Do Good: Embracing Brand Citizenship to Fuel Both Purpose and Profit

ISBN-13: 9781400245673

Media Type: Paperback

Publisher: AMACOM

Publication Date: 05-02-2023

Pages: 304

Product Dimensions: 6.00(w) x 9.00(h) x (d)

ANNE BAHR THOMPSON is founder of the brand consultancy Onesixtyfourth and former executive director of strategy and planning at Interbrand. She has been featured in the Financial Times, The New York Times, and on Fox Business and MarketWatch Radio.

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CHAPTER 1

THE NEW DEMAND THAT BRANDS MAKE A DIFFERENCE

In our personal lives, sometimes change comes slowly after we spend weeks, months, or years thinking about how we can be happier, more successful, or more fulfilled. Other times, change is not a choice. It is something that pursues us: We're fired from a job, a natural disaster strikes, our spouse calls it quits, or our child is diagnosed with a potentially terminal disease. Whether by choice or necessity, as we set out to do something differently or adapt to something unexpected, we quickly discover that changing takes time, is full of competing demands, and is far from easy — even when it's a proactive choice.

The process of change is no different for a business, particularly now, because the model that's guided business for the last several decades must change. What was an optional path for companies before the millennium has become mandatory. The global economy, technology, climate change, generational shifts, and an evolving cultural landscape are dramatically altering how business is conducted and the ways in which people consume, engage, and even abandon the brands in their lives. Over the past twenty-five years as a researcher studying consumers' and employees' relationships with brands, I've seen the signs of this coming revolution and watched their numbers increase at an exponential rate. If you've been paying attention, you've probably noticed some of these changes, too.

A NEW MILLENNIUM AND A CHANGING LANDSCAPE

It's hard to remember a time before mobile phones, wireless technology, and the ubiquity of social media. However, it really wasn't all that long ago: The first wireless Palm VII and BlackBerry were released in 1999, Facebook launched in 2004, and Twitter went live in 2006. In 1999 and 2000, as head of the consulting businesses at Interbrand, one of the world's largest brand consultancies with its finger on the consumer pulse in twenty-eight countries, I saw firsthand how technology was transforming our lives and relationships with brands. Through comprehensive discussions with people ranging from CEOs and CIOs to six-teen-year-olds who knew nothing other than living in a digitally connected world, four concepts emerged that captured the ways in which technology was altering our lives: mobility, connectivity, freedom, and humanity.

Today, these concepts may seem like givens, yet the impact they have had and continue to have on us as individuals and as a society is profound. Behavioral psychologists, economists, and marketers alike all look to make sense of how technology is altering our brain patterns and impacting the commercial pact that exists between companies and their customers, employees, and other stakeholders. In other words, between businesses and people.

In 1999, people were seeing the benefits and challenges of this new existence:

* We were gaining true mobility through the opportunity to plug ourselves in from anywhere to do almost anything — work, shop, make travel plans, and more. ...

* And we were connected to the expansive world of the Internet, as well as to our coworkers, families, and friends through email — anytime, anywhere.

* Because of mobility and connectivity, we cherished the freedom and control to turn our environments on or off with the flip of a switch.

* Yet many people reported they were missing the more personal aspects of communications; they were looking for reassurance that they would maintain human connections as technology interlaced itself more and more into our daily living.

As our lives became more integrated with machines, the nine-to-five workday was quietly disappearing. As people were expected to be connected anywhere at any time through a growing number of devices, an inherent tension was building: Employers were pressuring workers to be in touch constantly. This existed alongside a growing desire by individuals to use their newly acquired tech tools to stay in frequent contact with colleagues, family, and friends while on the go. Suddenly, we were bringing our communication network with us in our cars, on our travels, and during what used to be our downtime. The ability to turn a device off and escape was an increasingly difficult choice, accompanied by a fear of missing out when doing so. So, did these new mobile communications truly make us free?

At the same time we were becoming wired, we craved the intangible and untethered things that made us human. Our intimate ties to technology had changed our social needs and emotions. With a force equal to that of the technological revolution, which was quickly integrating itself into the fabric of our daily lives, an equal energy began to spring up in reaction: a quest for emotional connections and deeper human relationships and experiences.

As Marc Gobé so aptly wrote in his book Emotional Branding, "People love brands but brands don't love people back — this results in so many missed opportunities to connect." In response, brand consultants and marketers sought to humanize brands and create more meaningful experiences for connecting companies and their customers, for community building, and for ethical behavior. Sustainability and green consciousness — things more traditionally linked with corporate reputation — started creeping into brand image.

Over the past fifteen years, the research I've conducted on my own and on behalf of my clients has demonstrated that we are developing a deeper connection with the brands we interact with. Brands, especially the ones we're loyal to, represent more than things and services. They signify an ethos, the character of a culture or a group — either one that mirrors our existing values or one that we aspire to. And as more people grow concerned with equality and sustainability, more of us want to feel that our "relationship" with a brand links us to some kind of larger purpose designed to help shape a future that will both sustain the planet and enrich our modern lives.

