I’m at the Conscious Capitalism conference in Austin, TX, this week. It’s not an inexpensive conference to attend, so I wrestled with whether or not to come but ultimately decided that since we do so much business with “traditional” capitalists – big, conventional brands – that it made sense to come see how the “conscious” ones live.
What I’ve learned after one day at the conference is that they’re exactly the same. As the co-founder and co-CEO of Whole Foods spoke about capitalism, he sounded downright conventional – Republican, even. Not that there’s a thing in the world wrong with that. I just didn’t expect the dude who created a mass channel for herbal teas and gluten-free foods to be anti-big government.
But as the founder and CEO of Panera Bread talked about his company’s history and his personal journey in starting, growing and running it from one little cookie shop to thousands of stores across the country, I realized they’re a way more “conscious” business than I ever knew.
So what does that mean? And what do Whole Foods and Panera Bread – and dozens of other brands we all know and buy from regularly – have in common? Purpose.
We may not all be able to articulate it in the same short, pithy words the companies themselves use, but I think we can smell when a company has a purpose and something in us likes it. It makes us want to buy from them.
In fact, my hypothesis now is that some consumers go so far as to label a company green when they can smell the purpose. For instance, we repeatedly see in our surveys and focus groups that Apple and Toyota are labeled as green companies. They’re actually not so much, and I’ve always written it off that Toyota gets a green glow by being the pioneers with one green product (the Prius) and Apple gets credit because people think the brand is cool (so they must be green, right?).
But now I’m wondering if it’s more that consumers can feel something conscious, something purposeful, something really attractive about those companies and it just gets lumped into the whole green umbrella in their minds, like treating people well and not testing on animals also often do. That’s important since we’re seeing a growing trend in our data that consumers are looking to the companies behind the products they buy for verification about whether or not the product is green. In short, they want the corporate story. They want to know what drives you and what you’re really about.
Beyond how consumers see it, there’s a business case for purpose-driven companies. The book Firms of Endearment compares the performance of the companies profiled in the book Good to Great to 28 purpose-driven companies (defined in the book as companies that are loved by customers, employees, suppliers, environmentalists, the community and governments) and demonstrates that those companies – which include Google, Southwest Airlines and Johnson & Johnson – are outperforming the Good to Great companies by leaps and bounds (see chart above left).
So as you attend those big, roll-up-your-sleeves meetings within your companies and begin asking questions like, “What is our sustainability strategy?” and “What’s our CSR approach?” start by asking “What’s our purpose?” It may take more than a few meetings and involvement from some folks who don’t often come to those meetings … but it’s the right place to start. Your consumers will be able to smell it, and your financial statements will reflect it.