses that do good, contribute, and play their part must tell their stories just as well as Whole Foods Market, John Lewis and @Gandysflipflops: with originality and pride – and not just in the CSR section buried away in the annual reports.

For a sizeable chunk of us, purpose is now more important than ever.