Since branding became a focus for business in the late 1990s, businesses have looked to nurture consumers who will advocate on behalf of their brands — people who not only buy products or services themselves but who also recommend them to friends, "like" them online, and positively tweet or post about their experiences using them. Today, the tides are turning, and customers and employees alike are looking for the brands they buy and companies they work for to advocate on their behalf, as well as on behalf of those who are disadvantaged and for the planet.

Companies are no longer just companies. We imbue them with the characteristics of friends and family — and even enemies. So it's no surprise that people now demand businesses and their brands to do more than just make a profit. They expect brands to behave like active citizens and partner with customers, employees, and other stakeholders to co- create a better future.

OUR CHANGING ATTITUDE TOWARD BUSINESS

If you're a CEO, marketer, advertiser, entrepreneur, consultant, or other business executive, you're aware of the following movement: Each year, more brands that stand for good principles or causes are surfacing. While they are still in the minority among business enterprises overall, the impact they are having on our collective psyche and expectations for all companies is growing.

Increasingly, politicians, scientists, economists, and the general public are recognizing that our current approach to business needs to change. More and more business leaders are seeking models to guide them through shifting marketplace dynamics. Increasingly, customers and employees are letting companies know that they are no longer willing to accept business as usual, with the attendant human, environmental, and community costs of prioritizing earnings above everything else. Ultimately, people want businesses to do more than just earn a profit. They want the brands they buy to go beyond being only bottom line–driven to doing good on their behalf, as their customers.

DOING GOOD REDEFINED

Doing good. For most people this phrase conjures up images of kindness and self-sacrifice: A young Boy Scout helping an old woman to cross the street. A Peace Corps volunteer teaching a Nepalese man to build a smokeless stove. An aid worker in Haiti rescuing a young child from the rubble. Habitat for Humanity, the American Red Cross, Doctors With- out Borders, CARE, and other nonprofit organizations come readily to mind. When we hear the phrase doing good, few of us think of a business of any kind — whether it's a bank, a fast-food chain, an oil and gas producer, or even a retailer. And if we do, we likely think of "hippy" brands like Tom's of Maine, philanthropic businesses like Newman's Own, social enterprises like TOMS or Warby Parker that apply commercial strategies to maximize social impact alongside profits for external shareholders, or our favorite brand of certified-organic chocolate bars we buy from stores like Whole Foods Market.

Yet today many businesses across industries are doing good and adding social value. According to philanthropic tracking and rating sites, Giving USA and Charity Navigator, U.S. corporations gave $18.45 billion to charities in 2015.1,2

By the World Bank's 2015 statistics, that's more than the GDP of Iceland ($16.59 billion), Jamaica ($14.26 billion), the Bahamas ($8.85 billion), and many other countries. It's interesting to note that Giving USA's figures don't include the ways companies are directly contributing to the general good via, for example, initiatives such as employee-volunteer programs, using only ethically sourced materials, recycling waste, and reducing water usage in manufacturing production. If the impact of these and similar efforts were added to charitable donations, the number clearly would be much higher.

So why don't we think of business when we hear the phrase doing good? One argument that continues to gain momentum is this: Even though the number itself is large, corporate giving represents a very small percentage of corporate profits. Less than 1.2 percent of the Fortune 500's combined $1.5 trillion in profits is donated to causes and communities around the world.

With an average total compensation of U.S. chief executives of the 350 largest publicly traded corporations estimated at $16.32 million per CEO, or approximately a combined $5.7 billion in 2014, when considered alongside executive compensation, the dollar value that 1.2 percent represents seems tiny. However, the issue runs even deeper. Our Western cultural narrative associates doing good with idealism and altruism — two concepts we typically don't associate with corporations.

HOW TECHNOLOGY IS REWRITING OUR CULTURAL NARRATIVE

As technological advances and the digital era are altering our lives over-all, and the way we accomplish daily tasks, communicate, produce, and consume media, they are simultaneously changing our cultural narrative. Think about the impact of cutting and pasting, for example. The fact that we can digitally cut two seemingly different images and place them side by side has dramatically changed the way we see things fitting together. The act of mixing disparate elements — how we dress, what we read, what we listen to, what we watch — to create our own individual lifestyles has become practically second nature. This is especially true for Millennials — the generation born between 1980 and 1995 — and Gen Z — the generation born between 1996 and 2010 — who are far more comfortable with mashups of paradoxical things living side by side than their parents, teachers, and older coworkers have ever been.

We don't need to pick between H&M and Chanel, flip-flops and a suit, Beyoncé and Jimi Hendrix, or even Brokeback Mountain and Back to the Future. We now have permission to comfortably express the inconsistencies in our personalities daily and even moment by moment. This feature of our wired world has conditioned us to believe we have the right to have it all. We no longer have to decide between seemingly opposite states: competition or collaboration; money or meaning; love or power; sustainability or prosperity.

