What purpose do brands serve?

2020 put the topic of brand purpose front and center.

Afdhel Aziz is co-author of “Good Is the New Cool” (and its sequel, due out in spring) and founder of brand consultancy Conspiracy of Love. When he thinks What the Future, he has one hope for how this conversation will look in five years.

Matt Carmichael: The CEO organization Business Roundtable recently said it is OK for companies to broaden their focus from shareholder value exclusively to a broader sense of purpose. Did that actually change anything?

Afdhel Aziz: It was a pretty significant departure from the orthodoxy of the primacy of shareholder value. That signal was quite a shockwave. I would call that an opening salvo, because when it comes to seeing how far these companies have to go to truly be purpose-driven and be stakeholder-driven, there’s still a lot more work to be done.

Carmichael: How does a brand find a purpose?

Aziz: We start by looking at the origins of the company—what were the founders thinking? What was the initial reason to create this brand or product or company in the first place? Usually, it was to solve a problem in the world.

Carmichael: What if the reason you started your company was not particularly profound or pure?

Aziz: We think that all companies can reverse-engineer purpose into them. When people look at corporate philanthropy or corporate social responsibility or whatever you want to call it, they are focused on not only doing no harm, but they’re also focused on making money from doing good. And this is the crucial distinction to make. Purpose must be profitable to be scalable.

Carmichael: Is that harder with the polarized world that we live in?

Aziz: You’ve seen things that you think are quite settled, like climate change, for example. You think that this is not a debate, but it can become a subject of polarization. There’s a great quote from Nike’s Phil Knight: “It doesn’t matter how many people hate your brand, as long as enough people love it.” Activist brands are able to engender a tremendous amount of loyalty and advocacy from their fans, which more than make up for anybody who stops buying them.

Carmichael: Are there enough broad purposes to go around?

Aziz: Mental health and support for veterans have support across the spectrum. Our advice is to save the activism for activist brands. Most brands don’t have the time and energy to become that activist.

Carmichael: Does every brand need a purpose?

Aziz: To stand out in this day and age, you need to be differentiated. When I look at the history of brands, wave one was about getting share of mind, which was really centered around product and functionality and very utilitarian kinds of factors. As everybody started saying the same kinds of claims, you had wave two, which was going from share of mind to share of heart, which is advertising and storytelling. That’s become commoditized. In our book, we talk about great brands not only having share of mind and share of heart as an integrated story, but also share of spirit in that people value them for the social impact that they create in the world. That feels like the next evolution.

Carmichael: What kind of distinction do you draw between brand purpose and corporate purpose?

Aziz: A brand is a story a company tells about itself from a product to service perspective. So, for a brand, it’s really about engagement with consumers. A corporate purpose—now we’re getting into all the different stakeholders. How do you recruit talent? How do you keep your current talent? How does this company deal with its vendors? A corporate brand purpose has to be much more all-encompassing.

Carmichael: What, if anything, did 2020 change about all of this discussion?

Aziz: 2020 was the year this went from abstract theory to, “Holy shit, this is happening right now!” You had the kind of twin engines of COVID-19 and then Black Lives Matter happening in very quick succession and happening at a moment when the world had paused. Instead of thinking about a thousand things, suddenly we were all locked at home and the barriers between our work selves and family selves dissolved. It came at a moment when you suddenly saw how interconnected we are as a species. I think that’s what led to so many people inside companies saying, “OK, I have to do something about this. Whether I control the brand or the company, I have to step up.”

This may be just me being optimistic, but I believe we’re going to have a global awakening of purpose, the likes of which the world has never seen, because we’ve never had a global moment of trauma like this.

Carmichael: So, what does that look like in five years?

Aziz: The thing I want it to look like most of all is in how we tackle climate change. This is the uber problem. If we don’t fix this, it doesn’t matter what else we fix.

Carmichael: What role do younger consumers play in driving all of this?

Aziz: A huge amount. This is a generation which has realized their power as consumers to get brands to pay attention. Social media has leveled the playing field. Brands don’t control their narrative, their consumers do. Brands, whether they like it or not, are living in an era of radical transparency. Cancel culture when it regards brands is very real, and trust can be destroyed in seconds. I think the smart brands realize this.

Carmichael: Brands will have their stated purpose, but consumers might want to support them for a different purpose. Like you’re a minority- or woman-owned business. You’re a local business. You’re made in America. Can brands foster that without being distracted from their own stated purpose?

Aziz: I prefer to think about purpose almost as like a bank account. All those things you just mentioned are parts of the purpose equity that get put into a brand. The more you have that, the more likely you are to get loyal consumers who then advocate on your behalf. So even if somebody’s social purposes don’t align with mine, I might look at everything else that they do and go, “Yeah, I’m still going to buy this brand because it reflects my values as well.”