How companies take purpose too far and how to fix it

From solving their problems to standing by their values, people expect more than ever from brands. Author, consultant, and industry expert Rishad Tobaccowala explains what the next shift in corporate purpose could look like.

How companies take purpose too far and how to fix it
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  • Matt Carmichael What the Future editor and head of the Ipsos Trends & Foresight Lab
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Rishad Tobaccowala has advised global brands over a storied career, holding titles such as chief growth officer for Publicis Groupe SA. Now the author, podcaster and consultant thinks maybe the future of brand purpose is ... not needing one. He thinks purpose today exists partially to fill a vacuum in leadership on key issues that brands shouldn’t have to be the ones to fix. 

Matt Carmichael: What’s the state of purpose today? 

Rishad Tobaccowala: There are three ways to look at it. I host a podcast called “What’s Next?,” and I had two guests recently talk about purpose. One was from Thomas Kolster who basically said, “Forget everything you know, about brand purpose.” His basic belief was that businesses are now trying to position themselves as heroes, but they're not heroes. Customers are heroes and they say, “This is my purpose.” The other was from Steve Harrison who believes that purpose is over-hyped, that companies have forgotten that they exist to make things, sell things and create jobs. Anything that makes them not remember they're providing jobs, selling things, and making things and instead come up with social concoctions means they have lost the plot.

Carmichael: And the third way? Where do you land? 

Tobaccowala: I land in between these days. I believe purpose is important because it is the “why” that Simon Sinek says the company needs. But a company should be very clear that when they are identifying a purpose, it has something to do with their industry. Purpose is also important to attract and retain talent. People are very interested in what the purpose of the company is, even if the purpose is “We make great products.” Many people are now looking not just to join a company for money, fame or power, which is important, but for companies to have purpose, values and connections. 

Carmichael: Why are people looking to brands to solve problems like these? 

Tobaccowala: People are looking to brands to solve problems because they have decided to give up on media and government. If media and government did their jobs, we wouldn’t look to brands! To me, the purpose trend is due to a crisis of leadership. If leaders actually led, which means identify reality, fix problems, and deliver products and services, people would not say, “What about purpose?” That is their purpose.

Carmichael: If purpose is so important, why does it seem like the only good examples people can ever give are Patagonia and Ben & Jerry’s? 

Tobaccowala: Purpose is principles. If you're principled, you’re going to do things that will potentially hurt your career, hurt other people, or hurt financial performance because you decide to say, “That doesn't fit my principles.” 

Those brands take a stand and the stand pisses off certain people. What a lot of companies today are doing is adding purpose because they don’t want to piss off people, which is the exact opposite of what purpose is. Purpose is taking a stand! It's become basically paint and not internal brand architecture. 

Carmichael: How can brands avoid backlash?  

Tobaccowala: There are three places that brands can help that aren’t politically driven. One is all of us are going to get old and the country is growing old. Two is “I’m going to get hungry.” Feed people who don't have food. Who can refuse? The third is “We'd like our children to do better and one way to do better is to support education.” 

Carmichael: What does purpose look like in five years? 

Tobaccowala: Brands are built today on three criteria. One is delivery of benefits. If you clearly can do something particularly well, that's what you're supposed to be doing. The second is that you want to have happy employees. Is this tied into your benefits and are you looking after your people? The third is, is the purpose helping me feel better about your product or service? So, the future of purpose will be are you driving benefits to me, who is buying your product or service? That's the way I see the future of purpose, highly measurable and very much aligned with the company. 

Carmichael: Isn’t that kind of where we are now? 

Tobaccowala: Now it's become blather. The way I look at it is if you go to a fancy restaurant, one of the desserts they give you is a soufflé. It's basically puffed sugar like expensive candy floss. The idea should be, give me one purpose, show how it links to your product, show how you look after your employees with it and show me that because of that I'll feel better about your product or service. 

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The author(s)
  • Matt Carmichael What the Future editor and head of the Ipsos Trends & Foresight Lab