The digital age has enabled opposites to congruously coexist alongside one another. The transformative result has been to move us beyond a world of either/or and into a new universe of also. In an interconnected world, where coopetiton (collaborative competition), hybrid cars, mixed racial backgrounds, and gay marriage have moved from the margins into the mainstream, the notions of idealism and realism cease to be at odds with each other as well.

A growing number of CEOs today acknowledge that doing good is as essential a criterion for lasting business success as earning a profit. Organizations such as the CECP: The CEO Force for Good, for example, are growing. Founded by Paul Newman in 1999, CECP is a coalition of CEOs united in the belief that societal improvement is a measure of business performance. Membership now includes more than two hundred of the world's largest companies as diverse as American Express, Coca-Cola, Estée Lauder, Pfizer, Toyota Motor Corporation, United Parcel Service (UPS), and Xerox. Although many of the companies on CE-CP's roster were once considered part of the proverbial problem, they are now investing in creating social and financial value.

So why shouldn't a business make a profit while simultaneously doing good? Why shouldn't idealism and realism comfortably sit side by side? Just as compelling, why shouldn't doing good or becoming a sustainable business be seen as an investment into brand loyalty rather than simply a necessary cost of doing business?

DOING GOOD IS A MANDATE FOR BUSINESS

For decades, corporate efforts to fund social and environmental programs have been considered, at best, public relations campaigns designed to boost brand reputation and, at worst, a way to right wrongs. They were part of a zero sum game in which companies' positive efforts simply offset their negative behavior.

In the words of CultureQ research participants:

Big companies ruin communities in places like Africa or China with their factories. They kill local traditions and use up resources. Then they educate a few kids there and feel they've made up for all the bad things they've done.

I think everyone is equally responsible [for improving society]. No one company can do anything alone. Bigger companies have more pull, though, so they should be the most encouraging.

Consider Nike, for example. Its PR problems began in 1991, when activist Jeff Ballinger published a report documenting low wages and poor working conditions among the company's Indonesian contractors. Then, five years later, Nike's woes escalated when Life magazine published pictures of a child in Pakistan assembling Nike soccer balls. The company responded by creating a department to improve the lives of factory workers. More abuses were exposed, and Nike asked diplomat and activist Andrew Young to audit its labor practices abroad. Young's report was positive, and Nike was quick to publish it. Experts, however, criticized the report for being too soft on the company.

In 1997, college students began protesting Nike's practices, and in 1998, faced with lay-offs and significantly weakened demand for its products, CEO Phil Knight conceded in a speech at a press conference at the National Press Club. As The New York Times reported, Knight states, "The Nike product has become synonymous with slave wages, forced overtime and arbitrary abuse. ... I truly believe that the American consumer does not want to buy products made in abusive conditions." He then agreed to allow outsiders from labor and human rights groups to join independent auditors in Asia in their investigations of Nike's manufacturing practices. That day, he did something more powerful than admitting Nike had done something wrong and committing to bettering supplier policies. Through the wording of his statement, he acknowledged his customers' values and aligned the Nike brand alongside them. Today, Nike sees itself as having been on a "sustainable journey" for nearly twenty years, one that has no ending and for which the bar continuously rises with each accomplishment. As Mark Parker, Nike's current CEO, stated in the company's 2014/2015 Sustainable Business Report:

[W]e will never stop trying to achieve our ultimate vision of the future.

A future where we produce closed-loop products — created with renewable energy and recyclable materials.

A future where supply chains are fueled by skilled and valued workers — all of them supported by industry's unified standards.

And a future where NIKE's creative, driven and diverse teams continue to push the boundaries of what's possible — while engaging deeply with local communities.

This represents a new business model, driven by sustainable innovation. I believe it will accelerate change like the world has never seen.

(Continues…)

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Excerpted from "Do Good"
by .
Copyright © 2018 Anne Bahr Thompson.
Excerpted by permission of AMACOM.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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Table of Contents

Introduction 1

PART I: IT'S A BRAVE NEW WORLD

CHAPTER 1: The New Demand That Brands Make a Difference 13

CHAPTER 2: Balancing Social and Financial Values: The New Brand and Business Equation 30

CHAPTER 3: Brand Citizenship: The Consumer-First Model for Doing Good and Doing Well 52

PART II: THE PATH OF BRAND CITIZENSHIP

CHAPTER 4: Trust 77

CHAPTER 5: Enrichment: Enhance Daily Life 113

CHAPTER 6: Responsibility: Behave Fairly 147

CHAPTER 7: Community: Connect Me 184

CHAPTER 8: Contribution: Make Me Bigger Than I Am 214

PART III: CHOOSING CHANGE

CHAPTER 9: Stepping Forward into Brand Citizenship 241

ENDNOTES 259

INDEX 287