The Future of Profits is Purpose
We’re happy to announce Simon Mainwaring as our guest blogger this week. Simon is a respected author, influential blogger, international speaker and founder of We First. He writes about a new vision for the practice of capitalism – one in which brands and consumers partner to create social change.
Join Simon and Visible’s Becca Ramble on Tuesday, 6/7, 10:30 AM (PT) | 1:30 PM (ET), and learn how social media connects brands and consumers in ways that can build business and a better world.
We hope you’ll join us!
The Future of Profits is Purpose
By Simon Mainwaring
Social media is profoundly disrupting capitalism’s business models. It enables consumers to become a powerful voice in how corporations conduct themselves when it comes to their social responsibility, but it also gives brands a far greater opportunity to connect with their customers and leverage their loyalty.
This means that it is no longer sufficient—or even valid—for brands to keep their eyes focused solely on profits without acknowledging and responding to the larger meaning their customers want them to play in their lives. In the future, the most important work brands need to accomplish will be to define the mark they want to leave not on their investors, but rather on the world their customers live in.
Put another way: The future of profit is purpose. Transforming the core of a brand’s business today requires an absolute and unquestionable commitment to purpose. To be truly involved in the lives of their customers, corporations need to embed purpose deep into their corporate strategy. In the eyes of today’s consumers, this means seeing how the brand contributes concrete solutions to the human problems they care about. This may include such issues as the environmental impact the company makes in producing its products, how well it treats its employees, what efforts it takes to reduce its carbon footprint and its waste, and how much of its profits it contributes to social causes — in short, everything that the brand does to make a better society in which their customers live.
Consumers are eager to become loyal fans of companies that respect purposeful capitalism. They are not opposed to companies making a profit; they may even be investors in these companies—but at the core, they want smarter, more enlightened corporations that seek a balance between profit and purpose. Over time, consumers will force companies to compete on this new basis.
The smartest brands are already recognizing this, using social media to inform their customers of how they have embedded purpose into their core strategy. If you look at the websites of some of the most socially responsible companies, such as Patagonia, TOMS Shoes, Starbucks, Unilever, and Nike, you will notice they go to elaborate lengths to market their purpose as much as their products. Using narrative techniques, they weave a tremendous amount of meaning into their websites and marketing, sharing images of their production methods and sites, and explaining the intimate details of how they source their products, and which agencies and NGOs they work with to ensure the integrity of their Fair Trade and Sustainability policies.
Replacing the old capitalist paradigm of supply and demand, this dynamic between profit and purpose will become the new economic principle that drives the marketplace. Corporations that provide too little purpose for consumers will fail to build customers communities that in turn build their business. Consumers who want their brands to serve a greater meaning in their lives will drive the profits of corporations that provide them with that new sense of purpose.
Simon Mainwaring is the founder of We First, a social branding consultancy that helps companies, non-profits and consumer groups build a better world through changes to the practice of capitalism, branding, and consumerism using social technology. More information about profit and purpose is available in We First: How Brands and Consumers Use Social Media to Build a Better World (Palgrave/Macmillan, June 2011). To order, visit www.wefirstbook.com
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