Sunday, November 18, 2018

Purpose-Driven Marketing Comes to Town

“If you can fake sincerity, you’ve got it made” runs the old joke. The irony-impaired managers of the Association of National Advertisers (ANA) seem to have taken this as serious advice, last week announcing creation of a “Center for Brand Purpose” that will help companies publicize their social purpose. Confirming the worst stereotypes of marketers as cynical hucksters, the press release promotes its mission with the argument that “purpose-led brands grow two to three times faster than their competitors.”

The ANA’s grasp of causation may be no stronger than its sense of morality, but there’s no question it's in tune with the marketing herd.  Issue-based marketing is hot. Another announcement last week illustrates the point: a new program from a coalition of 2,600 socially-responsible “Certified B Corporations” such as Ben & Jerry’s aims to convince consumers to buy from companies that share their values.

Most of the B Corps have a legitimate history of activism. But the broader interest in taking social positions is intriguing precisely because the B Corps have been exceptions to the conventional wisdom that businesses should avoid controversial issues. Studies on the topic show mixed results1 and that most people care more about practical matters2. So why the sudden change?

The simple answer is Nike’s Colin Kaepernick ad, which was initially panned as hurting its image  but was later reported to boost sales.  Marketers being marketers, that was reason enough for many to try something similar.

But I think we can legitimately cite broader trends that have made marketers receptive to the shift. Fox News has demonstrated over the past twenty years that there’s a mass market for partisan bias. The growth of right-wing extremism has led to push-back in support of fairness, reason, and rule of law.  The recent election results can be read as a majority rejection of extremism, although other interpretations are possible.  If there is indeed an emerging consensus that American ideals are under threat, it’s now safer for companies to promote human rights, the environment, and fair employment practices: positions with broad public support despite attacks from the right.

There are other, more parochial reasons for some companies to take strong policy positions. Companies whose customers are concentrated on one or the other side of the urban/rural divide may benefit from polarizing choices: pro-Kaepernick for Nike, anti-abortion for Hobby Lobby. Industries with bad reputations may aim to change public opinion: oil companies touting their environmental concerns are a long-standing example (although this rarely extends to support for policies that would limit their profits).

The most intriguing current set of companies taking trying to change their reputations are the big tech firms which have quickly shifted from fan favorites to villains. Facebook has led the way, with seemingly endless privacy, hate speech, and election scandals  resulting in a huge loss of public confidence and threats of government regulation.  Other big tech firms haven’t been quite so widely criticized but broad concerns about the impact of tech on society are growing ever more common.

Tech companies are particularly susceptible to reputational damage because they need to recruit tech workers, who skew young, educated, urban, and immigrant. The best of those workers have many employment options and want to work at firms that agree with their values. Again, the problem is most severe for Facebook, whose own employees are increasingly concerned that it is doing more harm than good. But employee protests at Google , Amazon and Microsoft tell a similar story.  The recent walkout by 20,000 Google workers over sexual harassment is one more example – and was followed by changes in policies at other tech-driven firms including eBay, Airbnb, and Facebook itself. On the other side of the ledger, Apple has made privacy protection a core part of its own brand, both calling for regulation and resisting government requests to share data. Not coincidentally, Apple’s business isn’t as dependent on consumer data as many of its competitors.

Which brings us back to the original topic. If brands are taking political positions because that’s a good marketing tactic, the insincerity seems reprehensible. It also opens the door to brands supporting socially harmful positions if those are the most popular.  At best, expectations should be limited: no one expects a brand to support a policy that hurts its own business, and in fact we’re used to brands advocating policies that favor them. So any position taken by a business must be viewed with skepticism.3 

On the other hand, businesses do have a fundamental self-interest in promoting healthy social, political and physical environments. Advocating policies that protect those environments is a perfectly legitimate activity. Publicizing that advocacy is part of the advocacy itself. That it’s now seen as good marketing isn’t new and it isn’t bad: it’s just how things are at this particular moment.


1 Edelman, Sprout Social and Finn Partners show consumers want brands to lead on social issues. Morning Consult, Euclid, and Bambu found the opposite.

2 InMoment found 9% of consumers care mostly about brand purpose while 39% care mostly about functionality.  The remainder care about both. Waggener Edstrom reports that 55% of consumers say brands can earn their trust by delivering what they promise while fewer than 10% said trust is earned by supporting shared values.

3 Not to mention that brands have been known to attack legitimate research to support their preferred positions, to secretly fund supporters and attacks on opponents, and to say one thing while doing another. 

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