Originally Published by Accenture.
Nearly two-thirds of consumers globally (63 percent) prefer to buy goods and services from companies that stand for a shared purpose that reflects their personal values and beliefs, and are ditching those that don’t, according to new research from Accenture.
The fourteenth annual Accenture Strategy Global Consumer Pulse Research ‘From Me to We: The Rise of the Purpose-led Brand’ surveyed nearly 30,000 consumers from around the world to gauge their expectations of brands and companies today. The study found that companies that stand for something bigger than what they sell, communicate their purpose and demonstrate commitment, are more likely to attract consumers and influence purchasing decisions which improves competitiveness.
“Purpose is more than companies simply responding to issues of the day. It’s about having a genuine and meaningful commitment to important principles that consumers care about such as health and wellbeing, natural ingredients, environmental sustainability and family connections which inform every business decision,” said Bill Theofilou, senior managing director, Accenture Strategy. “Many companies have neglected to convey purpose due to complacency, lethargy or the fear of polarizing people, which has allowed smaller players to rise.”
Purpose influencing purchasing decisions
Sixty-two percent of consumers globally want companies to take a stand on the social, cultural, environmental and political issues close to their hearts. Moreover, 65 percent say their purchasing decisions are influenced by the words, values and actions of a company’s leaders. Consumers are attracted to organizations that are committed to using good quality ingredients (76 percent), treat employees well (65 percent), and believe in reducing plastics and improving the environment (62 percent).
Authenticity and trust driving growth
Today, 62 percent of consumers say their purchasing consideration is driven by a company’s ethical values and authenticity. Furthermore, nearly three-quarters (74 percent) crave greater transparency in how companies source their products, ensure safe working conditions and their stance on important issues such as animal testing. Accenture Strategy analysis found that a drop in stakeholder trust can severely impact an organization’s competitiveness and potential revenues by billions of dollars.
“In this era of radical transparency, consumers are voicing their opinions, values and beliefs, scrutinizing the actions of organizations and their leadership, and holding them accountable. They can see through inauthenticity and won’t tolerate it,” said Kevin Quiring, managing director, Accenture Strategy. “Consumers’ voices can change the financial trajectory of companies. They are more than buyers they are active stakeholders who are investing their time and attention and want to feel a sense of shared purpose. The winners in this era will not be passive bystanders.”
Consumers changing the trajectory of companies
Two-thirds of consumers believe their individual protest actions, such as boycotting a company or speaking out on social media, can make a difference in how companies behave. Over a third (36 percent) have been disappointed by how a company acted which betrayed consumers’ belief in what the company stands for, and nearly half (47 percent) stopped doing business with the company as a result.
Organizations that want to build stronger consumer connections and sustain their competitiveness by becoming purpose-led can do so by:
- Defining what their business stands for: Companies need to determine the larger role they want to play in their customers’ lives and put a stake in the ground. Leaders can do that by understanding what their customers feel passionately about, why their employees choose to work for them and why other businesses partner with them. They’ll find what makes the company special and can use it to make a difference.
- Being clear and authentic: Consumers can see through inauthenticity. If a company is truly committed to its purpose, its principles guide every business decision. This purpose will bind consumers, employees and shareholders alike. It requires bold leadership where actions speak louder than words.
- Engaging consumers on a deeper level: With consumers actively aligning themselves to specific companies and having a stake in their success, businesses can capitalize on this energy by getting customers involved in co-creating new products and services, designing initiatives or partnerships, and investing in the company’s growth in exchange for personalized rewards. Including customers in their innovation ecosystem will help companies maintain their relevance, identify new growth opportunities and markets, and keep them on track with delivering on their promises.
To find out more about the report, visit www.accenture.com/BrandPurpose. Join the conversation at @AccentureStrat #GCPR #BrandPurpose #CX