Brand purpose: Know your reason for being

By Richard Federowski

In today's fast-shifting consumer landscapes, companies are increasingly searching for ways to stay relevant for customers. The key is to develop a clearly formulated statement of what their brand stands for: a brand purpose. They can use this brand purpose in their marketing, but more importantly they should use it to guide their operational decisions and long-term strategic alignment. How can they best define their brand purpose and ensure that it is a driver across the value chain and a lever for value creation? Our Brand Purpose Framework is a tried-and-tested approach for defining a brand purpose that is both verifiable and trackable.

More than just a marketing tool

Your brand purpose is a compelling statement that encapsulates what it is you stand for as a company. If your vision states where you want to be in the future and your mission describes how you plan to reach that point, your brand purpose expresses why you want to do so in the first place. The fashion and sports industries have led the way when it comes to neatly formulated brand purposes.

Why is having a convincing brand purpose so important? In short, because it's what customers want. Richard Federowski, Partner at Roland Berger, explains it as follows: "Nowadays, the product itself, its function and style, is often not enough. Consumers care about society and about the brand's ecological footprint. They are looking for brands that take responsibility and have a story that resonates." This is borne out by the results of our recent survey of approximately 2,000 Western consumers. The majority said that brand purpose was an important part of how they perceived a brand. Importantly, they stressed the role of brand purpose in their purchase decisions, stating that it influenced their trust in the brand, their willingness to purchase the brand and their readiness to pay a premium for it. This relationship was particularly strong for consumers in the 19-40 age group.

Shaping a winning brand purpose

How can companies create a brand purpose that is truly compelling? We identify seven key factors. Thus, the brand purpose should be both tangible and authentic, describing simply and honestly what the company is and what it is not. Importantly, it must resonate with consumers, so the company must first understand its customers and what drives their behavior . It must carry emotional force, communicating a higher-order emotional benefit, as much for the company's employees as for its customers. It should act as a catalyst for internal alignment, providing guidance on strategic questions in areas from product development and go-to-market strategy to sourcing. Equally, it should guide the company's consumer-facing activities in order to avoid accusations of "woke washing". Finally, it should have a long-term orientation: Changing it too often will damage the brand's credibility with consumers.

The Roland Berger Brand Purpose Framework

Brand purposes need to be verifiable – in other words, you should be able to check and track how they are working in practice. This "working in practice" cover two areas. First, the brand purpose should act as a driver across the entire value chain, influencing your organizational structures, processes, tools as well as people. Second, it should be a lever for value creation. Possible key performance indicators for a "return on purpose" include lower labor cost compared to competitors, access to other or better communication channels, decreased marketing spend, increased process efficiency and most important: emotional unrational bonding with the audience.

At Roland Berger, we have experience helping companies devise and implement a compelling brand purpose. We offer everything you would expect from a strategy consulting firm, plus furthermore the skills and expertise of a branding agency; a unique combination. Our Brand Purpose Framework is not only a consultancy approach, it is much more because it integrates all aspects that you would expect from a creative agency. This framework provides a step-by-step approach to defining and leveraging a verifiable brand purpose, from understanding the brand DNA, its audience and the culture which shapes it, and formulating the brand purpose to interlinking and leveraging it internally and externally. In addition, to check your brand purpose truly reflects your reason for being, we suggest using the tool that is described in our white paper. This ensures you are asking the right questions and have a robust brand purpose that will stand up to external scrutiny.

Register now to download the full white paper about brand purpose, including more information on the seven key factors to fix the disconnect between purpose and operations. Additionally, you get regular insights into Consumer Goods & Marketing topics.